Filing taxes as an American in Italy :: Fosca D'Aceirno
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Taxing Italy

Demystifying the process of filing tax returns in two countries

🥸 As a US expat parent living in Italy with minor dependents am I eligible for the US child tax benefit?

It’s April and that means one thing for those of us from the United States, it’s time to file your tax return! 

Let’s be honest, taxes can be stressful if you’re dealing with just one country, let alone two, and, well, Italy’s fiscal system can be quite taxing in every sense of the word. 

  • By when do I need to file my US tax return if I currently reside in Italy? 
  • Do I have to pay taxes in Italy if my business is based in the US?
  • I am a US citizen living and working in Italy, do I still need to file a US tax return? 
  • What is a Commercialista and do I need one? 

Whether you are thinking about making the move or are already living here, temporarily or indefinitely, it is vital that you familiarize yourself with Italy’s tax laws, abide by them, and protect yourself financially. 

How can you do that? 

Don’t improvise and don’t trust unofficial sources for your tax information

Filing taxes as an American in Italy :: Fosca D'Aceirno

I see so many people who are eager to move to Italy (or are already living here) who ask for important information, like tax advice, in online forums or on social media. 

I recognize the value of these groups and feel that they are useful for support and experience sharing, but please be careful. Taxes are serious business and filing a tax return in Italy requires expert help. Since every personal and financial situation is different, it is unwise and risky to assume that yours will be like anyone else’s. 

Do you own property in Italy? Is your business based in the U.S. but you reside in Italy? Are you thinking about opening a business or buying property in Italy? If you pay income tax in Italy do you still need to file a return

See what I mean when I say that every tax situation is unique? 

This is where I can be of assistance. I can put you in touch with professionals who have an international clientele, are accustomed to working with US expats in Italy, and have the expertise and knowledge to make your life easier and give you peace of mind. 

Filing taxes as an American in Italy :: Fosca D'Aceirno

Who does your tax returns in Italy and the United States?

I have lived in Italy for over 25 years now and have never met anyone who does their own taxes. You need a professional, a commercialista, an accountant, but really a fiscal expert. 

Commercialisti are very revered figures in Italy and rightfully so. They are here to assist us, protect us, and help us navigate the often murky waters of dual taxation in a constantly evolving landscape. They keep up with the tax codes that are shaped by the incredible and rapid shifts in how we work and where we work so that you don’t have to fret. There have been some very high-profile tax evasion cases lately involving Italian influencers that are literally changing the game as I write this, reinforcing further how crucial it is to get expert help, someone who can steer you through the twists and turns dictated by the current scenario. 

Depending on your particular situation, you might very well also need the help of a tax attorney who is well-versed in both systems. I can also help you there. 

For quite some time I didn’t have a commercialista since I had a pretty straightforward income tax situation as a dipendente, an employee, with a contratto a tempo indeterminato, a permanent contract.  As many do, for years I filed my Italian tax return at the local CAF. If you have a fairly simple income tax situation like what I just described, chances are you can avail of their services which are quite good and very reasonably priced (the cost is pro-rated on the basis of your income).  

But I also filed, and continue to file, a return in the US every year as well, and if you a are a U.S. citizen living and working in Italy, you still need to file a U.S. tax return

Filing taxes as an American in Italy :: Fosca D'Aceirno

By when do I need to file my tax return if I live in Italy?

I typically file in Italy in May and get my return back in June/July.  I then send everything to a specialized New York based expat tax company and they file my US return. If you are a parent, be sure to ask when you file your return if you are eligible for the US child tax benefit.  

The good news, from the official IRS website, is that “If you are a U.S. citizen or resident alien residing overseas or are in the military on duty outside the U.S., on the regular due date of your return, you are allowed an automatic 2-month extension to file your return without requesting an extension. If you use a calendar year, the regular due date of your return is April 15, and the automatic extended due date would be June 15. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day.”

So, if the above applies to you, you have time, and please use that time wisely by doing some research on official government websites.

He is the IRS’s guidance for US Citizens abroad as well as details on the Italy – US tax treaty.  Italy’s Ministry of Finance’s official website for the Agenzia delle Entrate, the country’s revenue agency, is very informative and it’s in English! They also provide an excellent Italy tax lexicon for those who are interested in digging a bit deeper, even into the linguistic nuances of the revenue system. 

And once you’ve gotten what Italians call an infarinatura, a literal dusting of flour, an idea of some of the basic notions, reach out so we can talk about your situation and I can provide my insider help, advice, and referrals so that you can focus on enjoying April and the arrival of spring.

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