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turtle wrote:
Still, it will be an interesting question if IRS gets curious and there is no documentation stating that the Angola taxing authority actually received any of the withholding from your paycheck.


This has been my point in the past. I have no beef with companies withholding tax, if they are legally required to do so, plus they subsequently provide proof to the employee/sub-contractor that that withheld tax has indeed been paid to the relevant tax authorities. Proof may be some time coming as it could be 18 months after you actually worked on that particular contract. BUT if they cannot provide proof of payment the money should be re-embursed to the employee/sub-contractor not simply swallowed up into the company coffers.

It's also up to the employee to request proof further down the line that the money was indeed paid out.
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The 6% deduction is listed as West Africa, as far as I am aware no tax authority accepts West Africa under dual taxation laws. It does not matter if your tax adviser says it is OK, it is you who is ultimately responsible for the accuracy of your tax return. OI will not provide information on where the 6% deduction goes, I have asked on many occasions! No reply is the usual response. For the first 4 or 5 years with OI the bonus pretty much gives you back your 6% deduction. As for the extra days payment the 105 days does not include travel days so you have to do 3 weeks extra offshore over 6 months before you even start to get bonus days.
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I guess I will be finding out. Just finished my first year in Angola OI for Dubai. I'll be trying to deduct the 6%. Will update how it goes.
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Once again my 6% taxes are showing up as paid in Angola...not West Africa. So, once again the US will give me credit for those taxes paid in to another country. Looking forward to my 14% bonus which is all bonus....not just reimbursement for foreign taxes. I will also get a 10K tax break this year for part time residency in Angola since I worked 223 days this year in country...not counting travel days. All I had to do was supply my CPA with days exiting the U.S. and entering Angola and vice versa along with the physical address of the Staff House and Headquarters. As a matter of fact the CPA actually had me pay in too much tax last year and the IRS cut me a check for a refund instead of sending me a bill for more!
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rovredneck

Thanks for the detailed feedback with up to date information. Should prove useful to other USA based members.
James Mc
Site Admin
www.rovworld.com

Shocked Search First - Ask questions later Thumb Up
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Hi Red, Congrats and many happy "Returns". Anything can be claimed as a deduction or tax credit on a US tax return. The returns will be processed and all is fine until the day that the IRS has reason to question an item claimed in a particular year. They can go back several years under the statute of limitation. When and if the agency requires an audit it is best to have the documentation which will prove that the taxing authority mentioned in the return as paid has indeed received the listed funds.

One way to test this theory and guarantee an audit is to list “Tea Party” as a line item under Charitable Contribution Recipients on your US Income Tax form 1040. Should your return survive the ensuing scrutiny it will be bullet proof.

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