just2019 wrote:I'm hearing that I will still have to pay the IRS whiling living in SG quarterly, is that true or do I make a payment at the end of the year once I pay my SG tax payment too then subject the tax paid in SG to my US tax.. SG tax sounds easy but the US stuff is sounding to be difficult to keep up with.
Thank you!
You may have to make quarterly estimated tax payments depending upon your circumstances.
If you Singapore earned income is equal to or less than the earned income exclusion, then you will owe no federal income tax on your Singapore earnings; hence, you would not need to worry about quarterly tax payments.
If you make more than the earned income exclusion then you owe tax on the amount above the exclusion at a rate as though the exclusion were not in place, ie, highest marginal tax rate. From this tax, you subtract Singapore tax paid on the same amount and this is your net earned income tax bill.
If it's around approximately a $1000 or so, then you won't need to make quarterly tax payments as they only kick in if you figure that you will owe more than $1000, AND, that federal withholding won't meet 90 percent of your tax obligation.
However, you must also take into account passive or unearned income such as interest, dividends, rents and such. These are also taxed at a rate as though the earned income exclusion were not in place, and again, the $1000 rule applies.
Bottom line: If you don't have passive income (or have relatively little of it) and your Singapore salary is somewhere around the earned income exclusion, then you won't incur enough income tax liability to have to make quarterly payments. If you have significant passive income subject to taxation, or you're making a really big honking salary, you'll want to make quarterly payments in the quarter that your passive/active income is paid. So, if you are getting a shitpot of dividend payments in the fourth quarter, you'd also make an estimated quarterly tax payment to cover those dividends.
