Posted Sunday, December 1, 2024

This checklist is an addendum for expats and should be used in conjunction with our Sending Docs Checklist for 1040 Tax Returns.

Special Expat Timelines

For partial years, you must qualify as an expat taxpayer (foreign earned income exclusion) before we can file your tax returns. For example, you leave the United States on August 1, 2023. We must wait until the following July 31, 2024 before we can file your tax returns. However, if you owe taxes, those payments are required by April 18 to avoid interest (penalties are delayed until June 15). Therefore, it is ideal to prepare the tax returns, compute your tax liability, make a timely payment of taxes, and then file the tax returns when you qualify as an expat taxpayer.

FBAR FinCEN Report 114

We can complete the Report of Foreign Bank and Financial Accounts (FBAR) for foreign financial accounts if you like. This report is now required to be filed by typical tax return filing deadlines, and is commonly filed in conjunction with your individual tax returns. We do not automagically complete the FBAR nor is it included in your tax preparation fee. Our fee for the FBAR is $350 which includes up to 5 accounts.

This might seem steep and you are welcomed to do it yourself… the questionnaire is lengthy so we not only have to gather a bunch of stuff from you, we have to submit it as well. The FBAR is electronically submitted to the Financial Crimes Enforcement Network, a division of the U.S. Treasury Department (who also oversees the IRS).

IRS Form 8938

Similar to the FBAR, we do not automatically complete IRS Form 8938 nor is it included in your tax preparation fee. Our fee for IRS Form 8938 filing is $350 which includes up to 5 accounts. If you are unmarried (filing as a single) and you have foreign assets exceeding $200,000 on the last day of the year or $300,000 anytime throughout the year, or $400,000 and $600,000 respectively for married taxpayers, you are usually required to file Form 8938.

If you do not qualify as an expat, Form 8938 is still required for joint filers if you have foreign assets exceeding $100,000 on the last day of the year or $150,000 anytime throughout the year. The IRS has a nice Form 8938 table detailing the filing requirements for those living in the U.S. versus outside the U.S.

FBAR versus 8938

Some taxpayers might file on the FBAR. However, if a taxpayer has to file IRS Form 8938, it is a near certainty that he or she would also file the FBAR. Both forms are now typically filed with your individual tax return (Form 1040) and due April 15 (the FBAR does have an automatic 6-month extension built into it).

Not all worksheets are required. They are only used when the data is not found elsewhere (such as charity or rental property) or if you need to update things (such as banking information for direct deposit).

Foreign Earned Income Exclusion

Please submit your foreign earned income, travel dates, housing allowance, etc. using the following secure form-

FBAR and 8938 Information

Please use the following form to supply FBAR and 8938 information if you want us to prepare these filings in connection with your tax returns-

If you have any questions, please feel free to call us at 719-387-9800 or email [email protected]. Thanks again for your time- We look forward to working with you!!