US expat taxes work on citizenship, not residence: an American living abroad files a federal return on worldwide income every year the normal filing thresholds are met. Most expats end up owing little or no US income tax because of the Foreign Earned Income Exclusion ($132,900 for 2026) and the Foreign Tax Credit, but the filing and reporting duties stay.
Last checked: October 2026
In short:
- Calendar-year filers living abroad get an automatic extension from April 15 to June 15 and can extend to October 15 with Form 4868, but interest on unpaid tax runs from April 15.
- The Foreign Earned Income Exclusion is $132,900 per qualifying person for 2026 (up from $130,000 for 2025) and doesn’t reduce the 15.3% self-employment tax.
- An FBAR (FinCEN Form 114) is required when foreign accounts total more than $10,000 at any time in the year, due April 15 with an automatic extension to October 15.
Citizenship-based taxation and who has to file
The IRS says citizens and resident aliens abroad are “subject to tax on worldwide income from all sources”, and the filing rules are the same as for people living in the US. Moving to a no-tax country changes what you owe, not whether you file.
Whether you must file depends on gross income, filing status and age. For tax year 2025 (returns filed in 2026), the Form 1040 instructions set these thresholds:
| Filing status (under 65) | File if gross income is at least |
|---|---|
| Single | $15,750 |
| Married filing jointly (both under 65) | $31,500 |
| Head of household | $23,625 |
| Married filing separately (any age) | $5 |
Two traps catch expats. First, income you exclude under the FEIE or housing exclusion still counts as gross income when testing whether you must file. Second, if your net self-employment earnings are $400 or more you must file, whatever your total income. The $5 threshold for married filing separately also matters for anyone married to a non-American.
Deadlines and extensions
| Item | Deadline |
|---|---|
| Normal due date (and when interest starts) | April 15 |
| Automatic 2-month extension for those living abroad | June 15 |
| Further extension (Form 4868, filed by June 15) | October 15 |
| FBAR | April 15, automatic extension to October 15 |
The June 15 extension is for filing, not paying. If you expect to owe, pay an estimate by April 15. If you need to wait until you’ve qualified for the FEIE (for example, you moved mid-year and haven’t hit 330 days yet), Form 2350 is the special extension for that.
Foreign Earned Income Exclusion, housing and the Foreign Tax Credit
FEIE (Form 2555). The IRS gives the 2026 maximum as $132,900 per person, after $130,000 for 2025. You need foreign earned income, a tax home abroad and either the bona fide residence test or the physical presence test (330 full days abroad in any 12 consecutive months). It covers wages and self-employment income, not dividends, interest, gains or rent.
Foreign housing exclusion or deduction. On top of the FEIE, you can exclude (employees) or deduct (self-employed) housing costs above a base amount. The base is 16% of the maximum exclusion, which works out at $21,264 for a full 2026 year. Costs are capped too: for 2025 the general cap was $39,000 (30% of the exclusion), with higher limits for listed expensive cities. Check the 2026 Form 2555 instructions, when published, for this year’s cap.
Foreign Tax Credit (Form 1116). A dollar-for-dollar credit for foreign income tax, with no fixed cap, covering earned and unearned income. It often beats the FEIE in high-tax countries or above the cap. Our FEIE vs FTC thread compares them properly.
Reporting forms: FBAR and Form 8938
These are information returns. You can owe zero tax and still face penalties for missing them.
| Form | Who files | Threshold for expats |
|---|---|---|
| FBAR (FinCEN 114) | US persons with foreign financial accounts | Aggregate above $10,000 at any time in the year. Filed electronically through FinCEN’s BSA E-Filing System, not with your return |
| Form 8938 (FATCA), single or married filing separately | Taxpayers living abroad | More than $200,000 on the last day of the year or $300,000 at any time |
| Form 8938, married filing jointly | Taxpayers living abroad | More than $400,000 on the last day of the year or $600,000 at any time |
Many people have to file both. The FBAR threshold is aggregate, so three accounts of $4,000 each trigger it.
Self-employment tax and totalization agreements
This is where founders and freelancers get surprised. The IRS says self-employment tax rules are “generally the same whether you are living in the United States or abroad”, it applies once net earnings reach $400, and the FEIE doesn’t reduce it. The rate is 15.3%: 12.4% social security and 2.9% Medicare.
The way out is a totalization agreement. The SSA lists 31: Australia, Austria, Belgium, Brazil, Canada, Chile, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Luxembourg, the Netherlands, Norway, Poland, Portugal, Romania (in force from 1 September 2026), the Slovak Republic, Slovenia, South Korea, Spain, Sweden, Switzerland, the UK and Uruguay. Some assign self-employed people to their country of residence. To claim the exemption you get a certificate of coverage from the other country’s social security agency and attach a copy to your Form 1040 each year. Living in the Gulf, most of the Caribbean or most of Southeast Asia means no agreement and US self-employment tax stays.
State taxes
Federal tax follows citizenship; state tax follows domicile. States such as California, New York, Virginia and New Mexico can keep treating you as resident after you’ve left if you haven’t clearly broken domicile. Virginia, for instance, says someone who takes a job abroad stays a domiciliary resident “unless appropriate steps are taken to abandon Virginia as the state of domicile.” The state-by-state detail and the ties to cut are in our how to leave the US thread.
Behind on filing? The Streamlined procedures
Plenty of Americans abroad only learn about their filing duties years later. The IRS Streamlined Foreign Offshore Procedures are for people whose failure was non-willful, meaning “negligence, inadvertence, or mistake” or a good-faith misunderstanding. To qualify as living abroad, you must have had no US abode and been physically outside the US for at least 330 full days in at least one of the last three years whose return due dates have passed. You file the last 3 years of returns (or amended returns) and the last 6 years of FBARs. If you’re eligible, the IRS waives failure-to-file and failure-to-pay penalties, accuracy-related penalties, information return penalties and FBAR penalties. You can’t use it if you’re already under IRS examination or criminal investigation, and you need a valid taxpayer ID.
Related: FEIE vs Foreign Tax Credit (2026): which one US expats should use · How to leave the US (2026): a checklist for moving out of the US · Wyoming LLC for non-US residents: Form 5472, banking and tax (2026) · Tax residency explained: why the 183-day rule is a myth for most countries · Puerto Rico Act 60 (2026): 0% capital gains, 4% business tax and the catches
Quick answers
Q: Do US citizens living abroad have to file taxes?
Yes. US citizens abroad are taxed on worldwide income and follow the same filing thresholds as at home, such as $15,750 gross income for a single filer under 65 for 2025. Excluded foreign income still counts toward the threshold, and anyone with $400 or more of net self-employment earnings must file.
Q: What is the foreign earned income exclusion for 2026?
The IRS sets the 2026 maximum Foreign Earned Income Exclusion at $132,900 per qualifying person, up from $130,000 for 2025. You need a foreign tax home and either the bona fide residence test or 330 full days abroad in 12 consecutive months. It covers earned income only and doesn’t reduce self-employment tax.
Q: When is the FBAR due for expats?
The FBAR (FinCEN Form 114) is due April 15 following the calendar year, with an automatic extension to October 15 that you don’t need to request. It’s required when your foreign financial accounts add up to more than $10,000 at any time in the year, and it’s filed electronically with FinCEN, separately from your tax return.
Sources
- IRS: U.S. citizens and resident aliens abroad
- IRS: U.S. citizens and resident aliens abroad, filing requirements
- IRS: 1040 and 1040-SR instructions (2025)
- IRS: Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad
- IRS: Foreign earned income exclusion
- IRS: Figuring the foreign earned income exclusion
- IRS: Foreign housing exclusion or deduction
- IRS: Instructions for Form 2555 (2025)
- IRS: Report of Foreign Bank and Financial Accounts (FBAR)
- IRS: Comparison of Form 8938 and FBAR requirements
- IRS: Self-employment tax for businesses abroad
- IRS: Self-employment tax (Social Security and Medicare taxes)
- SSA: U.S. international social security agreements
- Virginia Tax: Residency status
- IRS: Streamlined filing compliance procedures
- IRS: U.S. taxpayers residing outside the United States (Streamlined Foreign Offshore)
This is general information from the Nomad Forums team, not immigration, tax or legal advice. Rules change; check the official source or a qualified adviser before applying.
Over to you: If you’ve caught up through the Streamlined Foreign Offshore Procedures, how long did it take and what did a preparer charge? And self-employed members in totalization countries, how long did your certificate of coverage take to come through?