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US Taxes
Kateryna Dzhevaga·IRS CAA · Authorized IRS e-file Provider·Federal practice (all 50 states)·EN · RU · UK
For US citizens and Green Card holders abroad

US tax obligations for citizens and Green Card holders living abroad

Living overseas does not end your US tax filing obligation — but it opens powerful tools to eliminate or reduce double taxation: FEIE ($130,200 for 2026), Foreign Tax Credit, treaty benefits. I help US expats stay compliant and minimise tax across both jurisdictions, fully remote across all 50 states and 30+ countries.

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TL;DR

If you're a US citizen or Green Card holder living abroad, you still must file Form 1040 every year and report your worldwide income — but the FEIE excludes up to $130,200 (2026) of foreign earned income, the Foreign Tax Credit eliminates double taxation on foreign taxes paid, and tax treaties further reduce withholding on passive income. June 15 is your automatic filing deadline, with October 15 standard extension and December 15 discretionary. If you haven't filed in years, Streamlined Filing Compliance Procedures provide a path back to compliance with no penalties for non-willful violations. Below: deadlines, forms, country-specific guides, blog deep-dives, and how I can help.
📅 Updated: June 2026

The US filing obligation never goes away

The United States is one of only two countries in the world (the other is Eritrea) that taxes its citizens on worldwide income regardless of where they live. This means: • A US citizen working in Lisbon files Form 1040 every year reporting Portuguese salary, US investment income, and any other worldwide income. • A Green Card holder retiring in Mexico still files Form 1040 reporting US Social Security, IRA distributions, and Mexican rental income — even with no US residence. • A US citizen with a foreign business pays US tax on the business income (potentially subject to GILTI, Subpart F, or PFIC rules depending on structure). • Renunciation of US citizenship or formal expatriation requires filing Form 8854 and may trigger the Exit Tax under IRC §877A — and tax obligations continue for the tax year of expatriation. The good news: the US has built powerful tools to prevent double taxation. The FEIE excludes up to $130,200 of foreign earned income. The Foreign Tax Credit eliminates double tax on foreign taxes paid. Tax treaties further reduce withholding and clarify residency. These tools mean that most US expats end up paying little or no US tax on their foreign earnings — but you still must file the return to claim them.

Key forms for US expats

These are the federal forms you'll likely encounter. Some are automatic (1040); others trigger only above thresholds (FBAR, 8938) or under specific situations (5471, 3520, 8854).

Form 1040

Form 1040 — Federal Income Tax Return

Annual federal return reporting worldwide income. Mandatory for all US citizens and Green Card holders regardless of where they live, as long as gross income exceeds the filing threshold (~$14,600 single for 2024).

Form 2555

Form 2555 — Foreign Earned Income Exclusion

Claims FEIE to exclude up to $130,200 (2026) of foreign earned income from US tax. Requires Bona Fide Residence Test or Physical Presence Test. Also claims Foreign Housing Exclusion / Deduction.

Form 1116

Form 1116 — Foreign Tax Credit

Claims credit for income taxes paid to foreign countries, dollar-for-dollar against US tax liability on the same income. Limit calculated separately for passive income, general income, and other categories.

FinCEN 114

FinCEN 114 — Foreign Bank Account Report (FBAR)

Required if aggregate balance of foreign financial accounts exceeds $10,000 at any point during the year. Filed separately with FinCEN (not IRS) by April 15 with automatic extension to October 15. Penalty for non-filing starts at $16,536 per violation.

Form 8938

Form 8938 — Foreign Account Tax Compliance Act (FATCA)

Filed with Form 1040 if specified foreign assets exceed thresholds ($200,000 end-of-year for single living abroad). Different thresholds than FBAR. Common to file both.

Form 5471

Form 5471 — Foreign Corporation Information

Required if US person owns 10%+ of a foreign corporation. Substantial filing burden. Triggers Subpart F, GILTI, and PFIC analysis. Common for entrepreneurs with foreign businesses.

Form 3520

Form 3520 — Foreign Trust / Gift Reporting

Required for gifts from foreign persons over $100,000, distributions from foreign trusts, certain transfers to foreign trusts. Penalty for non-filing is 5% per month up to 25% of the gift / trust amount.

Form 8854

Form 8854 — Initial and Annual Expatriation Statement

Filed by citizens renouncing US citizenship or long-term residents giving up Green Card. Triggers Exit Tax if Covered Expatriate. Must be filed even if no tax is owed.

Critical 2026 deadlines for US expats

April 15, 2026
Standard Form 1040 deadline + payment due (even with extension to file)
June 15, 2026
Automatic 2-month extension to file for US persons abroad (statement required)
October 15, 2026
Final deadline with Form 4868 + automatic FBAR extension
December 15, 2026
Discretionary additional 2-month extension (request by letter, expats only)

FEIE vs Foreign Tax Credit — the strategic choice

Most US expats can use one or the other (or a combination) to eliminate US tax on foreign-source income. The right tool depends on the foreign country's tax rate, your income level, and whether you have US-source income too.

FEIE — Form 2555

When FEIE wins

• You live in a low-tax or no-tax country (UAE, Costa Rica territorial, Thailand pre-LTR) • Your foreign earned income is below the $130,200 ceiling (2026) • You meet Bona Fide Residence or Physical Presence Test • You don't have significant US-source passive income that needs FTC offsetting FEIE excludes foreign earned income (salary, self-employment, professional fees) from US gross income. It does NOT exclude passive income — interest, dividends, capital gains, rental income still get the FTC path.

FTC — Form 1116

When FTC wins

• You live in a high-tax country (Spain, Portugal under regular regime, France, Germany) • Your income exceeds the FEIE ceiling — FTC has no upper limit • You have foreign passive income — FTC works for all categories, FEIE doesn't • You want to preserve foreign tax credit carryforward to future years (10-year carryforward) • You're claiming the Child Tax Credit (FEIE excluded income doesn't generate refundable CTC; FTC-offset income does) FTC gives a dollar-for-dollar credit for foreign income tax paid, against US tax on the same income.

By country

Each country has its own tax treaty status, banking environment, visa programs, and special tax regimes (NHR for Portugal, Beckham Law for Spain, Non-Dom for Cyprus, etc.). Click any country for a US-tax-focused guide.

Portugal✓ Tax treatySpain✓ Tax treatyCyprus✓ Tax treatyUnited Arab EmiratesMexico✓ Tax treatyThailand✓ Tax treatyGeorgia (country)SerbiaTurkey✓ Tax treatyCosta Rica
If you haven't been filing

Streamlined Filing Compliance Procedures — your way back to compliance

If you've been living abroad and haven't filed US tax returns or FBARs because you didn't know you had to — the IRS offers Streamlined Filing Compliance Procedures specifically for non-willful non-compliance. You file the last 3 years of returns + 6 years of FBARs, certify non-willfulness, and pay any tax owed — but no penalties for the back filings. This is the standard path for most expats catching up.

Read the full Streamlined guide

Deep dives — the expat tax library

Long-form articles covering the most common questions US expats ask. Each piece focuses on a specific form, rule, or strategy with concrete examples.

FEIE 2026: Form 2555 deep dive ($130,200 ceiling)

Bona Fide Residence vs Physical Presence Test, Housing Exclusion, when FEIE helps and when it hurts.

FTC vs FEIE — strategic choice with worked examples

When to pick Foreign Tax Credit over FEIE, dual claim mechanics, carryforward rules.

Streamlined Filing Procedures 2026 — catching up safely

How to qualify as non-willful, what to file (3 years returns + 6 years FBAR), penalty exposure.

Expatriation tax: Form 8854 and the Exit Tax under §877A

Covered Expatriate triggers, mark-to-market exit tax, planning around the rules.

PFIC — why foreign mutual funds are a US tax trap

Default punitive regime, QEF election, mark-to-market election, when to liquidate.

NRA spouse: §6013(g) election vs Married Filing Separately

When to elect joint filing with a foreign spouse and when MFS is better.

Foreign pension US taxation — 401(k), SIPP, PPR, super

How the US taxes UK SIPP, Portuguese PPR, Australian super, German Riester, and others.

Form 8938 (FATCA) for US persons abroad — thresholds explained

How 8938 differs from FBAR, abroad vs domestic thresholds, what counts as a specified foreign asset.

FAQ — US Expat Taxes

If your question isn't here, message me on Telegram for a personal answer.

The IRS Streamlined Filing Compliance Procedures are designed exactly for you. If your non-compliance was non-willful (you didn't know, didn't intend to evade), you file the last 3 years of Form 1040 + last 6 years of FBAR, certify non-willfulness on Form 14653, and pay tax owed. No penalties for the late filings under the program. The certification is signed under penalty of perjury, so accuracy matters — work with an experienced preparer for this filing.

Ready to get your expat taxes under control?

Book a consultation to discuss your situation, get an exact price, and start filing or catching up.

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