Accountant recommendations for a US therapist living in Argentina...

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River222

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Background: I moved to Argentina last year to be with my girlfriend and got my LMHCA license shortly thereafter in Washington State. We married in February of this year and I started my private practice remotely when we got back from the honeymoon, seeing all of my clients virtually. It’s been slow going building up my client base so I only have 3 clients right now. I plan on staying in Argentina for several years with yearly visits to the states. I’m currently in search of an accountant and would love recommendations of someone willing to work with a therapist practicing internationally, but in the meantime I have two main questions…

Question 1: I am trying to figure out/decide if I should apply for temporary argentine citizenship and how that would affect my taxes. What are the tax/legal implications of working remotely like this as a therapist?

Question 2: I've also just been offered a part-time job, also in Washington State, where I will work 10 hours a week for their clients and then use the other days to build my private practice. They are letting me choose if I want to be a part-time employee(w-2) or start my own business that contracts with them(1099). What are the pros and cons of these options? For example, If I go with 1099 would I be able to write off airplane tickets? Does this decision affect the question asked in question 1?
 
River222 said:
... I am trying to figure out/decide if I should apply for temporary argentine citizenship ..
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I'm pretty sure there's no such thing as temporary Argentine citizenship. You're either a citizen or not.

River222 said:
... They are letting me choose if I want to be a part-time employee(w-2) or start my own business that contracts with them(1099). What are the pros and cons of these options? ...
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Are they aware that you are planning to work from a foreign location?

Essentially, with a W-2, they will withhold your taxes, and then you'll need to apply for your foreign income exclusion. Plus, they might pay for medical insurance that you won't be able to use outside the US.

With a 1099, you'll have to pay self-employment taxes in the US. Therefore, contractors usually charge more than employees do, since they also cover their own taxes and insurance.
 
FrankPintor said:
Also, Argentinian citizenship cannot be renounced.
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Howdy Frank,

I never heard about this...I'm familiar with expats renouncing US citizenship due to it's global taxation, FACTA and other fun stuff. However, why would someone renounce Argentina? Why make it impossible too?
 
River222 said:
Background: I moved to Argentina last year to be with my girlfriend and got my LMHCA license shortly thereafter in Washington State. We married in February of this year and I started my private practice remotely when we got back from the honeymoon, seeing all of my clients virtually. It’s been slow going building up my client base so I only have 3 clients right now. I plan on staying in Argentina for several years with yearly visits to the states. I’m currently in search of an accountant and would love recommendations of someone willing to work with a therapist practicing internationally, but in the meantime I have two main questions…

Question 1: I am trying to figure out/decide if I should apply for temporary argentine citizenship and how that would affect my taxes. What are the tax/legal implications of working remotely like this as a therapist?

Question 2: I've also just been offered a part-time job, also in Washington State, where I will work 10 hours a week for their clients and then use the other days to build my private practice. They are letting me choose if I want to be a part-time employee(w-2) or start my own business that contracts with them(1099). What are the pros and cons of these options? For example, If I go with 1099 would I be able to write off airplane tickets? Does this decision affect the question asked in question 1?
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Howdy River,

Question 1: This is very dense topic and many here recommend a local accountant to tailor an answer to your exact situation. There are a lot of answers already on this forum if you are handy with the search feature. Your tax situation depends on your immigration situation. You will need to nail that down first.

Questions 2: I worked for many years as a bookkeeper in Los Angeles. As lunar mentioned, there's no real advantage to W2 if you are not planning on staying there. Your W2 pay withholdings includes state unemployment tax, state disability, and federal employment tax. Which I don't think you can claim without having residence in the state. You could of course keep a local PO box or friend's address to try to keep up appearances. On the plus side your employer pays half your FICA (7.65%?) and your Medicare taxes (1.45%?). These taxes you will need to pay on your own if you are self employed (it's deductible as a business expense). It's my understanding that Trump got rid of the home office deduction for W2 employees, so it would be in your advantage to be 1099. Some travel costs, uniform, business meals etc are also deductible. There are rules for claiming each of these costs. There's no business trip to the Bahamas contrary to common belief. Also as lunar mentioned some aspects of your benefits package such as any dental or medical insurance could be redirected to your contractor fees (aka salary) instead, since it won't be of any use to you abroad. The only downside I can think of to opting for 1099 would be in the event of future credit applications such as a car or home loan where proof of income as a W2 may qualify you faster. It doesn't sound like that is necessary given your situation. You will need to file a Schedule C on your tax return. As you develop your practice, you may also want to think about formalizing your business structure depending on your personal assets and the risk profile of your business (injury to clients or potential lawsuits).
 
Renouncing US citizenship requires the payment of the present value of future tax obligations, so I think it unlikely that one would renounce it for tax reasons unless they are poorly advised - it is far too expensive for that reason.

Regarding Argentine visa status, one should consider what the objective is before deciding on what immigration status to pursue. If you were to pursue Argentine citizenship, you would be responsible for paying taxes on your global income while living in the country, and there are a lot of other things to consider.

Contractor vs Employee has a test to ensure you are paying the right taxes and the IRS can question the decision made, so it is important you understand the difference before electing. In other words, don't just pick the one that is economically better, but the correct one according to the Internal Revenue Code.

While I am a CPA (licensed in Virginia), I am not currently providing tax advice. I would strongly recommend you find a capable tax advisor familiar with the State of Washington before making any decisions.
 
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