Americans working in the DR for Americans

[GringoCArlos]

Get your legal DR residency (cost about US$2000 using a reputable attorney) and forget the rest - they don't need to set up a company. You will be telecommuting only, right? Make the company pay your internet monthly costs, and thats it, nothing else is needed. Make them pay you in the US and get cash for living through a casa de cambio.

As for your HR manager, tell him the company needs to pay you in the US, deduct the Social Security and Medicare taxes as usual , and nothing more- no federal and usually no state taxes, but again ASK A GOOD TAX ATTORNEY FOR THEIR ADVICE, regarding maintaining a US home or renting it out, etc)

You can file a new W-4 (the number of dependents claimed) and claim 15, but have them list you as living in a foreign country.

ya!

 

[Eddyx]

The Dominican Tax Department has many people working in the offices of Codetel (Verizon) and also at Tricom, monitoring the internet traffic from and to the D.R.

Once they note that it is work material, they calculate the total amount of time spent on work correspondence, and if no tax report is filed by the individual, they assign a value, and calculate the taxes due.

When the individual comes to the airport, it is the job of Migraci?n to detain the individual when they are attempting to leave the DR, and to collect the taxes due.

Apparently, they have no people working at the land crossings to Haiti, so if one wanted to escape the DR without paying these taxes, they could theoretically pass over to Haiti, and then fly to anywhere in the world. (this may be one reason the Dominican Armed Forces are beefing up their numbers at the Haitian borders though).

Good luck.

I don't think this is true. The comuication with servers of private American companies through the internet is encrypted, so it's a very hard to determinate what kind of info, is crossing by the serves of the dominican internet companies.

:ermm:

 

[Criss Colon]

If "Gringo Carlos" Thinks It Costs $2000 For A DR "Residencia",....

I would not trust his knowledge about "Tax Collecting" either!
Cris Colon
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[GringoCArlos]

It will cost $2k to get the temporary and then the permanent residency USING A REPUTABLE ATTORNEY TO DO THE WORK. If you have a bunch of spare time with nothing to do, or else you really want to waste a lot of your time, do it yourself, and do it for probably $500. I didn't have the time as I was in the middle of the buildout of our offices, and I'll bet Fabio's firm would charge the $2k or more, and require 3 to 6 months to do it.

My company paid for the work to get mine, I got residency very quickly, and have renewed it since,with NO PROBLEMS. It's your decision to make.

I personally would tell your company they need to pay the law firm to do it for you, and I sincerely doubt they will blink an eye. They will be happy that they don't need to start up a DR company, and it will make your transition much smoother.

Some folks here have all the time in the world on their hands, or actually enjoy standing in lines, or using buscones. I don't. And, as a side note, what the heck do you know about getting residency, Criss - by your own admission, you are just a wetback here in the DR, without legal residency.

Suerte.

 

[Criss Colon]

"Do As I SAY, NOT As I DO!"

The cost of a "Residencia" is about $1000 US! LOTS of stories on DR1 from those who got their's done by good Dominican Lawyers for that price! No "Buscones",or standing in line"!
I wear it as a "Badge-of-Honour" (AND "Proof" that you don't need to "Waste" time or money getting "Papers" to live and work here!) and,that I worked for the Dominican Government for 10 years without ANY "Papers" of any kind!
I WILL get my "PAPERS" when I can bring in my "Effects", Household goods,and a "Car", from the USA without paying any "Fees"!
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[BF1]

I, as a Dominican lawyer's husband, would say that both GringoCarlos and Criss Colon are right, the price, from a responsible lawyer, is from 1,000 to 2,000 US. Price for corporation is usually the higher one because of the level of service requested.

 

[Criss Colon]

As USUAL,I Am "Half Right"!

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[ecibjkub]

I would also question the information provided by Gringocarlos. Even though technically each individual should declare their annual earnings to the Departamento de Impuestos Internos, this system is not yet prepared to track and make individuals accountable for taxes on their individual income. This IS enforced currently with:
-Companies (taxes to employees and declaration of earnings each month for tax purposes)

As an American working for a U.S. company, you should ask them how your payment is managed. If your payroll is processed in the U.S. and you are paid in US$, it is unlikely that you will have to pay taxes in the D.R., basically because this income is not being disbursed in the D.R. and therefore would not show up on the company's local payroll. This was my situation working for an international organization in Santo Domingo. I think technically I should have been also paying Dominican taxes but, since my payment was wired through the U.S. and the mechanism for declaring your individual income to the government is not enforced, I did not have to pay local taxes.

As for doing work via internet on vacation or a brief trip, please don't lose sleep--you will not be responsible for paying out on this income.

 

[GringoCArlos]

What part are you questioning, ecibjkub??

If she or her company sets up a DR company for her work, what, you don't think DGII / Hacienda isn't going to come looking for someone employed by the company to pay taxes in the DR?? Obviously, if there is a company, there must be employees right?

She should just get her DR residency so that she can legally take advantage of the US Foreign Earned Income exclusion, so that she does not pay taxes in the US. Barring getting residency, she must either stay outside the US for more than 330 days a year, or pay taxes to the US.

If she gets paid in USD in the US, who in the DR will know that, so why would she pay taxes to the DR if she is just working online, out of her home?

Yes, I ws forced to pay taxes here in the DR, and I had to file my taxes in the US too.

Another note: if a US citizen works in the DR, gets paid by a DR company, they must still file an annual 1040 in the US in order to qualify for the Foreign Earned Income tax exclusion. If you do not file your tax return, and the IRS catches it and sends you a notice of failure to file, you LOSE the exclusion, and they can tax the entire income for that year(s).

Also, if you do NOT file, there is no statute of limitations, and they could get you for the past 20 years if they want to pursue the issue. With penalties and interest, it could add up to more that you made during those years. With the way things are shaping up in the US and the world's economy, and two wars to fund, they will be shaking the bushes (no, not George and GW - haha me make funny) for more revenue even harder.