US expat taxes 2026: what Americans abroad must file, and expat tax in other countries

The United States taxes its citizens and resident aliens on worldwide income wherever they live. Publication 54 says so plainly: you are subject to the same filing requirements as people living in the United States, and living abroad changes the tools you have, not the obligation. An American in Lisbon or Singapore therefore has a US return to file on top of any local one, based on gross income from everywhere, and generally has two more reports if the foreign accounts are large enough. Double tax is handled by choice: exclude up to US$132,900 of foreign earned income for 2026, or credit the foreign tax against the US tax, or some of each on different income. The other countries on this site take a different starting point. Their tax follows residence or work, so an expat from those countries usually needs to establish that residence really ended. The two situations look alike and work very differently.

Five obligations that follow an American overseas

The threshold for the return ignores the exclusion. The IRS says you must file unless your total income, without regard to the foreign earned income exclusion, is below the amount for your filing status. A person who expects to owe nothing because everything is excluded still files, and the amounts are in the charts in the Form 1040 instructions.

Deadlines, in the order they fall

Dates that fall on a weekend or holiday move to the next business day. The trap is in the third column of the first line: June 15 is an extension to file and pay, yet interest on tax unpaid at April 15 still runs. Penalties for paying late, by contrast, start from June 15 if you qualify. Someone waiting to pass the 330-day test before filing can use Form 2350 instead, which the IRS accepts for that purpose by the due date of the return.

The exclusion or the credit: the decision that lasts

Two main tools stop the same income being taxed twice. The foreign earned income exclusion removes up to US$132,900 of pay from US income for 2026, and adds a housing amount, if you have a foreign tax home and pass one of its two tests. The foreign tax credit, claimed on Form 1116, reduces the US tax by the foreign income tax you paid on income also taxed by the United States. You can instead deduct those taxes on Schedule A, but the IRS says the credit is better in most cases, since a credit cuts the tax itself and a deduction only the taxable income.

Investment income points towards the credit: the exclusion only reaches pay for work abroad, so interest, dividends and rent stay outside it. Pay in a high-tax country can point the same way, in our reading. You cannot use both on the same income, and they interact: if you exclude pay, there is no credit on the tax on that pay, and if you take a credit on income you could have excluded, the exclusion may be considered revoked. Going back then takes IRS approval within 5 years. Choosing the exclusion also shuts out the additional child tax credit and the earned income credit for the year. We do not model which is better for you, since that depends on both tax systems at once.

FBAR and FATCA: two reports that overlap and do not replace each other

Both are about foreign assets, and filing one does not excuse the other. The FBAR applies when you have a financial interest in, or signature authority over, foreign accounts whose combined value passes US$10,000 at any time in the year, whether or not they earn anything. Keep the account details for 5 years. Form 8938 uses different definitions and a much higher bar for people living abroad, and it also reaches assets held outside a financial account:

The IRS gives these penalties for not filing Form 8938: US$10,000 for failure to file, up to a further US$50,000 for continuing after notification, and a 40% penalty on an understatement of tax linked to undisclosed assets. If you omit more than US$5,000 of income from a foreign asset, the statute of limitations can run to 6 years. Reasonable cause, and no willful neglect, avoids the failure-to-file penalty.

Social security and the people who stay in both systems

Income tax relief does not extend to social security. A self-employed American abroad generally pays self-employment tax as if at home. An employee of a foreign employer generally pays no US social security or Medicare tax on pay for work abroad, with exceptions that include American employers and certain foreign affiliates. The United States has agreements with some countries to stop dual contributions on the same work, usually leaving you in the system of the country where you work, and a certificate of coverage settles it. A green card holder abroad remains a resident alien for tax purposes until the status formally ends, as our substantial presence test page explains. Those who give up citizenship or long-term residency fall under the expatriation tax rules in Publication 519 and file Form 8854.

Expat tax outside the United States

For expatriates from the other countries on this site the question flips: does my old country still have a claim on me? The rules we publish start from where you live or work, and each has its own way of holding on. The United Kingdom taxes non-residents only on UK income, such as rent on a property you keep, but you must tell HMRC when you leave to live abroad, through form P85 or your Self Assessment return, and a short absence can bring gains back into tax on your return. Our Statutory Residence Test calculator works from your trips. France looks at the home, the main place of stay and your centre of economic interests, without a number of days in the sources we read, as our guide to leaving France sets out. In Germany, the rule is sharp: a dwelling kept and used (Wohnsitz) makes you resident with no day count.

An expat's other trap is the new country. Arriving can make you resident there well before the leaving is settled, and then two countries claim you for the same year. A tax treaty usually decides, using steps such as permanent home and centre of vital interests, which the dual residency guide walks through. Country by country, the tax residency table shows who counts what. For an American, a tie-breaker abroad is a separate question from the US return described above. We have not read the treaty text that would settle it for a US citizen, so take that one to an adviser.

What the counter on this page is for

The default above is a first year: a move in mid-March 2026, a short Christmas trip home, and stays continuing into 2027. It shows how much of the US$132,900 that first partial year opens up, since the limit follows the days of the tax year inside your qualifying period. Change the dates to test your own move. It covers only the day count for the exclusion, and it does not tell you whether to prefer the credit. To keep a running log of days through the year, the Taxlag app does that. A return with both US and foreign tax is worth showing to a tax adviser, because the choices above carry over from one year to the next.