The Most Trusted US Expat Tax Software

It provides multiple ways to contact customer support for tax filing assistance, including phone, chat, email and professional tax assistance. And while TurboTax also scored very well for this category, we’ve chosen TaxSlayer because it offers free professional tax assistance. MyExpatTaxes, an expat tax software that can e-file expat taxes for an accurate, fast and affordable filing experience!

1. Tax software is a digital product that allows you to file both your federal and state tax returns with guided help.
2. To qualify as a Bona Fide Resident, for the first year you need to have been living in a foreign country for an entire tax year, which is where many expats get confused.
3. The program has been around since 2003, but you’re forgiven if you haven’t heard of it.
4. This is the same for estate taxes for U.S. citizens living abroad.

The extension will give you until October 15 to file your U.S. tax return. You can also mail a physical IRS Form 4868 and pay $1 worth of extension taxes if that’s preferred. Instead of claiming a credit for eligible foreign taxes, you can choose to deduct foreign income taxes that you paid. This means you can take the benefit as a tax credit or as a tax deduction depending on which one is best for you.

Expats can eventually lose their passport for failing to file

However, if you meet IRS qualifications, the TaxAct IRS Free File Edition might work for you. If all of your foreign-taxed income was 1099-reported passive income, such as interest and dividends, you don’t need a 1116, provided that any dividends came from stock you owned for at least 16 days. Part 2 to list taxes paid in both the foreign currency and their U.S. dollar equivalent. Form 1116 first asks you to classify your foreign income by category. The author, a certified public accountant (CPA) with more than 20 years of taxation experience, completed all tax software testing by opening accounts with each provider to perform hands-on evaluations.

Child Tax Credit Calculator

Suppose, for example, you’re trying to figure out your status for the 2020 tax year because you lived in the U.S. for 60 days. As a CPA and former IRS agent, I can tell you that there are certain filing situations when you should hire a tax professional. I have seen many do-it-yourself tax returns that landed in the hands of an IRS auditor. us tax software for expats TurboTax also can be more expensive than its competitors, depending on the time of year. Its prices fluctuate and—without promotions or add-ons—currently range from $69 to $129 for federal income tax filing, plus an additional $59 for each state tax return. TaxSlayer Premium offers outstanding customer service compared to its competitors.

However, there are additional forms and schedules that may apply, such as Form 2555 (for claiming the Foreign Earned Income Exclusion) and Form 1116 (for claiming the Foreign Tax Credit). The FEIE allows you to exclude a certain amount of your foreign-earned income from U.S. taxation. The FTC, on the other hand, provides a credit for taxes paid to a foreign country, which can offset your U.S. tax liability. For accountants, providing comprehensive and personalized tax advice to U.S. expatriates requires a deep understanding of international tax laws, relevant tax forms, and potential tax benefits. When it comes to free tax filing options, all products are not created equal.

You’ll also need to pass either the Physical Presence test or the Bona Fide Residence Test to claim the Foreign Earned Income Exclusion. Partial-year exclusions are available if you’ve recently moved to a foreign country or returned to the U.S. mid-year. If you have any questions about whether https://turbo-tax.org/ you qualify under either test, you can review Publication 54 from the IRS. On the other hand, if you expect a refund, you don’t need to submit payment by the deadline. Further, you would not likely have any penalty or interest for late filing since these are a percentage of the amount due.

Best Tax Software Of 2022

The company’s new “Pay Per Return” policy was criticized for adding a $9.95 fee to print or e-file each additional return after the first, including returns prepared for members of the same household. On December 12, 2008 the company announced that it had rescinded the new policy. For these reasons, expat tax specialist firms often save expats far more money than they cost, as well as a whole load of time and hassle, by giving advice based on experience that a software just cannot provide. All of our picks offered an affordable tax software solution good for a variety of expatriate filing needs and situations. If you’re unsure whether you’re required to pay taxes in the country you reside in, make sure to get advice from a tax professional.

In addition, tax software allows accountants to input financial data from various sources, including foreign income, in a streamlined manner. Our analysis included a thorough review of each platform’s support options. We determined if the online tax software providers offered phone, live chat, email or help articles for users, and we evaluated each option.

US TAX SOFTWARE – COMPARING SOLUTIONS FOR US EXPATS

Marrying a non-American while overseas is commonplace for Americans overseas, and taxes for expats aren’t top-of-mind when walking down the aisle. FBAR and FATCA penalties are steep if you knowingly fail to file. If you meet the requirements and you’re found willfully failing to file an FBAR you can be fined up to the greater of $124,588 or 50% of the total balance in all your overseas accounts. The IRS previously partnered with private companies to create another free tax filing program called Free File, but only about 2% of eligible taxpayers use it. The fee can range from several hundred dollars to several thousand dollars, depending on the tax preparer and the complexity of the return.

Do American expats have to file a state income tax return?

Some tax preparers charge a fixed fee that varies by how complicated the return is to prepare. Individuals typically pay a fixed fee, while corporations usually pay hourly rates. Our editors are committed to bringing you unbiased ratings and information. We use data-driven methodologies to evaluate financial products and companies, so all are measured equally. You can read more about our editorial guidelines and the taxes methodology for the ratings below.

However, there are fewer effective tax software options for US expat. This is because filing US taxes from abroad is more complicated. The Foreign Bank Account Report is a form that you as a US American abroad are required to fill out if you have a bank (or any other financial) account established overseas.

This is because the TaxAct software includes access to five of the most common tax forms expatriates need . Plus, expert tax help is available for an additional fee, and there are even filing options for self-employed expats. Cash App Taxes is unique in the tax software landscape because it offers completely free tax filing, no matter how complicated your return. Most of the big players provide a free version for simple returns but charge for self-employed tax returns.