Americans in Italy: Is it worth paying for professional help with your taxes?
Navigating two tax systems as an American living in Italy can be a headache-inducing process. So it is worth shelling out for professional help?
Many Americans living in Italy need to file taxes in both countries; and depending on how high your income is, you may be surprised to learn you also owe tax in both countries.
We asked our American readers how they cope with all that bureaucracy and whether they recommend using the services of professional to navigate the system.
"Yes, IF they know what they’re doing!" said one anonymous resident.
"I will be paying much more starting in 2024 but it will be worth it for greater peace of mind. Taxes are so complicated here but add in a US citizen and it is truly a nightmare."
Almost all those who responded agreed that it was necessary to seek professional help in at least one, if not both countries.
READ ALSO: Reader question: Do US nationals in Italy have to pay taxes twice?
"US taxes have become a nightmare. We do our personal Italian taxes ourselves," said a reader in Florence; while Eija Trees in Collepasso advises: "Hire tax professionals in both countries, your life will be much easier."
It's particularly worth getting outside input if your situation is in any way complicated, say readers.
Scott in Milan uses the services of a tax professional "as I am an independent worker and have additional complexity from this."
The Internal Revenue Service (IRS) headquarters in Washington, DC. Photo by MANDEL NGAN / AFP.
"Get professional tax advice for your specific situation. Know that double taxation is real, despite the existence of tax treaties," said one anonymous reader who says they pay for professional help in order to avoid being audited in Italy.
The average cost of a tax consultant was between €500 and €1,500, readers said, though some paid more than this.
A small number of respondents said they handled the paperwork themselves, but underscored that the decision about whether or not to use an accountant depends on your personal situation, including "if you have property or investments in Italy," as one reader wrote.
READ ALSO: What is an Italian commercialista and do you really need one?
William Searles in Puglia says he fills out his own forms using TurboTax "as our financial situation is simple," but adds that he would seek out professional help "if we had more complex issues."
"Read the bilateral tax treaty as well as the IRS publications on taxation in Italy. Get the help of an accounting firm in advance to understand what records you will need to keep to be prepared to file your taxes in Italy," counsels an anonymous reader in Puglia.
"Do your homework. Find a commercialista with experience with US expats. Plan your transition from US to Italian tax systems," is the advice from US citizen Lee.
"Learn the gotchas before you get surprised," he adds; "You’ll have surprises anyway, but hopefully they won’t be devastating".
Please note that The Local is unable to advise on individual cases. To find out more about the requirements for filing your tax return, seek advice from a qualified professional.
For more information on Italian tax residence, see the Italian Revenue Agency’s website. For more information on IRS provisions available to US nationals living abroad, see the relevant IRS website page.
Do you have a question about living in or travelling to Italy which you’d like to see answered on The Local? Submit it here.
Comments (2)
See Also
Many Americans living in Italy need to file taxes in both countries; and depending on how high your income is, you may be surprised to learn you also owe tax in both countries.
We asked our American readers how they cope with all that bureaucracy and whether they recommend using the services of professional to navigate the system.
"Yes, IF they know what they’re doing!" said one anonymous resident.
"I will be paying much more starting in 2024 but it will be worth it for greater peace of mind. Taxes are so complicated here but add in a US citizen and it is truly a nightmare."
Almost all those who responded agreed that it was necessary to seek professional help in at least one, if not both countries.
READ ALSO: Reader question: Do US nationals in Italy have to pay taxes twice?
"US taxes have become a nightmare. We do our personal Italian taxes ourselves," said a reader in Florence; while Eija Trees in Collepasso advises: "Hire tax professionals in both countries, your life will be much easier."
It's particularly worth getting outside input if your situation is in any way complicated, say readers.
Scott in Milan uses the services of a tax professional "as I am an independent worker and have additional complexity from this."
"Get professional tax advice for your specific situation. Know that double taxation is real, despite the existence of tax treaties," said one anonymous reader who says they pay for professional help in order to avoid being audited in Italy.
The average cost of a tax consultant was between €500 and €1,500, readers said, though some paid more than this.
A small number of respondents said they handled the paperwork themselves, but underscored that the decision about whether or not to use an accountant depends on your personal situation, including "if you have property or investments in Italy," as one reader wrote.
READ ALSO: What is an Italian commercialista and do you really need one?
William Searles in Puglia says he fills out his own forms using TurboTax "as our financial situation is simple," but adds that he would seek out professional help "if we had more complex issues."
"Read the bilateral tax treaty as well as the IRS publications on taxation in Italy. Get the help of an accounting firm in advance to understand what records you will need to keep to be prepared to file your taxes in Italy," counsels an anonymous reader in Puglia.
"Do your homework. Find a commercialista with experience with US expats. Plan your transition from US to Italian tax systems," is the advice from US citizen Lee.
"Learn the gotchas before you get surprised," he adds; "You’ll have surprises anyway, but hopefully they won’t be devastating".
Please note that The Local is unable to advise on individual cases. To find out more about the requirements for filing your tax return, seek advice from a qualified professional.
For more information on Italian tax residence, see the Italian Revenue Agency’s website. For more information on IRS provisions available to US nationals living abroad, see the relevant IRS website page.
Do you have a question about living in or travelling to Italy which you’d like to see answered on The Local? Submit it here.
Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.
Please log in here to leave a comment.