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Health Insurance & Taxes as US citizen
SHC
Posted: Thursday, July 27, 2017 9:30 PM
Joined: 27/07/2017
Posts: 4


Hi there!

I'm planning to take an STCW course & begin applying for stew jobs in Ft. Lauderdale in late September. I'm coming from a corporate background so have never really had to explore other health insurance options or tax issues as they have always just come with my benefits package. I know that there will be different answers for different situations depending on whether I end up as a freelance for charters or a permanent crew member on a private yacht, but does anybody have some general tips on these two aspects of yacht life?

1. Would you suggest I purchase my own health insurance plan and use any plan that comes w/ a stew position as additional coverage? 

2. As an American citizen, what are the tax issues I should look out for? Any specifics for charter yacht vs. private yacht? I assume you aren't just handed a W2 every year...

3. As an American citizen, should I open up an internaitonal bank account for all income earned on boats outside of US waters? Should I just have everything wired to my US account and accept the taxes that come with it?

 

Any tips appreciated!

Sarah


captcary
Posted: Friday, July 28, 2017 2:08 PM
Joined: 17/07/2008
Posts: 26


Hi Sarah,

The taxes are something you just have to pay.  Even if you end up with foreign accounts you are still required to claim them and with the transparency with banks these days it will get you.  Cash tips are something that many do not claim and can get away with although not legal.  Many of the management offices will take taxes out even if you are on a foreign flag yacht.  You could end up on a US flag and have to pay them yourself or work for a company that pays them like any normal US workplace.  As for insurance it is a bit of a gray area.  Most of the bigger yachts will provide insurance but it is with a company not based in the US so technically it does not fit the profile as the approved insurance.  Even some US flag boats will get this insurance for their boat crew because they travel so much in foreign countries it is a better plan and coverage.  Also many times there can be pretty good gaps between jobs so you should think about your own healthcare policy but that is a choice you will have to make.  Also there is the fine for not having it that you have to pay the IRS.


SHC
Posted: Friday, July 28, 2017 3:21 PM
Joined: 27/07/2017
Posts: 4


Thanks so much for the insight. Sounds like it would be fine to just keep my US based bank account and ensure that my taxes are done by an accountant. And having my own insurance is the safest bet. I've been looking at a decent personal policy through GeoBlue Navigator via Superyacht Insurance Group. Are you familiar with them?
Mox
Posted: Saturday, July 29, 2017 2:44 AM
Joined: 31/08/2008
Posts: 1


Capt Cary is right all around!  Another option that works for some and not others is to form an LLC. Definitely think about it if you are going to stick with the freelancing!
SHC
Posted: Monday, July 31, 2017 2:22 PM
Joined: 27/07/2017
Posts: 4


Cheers, Mox!
Patrick Maflin
Posted: Tuesday, August 1, 2017 8:04 PM
Joined: 16/01/2015
Posts: 3


It seems that all the major points have already been covered in this thread. However I can see that individuals are starting to discuss ways of minimising your taxable income through the formation of LLC's which is a perfectly legal solution. However the fees to manage this type of company formation can be high, if you are unable to do it yourself. You may also want to consider looking to see if you qualify for the Foreign Earned Income Exclusion (FEIE). This allows individuals to write off up to $100,300 against tax per annum.

If you would like more information on this please click on the link below to a recent article we produced:

https://www.marineaccounts.com/news-archive/us-residency-and-foreign-earned-income-exclusion/77

We also have a short FEIE test:

https://marineaccounts.com/feie.php


Markbo
Posted: Friday, August 11, 2017 3:32 PM
Joined: 11/08/2017
Posts: 1


Sarah, I just wanted to mention (in case you were not aware) that the GeoBlue Navigator policy does not satisfy the requirements of ACA. You would still need a regular US health insurance policy to avoid the potential tax penalty.
SHC
Posted: Friday, August 18, 2017 5:31 PM
Joined: 27/07/2017
Posts: 4


Thanks, Markbo. The agent I spoke with did let me know that (after I asked) but she also said that she has always given coverage letters to US crew members and has never heard of them having to pay the fine in the long run...
 
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