living outside US

[oceanlovin'ea]

I know a couple who have been living in Columbia South America for the past few years doing a missionary work. We filed a tax return for them in 2016 because they had some income. In 2017 they didn't have enough income to require filing a tax return and in 2018 it was the same. But they were told by someone else living in there that if they didn't file tax returns each year they would have trouble getting their passports/visa renewed. Does anyone know if this is true?
They come back to the states every other year to visit family so definitely don't want any issues to arise.

Thanks
Linda F

[kathyc2]

Guessing there is confusion with revocation of passport due to tax debt rather than non-filing is below threshold. https://www.irs.gov/businesses/small...n-unpaid-taxes

[Lion]

I prefer to file tax returns to start the clock running on the statute of limitations. Besides, the IRS will wonder what they're living off of, who's paying their airfare, etc.

[ATSMAN]

I agree with Lion. I have two clients who live abroad and the only US income they get are interest and dividends less than the tax filing (MFJ) requirement, but we file tax return each year. One of them has ancesteral property in the foreign country and the agricultural income to the extended family is more than enough to pay their expenses abroad.

[Lion]

US citizens and tax residents must report and pay taxes on worldwide income. Also, information reporting requirements exist for foreign bank accounts, financial accounts, physical/real assets, etc. Taxes might not be due on income, but reporting requirements still could exist. And, the only way to exempt foreign income from US tax is to report it on a tax return. A tax return also starts the clock on the statute of limitations. I always file. (Sometimes I don't charge, such as for the long-time little old lady client in my state with just the usual, meager retirement income below the filing requirement.)

[ATSMAN]

US citizens and tax residents must report and pay taxes on worldwide income. Also, information reporting requirements exist for foreign bank accounts, financial accounts, physical/real assets, etc. Taxes might not be due on income, but reporting requirements still could exist. And, the only way to exempt foreign income from US tax is to report it on a tax return. A tax return also starts the clock on the statute of limitations. I always file. (Sometimes I don't charge, such as for the long-time little old lady client in my state with just the usual, meager retirement income below the filing requirement.)

I think for folks who live abroad the threshold is $400,000 (MFJ) instead of $50,000.