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5 Top ExPat Tax Tips

  1. File on time, every time.  This is actually a good tax tip for every US Taxpayer: File your tax return by April 15.  If you don’t owe US taxes on your foreign income, the IRS extends that deadline by two months, June 15.  You may apply for additional extensions through October 15, but you may owe interest on your unpaid taxes.
  2. Minimize your taxable income with the foreign Earned income exclusion.  If you qualify for the FEIE, you may not even have to pay US taxes.
  3. Reduce double taxation with Foreign Tax Credit.  After you live abroad six months or longer, you may need to pay income taxes in the country where you are working, in addition to your tax liability in the US.  The IRS limits some of this double taxation through its Foreign Tax Credit.
  4. Monitor your foreign account balances.  If you file singly and have financial assets with a minimum  cumulative value of $200,000 if you live abroad, $50,000 if you live in US, you must report those assets to the IRS using form 8938.  The amount varies for those who file jointly.  For more information, check fatca on IRS site, or see us at Expatriate Taxes, www.expatriottaxes.com.
  5. Look for refundable tax credits.  American Expats may receive the same tax credits that all US citizens have access to.  This can reduce your tax liability to the extent you may actually qualify for a tax refund. 

While you can’t escape the tax filing requirements, you can reduce the cost of tax liability.  If you do not have a tax preparer, visit www.expatriottaxes.com and be connected to a professional, experienced expat tax professional today.