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2020/10/16 at 12:15 pm #87193ExpatInfoDeskKeymaster
Posted by Chrisoz, 2 replies
My husband is American born & immigrated here to Australia 16yrs ago to marry me (I’m Australian born & bred citizen). Approximately 13yrs ago he became an Australian Citizen.
We’ve recently been investigating the possibility of moving to USA due to the failing health of his Mum. We’ve been reading all this stuff on taxes & IRS.
He’s never filed a USA return since immigrating to Australia because he has Australian citizenship, even has an Australian Passport since his American passport expired years ago.
We’re quite confused now, has he been misinformed? Should he have been filing all these years?
What are the implications is we did move there with regard to irs?
Hello! First off, we’re wishing the best for your mother in law.
Second off, let’s dive into the tax situation.
Unless your husband renounces his US citizenship, he is still a US citizen and thus subject to the worldwide tax filing requirements. The expiration of a U.S. passport does not affect his citizenship standing. You can read more about the filing requirements of US Expats here: https://www.myexpattaxes.com/expat-filing-requirements
Long story short, in general, if you are:
An Employee: You will need to file is your worldwide gross income (all the money you make, pre-tax) exceeds the reporting threshold. Generally, $10,400 for expats filing as Single.
In his case, $4,050 for expats filing as Married Filing Separately since you’re a Non-Resident Alien (NRA).
Self-Employed: You will need to file if you make more than $400 per year. Yes, the threshold really is that low.
If you have more than $10,000 total from all your foreign financial accounts (bank accounts, pension, etc.) at any moment in the year then you will also have to file the FBAR form which goes to the Financial Crimes Enforcement Network, NOT the IRS. This report is just for informational purposes, there is no tax calculated based on the amounts in your bank account.
So he hasn’t filed… what are the implications?
Well first off, don’t stress! It is not uncommon for U.S. Expats to be unaware of their filing requirements. In this event, he should look if he can apply for the streamlined procedure. If eligible, he can catch up with all these tax filing requirements without any late filing penalties by ONLY filing
3 years of late tax returns + the current year
6 years of late FBARs + the current year (if applicable based on the $10K threshold mentioned above)
More details can be found here: https://www.myexpattaxes.com/the-streamlined-procedure-for-u-s-expats
We do offer a really easy way to file your taxes (current and streamlined packages) through our new tax software designed specifically with expats. Check us out!
That was very well written and extremely informative. Thank you for making me understand the concept so well
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