Nomad Taxes
It’s April 15th, and it’s tax season in America.
I’ve gathered up all my paperwork, calculated my income, and expensed what I can from my business. It looks like I’ll owe the government about 15% of the money I brought in last year.
But really, why am I filling out these tax forms at all…
I lived in the United States for about 20 days last year. 5 days in January and about 15 when I came home for Christmas.
Here’s a few things I didn’t benefit from last year that my tax dollars are going towards.
I didn’t use the national highway system.
I didn’t get help or a sense of security from the local police force.
I didn’t use pubic transportation.
I didn’t use any of the American infrastructure whatsoever, but my tax dollars will help pay for these programs.
Even when I was living in the USA I rarely used any of these services, but now that I’ve been abroad for so long I know that I’m not getting anything for my money.
It seems that the only benefit I get from paying taxes is that I get to keep my passport. (Which I do need in order to travel) I get to say ‘I’m a citizen!’ and that’s about it.
It’s Hard To Justify Paying Taxes For Expats
Imagine if Walmart told you that you had to pay them just because they had other customers in a different part of town. Hey, you even get a Walmart card proving you’re a Walmartian! 😉
That’s kind of what it feels like paying taxes this year.
Somebody else is going to use the highways, somebody else is going to use the public transportation, somebody else might feel safer because of the military and police… but not me.
So, What’s fair?
Perhaps taxes could be augmented based on how long you were physically inside the USA, so that I would pay tax for just 20 days out of year I was here. (5% of my normal payment)
What about nomads who travel for multiple years without returning home? Is it fair that they pay any tax at all?
Maybe some people feel patriotic paying taxes and expecting nothing in return. That’s not how I feel.
More Americans are becoming digital nomads and spending their days living in Asia, South America, and Europe. Will taxation need to change to accommodate?
What do you think is fair? How much tax should digital nomads pay?
Should you pay any tax if you were out of the country for an entire tax year?
Should nomads pay business taxes for US entities but not personal income taxes?
You didn’t use pubic transportation?
I wasn’t in the country, so no. I used Hong Kong and China’s public transportation mostly.
Hi there, agreed with all your points but since you spent at least 330 days outside of the country, shouldn’t you be able to claim the foreign earned income exclusion?
Hey David! I looked into that (not extensively) and I believe in order to exclude your income from America you need to file taxes in another country and then show how you paid there. If you know otherwise I’d be grateful to know, but as I understand it the FEIE just protects you from having to pay double taxation in the USA and another country.