So, does this mean you don't have to pay any taxes at all for 2 years? Well, not technically, you still have to pay taxes in your home country. If you're from America though, EFL teachers don't make over the $92,900 USD (2011 figure) foreign income exclusion threshold. See this blog for more information http://www.waygook.org/index.php?topic=1237.0 . So, we basically end up not paying taxes in America or Korea for 2 years. Pretty great, huh?
If you are an American and you want to be tax exempt in Korea, you must fill out IRS form 8802 in order to get your US residency certificate (form 6166).
Although form 6166 is called a form, it's really just the paper you need to submit to your school in order to show your residency certificate and get tax exempt. While filling it out, there's a chance you might not get this form before you leave for Korea. In that case, on the form appoint your mom or dad or someone else you trust as an "appointee" and have them then send it to you to your Korean address before your first paycheck. You can find the form here http://www.irs.gov/Individuals/International-Taxpayers/Form-8802,-Application-for-United-States-Residency-Certification---Additional-Certification-Requests
One last note, yes this form does cost $85. But, I promise this amount will be less than the amount of Korean taxes you would have to pay over a year. So it is worth it :) You can find some instructions on how to fill out the form and another great blog with helpful information here http://shimmeringseoul.tumblr.com/post/51513138833/how-to-fill-out-irs-form-8802-us-residency .