If I live in Nicaragua, do I still have to pay US income tax on money coming from the US?

Yes, as a US citizen or Greencard holder, you must file a US return every year and report your worldwide earnings, which includes earnings from Nicaragua.

As such, not only must you report any US based income, you must also report any money earned in Nicaragua. Now, just because you have to report it, does not mean you have to pay tax on it. Depending on your circumstances, you may owe nothing at all to the US. It is best to speak with your accountant to know for sure if tax...

Yes, as a US citizen or Greencard holder, you must file a US return every year and report your worldwide earnings, which includes earnings from Nicaragua.

As such, not only must you report any US based income, you must also report any money earned in Nicaragua. Now, just because you have to report it, does not mean you have to pay tax on it. Depending on your circumstances, you may owe nothing at all to the US. It is best to speak with your accountant to know for sure if tax will be owed.

If you live in Nicaragua, you still have to pay US income tax but, as per the Foreign Earned Income Exclusion, you only owe on the amount over the threshold. Once you’ve gone over the threshold of roughly $100,800 for 2015 (this amount is indexed, so it rises very year), then you owe income tax.
 
In order to qualify for the Foreign Earned Income Exclusion, there are certain things that you have to be compliant with. For example, you have to make sure your tax home is...

If you live in Nicaragua, you still have to pay US income tax but, as per the Foreign Earned Income Exclusion, you only owe on the amount over the threshold. Once you’ve gone over the threshold of roughly $100,800 for 2015 (this amount is indexed, so it rises very year), then you owe income tax.
 
In order to qualify for the Foreign Earned Income Exclusion, there are certain things that you have to be compliant with. For example, you have to make sure your tax home is Nicaragua. So if you come to Nicaragua once a month or if you come here to Nicaragua and just spend a month that doesn’t mean you could file your taxes as if you’re living in Nicaragua under the Foreign Earned Income Exclusion, so that’s very important to keep in mind. In order to qualify, you actually have to make your tax home Nicaragua.  

 

(Marina Puesta del Sol, Nicaragua, pictured.)