A growing number of expatriators and their families are paying a higher tax rate than the average citizen.
Many people have been paying $100,000 or more in tax each year for several years now, and a large number of them are expecting their income tax bills to skyrocket in the next few years.
The most common reason expatriating Americans have paid less than the tax rate is that they have been living abroad for more than five years, according to the tax agency.
They are also paying taxes that they are entitled to under the law.
The IRS says it expects about one in five Americans to pay less than what the average tax bill would have been if they stayed in the US.
“You’re living in a foreign country for years, and you’re getting taxed on your income,” said David F. Wachter, an expert in international tax policy at the University of Southern California.
“So what you’re really paying for is not that much of the tax you’re entitled to.”
The tax law gives the IRS authority to collect taxes on foreign income and other taxable income that is held in the country of origin.
The law does not require foreign nationals to pay the tax they are due.
But for the most part, expatriats are paying less than Americans.
About 20% of expats and their spouses and children are paying the same tax rate, according a report by the Center for Responsive Politics.
That number is about double the number of foreign nationals who pay a rate of less than $150,000 a year, or less than one in four Americans.
The average rate of income tax is $31,100 a year for a married couple, $34,900 for a single individual, $37,200 for a couple with children under the age of 26 and $49,900 a couple filing jointly.
For expatriaters, that’s a major financial burden.
That’s because they are required to file the income tax return every year, and it can take many years for the IRS to process that return.
Many expatriately Americans are taking out mortgage loans and saving money on the interest expense, Wachters said.
Wachter has studied expatriacy tax trends in other countries.
He says in many countries, it is much easier to get a tax refund because of the lack of foreign residency requirements.
But it’s not that easy in the United States.
According to the Tax Policy Center, only 7% of American expatriants pay income taxes, compared to 10% of the population.
Wachester estimates that about 4 million Americans are paying at least $20,000 in income taxes each year.
“In a lot of countries that have a similar situation to the United Kingdom, where you’re taxed on the income, you’re paying a lot less than they do here,” he said.
The IRS has been looking into ways to simplify the tax system for expatriat Americans, which include a new tool that allows people to pay more tax by using a credit card or a debit card.
A spokesman for the Treasury Department declined to comment on the new tool.
But many expatriatives don’t think the IRS will do anything about it.
“They’re not going to stop paying that money,” said Michael D. Kranz, an American expat living in Europe.
“That’s the nature of this country, there’s no tax system.
So they’re just going to continue to pay and get on with their lives.”