The Tax Simplification for Americans Abroad Act (H.R. 5432) is a new legislative proposal introduced by Reps. Don Beyer and Dina Titus. Here's a summary of the key points related to this bill:

• Expansion of Foreign Earned Income Exclusion: The legislation aims to expand the Foreign Earned Income Exclusion to include additional types of income earned overseas, such as pensions and distributions from retirement funds. This would provide additional tax relief for Americans living abroad.

• Short-Form Certification: The bill would require the IRS to create a simplified short-form certification for U.S. taxpayers living abroad who meet specific criteria. Taxpayers eligible for this form are those who owe no U.S. tax and earn less than $400,000 annually.

• Consolidation of Forms: The bill seeks to consolidate and eliminate duplicative and burdensome forms that taxpayers are required to file under the Foreign Account Tax Compliance Act (FATCA) and the Bank Secrecy Act. This streamlining of forms would reduce administrative complexities for Americans living abroad.

• Simplified Form Similar to 2017's Form 1040-EZ: The short-form certification that the IRS is required to create would be designed to be similar to the simplified Form 1040-EZ as it existed in 2017. This would make it easier for eligible taxpayers to fulfill their obligations.

• Enhancing Accessibility: The bill's sponsors argue that this legislation would make it easier and more affordable for ordinary Americans living abroad to comply with U.S. tax requirements, reducing the need for expensive accountants to certify that they owe no U.S. taxes.

Overall, the Tax Simplification for Americans Abroad Act aims to simplify the tax filing process for U.S. citizens living overseas, reduce their tax burdens, and eliminate redundant paperwork associated with certain tax regulations. It seeks to address the unique challenges faced by Americans abroad in navigating the U.S. tax system.

“Ordinary Americans living abroad are often overlooked when U.S. tax policy is written, which can make it extremely difficult and expensive for them to navigate the tax system,” Beyer said in a statement.

The bill, Beyer said, “would help ordinary Americans fulfill their obligations without having to retain an expensive accountant to certify that they owe no U.S. taxes, and remove some of the frustrations faced by Americans living abroad who just want to follow the law.”

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