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US citizen working in Mexico ...
Thread poster: Patricia Rosas

Patricia Rosas  Identity Verified
United States
Local time: 16:02
Spanish to English
+ ...
Jul 22, 2007

Hi, all!

For a variety of reasons (primarily the birth of my first grandchild), I'm thinking of moving to Guadalajara, where my daughter, who has dual citizenship, lives. This would happen sometime in 2008 or 2009.

I know that I will need to talk to experts along the way, but does anyone know if I would need a work visa if I was simply working out of my home, as I do now?

I also know there is a tax treaty, but would I stop paying taxes to the US on income earned? That would lower my total social security earnings, wouldn't it?

Any info would be greatly appreciated!

Thanks,
Patricia


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GoodWords  Identity Verified
Mexico
Local time: 17:02
Spanish to English
+ ...
Depends if you decide to be tax-registered, and on what visa you are living in Mexico Jul 22, 2007

If you work for Mexican clients who require tax receipts (recibos de honorarios), you most definitely will have to have at least an FM3 and register with Hacienda, and get your RFC (Registro Federal de Contribuyentes), and pay Mexican taxes.

If you are thinking of moving for the long term, you will either have to get an FM3 anyway, or else visit the US at least every six months to reenter on a new tourist card (FMT).

Foreigners do work illegally in Mexico. Some go on doing it for years, but if they are caught, they are fined and deported.


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Harry Bornemann  Identity Verified
Mexico
English to German
+ ...
Illegal/Legal Immigrants Jul 22, 2007

Great way of turning the table..

But I found a helpful article about this question:

http://www.solutionsabroad.com/a_mexicantaxes.asp


[Edited at 2007-07-22 21:49]


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Patricia Rosas  Identity Verified
United States
Local time: 16:02
Spanish to English
+ ...
TOPIC STARTER
Thank to you both ... Jul 22, 2007

I appreciate the advice and the link! In terms of turning the tables, I just wish that those Mexican who are here could get the kind of warm welcome that I know I'll get down there ...

Best,
Patricia


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MGL  Identity Verified
Netherlands
Local time: 01:02
Russian to English
tax stuff Jul 23, 2007

I just recently moved back to the US after living in Russia for about 7 years, so I've done the expat tax dance for a while now (with help).

What you would need to do is file as you normally file, but you would also file a 2555 Tax Exemption declaration for all of the income you earn abroad under the cutoff (I believe $70K per year is the cutoff, and anything over that limit is taxable in the US).

Re: Social Security- yep, nothing will be going to your SS unless you specifically mail it in yourself. I did not do this while I lived abroad, so I cannot offer advice about any related tax implications - that's something I'd ask a tax expert / accountant about.

Hope this helps a little!


-Megan


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Daina Jauntirans  Identity Verified
Local time: 18:02
German to English
+ ...
Work visa loophole? Jul 23, 2007

Maybe someone can confirm this, but I have read on the Internet that if you telework for customers outside of Mexico (doing no business with Mexican customers), then you don't need a work permit and you would pay your taxes to the US. I haven't been able to find official backup for this, though.

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Lesley Clarke  Identity Verified
Mexico
Local time: 17:02
Spanish to English
Work permit Oct 4, 2007

I actually met an Irish translator at a Powwow here who had an FM3 on the basis that he only worked for foreign clients. You though would probably find that as the mother of a Mexican citizen, it is not very hard to get an FM2, which is better, somehow.

I hope I'm not being obtuse, but these are different immigration documents without which you would have to use a tourist card and leave the country every six months as well turning down any potential Mexican clients.

Regards
Lesley


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