This sounds deeply wrong, unless Austria has an odd arrangement with the USA. It is not like this in Japan or Australia. In many countries, taxes are automatically deducted and it would be impractical if not impossible to give the USA first cut. Also, if you get residency in a state with no income tax and form a corporation in the USA you can pay yourself below the foreign earned income exclusion and for most practical purposes owe the USA nothing. I would get a second opinion from a different tax specialist.