As the U.S. tax season approaches, it's crucial for Americans living abroad to be aware of their tax obligations. While the April 15 deadline is well-known for U.S. citizens residing in the country, it is equally significant for expats. Filing before this deadline ensures compliance with the IRS and helps avoid penalties.
For expats, meeting the April 15 deadline is essential for various reasons. It is the deadline for filing taxes if there is an outstanding debt owed to the IRS. Additionally, expats must also submit their Foreign Bank Account Reports (FBAR) by this date. Filing before April 15 can also ensure timely receipt of refunds, such as the Child Tax Credit.
For those unaware of their tax obligations, the IRS offers an amnesty procedure called the Streamlined Procedure. This process requires taxpayers to file for the past three years plus the current year, along with six years of FBARs.
Single U.S. taxpayers under 65 earning over $13,850 must file a tax return for the 2023 tax year in 2024. Different thresholds apply for married individuals filing separately and self-employed individuals.
Prior to filing taxes, individuals must obtain a Social Security number (SSN) or an Individual Taxpayer Identification Number (ITIN) if they do not have an SSN. Organizing financial documents, including local payslips and U.S. tax forms, is crucial for a smooth filing process.
Choosing a company that caters to expat needs is vital when filing U.S. taxes. Look for a service that provides important tax forms for international income, such as Form 1116, Form 2555, Form 8938, Form 8833, Form 8621, and FBAR.
While taxes are due by April 15, U.S. expats have an automatic extension until June 15 to file their returns. If needed, an additional extension can be requested until October 15. For further extensions, a timely request must be filed with the IRS by December 15.
Being prepared and informed about tax obligations can alleviate stress during the tax season. Consult with a licensed professional for personalized advice regarding your specific situation.
