I am hoping someone that has been an EXPAT in Germany can help verify I am properly understanding the tax burdens of being employed by a German company, being paid in Euros, living in Germany. I have the possibility of employment and trying to be properly informed.

A little background I have worked overseas before. I am familiar with the rules with Foreign Income Exclusion and the 330 day out of usa/35 day in usa rules. But due to the work, I will likely exceed the 35-day rule within the USA in a tax year so this reduces the benefit of claim the physical presence exemption.

German Taxes
Income 42% for 54k to 254k EUR
Solidarity surcharge tax 5.5%

American Tax rate
Income 24-32%
SS/Medicare 8%

Since I will not be exempt from German taxes and I can't meet the TESA requirements. I believe the using Foreign Tax credit would be my best bet since the German tax rate is much higher than the USA. Regarding SS or solidarity tax I believe you have to pay into one countries system but not both.

Anyone more familiar with this subject care to provide insights?

Sunday bump.

If no input I'll let the question die.

I lived in Germany for a couple of years for a US company. The taxes and tax laws are confusing. The company paid KPMG to do my taxes. They would give me a small book each year about 1/2" thick. Glad I didn't have to do it on my own. I think you should hire someone with USA and German tax experience.

Good luck.

I would be hiring Taxes out. But for salary negotiation I was trying to be better informed of what the additional tax burden is for being in Germany-Usa tax situation. The 42% federal tax really makes what would be a great salary in the states to a so-so salary due to the tax differences. And currently the Euro to USD conversation is roughly a 12-14% pay increase.

So my experience is food at stores not restaurants is cheaper and everything else is more expensive. My job gave me about 50% extra pay over USA wages and leased me a 5 series BMW. They even subsidized my rent and paid utilities. So I was very lucky. Back then 2000, gas was $5 a gallon, mostly taxes. With extra pay all the things they thru in it was very good financially.

My email address is in my profile in case you want to ask any other questions.