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If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. You are subject to tax on worldwide income from all sources and must report all taxable income and pay taxes according to the Internal Revenue Code.
Many Americans living abroad qualify for special tax benefits, such as the foreign earned income exclusion and foreign tax credit, but they can only get these benefits by filing a relevant U.S. return. For further details, see Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.
U.S. taxpayers who own or have an interest in certain foreign financial accounts in excess of the reporting threshold must report those accounts to the U.S. Treasury Department, even if the accounts don't generate any taxable income. Taxpayers should file a FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), electronically by the due date (generally April 15) using the BSA e-filing system. For further details see report of Foreign Bank and Financial Accounts (FBAR).
U.S. persons (and executors of estates of U.S. decedents) must file Form 3520, Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts, to report:
- Ownership of, transfer(s) to and distribution(s) from a foreign trust, note that a foreign trust may include a foreign pension or retirement plan treated as a trust
- Receipt of more than $100,000 in gifts or bequests from a nonresident alien individual or foreign estate (including foreign persons related to that nonresident alien individual or foreign estate)
- Receipt of gifts from foreign corporation(s) or foreign partnership(s) that exceed the section 6039F threshold amount (available at IRS.gov/Newsroom/Inflation-Adjusted-Tax-Items-by-Tax-Year)
CAUTION: Foreign pension and retirement plans, including self-funded plans and some employer-sponsored plans, may meet the definition of a grantor trust to the extent the foreign pension plan vehicle is a foreign trust and the individual (plan member) contributes property to the plan. Such individual, who contributes property to a foreign trust for their own benefit, is treated as the owner of the plan under the grantor trust rules even if the individual does not retain any level of control over plan investments and distributions. See the grantor trust rules in sections 671 through 679.
As a U.S. person engaged in transactions with a foreign trust, you are responsible for filing Form 3520 to report ownership of, transfer(s) to and distribution(s) from the foreign retirement plan. If you are treated as the owner of a foreign trust under the grantor trust rules you must ensure that the foreign trust files a Form 3520-A or must file a substitute Form 3520-A attached to your Form 3520 on behalf of the trust.
NOTE: Form 3520 does not have to be filed to report the following transactions:
- Transfers to a funded nonqualified deferred compensation arrangement described in section 402(b)
- Transfers to a stock, bonus, pension, or profit-sharing trust that would qualify for exemption section 501(a) except for the fact that it is a trust created or organized outside the United States described in section 404(a)(4)
- Amounts paid or accrued by an employer under a qualified foreign plan described in section 404A
- Transfers to, ownership of, and distributions from a Canadian registered retirement savings plan (RRSP), a Canadian registered retirement income fund (RRIF), or any other Canadian retirement plan that is within the meaning of section 3 of Revenue Procedure 2014-55. See Revenue Procedure 2014-55, 2014-44 I.R.B. 753, at irs.gov/IRB/2014-44_IRB#RP-2014-55
- Certain eligible individuals’ transfers to, ownership of, and distributions from certain tax-favored retirement trusts as described in section 5 of Revenue Procedure 2020-17. See Revenue Procedure 2020-17, 2020-12 I.R.B. 539, at irs.gov/IRB/2020-12_IRB#RP-2020-17
- Certain eligible individuals’ transactions with, and ownership of, certain tax-favored foreign trusts that are established and operated exclusively or almost exclusively to provide pension or retirement benefits, or to provide medical, disability, or educational benefits, as described in proposed regulations under section 6048. You may rely on these proposed regulations for any tax year ending after May 8, 2024, and beginning on or before the date that final regulations are published in the Federal Register, provided you and all related persons (within the meaning of sections 267(b) and 707(b)(1)) apply the proposed regulations in their entirety and in a consistent manner for all tax years beginning with the first tax year of reliance until the applicability date of the final regulations. See Proposed Regulations section 1.6048-5 as published in the Federal Register at govinfo.gov/content/pkg/FR-2024-05-08/pdf/2024-09434.pdf.
See the Instructions for Form 3520 for more detailed information regarding exclusions from reporting.
CAUTION: Revenue Procedure 2020-17 does not provide relief from any other required information reporting of such trusts (such as Form 8938, Statement of Specified Foreign Financial Assets and FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), nor does it provide any relief from taxation.
Taxpayers must also report virtual currency transactions to the IRS on their tax returns; these transactions are taxable by law just like any other property transaction. For more information see virtual currencies.
When to file
If you are a U.S. citizen or resident alien residing overseas or are in the military on duty outside the U.S., on the regular due date of your return, you are allowed an automatic 2-month extension to file your return without requesting an extension. If you use a calendar year, the regular due date of your return is April 15, and the automatic extended due date would be June 15. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day.
If you qualify for the 2-month extension but are unable to file your return by the automatic 2-month extension date, you can request an additional extension to October 15 by filing Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return, before the automatic 2-month extension date. Even if you are allowed an extension, you will have to pay interest on any tax not paid by the regular due date of your return.
Where to file
If you are a U.S. citizen or resident alien (including a green card holder) and you live in a foreign country, and you are:
Requesting a refund, or no check or money order enclosed, mail your U.S. tax return to:
Department of the Treasury
Internal Revenue Service
Austin, TX 73301-0215
USA
Enclosing a check or money order, mail your U.S. tax return to:
Internal Revenue Service
P.O. Box 1303
Charlotte, NC 28201-1303
USA
Electronic filing (e-file)
Taxpayers with an AGI (Adjusted Gross Income) within a specified threshold can electronically file their tax return for free using Free File. Taxpayers with an AGI greater than the specified threshold can use the free file fillable forms, the e-file by purchasing commercial software, or the authorized IRS e-file provider locator service. A limited number of companies provide software that can accommodate foreign addresses.
Taxpayer identification number
Each taxpayer who files, or is claimed as a dependent on, a U.S. tax return will need a social security number (SSN) or individual taxpayer identification number (ITIN). To obtain an SSN, use Form SS-5, Application for a Social Security Card. To get Form SS-5, or to find out if you are eligible for a social security card, contact a Social Security office or visit Social Security international operations. If you, or your spouse, are not eligible for an SSN, you can obtain an ITIN by filing form W-7 along with appropriate documentation.
Using an IP PIN to file
If you have an Identity Protection PIN (IP PIN), the correct IP PIN must be entered on electronic and paper tax returns to avoid rejections and delays. An incorrect or missing IP PIN will result in the rejection of your e-filed return or a delay of your paper return until it can be verified.
Don’t reveal your IP PIN to anyone. It should be known only to your tax professional and only when you are ready to sign and submit your return. The IRS will never ask for your IP PIN. Phone calls, emails or texts asking for your IP PIN are scams.
If you do not have an IP PIN, refer to Get an Identity Protection PIN (IP PIN) for details.