Navigating the US tax season can feel fraught with challenges when you’re living abroad, making expat tax planning essential.
Between the various deadline extensions, credits, and exclusions, and filling out the forms, it’s a lot to get your head around.
Below, we’ve created a handy resource to accompany you as you navigate expat taxes in 2024.
Know the tax dates
The IRS opens its filing season on January 29, 2024, but as a US citizen abroad, you have until June 17, 2024, to file your US expat tax return.
If you are living in Switzerland, check with your canton, most Swiss tax filings are due by March 31, 2024.
Additionally, if you have a foreign bank account, you will likely need to file the Foreign Bank Account Report (FBAR); this form has the same deadline as your US tax filing. (1)
Organize your tax documents and paperwork
Most of your tax documents will arrive by the end of January or mid-February. If you are missing a document, be proactive. Search for it online, or reach out to your expat CPA about where to locate it.
Download documents
As you organize, remember that most of your tax documents will arrive electronically. It may arrive via email, as an electronic reminder that you have tax documents available to download. Or, you may need to log into your financial accounts to download annual statements.
Review your name and address
If you’ve recently moved abroad, be sure to update your address. If the IRS needs to send you any correspondence, they will use the address they have on file.
Familiarize yourself with your previous filing strategy
Review your previous return for clues to the documents you used in the past. Common documents include:
• Personal & family identification (including Social Security numbers)
• Annual Salary Statements (W-2, Lohnausweis, etc)
• Financial Statements showing any income (interest, dividends, capital gains/loss)
• Retirement Account Statements (Pension statements, Traditional/Roth IRA contributions)
• Crypto/virtual currency – if you swapped one coin for another or if you transferred to fiat, you are required to report these transactions whether or not you receive form 1099-K.
• Potential Deductions: Mortgage interest payments, charitable giving, health insurance and medical expenses, etc
• Rental Property Information (income, expenses, improvements & depreciation)
• Business Information (income, expenses, improvements & depreciation)
• Travel calendar: this is especially important if you split your time between the US and other countries
Remember, as a US taxpayer abroad, your tax documents will look different than the standard US tax forms. You may not even receive a formal tax document for a non-US investment, so take the time to consider all income sources and ask your financial planner or tax preparer if you aren’t sure if something should be reported.
Understand Your Filing Status
The IRS has five main filing statuses:
• Single
• Head of Household
• Married filing jointly
• Married filing separately
• Qualifying widow/widower with dependent child
As a US citizen living abroad, you have some planning considerations around your filing status. Typically, married couples where both people are US citizens will file Married Filing Jointly (MFJ), while a US citizen married to a non-US person would file as Married Filing Separately (MFS).
However, everyone's case is unique, so be sure to check with a qualified professional if you'd like to ensure you're taking the best approach.
Finally, if you had a life-changing event such as a move, job change, divorce, marriage, or birth, be sure to update your tax and financial advisor.
Review last-minute tax savings opportunities
Even though the 2023 tax year has ended, there are a few tax-saving opportunities that allow you to save on your previous tax return. Be sure to review Traditional IRA deductions and potentially a SEP IRA contribution (if you are self-employed).
Consider an extension
As a US citizen outside of the US, you have until June 15th to file your US tax return. (Note: In 2024, the deadline is June 17th because the original date falls on a weekend.)
There are also extensions available upon request through October 15th and December 15th. Remember, an extension is to file, not to pay, so make the appropriate estimated tax payments.
You are unique, and so is your tax and financial situation. Rules of thumb or general information may not apply to your situation, so be sure to speak with someone who understands the complexities and challenges of being an expat.
References
Meet the Author
Arielle Tucker is a Certified Financial Planner™ and IRS Enrolled Agent with Connected Financial Planning. She’s spent over a decade working with US expats on US tax and financial planning issues. She is passionate about working with US expats and their families to help secure their financial future reflective of their core values. Arielle grew up in New York and has lived throughout the US, Germany, and Switzerland.