How to File U.S. Taxes While Living Abroad: Step-by-Step Filing Process

According to IRS data from 2016-2021, 62% of Americans who file from abroad owe $0 in federal taxes after applying available exclusions and credits. Filing from overseas involves specific steps and methods that differ from domestic filing, but with proper preparation, most expats complete the process smoothly.

Filing U.S. taxes from abroad requires submitting forms by mail or electronically, gathering foreign income documentation with proper currency conversions, and coordinating your federal return with separate foreign account reports. This guide walks you through every step of the filing process, from document preparation to submission.

Not Sure Where to Start? We’ll Guide You

Share a few details about your situation and we’ll walk you through which forms you need, whether you qualify for FEIE or FTC, and your best filing strategy.

Step 1: Gather Your Tax Documents Before You Start

Organized documentation prevents delays and ensures accurate filing. Start collecting these documents at least 8 weeks before your filing deadline:

U.S. Income Documents

W-2 forms from U.S. employers (request early if your address has changed)
1099 forms for contractor income, dividends, or interest
Prior year tax return for reference

Foreign Income Documentation

Foreign pay stubs or income statements from employers
Year-end summary from a foreign employer showing total compensation
Foreign tax return filed in your country of residence
Documentation of any employer-provided benefits (housing, transportation, tuition)

Foreign Account Information

Year-end statements for all foreign bank accounts
Monthly statements showing maximum balance during the year (for FBAR)
Investment account statements from foreign brokers
Foreign pension or retirement account statements

Currency Conversion Records

For consistency, use the IRS’s yearly average exchange rates or rates from a single reliable source, such as OANDA.com, for all conversions. Document which rate you use.

Physical Presence Tracking

If you’re claiming the Foreign Earned Income Exclusion via Physical Presence Test, create a detailed travel log showing:

Entry and exit dates for every country
Purpose of travel
Days spent in each location
Flight confirmations and accommodation receipts as backup

Step 2: Choose Your Filing Method

You have three primary options for submitting your return from abroad:

Paper Filing by Mail

Many expats still file paper returns, especially when claiming first-time FEIE with Form 2555 or dealing with complex international situations.

Where to mail your return:

If you’re living abroad with no tax due, mail to:

Department of the Treasury
Internal Revenue Service
Austin, TX 73301-0215 USA

If you owe taxes, mail to:

Internal Revenue Service
P.O. Box 1303
Charlotte, NC 28201-1303 USA

Always use certified mail with tracking from your local postal service. Processing takes 8-12 weeks for paper returns.

Pros: Works for all situations, creates a paper trail, required for certain amended returns
Cons: Slow processing, risk of mail delays, no instant confirmation

Electronic Filing (E-File)

E-filing from abroad speeds processing to 3-4 weeks and provides instant confirmation.

Available options:

IRS Free File: Free for qualifying taxpayers (AGI under threshold), but the limited software handles Form 2555 properly
Commercial software: TurboTax and H&R Block offer expat editions, though support for complex situations varies
Professional e-file: Most expat tax preparers submit electronically

Important limitation

Not all expat forms can be e-filed. You may need to paper file if you’re using:

– Certain treaty positions requiring Form 8833
– Multiple foreign sources require detailed explanations
– First-time Form 5471 for foreign corporation ownership

Pros: Faster processing, immediate confirmation, and refunds arrive quicker
Cons: May not support all expat situations, requires working software knowledge

Professional Preparation and Filing

CPAs and Enrolled Agents specializing in expat taxes handle the entire filing process, including electronic submission or proper mailing procedures.

What professionals provide:

Complete form preparation with expat-specific expertise
Strategic tax planning (FEIE vs. Foreign Tax Credit analysis)
Proper currency conversions and documentation
Electronic filing with IRS-approved software
Representation if questions arise

Best for: First-time filers from abroad, multiple income sources, self-employment abroad, catching up on late returns, or complex investments.

Step 3: Complete Your Core Tax Forms

Form 1040: Your Base Return

Start with Form 1040 using your foreign address. Enter worldwide income before applying any exclusions or credits.

Critical address formatting:

Use your actual foreign address in the correct format for your country. The IRS needs to know you live abroad to process expat forms properly.

Important

Report all income first, then reduce it through exclusions. Never simply omit foreign income because you think it’s excluded.

Form 2555: Claiming the Foreign Earned Income Exclusion

If you’re using FEIE to exclude up to $132,900 (2026 tax year), Form 2555 requires careful attention:

Part I: General information about your employer and foreign residency
Part II: Physical Presence Test details (if applicable) – list every country and date
Part III: Bona Fide Residence Test details (if applicable)
Part IV: Your earned income with precise currency conversion
Part VI: Foreign Housing Exclusion calculation if eligible

Check out our guide for detailed Form 2555 instructions.

Common Form 2555 mistakes:

Mixing up days in/out of the U.S. for physical presence
Using the wrong 12-month period for qualification
Including U.S.-sourced income in the foreign income section
Forgetting to prorate if you moved mid-year

Form 1116: Claiming the Foreign Tax Credit

If you paid foreign income taxes, Form 1116 allows you to claim the credit. Complete a separate Form 1116 for each income category (passive, general, etc.).

Required attachments:

Statement showing foreign tax calculation
Explanation of the currency conversion method
Foreign tax payment documentation

Pro Tip

Keep copies of foreign tax returns and payment receipts for six years or more. The IRS may request verification during audits.

Schedule 1: Additional Income and Adjustments

Schedule 1 captures:

Foreign unemployment compensation (not eligible for FEIE)
Foreign rental property income
Self-employment income from Schedule C
Foreign Housing Deduction (for self-employed expats)

Step 4: File Separate Foreign Account Reports

These reports are submitted separately from your tax return:

FBAR Filing

If your foreign accounts totaled over $10,000 at any time during the year, file FinCEN Form 114 electronically:

Step-by-step FBAR filing:

Go to the BSA E-Filing System
Create an account (requires email verification)
Select “FBAR” from available forms
Enter account information for each foreign account
Report maximum value during the year (not the year-end balance)
Convert all amounts to USD using December 31 Treasury rates
Submit electronically (system confirms receipt immediately)

Deadline: April 15, 2026, with automatic extension to October 15, 2026. No extension request needed.

Record-keeping: Save the confirmation email and a PDF copy for your records. Maintain supporting documentation for 6 years.

Form 8938: FATCA Reporting

Higher-value foreign assets require Form 8938 attached to your tax return. Thresholds for expats living abroad:

Single: $200,000 on the last day of the year OR $300,000 at any time
Married filing jointly: $400,000 on last day OR $600,000 at any time

Unlike FBAR, Form 8938 attaches directly to Form 1040 and includes broader asset categories.

Learn the complete differences in our FBAR vs. FATCA guide.

Step 5: Handle State Tax Filing

Don’t assume moving abroad eliminates state obligations. Some states continue claiming you as a resident until you definitively sever ties.

“Sticky states” that aggressively pursue expats:

California
New York
Virginia
South Carolina

Essential steps before filing:

Determine current state residency status
File part-year resident return for the year you moved (if applicable)
File a non-resident return if you have state-source income (rental property, partnership income)
Document steps taken to establish non-residency

Read our complete state tax guide for expats before assuming you’re clear of state obligations.

Step 6: Make Payments and Track Refunds

Payment Options

If you owe taxes after exclusions and credits:

Pay by April 15, 2026, even if filing later. Interest accrues on unpaid taxes from April 15, regardless of filing extensions.

Payment methods from abroad:

IRS Direct Pay (free, from a U.S. or foreign bank with a U.S. routing)
Credit/debit card (processing fees apply, 1.85-1.99%)
EFTPS (Electronic Federal Tax Payment System)
Check or money order by mail (use international certified mail with tracking)

Foreign bank transfers: The IRS does not accept direct international wire transfers. Use Direct Pay linked to foreign bank accounts where available, or payment processors that accept international cards.

Refund Delivery

Refunds to foreign addresses are typically sent as checks mailed internationally, which can take 8-16 weeks to arrive.

Faster refund option: Direct deposit works if you maintain a U.S. bank account. Enter routing and account numbers on Form 1040.

Tracking Refunds: Use the IRS ‘Where’s My Refund’ tool starting four weeks after e-filing or eight weeks after mailing a paper return.

Step 7: Know Your Deadlines and Extensions

Standard expat deadlines for filing in 2026:

April 15, 2026: Payment due (extensions don’t delay payment)
June 15, 2026: Automatic filing extension (no form required if living abroad)
October 15, 2026: Final extended deadline (must file Form 4868 by June 15)

The two-month automatic extension to June 15 applies if you live and work abroad on the April 15 deadline. Your foreign address on Form 1040 serves as proof.

Extension beyond June 15:

File Form 4868 before June 15 to extend until October 15. This is common for expats who need extra time to qualify under the Physical Presence Test.

Learn complete expat deadline strategies in our tax deadline guide.

Filing When You’re Behind

If you haven’t filed for multiple years, the IRS offers specific procedures for expats:

Streamlined Filing Compliance Procedures let you catch up penalty-free by filing:

Last 3 years of tax returns
Last 6 years of FBARs
Certification on Form 14653 that non-filing was non-willful

In 2023, the IRS approved 86% of streamlined applications and waived over $6 million in penalties. You must come forward before the IRS contacts you to qualify.

Common Filing Mistakes That Cause Delays

Incomplete forms: Missing signatures, Social Security numbers, or required schedules trigger rejections. Double-check every form before submitting.
Wrong filing address: Using domestic IRS addresses instead of international addresses delays processing by months.
Currency conversion errors: Inconsistent exchange rates throughout the return raise red flags. Stick with one method.
Missing FBAR: This is filed separately and cannot be included with Form 1040. Missing FBAR carries penalties starting at $16,536 per form.
Forgetting to attach forms: Form 2555, Form 1116, and other schedules must attach to Form 1040. Paper filers should staple in proper order.

Let Greenback Handle Your Filing From Abroad

Greenback is an American company founded in 2009 by U.S. expats for expats. Our CPAs and Enrolled Agents (many living abroad themselves in 14 time zones) specialize exclusively in expat tax preparation.

What we handle for you:

Complete document collection and organization
Proper form completion with expat-specific expertise
Strategic optimization (FEIE vs. FTC analysis)
Electronic filing with IRS-approved software
Separate FBAR filing through FinCEN system
State return preparation when needed

We’ve filed 71,000+ returns for 23,000+ expats across 190+ countries, maintaining a 4.9-star average across 1,200+ TrustPilot reviews. Transparent flat-fee pricing means no surprise charges, backed by our Make It Right guarantee.

Your next steps:

Get matched with an expat tax CPA based on your location and situation
Calculate your service cost with our transparent pricing calculator
Contact our Customer Champions with filing process questions

Ready to File Your Expat Taxes? Let Us Handle Everything

From FEIE to Foreign Tax Credit, FBAR, and Form 8938, we’ll prepare your full return so you don’t have to worry about missing a step.

This article provides general information about filing procedures for U.S. taxes from abroad. Filing requirements vary based on individual circumstances, income sources, countries of residence, and other factors. This content should not be considered specific tax advice. Always consult with a qualified tax professional regarding your unique situation. Tax laws and IRS procedures are subject to frequent changes, and the information presented reflects the current requirements as of the publication date.