US has certain laws for living, working abroad

This was originally published on Monday, May 19, 2014, in the Pacific Daily News.  Click here to subscribe to the PDN.

Editor’s note: Michael Camacho today continues a series of articles on the top of living and working abroad.

The United States government requires U.S. citizens and Legal Permanent Resident Aliens that live abroad to follow certain employment laws. Contact your new employer’s human resources department to ensure that laws from both the host country and the U.S. are followed.

• Taxes: The Internal Revenue Service requires that all U.S. citizens and Legal Permanent Resident Aliens that live abroad file taxes yearly. Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, discusses the special tax rules. You may be eligible for the Foreign Tax Credit that will reduce your U.S. tax liability. Because you are moving for employment, you may be able to deduct certain moving, travel and lodging expenses incurred from moving. Be sure to keep all your receipts associated with the move.

The IRS website,, has the procedures, regulations, forms and publications necessary to file while working overseas. You may call them directly from abroad at 1-267-941-1000 (not toll-free) or from Guam, toll-free, at 1-800-829-1040. It would be advantageous to get help with your taxes while living abroad from a tax preparer familiar with U.S. tax codes.

• Social Security payments: You are required to pay U.S. Social Security taxes if the country in which you will be residing does not coordinate its social service coverage with the United States.

According to the Social Security Administration, the United States has made agreements with other countries to help avoid being double taxed. To see if the country you will be living abroad has an agreement with the U.S., go to

• Medical and health insurance: Ask your employer if the company will provide medical insurance. If not, contact your current medical insurance company to see if they will cover you in a foreign country. They may be able to provide you with a list of reputable clinics and doctors in the area or refer you to an insurance company that covers that country. Minimum coverage requirements change from country to country and some countries offer free health care.

• Retirement accounts: You still can contribute to your IRAs or Roth accounts while living abroad, although there are some restrictions such as the maximum amount that can be deposited. Ask your employer if they will make contributions into your account. Also contact your investment company if there are fees for depositing money in the local currency. You will want to ensure that even if you are living abroad, you continue to save for retirement.

• Pets: You may want to bring along your four-legged family members. Moving pets internationally can be a challenge. Some countries ban certain breeds or animals. Shipping a pet abroad can be expensive and finding a house that allows pets may be difficult.

• Emergencies: Keep the contact information for the nearest U.S. Embassy or Consulate. Sign up for the Smart Traveler Enrollment Program. STEP is a federal program that keeps you informed on the most current information about the country you will be moving to. It also is a way for the closest U.S. embassy or consulate to contact you or your loved ones back home in case of a natural disaster or civil unrest. To enroll go to

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at and read past columns at the Money Matters blog at


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