Hi All,

I am currently on a contract in China through Wasinc at Shenzhen Airlines. The airline pays the Chinese income taxes so the quoted montly salary is net. I just did my first tax return with a CPA in the States (guys - get a good CPA. Don't do them yourself. Mine charged me a mere $500 to do my extension, state and federal return, and to prepare the paperwork for foreign bank account holdings.) and it was a most pleasing experience. I'm sure different CPA's will tell each of you different things based on their experience and comfort level. Basically after the foreign income exclusion, housing deduction, and not being able to itemize schedule A (cause I didn't have enough there believe it or not) with 2 kids I am getting a refund (after not paying a dime in taxes) from federal and carrying over a tax credit for future years. I owe state a couple hundred bucks.

Shenzhen gives you the tax receipts from the taxes that they pay to the government on your behalf so you can use a portion of those to offset any US taxes you might have (and in my case carry over the credit to future years because my taxable income was zero and the credit wasn't necessary)

I know not all airlines give you the tax receipts but even without them your tax liability should be minimal. If you can get them it's an added bonus for sure.

Just my 2cents.