While I am new here, I have been lurking for a long time and I do hope that this thread is allowed to remain open. I have read the stickies and the links and do not see a really specific discussion of what is now a very relevant tax issue.

For American players who decided to jump ship and head abroad to continue their career as poker players, a lot of interesting tax scenarios seem to have popped up. I have talked about this with two of my roommates who are facing similar situations and are trying to work it out with their accountants but I'd like to get a real discussion going so that more opinions can get in the mix and so it is easier to feel out the different options.

Do you qualify for the foreign earned income exclusion this year? Will you for next year? What are some of the things to be careful about when doing this to avoid messing it up? Is there any downside to doing this if you can?

Do you need to pay state income taxes this year? If so, how can you set yourself up to no longer need to do this in the future if you are planning to stay abroad and not call your old state home? What are the complications associated with doing this and are there some people for whom it would be unwise? Does maintaining health insurance in your home state disqualify you from claiming residency abroad or can you hold on to your insurance? If you have to let it go, how do you go about finding good and reliable global insurance?

Are all or some of the costs associated with living abroad now deductible work expenses? Are there new expenses that can be claimed that would not have been relevant without relocating? What about things like flights home to visit family? Are they deductible? What kinds of things should players be looking for as legitimate deductions that they may not have prior to moving?

FBAR's likely will need to be filed for sites like Skrill and foreign banks which is also new to many. I have also read about some new issues with foreign accounts that are very large but perhaps that is best saved for another discussion.

Again, moderators, if it is okay to let this discussion take place, I think it could be really useful to many people.

Thanks.

Dan

FWIW I think this thread is well beyond worthy of staying open. I would have liked to include questions such as these in this year's update to the sticky but couldn't recall having seen any substantial discussion of them. Perhaps they depend too much on the specifics of each situation, but let's see what we can get.

http://www.taxesforexpats.com/expat-...exclusion.html

Very good article on this imo.

As for what to look out for, make sure you understand exactly what the IRS considers a full day out of the USA. You dont want to find out next April that you fell just short of the 330 days required. There was a 2p2er a few months ago that I believe made this mistake and owed taxes in full as if he never left.

Thanks. A few follow ups. This article confuses me in one way. I thought you needed to make sure to be anywhere but the US for 330 days and just not be on US soil for 35 days but this maybe says otherwise? Like you have to also not be in the air or travelling or something of that nature.

This article does not discuss the state tax issues but it does seem very comprehensive on the foreign earned income exclusion issues. Have you come across anything like this for the state tax issue?

State taxes vary from state to state so its best to just get an accountant. I know that California doesn't recognize any foreign income exclusions so its best to establish residency in another state before leaving for good.

I'm not sure I understand your question is, but you have to be out of the country for 330 days of any consecutive 365 day period.

I think I remember reading somewhere that being in a plane above foreign soil (even if its not where you intend to land) counts as the starting point of a day out of the USA. So for example if you are in Canadian airspace starting at 11:59pm, your day 1 of 330 will start at midnight. If you cross into Canadian airspace at 12:01am, your first full day will start 24 hrs from then. I'm not 100% certain on this but this is what I remember reading a few months back.

To qualify for the physical presence test, you have to prove having resided in a foreign country for at least 330 full days out of 12 consecutive months. To qualify for bona fide residence test, you have permanent residence in the foreign country. Physical presence test is more applicable to short term experts and digital nomads while the bona fide residence test applies to long term experts