US citizens living abroad face one of the most complex annual compliance burdens of any nationality. The US taxes citizens on worldwide income regardless of residence, and failure to file the correct forms, even if no tax is owed, can result in significant penalties. This checklist covers the major annual obligations to ensure nothing falls through the cracks and to help you evaluate whether your tax preparer is covering the full picture.
Federal Tax Return: Form 1040
Every US citizen must file a federal tax return if their gross income exceeds the filing threshold ($13,850 for single filers in 2023, but for expats the self-employment threshold of $400 applies). The key question: are you properly claiming the FEIE (Form 2555) or the Foreign Tax Credit (Form 1116), or both?
- Form 1040: due April 15; automatic 2-month extension to June 15 for expats (no form required); Form 4868 extends to October 15
- Form 2555 (FEIE): attach if claiming the Foreign Earned Income Exclusion and/or Housing Exclusion
- Form 1116 (FTC): attach if claiming the Foreign Tax Credit; separate calculation per income basket
- State returns: many US states continue to require returns from former residents; check whether you have properly terminated state tax residency
FBAR and FATCA
These are not part of your tax return but are equally critical. See our dedicated FBAR/FATCA article for the full detail.
- FinCEN 114 (FBAR): file electronically by April 15 (auto-extension to October 15); required if aggregate foreign accounts exceeded $10,000 at any point
- Form 8938: attached to your tax return; required if foreign assets exceed the relevant threshold for your filing status and residency
- Both forms required: filing one does not substitute for the other
- Penalties for failure: among the harshest in US tax law; see our FBAR article for the specific amounts
Foreign Corporation and Partnership Reporting
If you own an interest in a foreign corporation or partnership, additional forms apply. These are often the most commonly missed by expats who set up offshore companies without knowing about the reporting obligations.
- Form 5471: required for US shareholders owning 10%+ of a foreign corporation; $10,000 penalty per year per form for failure to file
- Form 8865: required for US partners in a foreign partnership with 10%+ interest; similar penalty structure
- Form 8858: required for US persons with an interest in a foreign disregarded entity or foreign branch; $10,000 penalty
- Form 926: required when a US person transfers property to a foreign corporation; covers cash contributions over $100,000
Foreign Trust and Gift Reporting
Foreign trusts and large gifts from non-US persons trigger separate reporting requirements that are frequently missed.
- Form 3520: required to report gifts or bequests from foreign persons exceeding $100,000; also required for transactions with foreign trusts
- Form 3520-A: annual return of the foreign trust itself; due March 15 with extension to September 15
- Penalty: 35% of the gross reportable amount for failure to file Form 3520
- Form 709 (Gift Tax Return): required if you make gifts above the annual exclusion ($18,000 per recipient in 2024), including gifts of foreign assets
State Tax Compliance
US states are an often-overlooked piece of the expat compliance puzzle. Several states (California, New York, Virginia, and South Carolina) are notorious for aggressively asserting that former residents remain taxable in the state. Simply moving abroad does not terminate state tax residency without specific steps.
- California: requires affirmative domicile change; having a California driver's license, voter registration, or storage unit can be used to assert continued residency
- New York: 'statutory residency' rules can make you a New York resident even if domiciled elsewhere, if you spend 183+ days there and maintain a 'permanent place of abode'
- Terminating state residency: change your domicile formally before departing; update all registrations; close or minimize ties
- State FBAR equivalents: California imposes its own foreign financial account reporting requirement modeled on FBAR
Nomadic Tax Filing
Our advisors handle your US expat tax return end-to-end: FEIE, FTC, FBAR, and every form that comes with living abroad.