The rules for filing an income tax return are the same regardless if you are US citizen living in the US or abroad. You are subject to tax on your worldwide income from all sources. However, many citizens living abroad qualify for special tax benefits which prevent them from being double taxed on foreign-earned income.
How do I file a return as an expat?
Income
As an expat living abroad, you probably wont get a US W-2 form. If you do, you will enter your income as normal using the W-2 entry screen. However, most Americans living abroad will not receive a W-2.
To report income not reported on a W-2 or 1099 form:
- Federal Section
- Income
- Less Common Income
- Other Compensation
- Foreign Earned Compensation (including Foreign pensions)
Exclusion
If you are living and working abroad, you may be entitled to exclude up to $120,000 (2023) of your foreign income from your return. You may also qualify to exclude certain foreign housing amounts.
To claim the exclusion, you must meet the following requirements:
- You must meet the Tax Home Test
- You must have foreign earned income
- You must meet the Bona Fide Residence or Physical Presence test
View our article for more information on the requirements.
Do U.S. citizens living abroad need to file state taxes?
Maybe. Living abroad does not mean you are excluded from paying state taxes. It depends on the state you lived in prior to moving abroad. If you are unsure if you have to pay state taxes while living abroad, we recommend reviewing your state filing instructions for more information.
Need more help?
Check out Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.