US citizens and Greencard holders are required to file their annual income tax returns regardless of whether or not their income has been earned within the US borders. All income must be reported while filing the US Personal tax returns, regardless of which country you have earned it from. This is a requirement entrenched in the US tax law. It, therefore, makes the process for expat tax returns quite rigorous and a bit different from domestic returns. 

There are a number of reasons why people leave the US to go and work abroad, such as the opportunity to work in a new environment and learn new cultures as you interact with new people. Notably, overseas jobs usually come with very attractive perks such as six-figure salaries, housing allowance and holiday allowance. You are also provided with a top of the range car by the employer, and in some cases, it comes with a driver who will be at your beck and call. These are just some of the perks that lure Americans away from their comfort zones at home, to work in foreign countries. It is usually the pursuit for a better life.

If you get the opportunity to work in a foreign country, leaving the US does not relieve you of your obligation to the tax man. You can never evade the tax man simply because you have moved to another country, not unless you relinquish your American citizenship. As long as you`re a US citizen, you will be expected to meet your tax obligation and file your returns annually.Expat tax returns are prepared and submitted using the IRS form 1040. One of the advantages that expats have while filing their returns, is a 2-month extension that allows them to file their income tax by latest 15th June instead of April.

What tax reliefs and deductions do expats enjoy?

Foreign Earned Income Exclusion (FEIE)

To avoid double taxation, expats have a tax relief provision that allows them to exclude part of their foreign income from their IRS taxable income. However, to be eligible for this provision you need to meet certain thresholds, since not every expat gets to enjoy this tax relief program. Moreover, you need a tax returns expert to guide you on how to ensure you meet the requirements needed for FEIE so that you are eligible. At taxandaccountinghub, we have experienced IRS qualified approved Enrolled Agent and expatriate ex big 4 accounting firm tax consultant with who will help you file the IRS Form 2555 for foreign earned income.

Foreign Housing Exclusion

If you are an expat working for a foreign company abroad and you pay for your own housing, you are eligible to claim a benefit that enables you to deduct that expense from your taxable income.

Foreign Housing Deduction

If you are an American citizen and you are self-employed in a foreign country, you probably pay for your own housing. Did you know that you are eligible to deduct that expense from your taxable income? If you are wondering how to go about it, you need not worry because we are here to teach you everything about taxes for expat abroad.

To be able to claim the above mentioned benefits and ensure that you are fully compliant, it would be best to seek guidance from people who know the ins and outs of the trade. They are best suited to help you while filing your Form 2555.

Furthermore, to avoid penalties that may arise from improper 1040 tax return filing, it is important to let American Tax service experts guide you. Otherwise, you may end up paying more simply because you don`t know the tax reliefs, deductions and exclusions that are available for you, some of which you probably qualify.

Our team specialise with international expatriate U.S. personal tax return service. If you need assistance with US 1040 filing for refund claim/FATCA Compliance work/FBAR FINCEN114 Filing, ITIN/ Form W7 Application/EIN/Form W8BENE or CAA services/1040NR U.S. tax filing for refund claim of excess 1042S / 8288A/ 8805/ W2/ 1099. We are happy to assist our clients in a timely, efficient and cost-effective way.

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