Filing Late Taxes as an American Abroad

Submitting late US taxes as an American abroad is preferable to skipping them altogether, particularly if your adjusted gross income exceeds the tax filing threshold and you’ve missed the expat tax deadlines – April 15th for tax payments and June 15th for regular US tax filing. We get it; sometimes you forget or didn’t realize you had to file because life happens, but beware of potential tax penalties. Fortunately, there are solutions available if you need to file your American expat taxes late, and we’re here to guide you through them below.

Expat Tax Deadlines and Extensions

Before we move on to sharing the solutions, it’s essential to note the typical US expat tax deadlines and extensions.

If you are an American taxpayer and you are working and/or living outside of the United States, you have an automatic two-month extension to file your US taxes. This is only if you do not owe any taxes – including state taxes. The expat deadline is April 15th, 2024.

Expats receive an automatic extension to June 15th. Additionally, many expats can apply for a free tax extension through our software to qualify for filing their taxes until October 15, penalty-free.

Filing Late Taxes – The Consequences

If you are in a situation where you are filing late taxes, penalties and losing benefits connected to your foreign assets and income may happen.

Two specific IRS penalties are for filing late taxes. One is Failure to File, and the other is Failure to Pay. We will explain each one below according to the IRS guidelines:

Failure to File Penalty:

• 5% of the unpaid tax required to be reported.
• Reduced by the “failure to pay” penalty amount for any month where both penalties apply.
• Charged each month or part of a month, the return is late, up to 5 months.
• This applies for an entire month, even if the return is filed less than 30 days late.
• Income tax returns are subject to a minimum late filing penalty when filed more than 60 days after the return due date, including extensions. The minimum penalty is the LESSER of two amounts – 100% of the tax required to be shown on the return that you didn’t pay on time, or a specific dollar amount that is adjusted annually for inflation. The specific dollar amounts are:    
  • $485 after 12/31/2023
  • $450 for returns due between 1/1/2023 and 12/31/2023
  • $435 for returns due between 1/1/2020 and 12/31/2022
  • $210 for returns due between 1/1/2018 and 12/31/2019
  • $205 for returns due between 1/1/2016 and 12/31/2017
  • $135 for returns due between 1/1/2009 and 12/31/2015
  • $100 on or after 12/31/2008

Source: IRS.gov

Failure to pay tax reported on return:

• 0.5% of the tax not paid by the due date, April 15; 0.25% during the approved installment agreement (if the return was filed on time and the taxpayer is an individual); 1% if the tax is not paid within ten days of a notice of intent to levy
• Recurring charge on the remaining unpaid tax each month or part of a month following the due date, until the tax, is fully paid or until 25% is reached.
• A full monthly charge applies, even if the tax is paid before the month ends.

Source: IRS.gov

As a reminder, many of your expected taxes that are due to be paid need to be paid by the April 15th deadline, even if you want to file taxes through the June 15th automatic extension deadline. The good news is that many US expats don’t need to owe taxes because of expat tax benefits like the FEIE and Foreign Tax Credit.

We encourage you to file your taxes on time from the penalty information above. Doing so also helps you honor your citizenship obligation for filing US taxes.

For more information, please check out the Common Penalties for Individuals IRS page.

Losing Expat Benefits if Filing Late Taxes

Another downside to filing late taxes as an American abroad could be losing expat benefits, such as the Foreign Earned Income Exclusion. This allows US expats to exclude $120,000 of foreign income from their US taxes – which can help you save thousands off your tax bill. You can gain such a benefit through our software, by completing Form 2555 before the June 15th deadline. Otherwise, the IRS can take away your right to use this exclusion and won’t be able to use it for another five years.

Filing Late Taxes – The Solution

Want to know the number one solution for filing late US taxes? Using the Streamlined Procedure. This is a unique tax amnesty program set up by the IRS that saves millions of US citizens abroad from unnecessary tax fines and consequences. It is essentially a penalty-free way for you to catch up on our US tax returns. Especially if you qualify, you will not be subject to any penalties!

If you’ve never filed US expat taxes, you can ascend your way to becoming tax compliant. Our software makes filing late taxes as an American abroad fast and affordable.

Our service offers one-third of the price of a tax consultant. It is only 749€, no matter how complicated your case is. This is hundreds of Euros less than other expat tax companies.

The Streamlined Procedure through us offers up to 4 years of tax returns, 6 years of FBARs, and current year taxes. This means we can help you get financially sorted by reporting your bank records to the IRS if your income has been over $10,000 at any one time during the last 6 years.

Plus, you can get years of expat taxes done in a couple of hours. Yes, you read that right. Our company strives to make expat tax filing as simple and stress-free as possible. We love getting things done fast so you have time to do the things you love.

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Eligibility to Use the MyExpatTaxes Streamlined Procedure

• You did not live in a home (have an abode) in the US  and
• Were physically living outside of the US for at least 330 days in any one of the last 3 years.
• You failed to comply with U.S. tax returns because of non-willful conduct.
• You are currently non-compliant, meaning that you failed to file one or more tax returns 
• Haven’t filed FBAR (if applicable).

What is Offered with MyExpatTaxes 749€ Streamlined Price?

• Free Current Year Tax Amendment
• Comprehensive Tax Support
• Year-round Coverage
• Professional Tax Review and Consulting
• Tax Forms Signed by Certified Tax Professional
• Post submission IRS Audit Support
• Personal support for the entire process
• Secure document upload
• Streamlined Certification letter (form 14653)

Need More US Expat Tax Support?

Do you have additional US tax questions as an American expat? We’re here to answer them for you. Our friendly support team can lead you every step of the way! Otherwise, sign onto our app today for a smooth DIY expat tax software experience.