For freelance travelers, April can seem like a nightmare of all the adult questions you’ve been trying to avoid all year: Does travel insurance count as Obamacare? How do I prove I’m a real adult with real-people work when I don’t even have a postal address? And how do I go about getting one of those 401(k)s my friends back home keep talking about?

Though US taxes are confusing for practically everyone, freelance travelers experience twice the amount of work, stress, and headaches come April.

Before that dreaded April 18th deadline comes, here are a few things you might want to know to get things in order. Take a deep breath: you are a legitimate human being with legitimate work and with a little bit of help, the IRS will recognize it.

1. The rules for Obamacare exemptions

Penalties for not enrolling for US healthcare have become steep. For nomads, it’s difficult to understand whether your brief time in the States means you’re required to buy insurance.

As a US citizen, here are the only ways you can qualify for an exemption to Obamacare:

  • You’ve spent 330 days or more outside US.
  • You’re an official resident of foreign country or US territory. Learn More
  • You’re a health care sharing ministry member. Learn More
  • You’re an Indian tribe member or eligible for Indian health care.
  • You’ve spent time in jail. Learn More
  • You’ve received an exemption certificate number from the Marketplace.

The only other option? To claim the insurance was unaffordable for you. To qualify for this, you have to prove that the lowest-cost health insurance coverage plan offered to you in your state, either through a job or on your own, was still more than 8.05% of your household income.

Some expats have written some great blog posts further elaborating on the 330 day rule, and some of the intricate ways you can work with it while still making sure you visit home for the holidays. For freelancers in-between jobs/locations etc., you can also find good information about how short-gap exemptions work here.

2. The rules for the foreign exclusion tax

In the United States, if you’re working abroad and making foreign currency, you’re not required to file US taxes unless you make a salary above the cap of $100,800. Here’s the IRS guide to the foreign based exclusion tax and who qualifies.

And below are some other links to resources elaborating on how you pay taxes as an expat:

Information from a global tax affairs consultancy:
http://www.maximadvisors.com/

Quick US expatriate tax facts:
http://www.taxmeless.com/page2.html

US Federal tax liability: expat tax
http://www.expatinfodesk.com/expat-guide/nationality-specific-information/americans/us-tax-liability/

3. How retirement funds affect your taxes

As freelancers, we have the freedom and individual responsibility of deciding when to create a retirement fund and how much to contribute to it (If you’re still not convinced you should be saving for your retirement at all, the statistics in this article should do the trick).

However, it’s also important to remember that whatever retirement decision we make also affects how much of our income is taxed in April. For example, creating a traditional IRA retirement fund will make you save on taxes now, but pay taxes later. Starting a Roth IRA will mean you’re taxed normally now, but saving on taxes later.

There are great resources online to help you choose which one is best for you. Resources like Investopedia and Betterment.com break down the pros and cons of the Roth vs. Traditional IRA.

Miranda Marquit’s article in Betterment.com has great advice about the key questions you should be asking when making a decision:

“The main question to ask is whether you expect to be in a higher tax bracket than you are now when you withdraw from the account in retirement. If you choose a Roth IRA, you pay taxes now, but if you retire in a higher tax bracket, or if tax rates go up over time, you are protected from those increases.”

4. The myriad of retirement options freelancers have in comparison to traditional employees

Most people have heard of traditional IRAs, Roth IRAs and 401(k)s. But as a freelancer, you have way more options than that.

Payable’s blog post explains which how some freelancers could also benefit from a Solo 401(k) and a SEP IRA. A SEP IRA allows you to invest far more the $5,500 Roth IRA limit (as of 2016, you can contribute up to 25 percent of your self-employment income to a maximum of $53,000).

U.S. News delves even deeper including information on the New York-based Freelancers Union 401(k). A blog on Guilded also mentions the benefits of starting a Health Savings Account (HSA), instead of a traditional retirement plan. Like a traditional IRA, an HSA is also not subject to federal income taxes. The only difference? The funds made can only be used on qualified medical expenses (Not convinced this is necessary? An AARP article reported this Fidelity Investments estimate: a 65-year couple retiring this year will need over $240,000 to cover their future medical expenses).

5. How to file cheap and easily from abroad

As a freelancer, you’ll generally be filing a 1099, not a W2. This can affect the price you pay when using tax-filing software (For example, TurboTax — the software I had used previously when working as a teacher — charged more than $100 extra for filing under my freelancer circumstances). Use this list of IRS-approved online filing sites and research which will allow you to file 1099 for the least amount of money (I went with FreeTax USA).

Also be aware that some software won’t let you e-file from abroad and instead asks you to send your taxes via snail mail. Plan accordingly.

And lastly, check out the IRS guide to filing taxes abroad to make sure you’re sending at the right time to the right address.

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