Help Center Tags
FAQsIntroduction
US expats are generally required to file a US tax return if their income meets or exceeds the US filing thresholds, just as residents living in the US.
Depending on where you live in the world, you may be double-taxed, an occurrence where taxes are placed on your income from both the US and your host country. But don’t worry just yet—the US has variety of tax exclusions, deductions and agreements with several countries around the world to prevent double-taxation:
- Foreign Earned Income Exclusion (FEIE): Expats can exclude a little over $100,000 of foreign earned income from their US tax return. We recommend utilizing this exclusion if you pay low to no income tax in your host country, and do not have or plan to have children (dependents) who would register for a Social Security Number.
- Foreign Tax Credit (FTC): You could use every euro, pound, yen of income taxes paid in another country as credits against your US tax liability. Expats should use the FTC if they, for example, pay more income tax in their host country, and earn more than the FEIE rate.
- Foreign Housing Credit: Certain housing expenses from your home abroad can be deducted from your US tax return. There is a limit to how much you can deduct, but using this credit can help if your foreign earned income surpasses the FEIE threshold.
- Tax-Treaty Benefits: The US made agreements with several countries around the world to help prevent double taxation for Americans abroad. Expats can utilize tax treaty benefits when filing their US tax return to avoid having to pay US Social Security and Medicare taxes.
To learn more about whether you need to pay US taxes as an expat, visit our Expat Tax Guide.