Jenny Hunnicutt, a Florida-based writer and consultant, embarked on a 274-night cruise aboard Royal Caribbean’s Serenade of the Seas. Her journey quickly went viral on TikTok, showcasing a unique opportunity for remote workers in a post-pandemic world. With an increasing number of people opting for a remote lifestyle, working from a cruise ship has become a popular choice for individuals like Hunnicutt and her husband.
Despite the Bahamas flag flying atop the ship, American cruise passengers earning money while working from the ship are still subject to U.S. federal income taxes. As U.S. citizens or permanent residents, individuals incur taxes on “worldwide income,” regardless of where the money is earned. This means that even when working from international waters, Americans must file taxes in accordance with U.S. tax laws.
While working from a cruise ship may not pose significant tax issues for Americans, working from another country could trigger complex tax implications. Working abroad as a U.S. citizen or permanent resident may result in dual tax liabilities, requiring individuals to pay taxes in both the U.S. and the host country. Consulting with a cross-border tax professional before embarking on such remote work is advisable to avoid potential tax complications.
For self-employed individuals working remotely from a cruise ship, income may come in various forms. Joe Martucci, a certified public accountant and retired passenger on the ship, provided tax advice to influencers monetizing their content while onboard. He highlighted the tax implications of receiving gifts or prizes, such as casino winnings, which are considered taxable income and must be reported to the IRS.
It is crucial for individuals working remotely from cruise ships to be aware of the tax requirements associated with their income. Casino prizes, gifts received in exchange for promotional content, and other forms of income earned while onboard are all subject to federal income taxes. While some expats may qualify for certain tax exclusions, cruise passengers are less likely to meet the criteria for such exemptions, making it essential to report all sources of income accurately.
Working remotely from a cruise ship presents a unique opportunity for individuals seeking a change of scenery while continuing to earn income. However, it is important to understand the tax implications of such arrangements and comply with U.S. tax laws to avoid potential issues. Consulting with tax professionals and accurately reporting all sources of income is essential for individuals working from international waters to ensure compliance with tax regulations.