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Originally Posted by HammerMan72
Well sorry but this is ridiculous. I'm originally from Germany lived in 5 countries in over 20 years and never ever was I subject to German income tax laws or anything else.
That's just another ridiculous US law. You should always have to pay your taxes in your country of residence cause that's where you live, eat, work and spend your money. Non of the US's business plus I'm confident that in Spain you would still have to pay the local income tax US citizen or not.
You have to contribute to the economy of the country you work in not the country you come from. What freaking logic is that?
You don't understand the US law mainly because you haven't filed a USA tax return.
If an American lives abroad they have to file income taxes to the USA Internal Revenue Service.
If the American earns money from a company in the USA that will be taxable income to the USA because that company must report monies paid out.
If the American is working abroad and paying income taxes in that country, there is a law for no "double taxation".
Taxes paid to governments abroad can be used as exclusion credit to offset US taxes as well.
This is way oversimplifying the process, but an American will not be "double taxed" when they file, especially if the amount they earned is less than 100k.
I challenge you to get paid by a German business who is making the government aware that they are paying you to avoid paying income tax on that money.