Overseas audit of US citizen taxpayer

Pity the expat US citizen who has to continue filing US taxes no matter where they live. I´ve always wonder what would happen if things when wrong, would the IRS come after me overseas?

Here´s a report from an accountant that went through one. In this case, the triggering event was that the taxpayer filed an amended return. You should never, ever, file an amended unless you talk to a compentent international tax lawyer. Amended returns are individually examined and the chance of audits are high unless you have all your ducks in a row.

There are basically two schools of thought regarding how to deal with mistakes: "quiet" disclosure, where you just file next years return correctly and forget about the past, and "noisy" where you go for the full confessional. The main trap in the noisy route is that you have to disclose absolutely everything that could possibly come up. If you leave out anything, this is far worse than going the quiet route, since they will most definitely be looking for problems. There are no points for partial effort.

One interesting mistake was that the taxpayer had used his US address as filing address (even though he lived abroad). If you use a foreign address, it makes the IRSs audit more difficult, since you can choose to have the audit at your place of business, which will require them to travel overseas.

Merry Christmas

We´ve gone south to visit the family clan for a week. The Alvia train was very nice, but I can´t wait until they finish the AVE track (2014 from what I hear). The new terminal in Valencia looks like it was built in a war zone, surrounded by half-collapsed warehouses.

The kids love being with their cousins, grand-parents, great-grand mother, uncles, nephews, nieces, etc. This was one of the reasons that we moved to Spain, and it´s definitely much less work than having to fly in from the US.

The longer we stay here in Spain the more I think we will stay here. There´s other places that could be more professionally rewarding, but I think in five years geographic location will matter very little in my industry. When we first moved here three years ago, I was the first senior person in the office to be working remotely. Now there´s about five of us and more are coming in the next couple months.

The most important thing for us has been to see how well the children have adapted. They are now fully trilingual, with local friends and integrated in the culture. The nationalism thing still gets on my nerves a bit, but not nearly as much as it used to. We´ve also met a lot of nice people from school since our oldest is very studious, so the other parents really want their kids to hang out with him. Culturally I know I´m not going to fully fit in, but I´d have that problem anywhere now.

My New Year´s resolutions are going to be: get more involved in music (the 11pm practice times for most groups in Spain has been a barrier for me, plus relearning A,B,C to Do Re Mi...), get some professional help with my Spanish (it´s gotten pretty good, but it´s all by osmosis so far), and get a regular exercise program.

Lets see how that works out....

How to get a telephone technician to come to your house

This is from the US, but I thought it was really good advice if you are trying to get Telefonica to send a technician (as opposed to promising to do something and then never doing it):

I know you already canceled, but here are some tips for getting what you want from AT&T tech support. This is from dealing with them a few years ago, so they might be catching on to this game:

1. Report intermittent static on your voice line. That will get your pair switched most of the time.
2. Whenever they ask you do to do something, don't do it, but say you did, but make it obvious you didn't. They tell you to reset the modem, say "Yeah, okay it's reset", when they question how fast it was, just say "Yeah, I unplugged it, then all 4 lights flashed and turned orange and red and green and blue...". At some point, they realize your screwing with them but never indicate that you are, the trick is to be play even dumber then the person you are talking too.
3. Change your story every time. Be as unhelpful as possible when they try to pin you down on any details, especially technical details.

The theme here is not to be a "problem customer" who yells and curses, they can deal with that. You have to subtly wear the other person down, so it becomes their idea to roll a truck.

…

Once the technician gets on site, then it's a whole different ball game of getting them to do some work.

Parade of the Three Kings in Sant Cugat

In case you weren’t paying attention to your copy of “Sant Cugat Avui” that the municipality is nice enough to mail out, here’s the parade route of the “Tres Reyes Magos” for Sant Cugat on January 5th:

There are two main events: the Cavalcada de Reis, which is the parade where they throw candy and little presents for kids. The parade has a wonderfully campy feel to it and it’s quite impressive how much effort gets put into it.

The Ambaixadors Reials (on January 4th) is more like a “sit on Santa’s Lap” kind of event. There’s lots of videos on Youtube about it.

Bye bye Telefonica

We switched to Vodafone today after months of begging Telefonica to increase our ADSL speed. We had found that our house had very bad wiring, which was impeding our connection. Once we fixed it, we should have been about to get 6 megabits (it depends on your distance from the exchange near the monastery). Telefonica kept telling us that there weren’t any more ports available that could do more than 3 megabits, etc. Then they would promise to phone back, but never did.

So now we switched. Here’s the experience so far:

• Router: light-years ahead of the piece of crap Telefonica gives you. It even supports plugging in a USB hard drive for instant network storage.
• ADSL Connection: double the speed we were getting from Telefonica.
• Network speed to the US: I now about 190 milliseconds ping time to the silicon valley, which is about 60 milliseconds better than I was getting from Telefonica.

It’s almost too good to be true…

Two walls, a roof and the new anti-smoking law

The new anti-tobacco law made some attempts at closing the obvious loophole: it’s pretty hard for bars to change to “private smoking clubs” (they have to have a membership list and be run for non-profit).

Coming from a background of weaseling my way around rules I don’t like, there seems to be an obvious flaw in the definition of “open”: a building with no more than two walls and a ceiling. The obvious question is if the building is shaped like a cylinder, does that count as only one wall?

I wonder if people will be able to smoke here…

No smoking AND bilingual schools?

I feel like I’m getting two early Christmas presents… first the congress more or less finalized the law completely banning smoking from restaurants, bars, nightclubs without exception. The rules take effect January 2nd.

In the second piece of news, it looks like the Supreme Court is about to abolish the imposition of Catalan in the school system here. I’m sure there will be much gnashing of teeth and complaints about Spanish imperialism.

I’d be pretty excited about not having to pay two arms, a leg and a kidney to send our kids to school that has a reasonable mix between Spanish, Catalan and English. Unfortunately I’m sure our kids will have graduated by the time anything changes.

Bosch as a Catalan surname

When we first moved here, I assumed that people with the last name Bosch had some German ancestor. The more people I met, the more unlikely this theory became.

The oldest reference I found was a 1510 census of Valencia, which showed that Bosch was already a relatively popular surname. A random fact that struck me was that out of 4850 people recorded, 4602 only had a single surname. This was about 270 years after Valencia was re-conquered from the Moors.

It was also interesting to read about the Morisco Expulsion, where around 1600, about 300,000 people suspected of being of Moorish descent were deported from the kingdom of Aragon.

Many of them were sent to Marseille, which perhaps explains why people in the ex-kingdom of Aragon are somewhat lighter-skinned than people from other parts of Spain and why people from the south of France are darker-skinned.