How to File US Expat Taxes: Your Complete 2025 Filing Guide
Here’s what you need to know right away: You’re legally required to file a US tax return as an American living abroad, but here’s the good news—approximately 2 out of 3 expats owe absolutely nothing in federal taxes after applying the right exclusions and credits.
This step-by-step guide explains exactly how to file your 2025 expat tax return, which forms you need, and the best filing methods for your situation.
Step 1: Understand Your Filing Obligation
Bottom line: Every US citizen and Green Card holder living abroad must file Form 1040 if their worldwide income exceeds these thresholds:
- Single filers: $13,850 (2024 tax year)
- Married filing jointly: $27,700 (2024 tax year)
- Self-employed: $400+ in net earnings
This obligation exists regardless of:
- How long you lived abroad
- Whether you pay foreign taxes
- Whether you’ll owe US taxes after exclusions
Step 2: Gather Essential Documents
US Income Documents:
- Form W-2 from US employers
- Form 1099s for contractor work or investment income
- The previous year’s tax return for reference
Foreign Income Documentation:
- Foreign employer pay stubs or income statements
- Foreign tax returns filed in your country of residence
- Currency conversion records (use IRS published rates)
Account Information:
- Year-end statements for all foreign bank accounts
- Investment account statements
- Records of foreign pensions or retirement accounts
Step 3: Choose Your Tax Strategy
This is where most expats save significant money. You’ll typically choose between two main approaches:
Option A: Foreign Earned Income Exclusion (Form 2555)
What it does: Exclude up to $130,000 (2025 tax year) / $126,500 (2024 tax year) of foreign earnings from US taxation
Requirements:
- Pass Physical Presence Test (330+ days abroad) OR
- Pass Bona Fide Residence Test
Best for: Expats in low-tax countries like the UAE, Thailand, or Singapore
Example: A Teacher in Thailand earning $50,000 likely owes $0 in US taxes
Option B: Foreign Tax Credit (Form 1116)
What it does: Dollar-for-dollar credit for foreign taxes paid to other governments
Best for: Expats in high-tax countries like Germany, France, or Sweden
Can carry forward: Unused credits for up to 10 years
Example: An Engineer in Germany paying 40% local taxes likely owes $0 in US taxes
Step 4: Select Your Filing Method
| Filing Method | Cost Range | Best For | Includes FBAR? |
| IRS Free File | Free | Very simple returns | No – file separately |
| TurboTax Expat | $120-300 | Basic expat situations | Limited guidance |
| Expat Tax Software | $200-500 | DIY with expat features | Usually separate |
| Professional Filing | $530+ | Complex situations | Yes – included |
DIY Filing Resources
If filing yourself, use these official resources:
- IRS Form 2555 Instructions for FEIE guidance
- IRS FBAR Information for foreign account reporting
- Form 1116 Instructions for Foreign Tax Credit
Step 5: File Required Additional Forms
FBAR (FinCEN Form 114)
- Required if: Foreign accounts exceeded $10,000 total at any point during the year
- Where to file: BSA E-Filing System (separate from tax return)
- Deadline: April 15, automatic extension to October 15
Form 8938 (FATCA)
- Required for: Higher-value foreign assets
- Thresholds: $200,000+ (single expats), $400,000+ (married filing jointly)
- Filed with: Your tax return
State Tax Considerations
Some states continue taxing former residents. Review state tax obligations for your former state of residence.
Step 6: Meet Critical Filing Deadlines
- June 15, 2025 – Automatic filing deadline for expat tax returns (2-month extension)
- October 15, 2025 – Extended deadline if you file Form 4868
- April 15, 2025 – Payment deadline for any taxes owed (even if filing later)
File by June 15 to avoid last-minute stress, but remember payment is due April 15 if you owe taxes.
Common Filing Mistakes to Avoid
- Not filing when required – Even owing $0 doesn’t eliminate filing obligations
- Missing FBAR filing – Separate requirement with severe penalties (up to $12,921 per account)
- Wrong exclusion choice – FEIE vs. Foreign Tax Credit decision affects multiple years
- Ignoring state taxes – Some states aggressively pursue former residents
- Poor record keeping – Maintain documentation for the Physical Presence Test
DIY vs. Professional: Making the Decision
Consider DIY Filing If:
- Single income source from employment
- Living in one country all year
- No complex investments or business income
- Comfortable with tax software and forms
Consider Professional Help If:
- Multiple income sources or countries involved
- Self-employed or business owner abroad
- Significant foreign investments or real estate
- Behind on prior year filings
- Want tax optimization and peace of mind
When Professional Help Pays for Itself
Professional expat tax services often save more than they cost through:
- Penalty Prevention: FBAR violations alone carry penalties up to $12,921 per account
- Tax Optimization: Proper strategy selection can save thousands annually
- Time Savings: Avoid 20-30 hours of research and form completion
- Expert Guidance: Navigate complex situations and changing regulations
Why Choose Greenback for Professional Filing
Greenback is an American company founded in 2009 by US expats for US expats. Our team of CPAs and Enrolled Agents—many of whom are expats themselves living in 14+ time zones—understands your unique challenges firsthand.
What makes us different:
- 23,000+ expats helped, 71,000+ returns filed
- 4.9-star average across 1,200+ TrustPilot reviews
- Transparent flat-fee pricing with no hidden surprises
- Only CPAs and EAs prepare returns from start to finish
- Make It Right guarantee backed by a real company
Take Action: File Your 2025 Expat Taxes
Remember: Most expats owe little or nothing in US taxes, but filing remains mandatory. The key is choosing the right approach for your situation and staying compliant.
Your next steps:
- Get matched with a Greenback CPA for professional filing
- Calculate your estimated costs with our transparent pricing tool
- Contact our Customer Champions with specific filing questions
We’ll match you with the right accountant based on your unique situation and guide you through an easy onboarding process. You’ll have direct, one-on-one access and pay a flat price, backed by our Make It Right guarantee.
No matter how late, messy, or complex your return may be, we can help. You’ll have peace of mind, knowing that your taxes were done right.
Who doesn’t love a tax break? Download our easy-to-use excel calculator to get an estimate of how the foreign earned income exclusion can save you money.
