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Roth IRA vs. traditional IRA: Which retirement account is right for you?

14 Nov 2024

IRS announces inflation-adjusted tax penalties for 2025

12 Nov 2024

IRS announces e-filing shutdown for system update

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Core ($400)
Form 1040 federal tax return package
Premier ($500)
For those with additional income sources beyond the core package.
Streamlined procedure ($1,300)
For those who have not filed and want to become compliant with amnesty from penalties.

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American educators abroad

We serve many Americans who work as teachers and professors in international schools and universities.

First — the 'not so great news'. If you are a US citizen or green card holder working at an international school or university overseas, you are still required to file a US tax return.

Now — the good news. In most cases you will not owe any taxes to the IRS.

Because of the expat exclusion, roughly the first $100,000 are tax free. Beyond that, whatever taxes you are paying in your resident country are used to offset your U.S. tab obligation — so in the end you would owe nothing. The catch is that you must actually file the tax return (and do so correctly) to benefit from these tax saving opportunities. Otherwise, the IRS could deny you these benefits and make you pay tax.

Frequently asked questions

1. I work abroad and have no U.S. income - am I still required to file tax return with the IRS?

Yes - such is the U.S. law. American citizens are required to file an annual return on their worldwide income (regardless of where they live and where the income is earned). Please see for full details: https://www.taxesforexpats.com/expat-tax-advice/why-file.html

For more details about history of how U.S. came to this mode of taxation, please see: https://www.taxesforexpats.com/expat-tax-advice/Citizenship-Based-Taxation-International-Comparison.html

2. What will happen if I do not file?

Unfortunately the IRS is rather strict if it finds that you haven't filed with potentially large fines.

We wrote an article that fully explains it: https://www.taxesforexpats.com/articles/tax-rules/what-if-you-don-t-file-your-expat-tax-return-irs-fees-penalties.html

3. How can the IRS find me?

There are multiple way that the IRS can find you, even if you are living and working abroad.

We wrote this article that explains this: https://www.taxesforexpats.com/expat-tax-advice/how-irs-can-find-you.html

4. Can I file when I return to the US?

While possible, it's not advisable.

The main reason is that currently the IRS is offering a penalty-free amnesty program for those who are living abroad. It allows filing of last 3 years of returns (even if you haven't filed for longer) and leaves you free of any fees or penalties. But the key element required for joining the program is your residence abroad. If you plan to deal with these matters upon your return, the terms you will face will be very different.

5. At what income level am I required to file the US tax return?

This article expains this in detail: https://www.taxesforexpats.com/expat-tax-advice/minimum-filing-requirements.html

In general the minimum filing threshold is $12,000.

6. Should I prepare my own expat tax return or have it done professionally?

We believe you should have certain things done professionally - tax preparation being one of them.

This article explains this in more details: https://www.taxesforexpats.com/about/why-get-professional.html

7. If my school pays for my initial move and annual trips back home, is this considered taxable income? Can it be excluded using the FEIE?

Yes, this is all considered taxable income and both positions are subject to exclusion.

Initial move expenses are excluded on a separate form.

Paid trips back home are excluded to the extent of the allowed annual cap for exclusion ($97,600 for 2013).

Roth IRA vs. traditional IRA: Which retirement account is right for you?

IRS announces inflation-adjusted tax penalties for 2025

IRS announces e-filing shutdown for system update

Roth IRA vs. traditional IRA: Which retirement account is right for you?

IRS announces inflation-adjusted tax penalties for 2025

IRS announces e-filing shutdown for system update

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American educators abroad

We work with schools on every continent & help hundreds of educators every year

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