REFERENCE

US taxes for Americans abroad: what actually applies

The US is nearly alone in taxing by citizenship: move to Lisbon or Singapore and your worldwide income is still on a US return. Most expats end up owing little or nothing, but only by using the relief provisions correctly, and two of the big ones are day-count tests. Here is the honest map.

The obligation nobody escapes

If you meet the ordinary filing thresholds, you file, from anywhere. Expats get an automatic extension to June 15 (payments still due in April), and the return is where the relief gets claimed rather than assumed. Skipping filing because "I owe nothing" forfeits the elections that make that true.

Relief route one: the Foreign Earned Income Exclusion

Form 2555 excludes foreign earned income (roughly $130,000 per person in 2025, inflation-adjusted, plus a housing exclusion) if you qualify by one of two tests: bona fide residence (a full calendar year genuinely resident abroad, judged on facts) or the physical presence test: at least 330 full days in foreign countries within any 12-month window. The 330-day route is pure day counting, the margin is only 35 days a year, and US travel days burn it fast. Details and the planning math: the FEIE 330 guide and calculator.

Relief route two: the foreign tax credit

Form 1116 credits foreign income tax against US tax dollar for dollar. In high-tax countries (most of Western Europe), the credit alone often zeroes the US bill and banks excess credits, which is why many advisers prefer it there over the FEIE; it also keeps income "visible" for things like IRA contributions. In low-tax countries the FEIE does the work instead. Choosing is genuine planning, not a checkbox: revoking the FEIE locks it out for five years.

The paragraph about FBAR everyone needs

Separate from the tax return: if your non-US financial accounts together exceed $10,000 at any point in the year, you file an FBAR (FinCEN 114), and FATCA's Form 8938 can apply at higher thresholds. These are information filings, not taxes, but the penalties for ignoring them dwarf most people's actual tax. If this is you, file them.

The state tax surprise

Federal relief does nothing about your state. Sticky states keep claiming movers who left for abroad without cleanly ending domicile, California being the famous example, and the dispute is argued from ties and days. If you left a state for another country, the exit evidence matters exactly as it does for a domestic move.

"Expatriate tax": the term means two things

Colloquially, "expatriate tax" means everything on this page: the US taxes an American living abroad. Technically, the expatriation tax is something narrower and harsher: the exit tax (section 877A) on certain people who renounce citizenship or abandon a long-held green card, a deemed sale of worldwide assets on the way out for covered expatriates. If you are researching a renunciation, that is specialist territory; this page covers the far more common case of living abroad while keeping the passport.

Where the day counting bites

Three clocks in this picture are day counts: the FEIE's 330 foreign days, the state exit you may still be proving, and, for green-card holders and returning visitors, the Substantial Presence Test. SpyglassBeacon runs them from one automatic, on-device record: foreign days toward 330 with a live "days still needed" count, per-state and per-country history, and a timestamped export for whoever prepares the return.

Frequently asked questions

Related: The FEIE 330 guide · Physical Presence Test calculator · Resident vs. nonresident alien · Schengen 90/180 tracker