@Sitkinyu , as I read your answers to my questions, what I get is that (a) you are US citizen; (b) a Hong Kong based entity is employing you to do some work ; (c) you are performing the work in the USA; (d) you are getting paid by the foreign entity ; (e) Hong Kong is not taxing this income.
Thus the situation you have here is self-employment with (possible ) earnings. Therefore
(1) you file a schedule-C to show the income in US$ ( converted using US$ of the day or averages published by treasury or other reputable source ), declare any allowable ( generally meaning ncessary and customary ) expenses associated with earning stream,
(2) you will end up paying Federal, State ( if your State taxes personal income ) and SECA ( at 15.3% for Social Security and Medicare taxes for the self-employed -- on about 92% of the net income. TurboTax will do all the required work and fill out the forms,
(3) in order to be compliant with Pay as you Earn principle, you should be making ESTIMATED federal and state tax payments quarterly.
You do not have to send in any paperwork to prove your earnings from abroad, but must keep bank records / wire transfers etc. in case you get audited. Your income, while foreign sourced, does not require you to claim any special handling because it is not being taxed by the foreign taxing authority. Please also note that if the amounts paid to you rest in any foreign bank accounts owned/operated by you, you may come under the FBAR ( FINCEN 114 ) and/or FATCA ( IRS form 8938 ) reporting requirements.
Hope this has answered your query.
