The following information was provided by the US Embassy in Panama.? It was a follow up to a few questions that were left unanswered after the town hall meeting on November 2nd, when any and all US Citizens living in Panama were invited to the ambassador?s residence for a question and answer session.? We are republishing it as a service to our American clients either residing in Panama or thinking about moving to Panama.
1. Income Taxes and FATCA
??is there anyone in the Embassy to help Americans here
with their income tax questions??The IRS resource for questions can be found at the
following website?http://panama.usembassy.gov/irs/income_tax.html?and the PDF
located at?http://www.irs.gov/pub/irs-pdf/p4732.pdf?.
The Embassy is working to plan a Town Hall meeting in March 2013 with the IRS to
discuss issues and answer questions.
Would it be possible for Citizens to take their income tax envelopes to the Embassy to
mail instead of having to pay for mailing them??Current regulations do not permit the
use of Embassy mail services for this purpose.
We have to pay taxes here in Panama as well as paying them in the US if we have a job
here. If we are not living there, why do we have to pay income tax in the US??All US
citizens are required to pay income taxes in the US for income earned anywhere in the
world. However, you are allowed to use your income or taxes paid here as credits
against your US income or taxes. There is also a Foreign Income Exclusion that can be
used to assist with your income tax payments.
More information on these issues can be found at the following websites:
http://www.irs.gov/publications/p54/ch05.html#en_US_2011_publink100047580
http://www.irs.gov/publications/p54/ch04.html
It appears that FATCA is having a negative impact on our ability to do banking here in
Panama. Banks are unwilling to open accounts for those of us who don?t have a lot of
money. What are we supposed to do??At the current time, FATCA regulations have not
been completed and they are not implemented in Panama. Once we have more precise
knowledge of the implementation here and its impact on US Citizens, we will share that
information with you.
They say it will be fully implemented on June 30, 2013 ? is that true??The FATCA
implementation date has not yet been announced.
2.
How is the Free Trade Agreement (TLC) going to impact Americans here in Panama?
Right now when I order medicines from the US, the duty on the medicines is twice the
cost of the medicines. Is the TLC going to give us any breaks in this regard? Will it
help with any other issues?
In general, the TLC may make a number of US goods easier to find in Panama than they
are today. Whether the prices of these items and others will drop along with the drop
in tariffs is a question that will have to be answered by the merchants selling the goods
here in Panama.
The great majority of medicines should already be entering Panama without paying any
customs duty, since Panama has a general policy of not putting tariffs on medication.
The TPA does lock in the duty free treatment for medicines made in the U.S., which
means that the duties must stay at zero for those products. Moreover, Panama also
exempts some medications from their VAT tax too (the ITBMS or 7% sales tax).
In the case where tariffs are being charged, it is possible that the medicines are being incorrectly
classified as a product for which there is a duty. If they are being brought in through Mailboxes
etc, FedEx, or DHL, or others, you should work with them to figure out why they are being
charged the tax, and what they can do about it getting it removed. The provider of the
prescription drugs may also need to be contacted so that they are shipping them in accordance
with the Panamanian laws with respect to tariffs.
3. Visa and Passport Interviews
??there is a lot of talk that DHS has taken over the
interview process for visas and passports ? is it true?
No, the State Department conducts all interviews and is responsible for the issuance of
Visas of all types.
4. Driver?s License for Panama
??Panama allows you to drive here for 90 days after
you arrive without getting a Panamanian driver?s license ? can?t the Embassy do
something that would allow US Citizens to drive for 180 days which matches up to the
tourist visa you have to have to be here??Each country and even each state in the US
makes their own rules relative to obtaining a driver?s license.
It seems outrageous to have to pay $50 to have the Embassy prepare an affidavit to
identify our US driver?s licenses as current so that we can apply for a Panamanian
driver?s license. Why can?t we allow access directly into our driver?s license database
in the US to verify the validity of the licenses??As you that have licenses are aware,
the process to obtain a license only starts at the Embassy, and what the embassy is
doing is notarizing that the copy of your US license is a true and valid copy and that the
license is valid at this time. The rest of the process is what is required by Panama to
obtain the license.
Each state in the US has its own rules and database for driver?s license. States do not
allow foreign government access to their license databases. There is no single database
that we are aware of in Spanish that includes all of the information to determine validity
for all 50 states and US territories.
5.
Why is it that there are non-English speaking guards to help American citizens at their
own Embassy? We all don?t speak Spanish. How are we supposed to get help if we
need it??This is something the Embassy is currently reviewing. While not all our guards
speak English, there are English-speaking guards stationed inside the entrance to the
Consular Section. We will take steps to make them more identifiable to US Citizens and
others who do not speak Spanish and develop a means for you to access English-
speaking personnel from the gate area if the guards there do not speak English.
6.
We have many disabled vets here in Panama and walking up to the entrance is hard
for us. Can?t we drive up closer??When you make your appointment for ACS services,
you can also request the ability for your taxi driver to drop you off or you to drive your
car to the parking area closer to the entrance to the Consular Section. The taxi driver
would have to exit the grounds and wait for you to call them to return to pick you up.
The process to do this is described at
http://panama.usembassy.gov/parkingsi.html
Any elderly person or person with a physical problem that would make it difficult to walk to the
entrance can apply for this access.
7.
Handicapped driving permits have to be obtained through the Panamanian
government, and not through the Embassy. Why can?t you do this for us?
Handicapped driving permits are a privilege granted by the Panamanian government
through their laws and the process is completely under their control and at their
discretion. We cannot usurp their authority to control the access to their country.
8.
Housing here in Panama is terrible. Everything leaks, even new houses, and
construction is very poor without any effective way to get the landlords or the
builders to make the proper repairs. We often end up paying for the same
construction twice ? once to build it and once to repair the construction. Inspections
from the Panamanian government also don?t help insure the quality. What can the
embassy do to help with this? Why can?t we have a list of competent approved
builders and Contractors from the Embassy so that we don?t waste our money?
The Embassy is not permitted to make recommendations for any types of personal
services within the country.
This might, however, be a good opportunity for an enterprising individual to develop a
business like?Angies List?in the US, which does exactly what you are suggesting.
www.angieslist.com/
9.
It appears like hiring of Americans at the embassy creates a two-tier salary system. If
you are American and living here with your spouse who is working for the embassy
there is one pay scale, and if you are simply an American living here, there is another
pay scale that is much less and on the same scale as Panamanian employees would
receive. Why is that?
US Citizen spouses of Americans who have been assigned to work here in the Embassy
have pretty much given up their careers to be with their spouses and families. If they
were in the US, they would be working at a pay scale similar or higher to that which they
are paid if they work in the Embassy here. If you are a US citizen and you are living and
working here, you are doing so voluntarily and are not here because you have been
assigned here to serve your government. You have chosen to be in this labor market
with these pay scales, and the Embassy pay scales for these roles are competitive with
those found in the local labor market.
10.
What is the embassy doing to take care of American citizens in Panama?
While Americans need to rely on the legal system and local police authorities for
assistance with problems, we are trying to provide security and law enforcement
training for the various law enforcement entities, assisting them in their switch to an
accusatory legal system which should dramatically shorten the length of time cases take
to be resolved, promoting and training for Community policing, working on
strengthening Democratic Institutions, and implementing the Trade Agreement to help
Panama grow their economy while strengthening US Exports.
All of these efforts should augment the ability of local law enforcement to do their jobs
in a more effective manner, make the country safer and secure for Panamanians and
also for Americans, and keep the economy here expanding to continue to make it a
good place for Americans to live.
11.
Are Wills and other legal documents that are created in the US valid for use here in
Panama??In general, US documents need to be Apostilled in the US to be able to be
recognized here in Panama for their proper uses. This would include wills, Powers of
Attorney, and other similar documents. This certifies them for international use here in
Panama. The documents do not need to be Apostilled in both English and Spanish, but
the Apostilled copy in English could have an official translation to Spanish to make it
easier to use here in Panama.
12.
How can we find information on Volunteer work that U.S. citizens can do here?
There is a People-to-People Coordinator in the Embassy that you can contact for
information on the different volunteer work you can perform in Panama. Her contact
information is as follows:
Debra Negron
People to People Coordinator US Embassy Panama Off: 507-317-5268
Organizations such as the American Society and service clubs like the Rotary Club and
the Lions Club should also be good sources of volunteer opportunities.
13.
Sites Maps for Panama? How can we get them?
It was mentioned that you can get these maps in Excedra Books or in Gran Morrison.
One online website with reasonably good waterproof maps is?www.itmb.com?for
International Travel Maps.
There is also access to an ?interactive? map at the Panama Tourism website at:
http://www.visitpanama.com/index.php?option=com_content&view=article&id=207&It
emid=539&lang=es
14.
Veterans Insurance not recognized here. Anything the Embassy can do about it?
If you are referring to Tricare, Hospital Nacional has an International desk that can
provide you with the list of doctors that accepts Tricare depending on the option you
have, which could be Tricare Standard Overseas or Tricare for Life.
If you are a veteran and have the Foreign Medical Program (FMP) and have the letter
from the FMP indicating their accepted conditions, the personnel from Hospital
Nacional can also provide you with the list of doctors to provide services.
We have also learned that there are several pharmacies that fall under the Healthcare
Alliance that will assist Tricare and VA beneficiaries in obtaining their medications. We
contacted them to find out what services they offer and were told me that they obtain
the proper medications and will even deliver them to the client?s home if necessary.
More information can be found at?http://www.healthalliance.com.pa/?.
15.
Our children?s nannies are having difficulties obtaining Tourist Visas to accompany
our families to the US for visits ? what do we need to do to help them qualify for the
Visas so that they may go with us?
Many nannies do not have sufficient income or ties to Panama to qualify for a tourist
visa on their own, but if they are going to the US as your employee on a trip for a
specific period of time and for a specific purpose, they may qualify. The nannies need to
have worked for you for at least a year, have experience doing that kind of work with
you or others and you have to have Work Contracts for them that they can present at
the interview, in English and in Spanish.
The requirements for the visa and those contracts can be found at the following web
site:?http://ustraveldocs.com/pa/pa-niv-typedomesticemployee.asp?.
Please note that while they are in the US, they must be paid at the standard wage for
their type of work in that area of the country, not the wage that you are paying them in
Panama. In the end, they need to convince the interviewing officer that they will be
returning to Panama with your family after their short visit to the US. They will also be
required to read a short pamphlet that describes their rights while in the US and signify
to the officer that they understand the information presented.
16.
Retirees will now be issued a cedula. Before, with the I.D., the retiree needed to
change the Immigration card and pay for the new card every time their passports
were replaced since the ID was in the passport. Will it be the same procedures with
the new cedulas?
The PNM Immigration Office has confirmed that the Pensionado will not need to replace
the cedula when a passport is renewed. The cedula is a permanent document, with a
specified expiration date.
The cedula is only given to a Pensionado with Permanent residence or to those
Pensionados that have completed all paperwork for Permanent Pensionado status in
Panama. Those Pensionados with permanent status are welcome to visit the PNM
Immigration Office to request the note that needs to be taken to the ?Cedulacion? Unit
at the Panamanian Civil Registry for issuance of the cedula
?
About the Author
Kent Davis, founder and head broker at Panama Equity real estate, has been widely quoted in publications such as Time Magazine, Capital Financiero, and The Panama Guide for his unabashed views on the Panama real estate market. Panama Equity is regarded as one of the most active real estate agencies in Panama and Kent?s articles, reports, and market research projects have been syndicated by press agencies including Bloomberg and the Associated Press. ? Connect with the Author via: Email | LinkedIn | Facebook | Google+
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