S
Sascha
Hello,
I am a graduate student and German citizen in the US (employed as a
research assistant) and I am here since August of 2001. For 2002 and
2003 I claimed a tax exemption on my income of $6,000 and $5,000,
respectively. While filing my taxes for 2004 now, I saw that this tax
exemption (20(4)) has a retroactive clause, stating that if I should
reside in the U.S. longer than 4 years, I will be liable for tax for all
years claiming treaty exemptions.
As far as I understand that means I would have to pay back all the taxes
I saved with the exemption, plus penalties. I was not aware of this
retroactive clause when I filed my taxes. And I will definitely still be
in the US during 2005 and 2006, meaning that this retroactive clause
will apply to me. Can anybody give me some advice on what I need to do?
Thanks,
-- Sascha
I am a graduate student and German citizen in the US (employed as a
research assistant) and I am here since August of 2001. For 2002 and
2003 I claimed a tax exemption on my income of $6,000 and $5,000,
respectively. While filing my taxes for 2004 now, I saw that this tax
exemption (20(4)) has a retroactive clause, stating that if I should
reside in the U.S. longer than 4 years, I will be liable for tax for all
years claiming treaty exemptions.
As far as I understand that means I would have to pay back all the taxes
I saved with the exemption, plus penalties. I was not aware of this
retroactive clause when I filed my taxes. And I will definitely still be
in the US during 2005 and 2006, meaning that this retroactive clause
will apply to me. Can anybody give me some advice on what I need to do?
Thanks,
-- Sascha