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Americans Living and Working Abroad: Last Call from the IRS

The Internal Revenue Service (IRS) reminds U.S. taxpayers who live and work outside the United States to file their 2023 federal tax return no later than Monday, June 17.

This deadline applies to U.S. Citizens and resident aliens abroad, including those with dual citizenship.

U.S. citizens or foreign nationals residing abroad or on military service outside the U.S. are entitled to an automatic 2-month extension to file their tax return and pay any amounts due. A taxpayer is entitled to the June 17 extension to file and pay if:
  • You live outside the United States and Puerto Rico and your principal place of employment or position of service is outside the United States and Puerto Rico, or
  • Serve in the military outside the United States and Puerto Rico during the regular due date of your tax return.

To use the automatic 2-month extension, taxpayers must attach a note to their tax return explaining which of the abovementioned situations applies.


File to request benefits

Many taxpayers who live outside the U.S. qualify for tax benefits, such as the Foreign Earned Income Exclusion and the Foreign Tax Credit, but they are only available if you file a U.S. return.

Additionally, the IRS encourages families to learn about expanded tax benefits, such as the Child Tax Credit, Other Dependent Credit, and Child and Dependent Care Expense Credit, and to claim them if they qualify. Although foreign taxpayers often qualify, the calculation of these credits differs depending on whether they lived in the U.S. for more than half of 2023. For more information, see the instructions for Schedule 8812, Tax Credits: qualified Children and Other Dependents, and Form 2441, Child and Dependent Care Expenses.


Report in US dollars

Income received or deductible expenses paid in foreign currency must be reported in US dollars on the tax return. Additionally, any tax payments must be made in US dollars.

IRS Form 8938 stipulates that the December 31 exchange rate must be used for all transactions, regardless of the actual exchange rate on the date of the transaction. Generally, the IRS accepts any published exchange rate that applies consistently.

The FinCEN Form 114 instructions state that for non-U.S. currency accounts, the filer must convert the maximum account value to U.S. dollars using the U.S. Treasury Department's Bureau of Fiscal Service exchange rates. in effect on the last day of the calendar year in question. If the Fiscal Service Office exchange rate is not available, the filer may use another verifiable foreign currency exchange rate.


Making tax payments

The IRS encourages taxpayers to consider paying their U.S. tax obligations electronically to ensure that tax payments are posted on time. The quickest and easiest way to do this is through your personal IRS online account, IRS Direct Pay, and the Electronic Federal Tax Payment System (EFTPS). These and other electronic payment options are available at IRS.gov/payments.


Expat tax return

Taxpayers who have renounced their U.S. citizenship or ended their lawful permanent residency in the U.S. during 2023 must file a dual-status tax return along with Form 8854, Initial and Annual Expatriation Statement. Additionally, a copy of Form 8854 should be submitted to the IRS by the tax return's due date, including any extensions.


How we can help

At H&CO, we have a team of qualified tax professionals (CPAs) who deeply understand the complexities involved in income tax preparation. Our experts are committed to guiding you throughout the process with the utmost care and attention. We provide exceptional service and a personalized approach to help you navigate US and international income tax laws while keeping you updated with the latest changes.

With US offices in Miami, Coral Gables, Aventura, Fort Lauderdale, Orlando, Melbourne, and Tampa, as well as offices in more than 29 countries, our international CPAs and tax advisors are available to help you with all of your tax planning. taxes. tax preparation and IRS representation needs. To learn more about our accounting firm's services, take a look at our Individual Tax Services, Business Tax Services, International Tax Services, Expat Tax Services, SAP Business One, Entity Management, Capital human, and audit and assurance services.

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