Tax Information for Americans

This information is accurate to the best of our knowledge. However, please note that we are NOT tax experts. We cannot take any responsibility for the accuracy of this information. If you have a special circumstance or are unclear of your tax responsibilities, please contact a professional tax consultant http://www.us-taxcpa.com/ (in Tokyo) or the IRS at 787-622-8940. The IRS web page at http://www.irs.gov contains a lot of good information and answer many frequently asked questions about paying taxes as a foreigner overseas (http://www.irs.gov/publications/p54/index.html).

JETs

JETs are liable (unless specified) for both Japanese and U.S. Federal taxes (as well as State taxes, if applicable). Please see the information below on your responsibilities for these taxes.

All 3^rd year American ALTs, and 1^st year CIRs & SEAs must pay taxes in Japan.

If you are liable for tax, your CO should cover this cost and should be automatically added to your paycheck (check with your CO for how they will handle this).

If you are exempt then you must file an exemption form【p.113 of the Gen. Handbook】, which should be provided by your supervisor. You must also submit the IRS Form 6166 (Certificate of Residency to prove that last fiscal year you were in fact a U.S. resident prior to coming to Japan. If you have not yet prepared your Certificate, you can apply for one using Form 8802 (http://www.irs.gov/pub/irs-pdf/f8802.pdf) Application for US Residency Certification.

You should not have to worry about Japanese taxes. It is your CO’s responsibility to adjust your compensation to match what was agreed on in your contract. Some JETs pay their taxes individually and receive a lump sum at the end of the year, or in quarterly installments. Other JET COs take care of everything. When your tax slips arrive in the Summer (usually during your 3^rd year as an ALT, or at the end of 1^st year for CIRs and SEAs) ask your supervisor what should be done.

Forms－ all Americans:

-Form 1040
http://www.irs.gov/pub/irs-pdf/f1040.pdf
US Individual Income Tax Return

-Form 2555 (EZ)
http://www.irs.gov/pub/irs-pdf/f2555ez.pdf
Foreign Earned Income Exclusion

1^st year USA JETs

-Form 4868
http://www.irs.gov/pub/irs-pdf/f4868.pdf
Application for Automatic Extension of Time to File US Individual Income Tax Return

Other

-Form 2350
http://www.irs.gov/pub/irs-pdf/f2350.pdf
Application for Extension of Time to File

-Form 8822
http://www.irs.gov/pub/irs-pdr/f8822.pdf
Change of Address Form

-Form TDF 90-22.1
http://www.irs.gov/pub/irs-pdf/f90221.pdf
Report of Foreign Bank and Financial Accounts

If you registered your Japanese address with the IRS last year, they will automatically send you the Standard Overseas Filling Package. This package includes the forms you will need to file your U.S. taxes. If you do not receive this package your can either request it from the IRS Forms Distribution Center, P.O. Box 25866, Richmond, Virgina, 23260 USA OR you can download them at http://www.irs.gov/formspubs/index.html.

1040

You must fill out the long form of 1040, if you want to claim Foreign Earned Income Exclusion.

You must to report ALL income from ALL sources for the year, which includes income from the U.S., Japan, and any other country in which you were employed last year. Wages from both U.S. and Japanese sources are written on line 7. Your Income Exclusion, which is calculated on Form 2555-EZ, is entered in parenthesis (negates the number) on line 21.

In addition to any W-2s from previous work abroad, you must also send a copy of your Japanese Statement of Earnings ((make this a link to the photo) Gensen choshu hyo－【Pg. 111 of the 2006 Gen. Handbook】), which includes a translation of your total earnings and its dollar equivalent (www.xe.com is a good reference).

2555-EZ

JETs can apply for Foreign Earned Income Exclusion, since they make less than $80k per year. This must by applied for each year; it does not become an automatic deduction if you applied for it the year before or even if you have no U.S. income.

In order to file form 2555-EZ you must first meet the Physical Presence Test, meaning, you must live in Japan for 330 full days during any 12 consecutive months. 1^st year ALTs will not fulfill this by April, so they must file form 4868 (file extension) in order to meet this requirement. These forms will extend your filing date 2-months past your automatic Overseas filing date (ie. the new filing date is August 15). However, if you owe the government any money, this MUST be paid by April 15, whether you are required to file your taxes or not. Failure to pay by this date will result in a penalty fee and interest added to whatever you owe. Do not file either your 1040 or 2555-EZ until you have met the physical presence test.

Form 4868 and Form 2350

Although all ex-pats receive and automatic 2 month extension to file their taxes overseas, those who have not passed the Physical Presence Test must request another 2 month extension (August 15) via form 4868. However, if you need even more time (ie. you arrived in Japan after August 15), you must then file form 2350, which is a more detailed request for extension. Both the 4868 and 2350 must be filed by June 15^th.

TDF 90-22.1

If you had over $10,000 in a foreign bank at anytime during the year, you need to tell the Department of Treasury. Fill out form TDF 90-22.1 to declare these accounts.

※ State Taxes

Some States require you to file your tax return, even if you are living abroad. Some States don’t require anything. To see what your State tax requirements are, please refer to this website - http://www.taxadmin.org/fta/link/forms.html

Non-JETs

As this is a JET-related website, we do not have specific information on non-JET Americans living in Japan. Please note that if you own any stocks, property, and so on in America, or if you have family here with you in Japan, the filing process will become much more detailed and complicated. Please refer to this website linked from the U.S. Embassy Tokyo’s homepage.

http://www.taxanswer.nta.go.jp/gaikoku301.htm