gunmajet.net

Overdue post on everybody's favorite. Apologies for starting a second topic but I thought it'd be more clear. JenniferCParkLatinoKorean's info has you mostly covered anyway. My personal recommendations:

Read the instructions, either the official ones that come with the forms (links below) or other peoples' from the web.
I am not a tax advisor or anything like it and never have been. None of this is official, or authoratative. I take no responsibility for any of this. I'm a JET. I do my taxes. That is all.
Good news: Americans don't owe jack on JET (to the IRS). Bad news: you'll have to jump through hoops for it. (Due to tax treaties, you don't have to pay U.S. federal income tax because you pay income tax in Japan. But your BoE pays it for you here. Bam.)
Federal [www.irs.gov] and state income taxes are not the same. You probably won't owe any federal income tax on your income in Japan, but you may owe state tax, e.g. if you are a Californian [www.ftb.ca.gov].
Do yourself a favor and set yourself a deadline of March 31 to get this stuff done. If you mail your forms, it takes a week or so to get there. Even if not, if you hit a question you can't answer, and try to call the IRS in April, you'll enjoy paying trans-Pacific rates to hold for large fractions of an hour.
Q: Wait a minute, do I file now, or later? A: Pay now, file later. There's 1. paying money, and 2. filing paperwork. The money is due April 15th. For everybody. The paperwork is due June 15th; _unless_ you file for an extension (form 4868), which you definitely want to do if you're a 1st-yr. This is because you don't want to file paperwork until after you've been out of the U.S. for more than 330 days.
Q: Wait a minute, how do I know how much money I owe if I don't do the paperwork until after I have to pay?! A: Ah, now you see the elegance of doing U.S. taxes. So, fill out the forms now, and pay now, then, if you're a 1st-yr, hold onto(i.e. don't lose or forget about) the forms until summer.
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As Jen said, this pub is your best friend; it has all the info you need for federal (esp. section 1 and the FAQ at the back):
http://www.irs.gov/publications/p54/index.html
Just read it.

Paperwork. Forms you need:
1040 [ http://www.irs.gov/pub/irs-pdf/f1040.pdf ],
2555-EZ [ http://www.irs.gov/pub/irs-pdf/f2555ez.pdf ],
4868(for 1st-yrs; file this one now) [ http://www.irs.gov/pub/irs-pdf/f4868.pdf ]

Instructions for each form:
1040 [ http://www.irs.gov/pub/irs-pdf/i1040.pdf ]
2555EZ [ http://www.irs.gov/pub/irs-pdf/i2555ez.pdf ]

Another good walkthrough on the federal forms (altho from a couple years ago):
http://www.sarcenet.org/taxes/

Treasury Reporting Rates Of Exchange - Annual Average Rates
You must express the amounts you report on your U.S. tax return in U.S. dollars.
To read more about exchange rates on the IRS' web site, please go here. The IRS will not post an exchange rate schedule on its web site. Instead, you may use the US Treasury rate from Financial Management Service (FMS) [http://fms.treas.gov/intn.html#rates] or exchange rates listed on the Federal Reserve website [http://www.federalreserve.gov/releases/g5a/current/].

Federal Reserve Average $/Yen Exchange Rates (2004-2007)
Japan 2007: 117.76 , 2006: 116.31 , 2005: 110.11 , 2004: 108.15

I won't walk through the forms here; please see the instructions linked to above. And read the forms themselves; they walk you through. Basically, your JET salary (in US$) gets added into line 7 on the 1040. Even 2555-EZ is more complicated than it needs to be; it checks a bunch of things; but basically, you pass. A couple useful points that may trip people up, tho:

You are not a bona fide resident. You will use the Physical Presence Test. (Test 2, check "Yes")
Tax Home: your tax home is where your paychecks are cut, probably your BOE. (So line 3 is "Yes")
I left line 7 blank.
9c I wrote Public High School.
11a is basically your jobs and when you started.
12c and 12d are probably zero.
The directions on line 18 (the last line) are basically the important ones.

Addresses: my idea is try writing your address like: Maebashi-city, Gunma-prefecture, Japan, 371-0001. Apartment names are hard to fit in the form, and probably depends on what your apartment name looks like.

Filing address for those of us living abroad:
Department of the Treasury
Internal Revenue Service Center
Austin, TX 73301-0215

Telephone Assistance for Individuals:
Toll-Free, 1-800-829-1040
Hours of Operation: Monday – Friday, 7:00 a.m. – 10:00 p.m. your local time (Alaska & Hawaii follow Pacific Time).

The U.S. Embassy's website on taxes:
http://japan.usembassy.gov/e/acs/tacs-7126b.html
The IRS has an answer for everything.
http://www.irs.gov/businesses/page/0,,id%3D6984,00.html#AssD

BUT,
and there's a big "but" this year:
2008 Stimulus package with rebates:
http://tax.cchgroup.com/legislation/2008-stimulus-package.pdf

This is of particular interest to 1st-yrs because you may have U.S. income. I called the IRS last week, and they said they just got an answer back on the question of excluded foreign earned income, and it probably won't help qualify you for the rebate.
But, depending on your particular incomes and deductions, it may actually be more advantageous for some 1st-yrs to not take the Foreign Earned Income Exclusion, (2555EZ) and then take the rebate, if the tax you then owe comes to less than the $300 rebate. (since the rebate is _refundable_) (But who knows, the news might change on excluded (2555) income, or they may decide even unexcluded foreign income may not count.) Again, I am not a tax advisor.

CALIFORNIA

Officially, in California, you are considered a resident if you have most of your ties/life/stuff (and/or intention to return) there. And you owe taxes on all your income.

The FTB on Residency: [ http://www.ftb.ca.gov/forms/07_forms/07_1031.pdf ] They make it complicated.

However, there is a so-called "Safe Harbor" provision for overseas workers: if you are overseas for more than about 18 months, your foreign income can be exempted. So if you are not a 1st-yr, you can choose. If you want to be able to say that you were a tax-paying resident (mainly for those wanting to get in-state tuition at UC when you return home), then pay up; if you want to be exempt, and pay no taxes, then you can invoke the "Safe Harbor" provision. (Even for resident tuition, it's not simple; each school/campus is different, and each case is decided separately. So see the financial aid website for the school you want to apply to.)

Complicated cr*p (official terms): you are "domiciled" in California; most of you are a "resident" of California; you are "currently residing" overseas; you are probably "physically present" outside of the U.S. now. Confused?

Forms you need:
540 [ http://www.ftb.ca.gov/forms/07_forms/07_540.pdf ],
540CA [ http://www.ftb.ca.gov/forms/07_forms/07_540ca.pdf ]

Instructions for them:
540 [ http://www.ftb.ca.gov/forms/07_forms/07_540a_540ins.pdf ]

The 540 works a lot like the federal 1040. But if you're paying tax on your JET income, instead of subtracting it, you'll have to add it back on form 540CA on line 21f and so on 540 line 16. (You have to fill out very little of 540CA.) These are probably the only special lines you need to worry about on your California forms.

I recomend paying online from your bank account at the FTB's website ( www.ftb.ca.gov )
You'll have to set up a CSN (like a PIN) by giving your SSN and last year's California income. (If this is your first time filiing, it's probably zero.) It's free and easy, and you can check your balance online. You can pay by credit card, but they charge you a fee.

The mailing address (for forms) for overseas filers is:

Franchise Tax Board
PO Box 942840
Sacto, CA 94240-0002

Sheeeto, man, I coulda watched a whole movie by now....
Have fun, (and let me know if there are mistakes; I'll correct them)
Kurtis
Maebashi