A Useful Guide To Tax Planning Matters For Americans Abroad

We tend to lose sight of our obligations at home when we decide to vacation—and one of those obligations is paying taxes. If we don’t know what we’re doing, we may end up facing some pretty hefty repercussions with the authorities, especially in the United States, where taxes are strictly enforced. Luckily, there are ways to stay out of trouble. First and foremost, you can file your taxes online for free. Furthermore, there are so many tools and calculators available to help you crunch the numbers. Beyond that, here are some helpful hints for tax preparation once you’ve left the country.

A Useful Guide To Tax Planning Matters For Americans Abroad

The Rules

Yes, regardless of where you live at the time, if you are a US citizen residing abroad, you must file a US federal tax return and pay US taxes on your global income. To put it another way, you’re subject to the same income tax laws as those who dwell in the United States. While nearly all of the 244 independent territories utilize territorial, residency, or no income taxation at all, the United States and Eritrea are the only two governments with citizenship-based taxation. This settles the question of whether or not American citizens who live in foreign nations must pay taxes.

If you are a U.S. citizen or resident alien residing outside the United States on the usual due date of your return, or if you are in the military on service outside the United States, you are automatically granted a 2-month extension to submit your return without requesting one. The default 2-month extension for a calendar year return is June 15. It’s important to remember that any taxes owed must be paid before April 15th, or interest will be assessed beginning April 15th.

Professional Help

Americans who live and work outside the United States are required by US tax law to disclose all of their international income. For domestic tax accountants, this can be more difficult since they may overlook or be unfamiliar with various U.S. tax requirements. You may use these tax tips for Americans working abroad to assist you in this situation since these specialists who offer these guidelines have the expertise and experience to assist US expatriates with their US income tax requirements.


If you discover that you omitted to declare some income on your return or that you did not take all of the authorized deductions, you must file an updated return using form 1040X for that tax year.

The best approach is to file an adjustment before the IRS notices the error, as fines are generally reduced. The countdown starts after the original return is filed, and updated returns must be filed by a particular date to receive a credit or refund.

Where to File the Taxes

If you live in a foreign country and are a U.S. citizen or resident alien (including a green card holder), submit your U.S. tax return to:

Department of the Treasury

Internal Revenue Service Center

Austin, TX 73301-0215


State Tax Return

One of the most important factors in determining whether or not you must submit a state tax return as an expatriate is whether or not you intend to return. Every state has its standards for citizenship and permanent place of abode, which influence whether or not you are deemed a resident and must file. For example, Massachusetts law specifies that you cannot alter your citizenship by leaving the state for an extended period. Other states where you may be required to submit a state tax return include California, New Mexico, North Carolina, New York, and Virginia. To be sure, check with your state’s government.

It might be difficult to read through and comprehend the US tax code. The information is considerably more complicated and unclear when you’re a US expatriate. Hopefully, these tips will assist you in sorting through the avalanche of data and taking critical measures.

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