Paid by an American company but working from France: where should I pay taxes?

Question

Here's the situation: I'm French and I was legally employed by a US company but working remotely from France until Dec 30th, 2012. I arrived in the US on Dec 30.

I was on the company's payroll for this whole period, and had taxes withheld based on a non-resident status (no deduction allowed).

So I now need to file my taxes. The problem is, I don't understand why I should even pay taxes in the US. Even though I was working for an American company on US business stuff (nothing related to France whatsoever), my fiscal domicile was in France, so I should only pay taxes in France, right?

So, in my tax return, can I say that I had no US revenue at all during this whole year?

Thanks!

Answer 1

There's nothing wrong with your reasoning except that you expect the tax laws to make perfect sense. More often than not they don't.

I suggest getting in touch with a professional tax preparer (preferably with a CPA or EA designation), who will be able to understand the issue, including the relevant portions of the French-US tax treaty, and explain it to you.

You will probably also need to do some reporting in France, so get a professional advice from a French tax professional as well.

So, in my tax return, can I say that I had no US revenue at all during this whole year?

I doubt it.