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U.S. Expats Abroad

U.S. tax guides for Americans living overseas: the physical presence test, FEIE vs. foreign tax credit, PFIC exposure on foreign funds, and country-specific filing considerations.

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Deductions & Credits

Form 1116 and the Foreign Tax Credit: How U.S. Taxpayers Offset Foreign Taxes Form 1116 claims the Foreign Tax Credit: a dollar-for-dollar credit for income taxes paid abroad. Here's which taxes qualify, how the limitation and income baskets work, and how the credit interacts with the FEIE.

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Form 2555 and the Foreign Earned Income Exclusion: Who Qualifies and How It Works The Foreign Earned Income Exclusion lets US expats exclude foreign wages from US tax. Here's who qualifies, the physical presence vs bona fide residence test, and when the Foreign Tax Credit is the better choice.

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FEIE vs. Foreign Tax Credit: Which Should U.S. Expats Take? The FEIE and Foreign Tax Credit both reduce your U.S. tax bill, but choosing the wrong one can cost you IRA eligibility, Social Security credits, and thousands in taxes.

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Compliance & Reporting

Form 8858: Foreign Disregarded Entities and Foreign Branches Form 8858 is required when a U.S. person owns a foreign disregarded entity or operates a foreign branch, including many self-employed expats. Here's who must file, what counts as a foreign branch, and the penalties.

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Form 8938 and FATCA: Foreign Financial Asset Reporting for US Persons Form 8938 (FATCA) requires US persons with foreign financial assets above the threshold to report them annually. Here's how it differs from FBAR, the thresholds, and the penalties for missing it.

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FBAR (FinCEN Form 114): Who Must File and the Real Cost of Getting It Wrong If your foreign accounts together crossed $10,000 at any point in the year, you almost certainly have an FBAR to file. The penalties for ignoring it are far larger than most people expect, and missing prior years is usually fixable if you move first.

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ITIN Applications (Form W-7): How Foreign Individuals Get a U.S. Tax ID An ITIN lets someone who cannot get a Social Security number file a U.S. return, claim a treaty benefit, or be claimed as a spouse or dependent. The application is straightforward once you know which document path avoids mailing your passport to the IRS.

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Streamlined Filing Compliance Procedures: How to Catch Up on Late FBARs and Foreign Income If you missed foreign account reporting because you genuinely did not know the rules, the Streamlined Procedures let you catch up with limited or no penalty. The catch is that they require certifying non-willful conduct and only work before the IRS contacts you.

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Form 8621: PFIC Rules for Foreign Mutual Funds and Non-U.S. Investments Foreign mutual funds, ETFs, and certain non-U.S. holding companies can trigger PFIC rules and Form 8621. The tax cost is often worse than investors expect, and the filing can follow you for years.

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International & Treaties

U.S. Tax in Mexico: Expat Filing, Treaty Planning, and Mexican Investment in the U.S. U.S. tax guide for Americans living in Mexico and Mexican residents investing in the U.S., including treaty issues, Mexican entities, U.S. LLCs, and U.S. real estate.

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Form 8833: Treaty-Based Return Positions and When You Must Disclose Them Claiming a tax treaty benefit that overrides U.S. tax law often requires disclosure on Form 8833. Here's when the form is required, when it's waived, and why the treaty tie-breaker can be dangerous for green card holders.

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GILTI and Net CFC Tested Income: How the U.S. Taxes CFC Profits GILTI was renamed net CFC tested income for 2026, with a 40% deduction and a 90% foreign tax credit. Here is how the regime works for corporations and individuals, and how the Section 962 election and high-tax exclusion change the answer.

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PFIC Tax Rules: What U.S. Investors Need to Know About Foreign Funds U.S. persons who own shares in foreign mutual funds, ETFs, or pooled investment vehicles are likely holding a PFIC. The tax consequences are severe by default, but elections are available that can change the outcome significantly.

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Residency & Status

Physical Presence Test for U.S. Expats: How to Track the 330 Days The physical presence test for the Foreign Earned Income Exclusion is stricter than most expats expect. It requires 330 full days in foreign countries during a 12-month period, and travel days are often where the calculation breaks.

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