Skip to main content
← Back to Resources

US Expat Tax Services

Tax preparation and planning for US citizens and green card holders living abroad. FBAR, FATCA, foreign income exclusions, and international compliance expertise.

The United States is one of only two countries that taxes citizens on worldwide income regardless of where they live (the other is Eritrea). If you're a US citizen or green card holder living abroad—or a DFW resident with foreign income, accounts, or assets—you face complex tax obligations most preparers don't understand. Our CPAs specialize in expatriate taxation and international compliance, helping Americans abroad stay compliant while minimizing their US tax burden.

US Tax Obligations

US citizens and green card holders must file US taxes on worldwide income, regardless of where you live.

You Must Report:

  • Foreign employment & self-employment
  • Rental & investment income
  • Pensions & any other income
  • Foreign accounts (FBAR) & assets (FATCA)

⚠️ Non-compliance penalties: Up to $12,500/account/year (non-willful)

Foreign Earned Income Exclusion (FEIE)

RequirementDetails
2026 ExclusionUp to ~$130,000
Income TypeEarned only (not investments)
Form2555

Qualification (meet ONE):

  • Bona Fide Residence: Resident of foreign country for full tax year
  • Physical Presence: 330 days abroad in any 12-month period

Housing costs above base amount also excludable.

Foreign Tax Credit (FTC)

Credit US taxes for foreign taxes paid—prevents double taxation.

FeatureDetails
Form1116
Carryback1 year
Carryforward10 years

Often better than FEIE for high-tax countries or income above exclusion limit.

FBAR vs. FATCA

RequirementFBARFATCA (Form 8938)
Threshold$10K aggregate anytime$200K year-end / $300K anytime*
FormFinCEN 1148938 (with return)
Due DateApr 15 (auto ext. to Oct 15)With tax return
PenaltiesUp to $12,500/account$10K-$60K

*Higher for married filing jointly. Many assets require BOTH forms.

Tax Treaty Benefits

US has treaties with ~70 countries. Benefits include:

  • Reduced withholding on dividends/interest/royalties
  • Exemptions for students, teachers, researchers
  • Tie-breaker rules for dual residents
  • Social security totalization
  • Pension taxation rules

Must claim on return (Form 8833). Not automatic.

Streamlined Filing (Catch-Up)

Haven't been filing? IRS offers amnesty for non-willful taxpayers:

RequirementAmount
Delinquent Tax Returns3 years
Delinquent FBARs6 years
PenaltiesNone (if non-willful)

✓ Voluntary disclosure is always better than IRS discovery.

Self-Employment Tax

  • FEIE does NOT exclude SE tax — may owe 15.3% on foreign self-employment
  • Totalization agreements — ~30 countries exempt you from US SE tax if covered abroad
  • Without agreement — may pay into both systems or neither

Pro Tips

File Every Year

Even if you owe no US tax, file your return. The statute of limitations doesn't start until you file, and some credits/exclusions require timely filing.

Don't Forget State Taxes

Some states (California, New Mexico, Virginia) continue to tax former residents who move abroad. Properly severing state residency is critical.

Keep Meticulous Records

Document your physical presence, foreign tax payments, and account balances. Reconstruction is difficult from abroad.

Frequently Asked Questions

Do I really have to file US taxes if I live abroad?
Yes. US citizens and green card holders must file US tax returns reporting worldwide income, regardless of where they live, what currency they earn, or whether they owe any US tax. The filing thresholds are the same as for US residents (around $14,600 for singles in 2026). You may owe nothing after exclusions and credits, but you must still file. Non-filing can result in penalties and may jeopardize your passport renewal.
What is the deadline for expat tax returns?
Expats living abroad receive an automatic 2-month extension, making the deadline June 15. However, any tax owed still accrues interest from April 15. You can request an additional extension to October 15 using Form 4868. The FBAR (FinCEN 114) is due April 15 with an automatic extension to October 15—no form needed for the extension. We recommend filing by June 15 or obtaining extensions to avoid late-filing penalties.
I haven't filed in years. Will I go to prison?
Unlikely, if your non-filing was non-willful (you didn't know about the requirement or made an honest mistake). The IRS offers the Streamlined Filing Compliance Procedures, allowing you to file 3 years of tax returns and 6 years of FBARs with no penalties if you certify non-willful conduct. Criminal prosecution is reserved for willful violations and large-scale tax evasion. Contact us—we've helped many expats become compliant without penalty. Voluntary disclosure is always better than IRS discovery.
Can I use both the foreign earned income exclusion AND foreign tax credit?
Yes, but not for the same income. The FEIE excludes income from US taxation; the FTC credits foreign taxes against US tax. For income up to the FEIE limit, you typically exclude it. For income above the limit, or investment income (not eligible for FEIE), you use the FTC. In high-tax countries, the FTC may be more beneficial than the FEIE. We analyze your situation to determine the optimal combination.
What about my foreign retirement accounts?
Foreign retirement accounts have complex US tax treatment. Some (UK pensions, Canadian RRSPs under the treaty) receive similar treatment to US accounts. Others may be taxable annually on earnings (no deferral), may trigger PFIC rules if invested in foreign mutual funds, and must be reported on FBAR and potentially Form 8938. Some countries' pension contributions aren't deductible for US purposes. It's complicated—we analyze your specific accounts and applicable treaty provisions.
Do I need to report foreign accounts I just sign on?
Yes. For FBAR purposes, you must report any foreign account over which you have signature authority or other authority, even if you don't own it. This includes accounts you can access for your employer, family member, or business. The $10,000 threshold is aggregate across all accounts you own AND all accounts you have signature authority over. Many expats miss this requirement—we ensure complete reporting.
What if I renounce my US citizenship?
Renouncing citizenship or abandoning a green card has tax consequences. You must file Form 8854 and may face an "exit tax" if you're a "covered expatriate" (net worth over $2M, average income tax liability over ~$190,000, or non-compliance with tax obligations for 5 years). The exit tax treats you as selling all assets at fair market value on the day before expatriation. It's a significant decision with lasting tax implications—we strongly recommend consultation before taking this step.
How do currency conversions work?
You must report all amounts in US dollars on your return. For income received throughout the year, use the yearly average exchange rate. For specific transactions (asset sales), use the rate on the transaction date. For account balances on FBAR, use the December 31 rate (Treasury publishes official rates). We handle all conversions using appropriate rates and maintain documentation for the IRS.

Need Help With Your Taxes?

Book a free 15-minute discovery call. Krystal calls you to talk through fit and scope.

Book a discovery callContact Us