European Stars And Stripes (Newspaper) - April 12, 1987, Darmstadt, Hesse                                Pegs 2 the stars and stripes sunday.aprll12.19s7 tax irs wants you  Bureau if you Cam Money overseas and Aren t paying taxes the internal Revenue service would mite 10 Nave a word with  civilians worldwide who do not file lax re turns Cost the government 12.3 billion a year said Dan Nimelton assistant representative m the irs office in Bonn. And an irs crackdown on that Urc ported income might land Many american civilians and retired in the european military Community in hot  s happening to people is they re saying hey it s foreign sourced earned income i Don t have to file Melton said. The Bottom line for american civilians and Retiree earning Money in Europe is this you must report income to either the United Stales or a foreign government or both said Jerry Shiles an attorney with the 21st support Odomd in  an extreme example an american civilian working for the army and air Force Exchange service who is paid in German Marks must pay both German and american taxes Shiles said. He knew of one Case where an individual making an average wage faced a combined tax rate of 32 percent most . Government employees overseas must meet Normal requirements for reporting income and paying taxes. The issues grow fuzzy Tor americans living abroad who work on a contract basis or work for a company dial contracts with the government shies said. In the first insane when individuals work on a con tract Blithe military considers them self employed. Thai Means the military does not report to the irs exactly what each person ii paid it docs not withhold Federal income tax and it does not withhold social Security for the self employed prion working on a contract the first j80,000 earned overseas from a us. Organiza Tion can be exempt. The result is no . Income Tun on less than $80,000  there s a catch. The irs and the military Don t agree on  lab Orris and who an employee  key is control the irs considers a person an employee if there arc significant controls on his or her work controls include set noun specific responsibilities a pre determined work place or provision of tools and  determined to be employees of the government do not get the $80,000  irs is tooting closely to determine if contract to if in for the military in Europe actually Are employees the troubles of contract workers Don t end there. The German tax office is seeking irs help in locating self employed americans who should be paying Ger Man taxes Shiles  working with universities military credit unions or major corporations with government con tracts in Europe also have possible tax woes. Employees of such businesses do qualify for the$80,000 exemption on foreign sourced earned income but they must report All income and file a form claim ing the exemption. The irs faces a problem finding people who Don t file Mellon said."1 Don t have a specific number but it s wide spread he  taxpayer faces a problem by not filing quickly enough. If alter a year the exemption it unclaimed Al the income is taxable. For example a person who earned $50,000 Latt Yea while working in Germany for a .-b8d electronics firm can avoid paying taxes by filing a form claiming the exemption on foreign sourced earned income. But if the form is not filed try april 15,1988 one year after the filing Daw for 198$ All of the income is taxable at Normal  1987, the exemption drops to $70,000, Many people in this category who receive partial support on military installations claim the status of forces agreement exempts them from German Taxeras Well. But the German tax office has other ideas Shiles  treaty As i read it exempts those people from German taxes on the Assumption that they Are . Taxes he said it has t been aggressively Pur sued because they the germans just got wind of ii both the . And German governments Are stepping up the search for americans living Broad who fall through the crack. And the irs is getting Strong backing from Congress in its Effort. Starting in 1988, there will be a 1500 penalty for not including a social Security number on a passport application. The irs working with the stale department will use the numbered passports to keep Tycko americans uvin abroad who should be filing tax returns Mehon  those unsure where they lit in the complicated tax picture help if available through base or Post Legal  civilians not associated with tie military Community can receive help at the irs office in the . Embassy in Bonn. A hiking mortgage interest Rote to 9.5 percent Washington a the Veter ans administration announced Friday it was raising its maximum interest Rale on federally backed a mortgages a full percentage Point 0 9.5 percent the first increase m this rate in two years. Temperatures the a said that it was making the change to bring its rate More in line with the mortgage Market which has been moving up in recent weeks the change will take effect on monday. In the past three years the a has lowered its mortgage rate is times with the last Cut occurring on Jan. 16, when the rate was reduced to 8.5 percent the lowest level in nine years a rates hit an All Lime High of 17.5 percent in septem Ber 1981. A Home loan experts said the 9.5percent rate was Stilt Low enough that it should not Dampen demand for new Loans and Home refinancing. Officials said that in the past six months de Mand for a backed mortgages has been averaging about 40,000 � month. The a said it was also increasing other loan Rales by one percentage Point. This includes a new rate of 10 percent for graduated payment Mort gages and 11 percent for Home improvement Loans. The rates apply to new Loans no existing ones. The last time the a in creased its mortgage rate was on march25,1985, when it raised the rate by one half percentage Point to 13 percent. France s finance chief Calls plunge of Dollar quite normal1 fluctuation Washington up French finance minister edouard Balladur de scribed Friday the fall of the Dollar to re Cord lows As a Normal fluctuation and denied that the United slates tacitly welcomed the decline to curb its Trade deficit. The French official also unveiled at breakfast news conference a list of proposals to help the world s poorest nation scope with crippling debt problems Balladur representing France at meeting of finance ministers from the world s seven major Industrial countries said the few changes Between the yen and the Dollar Over the last 24 hours Wen not surprising or inappropriate. The Dollar opened at 142.50 yen i Tokyo Friday its lowest rate since the end. Of world  new decline came one Day after the seven finance ministers restated a agreement originally announced in Paris feb. 22 by six of the seven countries to stabilize major currencies at roughly their present Levels. The seven nations Are the United tales Japan Britain Germany France Italy and Canada. Italy did not participate in the agreement readied in parts in february we do not live in b fixed Exchange Rale system. It is quite Normal to expect fluctuation such As this Balladur said. Dealers said the Selling pressure was Trig gered by Treasury Secretary James bakes remark thursday that the Dollar s decline has been orderly and improves the prospects for correcting. Us Trade imbalance with Japan and Germany. Balladur reacted firmly against the interpretation of Baker s remarks As a re Flection of the United slates happiness with the Dollar s poor performance. "1 do not at at believe that the Ameri can authorities want a weaker Dollar now or in the future he said. The French official also said there Wasno contradiction Between the Treasury Secretary s position and that if Federal Reserve Board chairman Paul voter who warned against the decline of to Dollar. Balladur said the two americans were on the same  he said the second focus of the talk Between the group of seven ministers was the plight of third world nation sinking deeper into debt under the weight of a flowed world Economy. He said France deeply involved i efforts to Aid the faltering co nordics of several countries in sub saharan Africa proposed three Basic Ste just the  of debt repayment periods by five to 10years, an improvement in the International monetary fund s ability to compensate for Export earning losses from the decline in the prices of Basic commodities and a new mechanism to partially refinance rescheduled debt on easier terms. Anti-. Bomb plot reported foiled. . Ankara Turkey apr a newspaper Friday said police foiled a plot by terrorists belonging to tote islamic jihad organization Patuck . Targets in Turkey. A High level intelligence official in Ankara confirmed the report and said arrests were made in the Case. The official insist Don anonymity and refused to give details. The Istanbul newspaper Mill icel said police acting on a tip caught a turkish Citi zen of lebanese origin with 200 pounds of plastic explosives in the Southeastern Mediterranean con ill town of  newspaper said police slaked out the House of the Man identified As Hidi Filiz. When a lebanese citizen identified As Huseyin Mohammed cent in contacted Filiti both men were arrested. Mill yet said cent in told police hews a member of the moslem extremist organization islamic jihad and was sup posed to take the explosives to Istanbul where he would my accomplices arriving from abroad. The group later planned to . And israeli diplomats in Ankara and. _ be Jung near Kro 44ijv j�l4eii i Jiu Nilal in rttlll4m14izmir, Mill yet quoted com tiny As Tel police. The . Air base in in Firtik i Adana also was a target the paper said we Don t have anything to add to the report tech sgt. Jim Hunt spokesman at in Trlik a told the stars and stripes Friday it reported cent in As saying the group planned to Swap hostages for 200islamic jihad militants Hula in israeli  took com tiny id Istanbul and after waiting for two weeks arrested a iranian who showed up for he meeting the newspaper said. It identified the Ira Nian As it Var of Kermit Ayubi