1. I’m a U.S. citizen living and working outside of the United States for many years. Do I still need to file a U.S. tax return?
Yes, if you are a U.S. citizen or a resident alien living outside the United States,
your worldwide income is subject to U.S. income tax, regardless of where you live.
However, you may qualify for certain foreign earned income exclusions and/or foreign income tax credits.
Please refer to Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, for additional information.
2. I pay income tax in a foreign country. Do I still have to file a U.S. income tax return even though I do not live in the United States?
You have to file a U.S. income tax return while working and living abroad unless you abandon your green card holder status by filing Form I-407,
with the U.S. Citizen & Immigration Service, or you renounce your U.S. citizenship under certain circumstances described in the expatriation tax provisions.
See Publication 519, U.S. Tax Guide for Aliens, for more details.
3. I just realized that I must file U.S. income tax returns for prior years. How many years back do I have to file?
You must file a federal income tax return for any tax year in which your gross income is equal to or greater than the personal exemption amount and standard deduction combined (per the Form 1040 Instructions for the corresponding tax year).
Generally, you need to file returns going back six years.
This will depend on the facts and circumstances of your particular situation.
For example, refer to Information for U.S. Citizens or Dual Citizens Residing Outside the U.S.
4. I am a U.S. citizen married to a nonresident alien. What is my filing status and can I claim an exemption for my foreign spouse?
In general, if you are a U.S. citizen or resident alien married to a nonresident alien, you ar considered “Married Filing Separately” unless you qualify for a different filing status.
If you pay more than half the cost of keeping up a home for yourself and a qualifying child or other relative, you may qualify for the head of household filing status.
If you are a U.S. citizen or resident alien married to a nonresident alien, you and your spouse can choose to have your spouse treated as a U.S. resident for all U.S. federal income tax purposes.
This allows you and your spouse to file a joint return, but also subjects your nonresident alien spouse’s worldwide income to U.S. income tax.
If you file a joint return, you can claim an exemption for your nonresident alien spouse.
If you do not file a joint return, you can claim an exemption for your nonresident alien spouse only if your spouse has no income from sources within the United States and is not the dependent of another U.S. taxpayer.
5. I am a U.S. taxpayer residing abroad and I have a child who was born abroad. Can I claim my child as a dependent on my tax return?
In general, you can claim exemptions for individuals who qualify as your dependents.
To be your dependent, the individual must be a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico for some part of the calendar year in which your tax year begins.
Children usually are citizens or residents of the same country as their parents.
If you were a U.S. citizen when your child was born, your child generally is a U.S. citizen.
This is true even if the child’s other parent is a nonresident alien, the child was born in a foreign country, and the child lives abroad with the other parent.
You must include on your return the social security number (SSN) of each dependent for whom you claim an exemption.
If your dependent is a nonresident alien who is not eligible to get a social security number, you must list the dependent’s individual taxpayer identification number (ITIN) instead of an SSN.
6. What deductions and/or credits am I allowed on my U.S. income tax return as a U.S. citizen living and working in a foreign country?
U.S. citizens and resident aliens living outside the United States generally are allowed the same deductions as citizens and residents living in the United States.
If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U.S. tax on the same income, you may be able to take either a foreign tax credit on foreign income taxes or an itemized deduction for eligible foreign taxes.
However, if you take the foreign earned income exclusion your foreign tax credit or deduction will be reduced.
If eligible, you can claim a foreign tax credit on foreign income taxes owed and paid by filing Form 1116 with your U.S. income tax return.
You may also be eligible for the foreign earned income exclusion.
The due date for filing a federal individual income tax return generally is April 15 of each year if your tax year ends December 31st.
Your return is considered filed timely if the envelope is properly addressed and postmarked no later than April 15.
If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day.
If you cannot file by the due date of your return, you can request an extension of time to file.
To receive an automatic 6-month extension of time to file your return, you should file Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, by the due date of your return.
However, if you are a U.S. citizen or resident alien, who is either:
(1) living outside of the United States and Puerto Rico and your main place of business or post of duty is outside of the United States and Puerto Rico; or
(2) in military or naval services on duty outside of the United States and Puerto Rico on the due date of your return
you are allowed an automatic 2-month extension until June 15 to file your return and pay any tax due.
There are various options for paying your U.S. taxes.
EFTPS (Electronic Federal Tax Payment System).
This is only available if you have a U.S. Bank account.
Check or money order.
To pay by check or money order, make your check or money order payable to the “United States Treasury” for the full amount due. Do not send cash. Do not attach the payment to your return.
Credit or debit card.
This option is useful if you do not have a U.S. bank account. Refer to the Pay Your Taxes by Debit or Credit Cardwebsite with details regarding this process and fees.
You can check the status of any refund you expect as soon as 24 hours after you e-file a return or 4 weeks after you file a paper return.
10. What are my responsibilities as a green card holder if I have been absent from the United States for a long period of time?
As a green card holder, you generally are required to file a U.S. income tax return and report worldwide income no matter where you live.
However, if you surrender your green card or the U.S. Citizen & Immigration Service determines that you have abandoned your green card and takes it away from you, you will need to follow the nonresident alien requirements for filing a Form 1040NR, U.S. Nonresident Alien Income Tax Return.
You will be considered a United States resident for tax purposes if you meet the substantial presence test for the calendar year.
To meet this test, you must be physically present in the United States (U.S.) on at least:
- 31 days during the current year, and
183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
- All the days you were present in the current year, and
- 1/3 of the days you were present in the first year before the current year, and
- 1/6 of the days you were present in the second year before the current year.
You need an ITIN if you are not eligible to get a social security number but must provide a taxpayer identification number on a U.S. tax return or information return.
Examples include the following:
- A nonresident alien individual eligible to get the benefit of reduced withholding under an income tax treaty .
- A nonresident alien individual not eligible for an SSN who is required to file a U.S. tax return or who is filing a U.S. tax return only to claim a refund.
- A nonresident alien individual not eligible for an SSN who elects to file a joint U.S. tax return with a spouse who is a U.S. citizen or resident alien.
- A U.S. resident alien (based on the substantial presence test) who files a U.S. tax return but who is not eligible for an SSN. Etc.
ITINs are for federal tax reporting only and are not intended to serve any other purpose.
The IRS issues ITINs to help individuals comply with the U.S. tax laws and to provide a means to efficiently process and account for tax returns and payments for those not eligible for Social Security Numbers (SSNs).
An ITIN does not provide authorization to work in the United States or provide eligibility for Social Security benefits or the Earned Income Tax Credit.
Foreign persons are generally subject to U.S. withholding tax at a 30% rate on the gross amount of certain income they receive from U.S. sources.
By providing a completed Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding, to the U.S. payer (also known as the U.S. withholding agent) before or at the time income is paid or credited, you are:
- Establishing that you are not a U.S. person,
- Claiming that you are the beneficial owner of the income for which Form W-8BEN is being provided, and
- If applicable, claiming a reduced rate of, or exemption from, withholding as a resident of a foreign country with which the United States has an income tax treaty. In order to claim a reduced rate or exemption from tax under an income tax treaty, the Form W-8BEN must include a valid U.S. taxpayer identification number.
The completed Form W-8BEN is provided to the U.S. payer (also known as the U.S. withholding agent) before or at the time income is paid or credited.
This form is not filed with the U.S. Internal Revenue Service.
14. I live in a foreign country. How do I get a social security number for my dependent who qualifies for a social security card?
You will need to contact the Social Security Administration, as the IRS does not issue SSNs. Use Form SS-5-FS, Application For A Social Security Card, which may be obtained from and filed with the Social Security Administration.