Expert Guide to US Expat Taxes in Chile

Whether you’re working in Santiago, retired in Valparaíso, or running a business from Patagonia, your US tax obligations don’t disappear when you move to Chile. As a US citizen or green card holder living in Chile, you’re still required to file annual US tax returns—and now, Chilean taxes may apply too. This guide walks you through everything you need to know about US-Chile expat taxes. From filing deadlines and reporting requirements to 2023’s new tax treaty, we’ll help you avoid double taxation and costly penalties.

Do I Need to File US Taxes From Abroad?

US-Chile Expat Tax Deadlines

Chilean Taxes for US Expats: Navigate US-Chile Expat Tax Obligations

US-Chile Expat Tax Agreements

Key US Tax Forms Every US-Chile Expat Tax Filer Needs

Optimize Your Taxes with US Tax Benefits: US-Chile Expat Tax Strategies

Self Employment Chile

Investing in Chile as a US Expat

Retirement in Chile

US-Chile Expat Taxes Made Easy with MyExpatTaxes

Do I Need to File US Taxes From Abroad?

It’s a fair question! Though you might not like the answer. Because the US taxes based on citizenship rather than residency, as a US citizen or green card holder, if you meet any of the thresholds you’ll need to file. You’re also required to report your foreign income, even if you don’t owe any US taxes.

In 2025, you’ll need to file your 2024 US taxes if:

Filing Status	Income Threshold
Single	$14,600
Married Filing Jointly	$29,200
Married Filing Separately	$5
Self-Employed	$400
Qualifying Widow(er)	$29,200
Head of Household	$21,900

US-Chile Expat Tax Deadlines

Expats have the advantage of an automatic extension to get their US filing in order.

Deadline	Date
Standard Filing Deadline	April 15th
Automatic Extension for Expats	June 16th
Deadline for Expats Filing an Extension (file by June 15th)	October 15th
FBAR Deadline for Expats	October 15th
Deadline for Expats if you Filed a Second Extension	December 15th

Just as in the US, the Chilean tax year follows the calendar year (January-December), with your annual return due on the 30th of April the following year.

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Catch Up With The Streamlined Procedure

If you weren’t aware of the need to file your US taxes from abroad, there is a solution! The Streamlined Procedure is an IRS amnesty program that allows you to become compliant by filing 3 years of tax returns and 6 years of FBARs, without any failure-to-file or FBAR penalties. The only catch is that you have to file the Streamlined Procedure before the IRS contact you, or become ineligible–and subject to hefty fines.

Chilean Taxes for US Expats: Navigate US-Chile Expat Tax Obligations

Who Has to File Taxes in Chile?

Chile has a phased tax system that treats foreigners differently depending on how long they’ve lived in the country.

You become a resident after living in Chile for 180 consecutive days in one year, or 180 non-consecutive days per year for two years.

• Nonresidents are only taxed on income earned from Chilean sources.
• Residents are taxed on their worldwide income—but not right away.

For the first three years of Chilean residency, you’ll still be taxed only on Chilean-source income, even if you’re technically considered a resident. After those three years, you can request an additional three-year extension to remain taxed as a nonresident. This means expats can usually live in Chile for up to six years before being taxed on foreign income—an opportunity worth planning around.

Chilean Taxes

In Chile, tax residents are subject to a progressive income tax system, with rates ranging from 0% to 35.5% based on income levels measured in Monthly Tax Units (UTM). For instance, earnings of between 13.5 and 30 UTM are taxed at 4%, while earnings over 150 UTM are taxed at 35.5%.

Social Security contributions are approximately 20% of the monthly salary, capped at 75.7 Unidades de Fomento (UF), approximately $3,048.65 in 2025. Additionally, there is a mandatory unemployment insurance contribution of 3%, with 0.6% paid by the employee and 2.4% by the employer, capped at 113.5 UF (approximately $4,570).

Non-residents are charged on Chilean-source income at a flat rate of 15% for income derived from professional or technical services, and 35% for all other sources of income.

Other Taxes

Chile imposes a Value-Added Tax (VAT) of 19% on most goods and services. There is no net wealth or inheritance tax in the country. Corporate income is taxed at progressive rates of between 0%–40%, and inheritance is taxed at between 1%-25%.

US-Chile Expat Tax Agreements

Tax Treaty

The US-Chile Tax Treaty, originally signed in 2010, was officially ratified and entered into force on December 19, 2023.

The treaty aims to reduce double taxation, especially by lowering withholding rates on certain income:

• Dividends: 15%, or 5% if you own 10%+ of the company.
• Interest: 15% initially, dropping to 10% after five years; in some cases as low as 4%.
• Royalties: Usually 10%, or 2%–5% in special cases.

It’s important to note that the treaty includes a “savings clause”, which allows the US to tax its citizens and residents as if the treaty had not come into effect. US citizens cannot use the treaty to avoid US taxation on their worldwide income. However, US expats in Chile can still use FEIE or Foreign Tax Credit to avoid double taxation.

Totalization Agreement

The US and Chile have a totalization agreement in place. Totalization Agreements prevent expats from paying Social Security taxes in both countries. If you’re working in Chile, you’ll generally only pay into the Chilean system.

This agreement also protects your future benefits. If you split your working years between the US and Chile, the agreement allows you to combine credits from both countries to qualify for Social Security benefits.

Key US Tax Forms Every US-Chile Expat Tax Filer Needs

If you’re living in Chile as a US citizen, filing your US taxes doesn’t stop at Form 1040. Several additional forms may apply depending on your income, and financial assets abroad. Understanding which ones to file is a critical part of staying compliant with US-Chile Expat Tax rules.

Here are the most common forms to watch for:

• Form 1040 – Your main US tax return, required every year regardless of where you live.
• Form 2555 – To claim the Foreign Earned Income Exclusion (FEIE), which allows you to exclude up to a certain amount of foreign wages.
• Form 1116 – For the Foreign Tax Credit, which can help reduce double taxation if you’re paying Chilean income taxes.
• FinCEN Form 114 (FBAR) – Required if you had more than $10,000 combined across all foreign financial accounts at any point during the year.
• Form 8938 (FATCA) – If your foreign accounts and assets exceed $200,000, this form is required in addition to the FBAR.

Good to Know: MyExpatTaxes includes all these forms and many more as standard with all our Plans.

Optimize Your Taxes with US Tax Benefits: US-Chile Expat Tax Strategies

Four of the greatest US tax benefits that help reduce double taxation for Americans living in Chile are the Foreign Earned Income Exclusion (FEIE), Foreign Tax Credit (FTC), Child Tax Credit (CTC), and Additional Child Tax Credit (ACTC).

Foreign Earned Income Exclusion (FEIE)

The FEIE allows you to exclude up to $126,500 of foreign-earned income from US taxation. You’ll need to pass either the Physical Presence Test (you’re physically in a foreign country for at least 330 full days in any 12-month period) or the Bona Fide Residence Test (you reside in a foreign country for an uninterrupted period that includes an entire tax year) to qualify. This exclusion applies only to earned income, like wages or self-employment, not passive income. To claim the FEIE, you’ll file Form 2555 with your tax return.

Foreign Tax Credit (FTC)

The FTC lets you reduce your US tax bill by the amount of income tax you pay to Chile. The FTC can be applied to all foreign income, not just earned wages; this includes rental income, interest and dividends, as long as you claim foreign taxes in the same bucket of income. For example, foreign income taxes paid on rental income can only offset US taxes on foreign passive income.

You’ll need to file Form 1116 along with your tax return to claim the FTC.

Child Tax Credit (CTC)

If you’re a US citizen or green card holder with a qualifying child under age 17 who has a Social Security Number, you may be eligible for the Child Tax Credit of up to $2,000 per child.

To qualify for the full refundable amount, your income must be below a certain threshold. If you’re a single filer, you’ll be eligible for the full refund if your income is below $200,000. For joint filers, the income limit is $400,000.

Additional Child Tax Credit (ACTC)

If the full CTC exceeds your tax owed, you may qualify for a refundable portion through the ACTC—up to $1,700 per child. You won’t qualify for the refundable portion if you claim the Foreign Earned Income Exclusion (FEIE).

The CTC and ACTC can be claimed on Schedule 8812.

Self Employment in Chile

Foreigners in Chile can apply for a Temporary Residence Visa, which is valid for one year and renewable up to two more years. You’ll need to submit a viable business plan, proof of sufficient funds for your stay, and a clean criminal record. You can then register with the Servicio de Impuestos Internos (SII) and the social security institute (IPS) to pay taxes and contributions, and obtain a tax ID (RUT). While Chile lacks a distinct digital nomad visa, self-employed foreigners and remote professionals can work legally under this temporary visa, benefiting from strong internet infrastructure and dedicated co-working spaces.

The US-Chile Totalization Agreement ensures that social security taxes (including self-employment tax) are paid only to the country where you are a tax resident.

Investing in Chile as a US Expat

Chile’s investor-friendly climate make it an appealing option for US expats. Here are a few popular ways to grow your wealth while living in Chile:

• Property: Real estate in cities like Santiago, Valparaíso and Puerto Varas can be a solid long-term investment. Foreigners can buy property even as tourists, and you’ll need a tax ID to be able to pay the required taxes. Be sure to work with a reliable bilingual attorney, and expect to pay around 3% in legal, notary and agent fees. If you rent out Chilean property, any income must be reported on your US tax return via Schedule E.
• Retirement Accounts (IRAs/Roth IRAs): As a US expat, you can still contribute up to $7,000 annually to an IRA assuming you are eligible in other regards. Investments are tax-free or tax-deferred and can help you stay on track for retirement—no matter where you live.
• US-Based Stocks & Bonds: Many expats keep their investment portfolios in US-based assets. Foreign mutual funds can trigger PFIC reporting requirements and higher taxes. Sticking with US stocks and bonds avoids Form 8621 complications and usually means lower fees.

Already invested in Chilean or other foreign mutual funds? MyExpatTaxes can help you navigate the PFIC rules and file Form 8621 accurately.

Retirement in Chile

Chile offers U.S. expats a compelling retirement destination thanks to its varied climate, from Mediterranean warmth in central regions to alpine summers in the south and temperate coastal zones, accommodating a range of lifestyle preferences. The country is ranked among the safest in South America in 2025, though it’s advisable to check out the US State Department travel advisory before visiting.

US citizens can apply for Chile’s Retirement (Rentista) Visa, valid for one year and renewable, which requires proof of stable passive income—no formal retirement age required—and offers a pathway to permanent residency after two years.

The cost of living is about 40–60% lower than in the US and most retirees can live comfortably on about $2,000 per month (2025). An extra bonus is that when you receive US pension or social security income in Chile, it’s exempt from Chilean taxation, regardless of your residency status.

Healthcare in Chile is accessible through dual systems: the public FONASA and the private ISAPRE. Most retirees choose the peace of mind that private insurance offers, with monthly payment costing under $100 per month.

Overall, Chile blends favorable weather, affordable living and healthcare, and flexible visa options into a attractive retirement package for US expats.

US-Chile Expat Taxes Made Easy with MyExpatTaxes

We know that US-Chile expat taxes aren’t the most exciting topic—but filing correctly can save you serious money while keeping you compliant. Our award winning software has helped thousands of expats file their US taxes smoothly from abroad. All the forms mentioned here are included in our standard package–plus many more.

You can e-file in under 30 minutes with our Base DIY package. Want some extra support when filing your 2024 tax return? Upgrade to our Premium plan to work with a Tax Professional directly. Whatever your tax needs, we have an affordable solution for you.

Let us prove that expat taxes can be easy, and get the most boring job of the year out of the way today!