A simple and comprehensive checklist to help prepare your expat tax returns. Provide this list to an expat tax professional or use it to complete your taxes on your own.
Get an idea for what will be needed to complete your US taxes.
Disclaimer: Taxes for expats living abroad are extremely complex. We insist that your best bet is to hire a tax professional who specializes in these tax returns. There are so many unique situations that can lead to penalties and more taxes. This guide is very general and does not replace the IRS publications on how to stay compliant with your taxes.
US Expat Tax Checklist – Online Tax Professionals
Expat tax checklist item 1 – Identification
Expat taxpayers need to list the complete legal name, date of birth, and social security number (or ITIN) which is needed for every taxpayer and dependent to be listed on the tax return.
2 – Address Information
Your tax return will possibly require your foreign living address, your US mailing address (if applicable), and the address of your employer(s) and/or your business.
3 – Date your foreign residence was established
This will be needed to complete the foreign earned income exclusion.
4 – Travel Information
Also needed for the foreign earned income exclusion will be to list all travel and the arrival and departure dates for the applicable year.
5 – Occupation
Each taxpayer must list their occupations. In some cases, this is listed more than once on the tax return.
6 – Wages or self employment income totals
Most expat tax professionals will want this in your local currency. The IRS generally wants specific rates used to convert this income to US dollars. Self employed taxpayers will need to create a simple categorized profit and loss statement.
7 – All worldwide income
This includes wages, income from self employment, income from renting property, interest, dividends, capital gains, etc. US persons are required to report all of their worldwide income.
8 – All US tax documents
Gather and include all W2s, 1099s, 1098s, etc, as applicable.
9 – Non US income taxes paid
You will need the amount and dates of any foreign “income” tax paid. Plan to list “social taxes” or “wealth taxes” separately.
10 – Housing Expenses
If you claim the foreign earned income exclusion and your income exceeds the exclusion, you might qualify for the housing exclusion. List those expenses and provide them to your tax professional to claim as appropriate.
Expat tax checklist item 11 – Financial account maximum and end of year totals
If so, it must be indicated on your tax return (and an FBAR report will be required).
If you had more than this in max value, you may also need to include form 8938 (statement of specified foreign assets). The thresholds for these vary.
Do not skip this step or ignore these requirements as the penalties for not filing them when they are required are extreme.
12 – Non-US entity control or shares
If you have control or shares of any foreign corporation, partnership, or trust – there are some strict filing requirements for this as well.
If you received a distribution from a foreign trust or a gift from a non-US person, there may be additional forms required to be filed.
Non compliance in these areas can invoke extreme penalties ($10,000 to $100,000 per year and even more).
13 – State taxes
If you maintain a permanent residence or even if you intend to return to some states, these states might require you to file your state taxes.
The best place to look to make sure is in your state’s filing instructions for non residents or for those living abroad.