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TNSTUD
June 14th, 2009, 08:53 PM
Does the crew members on cruise ships not registered in the US pay any income tax and is so to whom?

PennyAgain
June 14th, 2009, 08:59 PM
Cruise ship employees are paid while the ship is at sea and pay no US taxes. Of course they get no Social Security or Medicare when that time comes.

Crew, officers, cooks, dancers and even the doc gets paid at sea.

paul929207
June 14th, 2009, 09:10 PM
Does the crew members on cruise ships not registered in the US pay any income tax and is so to whom?
Assuming they are not US citizens, they owe no tax to the US. Whether they pay to their home country would depend on its laws.

TNSTUD
June 14th, 2009, 09:16 PM
Assuming they are not US citizens, they owe no tax to the US. Whether they pay to their home country would depend on its laws.
Even if they were US citizens how could they owe US taxes when they are working not in the US?

paul929207
June 14th, 2009, 09:45 PM
Even if they were US citizens how could they owe US taxes when they are working not in the US?
It does not matter where the income is earned, if you are a US citizen, you owe taxes on the income. Nw, there may be no way for the government to find out about the income, but legally, it is taxable.

cb at sea
June 14th, 2009, 09:49 PM
Why is it important to know that? They are not US citizens, and don't pay taxes to the United States--the ship isn't registered to the US, either....they don't pay taxes and are not bound by our laws.

mikedw
June 14th, 2009, 09:49 PM
I was reading a story about that awhile back. There are US citizens who have lived overseas for decades and they have to pay Federal Taxes, plus the taxes in the country they live in now.

mtwingcpa
June 14th, 2009, 10:19 PM
Even if they were US citizens how could they owe US taxes when they are working not in the US?

US citizens are required to pay US income taxes on their worldwide income regardless of where they live. (Most other countries with an income tax are not so grabby.) That said, they are probably entitled to claim a "foreign tax credit" for income taxes paid to other countries (thereby minimizing double taxation) and they MIGHT be entitled to claim a "foreign earned income exclusion" with respect to a certain amount of job earnings in foreign countries (although I am not sure whether working on a foreign flagged cruise ship would qualify for that).

G'ma
June 14th, 2009, 10:53 PM
Does the crew members on cruise ships not registered in the US pay any income tax and is so to whom?

Nope. Cruise ships are not registered in the U.S. and are therefore exempt from U.S. taxes and all Labor laws, including minimum wage, and other laws of the U.S. They are, however, subject to the laws and tax codes of the country in which they are registered.

I don't think Liberia, Panama, Bahamas and others care much.....

smeyer418
June 15th, 2009, 12:15 AM
Nope. Cruise ships are not registered in the U.S. and are therefore exempt from U.S. taxes and all Labor laws, including minimum wage, and other laws of the U.S. They are, however, subject to the laws and tax codes of the country in which they are registered.

I don't think Liberia, Panama, Bahamas and others care much.....


Its true Cruise lines don't pay taxes on ships registered outside the US but US companies do pay taxes on all income earned anywhere unless there is an exclusion or they pay taxes elsewhere. They do pay registration fees there. Also foreign flagged cruise ships are not exempt from all US laws for instance the US disability law DOES apply to ships that call on the US and must obey coast guards rules and health laws. Don't believe me....its in this case against NCL....

http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=000&invol=03-1388

oh and the cruise lines have to pay taxes on the income they earn on Casino's when in Alaska waters....

paul929207
June 15th, 2009, 07:19 AM
The employees on cruise ships are not liable for US income taxes unless they are citizens of the US.

Passengers, who are US citizens, owe taxes on winning from things like bingo and the casino.

patseacruiser
June 15th, 2009, 07:36 AM
i did have a conversation with one of the australian dealers and they are supposed to claim their income when they come home or something but now that tips are on your s&s card in a lot of cases, it's a record of what they are earning.

BruceMuzz
June 15th, 2009, 07:36 AM
Don't forget that any non-US Citizen who holds a US Green Card must pay US Income Taxes on money he earns anywhere on Earth. Most ship's crew do NOT want a US Green Card.

US Citizens who live permanently outside the USA are not taxed on their first $85,000 or so of income - regardless of where it is paid. But they must still file a US Tax Return every year.

Shorex
June 15th, 2009, 12:00 PM
If this topic is interesting to you, and you have NOTHING else to do today, here is some extra credit reading:

Individual Foreign Earned Income/Foreign Tax Credit - IRS Statistics (http://www.irs.gov/taxstats/indtaxstats/article/0,,id=96621,00.html)

Tax Topic 856 - Foreign Tax Credit (http://www.irs.gov/taxtopics/tc856.html)

Foreign Tax Credit - Choosing to take Credit or Deduction (http://www.irs.gov/businesses/small/international/article/0,,id=97037,00.html)

There will be a pop quiz on Monday. ;)

paul929207
June 15th, 2009, 12:13 PM
If this topic is interesting to you, and you have NOTHING else to do today, here is some extra credit reading:

Individual Foreign Earned Income/Foreign Tax Credit - IRS Statistics (http://www.irs.gov/taxstats/indtaxstats/article/0,,id=96621,00.html)

Tax Topic 856 - Foreign Tax Credit (http://www.irs.gov/taxtopics/tc856.html)

Foreign Tax Credit - Choosing to take Credit or Deduction (http://www.irs.gov/businesses/small/international/article/0,,id=97037,00.html)

There will be a pop quiz on Monday. ;)
At least I have a week to study (or come up with an excuse to stay home sick). :)

PennyAgain
June 15th, 2009, 01:25 PM
I'm calling in sick ahead of time. No tax test for me!

Snowbuddy
June 15th, 2009, 02:19 PM
I think I am having a bad dream...I come to this site to read up on cruise stuff, give myself a little bit more to think about & look forward to for our next cruise, and to have a brief respite from work (I am a CPA)...and, POW, income taxes comes up! :eek: eek! somebody please wake me!

:D

Aquahound
June 15th, 2009, 05:55 PM
Passengers, who are US citizens, owe taxes on winning from things like bingo and the casino.

Are you sure about that?

It is my understanding that cruise ship winnings under $10,000 are not taxable.

paul929207
June 15th, 2009, 06:12 PM
It is my understanding that there is no difference between a cruise ship casino & a vegas casino, except for the fact that you get a 1099 from Vegas, but not from a ship. However, I could be mistaken. I have not had the problem trying to decide how much of my winnings to report.

smeyer418
June 15th, 2009, 06:18 PM
Are you sure about that?

It is my understanding that cruise ship winnings under $10,000 are not taxable.
nope that is wrong. All winnings are taxable. The issue is whether the cruise line reports them or not. But tax advice on here is about as accurate as medical advice.....

Aquahound
June 15th, 2009, 06:28 PM
nope that is wrong. All winnings are taxable. The issue is whether the cruise line reports them or not. But tax advice on here is about as accurate as medical advice.....

Things must have changed in the last few years. In 2004, my brother-in-law won the jackpot bingo for $6500. According to the purser, he was not obligated to report it because it was won at sea. He paid no taxes on it.

I'll check with some CBP buddies of mine and get back.

Aquahound
June 15th, 2009, 06:35 PM
Yep, I was correct. Winnings, or "monetary instruments" of less than $10,000 do not have to be declared.

smeyer418
June 15th, 2009, 06:38 PM
Yep, I was correct. Winnings, or "monetary instruments" of less than $10,000 do not have to be declared.
that is a different issue. yes cash in excess of $10,000 whether won or just carried needs to be declared. All winnings by US citizens or nationals is taxable. Ask the IRS not the CBP its a different rule.

G'ma
June 15th, 2009, 11:05 PM
Its true Cruise lines don't pay taxes on ships registered outside the US but US companies do pay taxes on all income earned anywhere unless there is an exclusion or they pay taxes elsewhere. They do pay registration fees there. Also foreign flagged cruise ships are not exempt from all US laws for instance the US disability law DOES apply to ships that call on the US and must obey coast guards rules and health laws. Don't believe me....its in this case against NCL....

http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=000&invol=03-1388

oh and the cruise lines have to pay taxes on the income they earn on Casino's when in Alaska waters....

The question was about shipboard employees and if they pay U.S. taxes. It was not about U.S. tax laws in general, who pays what to whom and what U.S. laws are enforceable on a cruise ship.

smeyer418
June 15th, 2009, 11:12 PM
The question was about shipboard employees and if they pay U.S. taxes. It was not about U.S. tax laws in general, who pays what to whom and what U.S. laws are enforceable on a cruise ship.
1. you answer the questions you want to I'll answer the questions I want to.
2. You really don't know anything about US tax law.

US national employees(US citizens or permanent residents) are required to report all income where ever earned. There are special exemptions and whether they pay taxes depends on their individual returns.

smeyer418
June 15th, 2009, 11:21 PM
Nope. Cruise ships are not registered in the U.S. and are therefore exempt from U.S. taxes and all Labor laws, including minimum wage, and other laws of the U.S. They are, however, subject to the laws and tax codes of the country in which they are registered.

I don't think Liberia, Panama, Bahamas and others care much.....
note you didn't answer the original posters question either and your answer is wrong. The issue is whether an individual has to pay US taxes(or report the income) US law requires that a US citizen or national has to report ALL income where ever earned. this includes tax free income(because sometimes the alternate minimum tax applies). Taxes are due if the income is above a certain level and depending on the number of dependents and deductions.
Non US nationals working outside the US do not pay US income taxes.

Aquahound
June 16th, 2009, 07:40 AM
that is a different issue. yes cash in excess of $10,000 whether won or just carried needs to be declared. All winnings by US citizens or nationals is taxable. Ask the IRS not the CBP its a different rule.

You are correct....sorry. I was confusing Customs laws with tax laws.

GottaLuvCruising
June 16th, 2009, 08:00 AM
Related to this topic, which is totally unrelated to cruising...but we lived overseas for two years. The first $125K of earnings were excluded from U.S. taxes back then. We paid income taxes in Taiwan (where we lived) and got a credit of that amount on the taxes we did have to pay to the U.S. However, the great state of Maine (greedy ultra-liberal place that it is) taxed us on every penny of earnings while we neither worked nor lived there (because it was our home state of record).

The tax laws are complicated. And what a cruise ship crew member pays or doesn't pay in taxes is really of no concern to me and not the business of any cruise passenger.

Taxguy77
June 16th, 2009, 08:30 AM
I think I am having a bad dream...I come to this site to read up on cruise stuff, give myself a little bit more to think about & look forward to for our next cruise, and to have a brief respite from work (I am a CPA)...and, POW, income taxes comes up! :eek: eek! somebody please wake me!

:D

We cruise to get away from taxes, don't we?:confused::confused:

G'ma
June 16th, 2009, 11:00 AM
1. you answer the questions you want to I'll answer the questions I want to.
2. You really don't know anything about US tax law.

US national employees(US citizens or permanent residents) are required to report all income where ever earned. There are special exemptions and whether they pay taxes depends on their individual returns.

Once again, I am NOT trying to interpret U.S. tax laws...I'm responding to the question.

And, you're wrong...I do know something about tax laws for U.S. citizens working abroad; having done so for many years in several countries.....

The U.S. has tax treaty laws with over 40 countries and U.S. citizens whether residing or working abroad are subject to U.S. taxes. There are certain exemptions under certain circumstances.

But, no matter what, unless the ship is a U.S. flagged ship, the employees of that ship do not pay U.S. taxes unless one is a citizen of the U.S.... That is the answer to the OP question.

G'ma
June 16th, 2009, 11:03 AM
note you didn't answer the original posters question either and your answer is wrong. The issue is whether an individual has to pay US taxes(or report the income) US law requires that a US citizen or national has to report ALL income where ever earned. this includes tax free income(because sometimes the alternate minimum tax applies). Taxes are due if the income is above a certain level and depending on the number of dependents and deductions.
Non US nationals working outside the US do not pay US income taxes.

Well, unlike some, I can read and have a wonderful grasp of the English language. Here, for your consideration, is the One-Liner original question....which I addressed:

"Does the crew members on cruise ships not registered in the US pay any income tax and is so to whom?"

NCTribeFan
June 16th, 2009, 11:34 AM
Even IF some of us are CPAs and have dealt with foreign earned income and taxes, this is NOT the place to request any tax information and certainly not where you should be asking tax questions.

As I tell any client who calls and says "I have a simple tax question..."

There ARE no simple tax questions!

Why are you asking, OP? If you're a US citizen who is interested in working on a cruise ship, you need to consult - IN PERSON - a CPA who can discuss ALL the possible issues. If you aren't, then why are you asking this?

okgirl
June 16th, 2009, 05:02 PM
The employees on cruise ships are not liable for US income taxes unless they are citizens of the US.

Passengers, who are US citizens, owe taxes on winning from things like bingo and the casino.

But only on single jackpot winnings in excess of $1999. Before I could get the machine (or the casino host) to pay out my $2500 and $2000 jackpots I had to fill out a 1099G

Snowbuddy
June 16th, 2009, 05:09 PM
The employees on cruise ships are not liable for US income taxes unless they are citizens of the US.

Passengers, who are US citizens, owe taxes on winning from things like bingo and the casino.

But only on single jackpot winnings in excess of $1999. Before I could get the machine (or the casino host) to pay out my $2500 and $2000 jackpots I had to fill out a 1099G

Not exactly...according to the IRS website:
Gambling winnings are fully taxable and must be reported on your tax return. Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse and dog races and casinos, as well as the fair market value of prizes such as cars, houses, trips or other noncash prizes.
Depending on the type and amount of your winnings, the payer might provide you with a Form W-2G and may have withheld federal income taxes from the payment.
The payer must furnish a Form W-2G to you if you
receive:
1. $600 or more in gambling winnings and the payout is at
least 300 times the amount of the wager (except winnings
from bingo, keno, and slot machines);
2. $1,200 or more in gambling winnings from bingo or slot
machines;
3. $1,500 or more in proceeds (the amount of winnings
less the amount of the wager) from keno; or
4. Any gambling winnings subject to federal income tax
withholding.

paul929207
June 16th, 2009, 05:41 PM
Whether you are given a 1099G or not, all gambling winnings are taxable on US Federal Income Tax returns.

dkjretired
June 16th, 2009, 07:04 PM
Whether you are given a 1099G or not, all gambling winnings are taxable on US Federal Income Tax returns.

Absolutely correct, here is a great article that explains the whole thing....

http://www.cruise-casinos.com/jackpots.htm

okgirl
June 17th, 2009, 08:33 AM
[quote=okgirl;19998539]

Not exactly...according to the IRS website:
Gambling winnings are fully taxable and must be reported on your tax return. Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse and dog races and casinos, as well as the fair market value of prizes such as cars, houses, trips or other noncash prizes.
Depending on the type and amount of your winnings, the payer might provide you with a Form W-2G and may have withheld federal income taxes from the payment.
The payer must furnish a Form W-2G to you if you
receive:
1. $600 or more in gambling winnings and the payout is at
least 300 times the amount of the wager (except winnings
from bingo, keno, and slot machines);
2. $1,200 or more in gambling winnings from bingo or slot
machines;
3. $1,500 or more in proceeds (the amount of winnings
less the amount of the wager) from keno; or
4. Any gambling winnings subject to federal income tax
withholding.

Whether you are given a 1099G or not, all gambling winnings are taxable on US Federal Income Tax returns.

These statements may very well be accurate. It is not how Carnival is addressing the situation. I've had many "single spin" wins of $250 to $1000. The machine pays it out and I've never had to fill out a 1099G or had to show my drivers license to obtain my winnings. In fact the $1000 win was on the $1 wheel of furtune on the big wheel spin and I just uploaded it into my players bank.

The 2 jackpots I won ($2500 on a $1 machine, and $2000 on a .25 machine), both exceeded what the machine would pay out, and per the casino host required that they fill out a 1099G before my winnings were paid to me.

I understand the letter of the law says that a US citizen must pay tax on any earnings regardless of where or how they are earned, but it's not my experience that other governments are reporting that information properly. I've never had to fill out anything for my winnings in landbased casino's in the caribbean.

And I do understand the larger picture here.....It is my responsibility to report it, even if I haven't had to fill out any traceable paperwork......

paul929207
June 17th, 2009, 08:56 AM
No casino in a foriegn country is required to report anything to the IRS. I am not sure how this would affect a cruise ship that sails from a US port. If the IRS does not receive a 1099G, they are unlikely to know of the income (winnings) unless the taxpayer reports it on the tax return.

smeyer418
June 17th, 2009, 01:19 PM
I've seen NCL require an IRS form before it paid out a jackpot of about $10,000....outside the limits but on a cruise that originated in the US on a non US Flagged vessel. What other cruise lines do I can't say. The fact of no 1099 or its equivalent doesn't change whether the income is taxable only if it had been reported although I doubt that many people report unreported income but that is a different issue....