[ccbeachlife]

Hello,

I am an American employed on a motoryacht that does not travel in US waters. I am somewhat new to the industry and am trying to figure out my tax situation. I have asked the other American on board what he does and his response was that he does not report anything to the IRS, which seems a little dangerous if he ever wanted to go and qualify for a home loan or started to pay taxes again.

Unfortunately it looks like I can not apply for the IRS Foreign Income Tax Exclusion because I have spent less than 330 days outside of the US (25 days vacation in the US and 20 days spent in international waters, which doesn't count as being outside the US according to the IRS website).

Any American crew out there that have a legal way of handling the tax man? Maybe a way to pay reduced taxes? Pay Federal but not State tax? Social Security tax?

I have heard of some yachts paying the American crew's taxes that way the crew members net income is equal to that of non American crew in the same position (who seem to be able to get away without having to pay taxes to their home countries, either illegitimately or legitimately).

Can anyone recommend a good tax man that deals with Americans in the yachting industry?

Any help would be appreciated.

Thanks!

[CharlesFCook]

I think you can pay full Federal and State taxes just like the rest of us or nothing. Do you get a w-2 or 1099? If not I don't think the IRS knows you are getting paid. People who get paid cash don't get a w-2 or 1099 and don't pay taxes on it.

[NYCAP123]

If you don't get a 1099 or W-2 you are self-employed and responsible to report you income and make quarterly deposits (figure 30% of gross) also taxes in your state of residence. Of course you can just stay silent as long as you don't put money into a bank account, want credit, a car or a house within the next 3 years or so. If you do get caught there is a very fine B & B where you can get free room and board out in Levenworth if the IRS finds out anyway (like if a rival turns you in).

[AndyP79]

Originally Posted by ccbeachlife

Hello,

I am an American employed on a motoryacht that does not travel in US waters. I am somewhat new to the industry and am trying to figure out my tax situation. I have asked the other American on board what he does and his response was that he does not report anything to the IRS, which seems a little dangerous if he ever wanted to go and qualify for a home loan or started to pay taxes again.

Unfortunately it looks like I can not apply for the IRS Foreign Income Tax Exclusion because I have spent less than 330 days outside of the US (25 days vacation in the US and 20 days spent in international waters, which doesn't count as being outside the US according to the IRS website).

Any American crew out there that have a legal way of handling the tax man? Maybe a way to pay reduced taxes? Pay Federal but not State tax? Social Security tax?

I have heard of some yachts paying the American crew's taxes that way the crew members net income is equal to that of non American crew in the same position (who seem to be able to get away without having to pay taxes to their home countries, either illegitimately or legitimately).

Can anyone recommend a good tax man that deals with Americans in the yachting industry?

Any help would be appreciated.

Thanks!

Hi,
I am a former US Coastguardsman, and Merchant Marine. If you are employed on an American Yacht, then they should have something in place for you anyway, it's the law. But since your on a foreign flag vessel, you have a couple of choices. One would be to let them handle it. I would caution on this depending on where it is flagged, and how you got the job, agent or dockwalk. You said you are outside of US waters. I would open an account, and watch my money grow. Here comes choice number two. You need to hire a maritime lawyer. Try to find one in the areas of Houston, Los Angels, or Fort Lauderdale/ Miami area. Most Maritime Lawyers will be able to do your taxes for you. If you make less then I think it is $75K a year, while you still report it, you pay no tax. If you make more, then the rules change. You can also keep track of all your receipts for travel, schools, food, clothes, tools, anything tht relates to your job, and claim it as work related expenses, this will help lessen the taxable amount of income. Sometimes you can find an accountant that works only for Merchant Mariners, try looking some up in Yellow pages dot com for the Norfolk area maybe. One thing you don't want to do if you make a considerable amount of money and spend a lot on expenses, is use H&R Block. They are the worst at understanding Mariners.
Best of Luck
Andy