Do I Have to File a Tax Return as a US Citizen Working Abroad?

If you work overseas but have US citizenship, you may have questioned whether or not you need to pay US federal taxes and file an income tax return.

The answer: Yes.

If you are a US citizen who is working overseas, you will still need to file a federal tax return and pay taxes just as any US citizen living and working in the United States does.

Here is a look at some of the basics that you will need to know when preparing and filing your tax return while living and working outside of the US:

Filling Out and Filing Your Return

If you live and work overseas, you will need to file a federal tax return. Just like anyone else filing a US federal tax return, you can either use paper forms or e-file. You do get an additional two months to file over those living in the States. Your return typically needs to be postmarked by June 15 th instead of April 15 th (April 17 th for 2012).

If you owe taxes, however, your tax payment is still due by April 15 th (April 17 th for 2012) and if you don’t pay them on time you will be assessed interest and penalty fees .

Keep in mind though, that if you are unable to get your return filed on time, you can file for an automatic extension that will give you until October 15 th to file your return. But even in this case, your taxes owed are still due on April 15 th (April 17 th for 2012).

What Would Happen If I Don’t File?

If you don’t file you are taking a huge risk. When you owe the US government tax dollars and have not filed, there is no statute of limitations for collecting the money that you owe. While

it might be difficult for the government to track you down while living overseas, if you were to return to the US to live, you would more than likely receive a tax bill with interest and penalties added on to it.

How Do I Prevent Getting Taxed Twice?

Another question many US citizens have when working overseas is how they can prevent getting taxed twice for their earnings, from the US and the country they are working in. The United States actually has tax treaties with many countries, which allows tax information to be shared and helps to protect workers from getting taxed for their full income in both countries.

Additionally, the IRS has agents in many countries who work with the US embassies to assist with US citizen tax issues and help to keep tax payers in compliance.

Do I Get Any Special Tax Breaks or Benefits?

If you are working in a foreign country you may be eligible for some tax breaks. Some benefits that you may be eligible for include:

  • If you are working in a country that has a tax treaty with the US you may be able to get a reduction in your taxable income in the foreign country as well as in the US.
  • Your cost or partial cost for housing may be tax deductible.
  • You may be able to exclude some of your foreign earnings on your tax return.

Where Can I Find More Information?

If you are looking for additional information or assistance in filing your tax return while living and working in a foreign country you can visit the FAQ page on the IRS website .

You may also want to consult with a tax professional who specializes in preparing tax returns for US citizens who are living and working in foreign countries.


Category: Taxes

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