Earning Income from UK company and residing in U.S.?

Question

Over the next few months, I will begin earning income from a U.K. company as an independent sales representative. I live in the U.S. Some of the sales will come from other countries, such as Japan, China, UK, and other EU countries. Am I subject to U.S. tax on all foreign transactions? I have not set up a business and am wondering about my options. Does anyone know where to start? Income potential will be residual income over a 5-10 year span resulting in fairly significant revenue.

Answer 1

A U.S. citizen or resident must report the world wide income from any source.

Read: Read: http://taxipay.blogspot.com/2008/03/us-c...

Answer 2

Assuming this is a legitimate sales job, the work is fully taxable by the IRS as US-source work.  It's also subject to 15.3% self-employment tax.

Setting up a business will not reduce the tax bite.