Case study 1
Certificate of coverage obtained for a self-employed consultant abroad
The client had been told that because the exclusion removed their earnings from US income tax, nothing further was due. The self-employment charge was still being assessed, and it was the largest line on the return. Their country of work has a totalization agreement with the United States, so the position was available; what was missing was the document. We prepared the application to the administering agency, describing the work, the place it was carried out and the period. The engagement produced a certificate of coverage and a return claiming the allocation with the evidence attached rather than asserting it.
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Case study 2
Two separate positions untangled on a return already filed
A self-employed US person abroad came to us with a filed return that had treated the income tax and social-security questions as one. The exclusion had been claimed, and the self-employment computation had then been prepared as though the excluded amount had left the base. It does not. We reworked both computations independently, applied the exclusion and the foreign tax credit to the income tax side only, and dealt with the social-security side on its own footing. The engagement produced an amended return setting each position out separately, with a note explaining why the original approach produced the wrong base.
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Case study 3
No agreement in place and the charge planned for instead
The client worked in a country with no totalization agreement with the United States, so the social-security charge on their business profit genuinely applied alongside the local contributions they were already paying. There was no relief to find, and saying so early was the useful part of the work. We set out why a treaty on income does not reach contributions, quantified the charge within the year's projected liability, and built it into the instalment planning rather than leaving it to appear at filing. The engagement produced a funded liability and a written explanation of a result the client might otherwise have kept trying to overturn.
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Case study 4
Local statutory accounts reconciled to a US profit computation
The client's business was audited locally and the accounts were sound, but they had been used unchanged as the profit figure on the US return for several years. The two systems differ on timing, on what is deductible and on how assets are written off, so that figure was not the right one. We rebuilt the computation for US purposes from the underlying records, kept a line-by-line reconciliation back to the local accounts, and documented the conversion basis. The engagement produced a defensible profit figure, a reconciliation that can be rerun each year, and corrections for the years still open.
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Case study 5
A contractor working through a local company and the charge revisited
The client had moved from invoicing personally to working through a company incorporated where they live, and assumed the self-employment question had gone away with the change. Whether it has depends on what the arrangement actually is and on how each system characterises the payments out of it, which is a question about substance rather than about the incorporation certificate. We reviewed the contracts, the flows and the local filings before taking a position either way. The engagement produced a characterisation written down with its reasoning, a consistent treatment across both countries' filings, and a list of the facts it depends on.
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Case study 6
Back years filed for someone who thought the exclusion covered everything
A US person had been self-employed abroad for several years and had filed nothing, on the understanding that the exclusion meant no return was needed. The obligation follows the person, and the exclusion is claimed on a return rather than replacing it. We rebuilt each year's business profit, applied the exclusion and the foreign tax credit to the income tax computation, established whether a totalization agreement reached the social-security charge, and filed the years together with the account disclosures that belonged with them. The engagement produced a complete filed history and a current-year basis the client now maintains.
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Case study 7
One Salary, Two Countries Claiming It
A US citizen resident in Canada, taxed in full on both sides because each return was prepared without the other in view. Deciding which country has the first right to the income, then claiming relief on the second return in the right order, is what stops the same dollar being taxed twice.
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Case study 8
Which Country Taxes the Salary
The employment article turns on where the work is done, who pays, and who bears the cost — three tests that can point in different directions. The file establishes all three before either return is drafted.
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