Maximizing your U.S. Tax Situation in Singapore: Know how your income and your housing allowance may affect your U.S. taxes while living in Singapore.
As a U.S. person living in Singapore, taking advantage of all of your U.S. tax benefits will be essential to ensuring that your tax liability is minimized both now and in the future. Generally, you will want to claim the foreign earned income exclusion to offset any tax liability arising on your income. If you have more income than can be offset by this exclusion, you can also take advantage of an additional write off for your housing expenses abroad. Taken together, these tax benefits will likely exclude the lion's share of your income from U.S. tax.
However, if you receive wage income that can't be offset or you have dividends, interest, or capital gains, you will also want to take advantage of a credit for taxes paid in Singapore. You can take a credit for taxes paid during the year in which you actually made payment or elect to claim a credit for taxes when the tax liability accrues (i.e. when you earn the income). However, if you make this election, you would need to claim the credit in the same manner in all future years. Filing your U.S. tax return requires careful consideration of your facts and circumstances. Our team of trained tax experts is ready to help you to ensure that you don't pay any more tax than is required.