wages

3 replies
46 views

I work on a Disney Cruise ship. I am based out of Florida but the ship is flaged out of the Bahamas. Is my salary from a foreign country then? I pay federal withholding but no fica or medicare.

MaryK4

Alumni - Intuit

Because the ship is considered Bahamas it is foreign income which is why no FICA is taken out. However, as a U.S. resident you are required to report and pay tax on all income so the withholding is used taken to pay taxes.

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mwbeach81Author

Level 2

Thanks, so I mark it as foreign income on my taxes even though I paid US income tax on it?

Carl

Level 11

There is a difference between "foreign income" and "foreign earned". Income paid to you by Disney, a U.S. registered corporation, is U.S. income.

If your income is reported on a W-2, then you enter the W-2 exactly as printed.

Now, the income may be "foreign earned", but it's not foreign income if paid in US dollars and reported on a W-2.

Being foreign earned "may" help on the tax front. I would highly suggest you contact a local tax professional such as a CPA to get clarification. It can get complicated because money earned while in U.S. waters is generally not considered foreign earned.

But then, I'm no expert on this. I most certainly wouldn't go on the word of anyone in this public user forum though, regardless of what expertise they may claim. If you want a taste of just how complicated this can be, check out the article at https://lifeofiris.com/2022/02/27/do-cruise-ship-crew-pay-taxes/