Do I Have to File if I Live Outside the U.S.?
UPDATED: January 10, 2020
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Yes, you do. If you earn income and live abroad, you will have to file a return every year. You will need to report all income earned worldwide if the income meets the minimum income filing requirements for filing status and age (which are the same requirements whether or not you are living in the United States).
Following is a table outlining the 2018 IRS income/status/age requirements for filing:
|If your filing status is…||And at the end of 2018 you were…*||Then file a return if your gross income was at least…**|
|65 or older||$13,600|
|Married filing jointly***||Under 65 (both spouses)||$24,000|
|65 or older (one spouse)||$25,300|
|65 or older (both spouses)||$26,600|
|Married filing separately||Any age||$5|
|Head of household||Under 65||$18,000|
|65 or older||$19,600|
|Qualifying widow(er) with dependent child||Under 65||$24,000|
|65 or older||$25,300|
* If you were born on January 1, 1954, you are considered to be age 65 for purposes of filing a 2018 tax return.
** Gross income is all income you received in money, goods, property and services not otherwise exempt from tax, including income from sources outside of the United States or from the sale of your main home. Don’t include any social security benefits unless (a) you are married filing a separate return and you lived with your spouse at any time in 2018 or (b) one-half of your social security benefits plus your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly). If (a) or (b) applies, see the instructions for lines 5a and 5b to figure the taxable part of social security benefits you must include in gross income. Gross income includes gains, but not losses, reported on Form 8949 or Schedule D. Gross income from a business means, for example, the amount on Schedule C, line 7, or Schedule F, line 9. But, in figuring gross income, don’t reduce your income by any losses, including any loss on Schedule C, line 7, or Schedule F, line 9.
*** If you did not live with your spouse in 2018 (or on the date he or she died), and your gross income was at least $5, then you will need to file return regardless of your age.
For purposes of determining whether or not you need to file, include any income that you might otherwise exclude under the foreign earned income exclusion and/or housing deduction and exclusion (see below). If you are self-employed, gross income also includes Profit or Loss from Business on Schedule C of Form 1040 (or Net Profit from Business on Schedule C-EZ).
You can download all IRS tax forms from the internet.
You may substantially reduce your tax liability if you qualify for a foreign earned income exclusion and/or housing deduction and exclusion. As of tax year 2018, the maximum exclusion amount for foreign earned income is $104,100 (the figure is adjusted annually for inflation). The amount you may exclude or deduct for housing expenses depends on your circumstances. Qualifying information is published in IRS Publication 54.
If you plan to use the exclusions and deductions described above, you will need to file Form 2555 (and use Form 2555 Instructions) or Form 2555-EZ (and use Form 2555-EZ Instructions). Use Form 2555-EZ if you are only planning on using the foreign earned income exclusion. If you plan to use both the earned income and housing exclusions/deductions, use Form 2555.
Don’t forget about taxes in the country where you live. Some countries will credit you for taxes you pay to the IRS, others may not. If you do pay taxes in the country where you live, do not claim those taxes on your U.S. tax return as federal income tax withheld. You may, however, claim the amount as a foreign tax credit or foreign tax deduction. Check out Chapter 5, Taxes of Foreign Countries and U.S. Possessions for more information.
If you have questions, you can contact the IRS in the following ways:
- Go to http://www.irs.gov
- Phone: 1-800-829-1040 –this is the national hotline. Expect it to be very busy as tax deadline day looms closer
- Or you can read through IRS Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad
If you need forms and cannot download them, you can call 1-800-829-3676, or write to the National Distribution Center at P.O. Box 8903, Bloomington, IL 61702-8903.
Learn more about federal income taxes and the law at FreeAdvice.com.
To learn more about taxes and the IRS, see the following articles:
The Free Advice Guide for Filing Your 2008 Tax Return
Filing Your 2008 Tax Return: Bring on the Paperwork
When You Have to File Your Tax Return Late
When You Need to Pay Your Income Tax Late
What Will It Cost Me to Get My Money Early?