Moved Abroad for Work? Don’t Miss These Year-End U.S. Tax Deadlines

Every year, I meet U.S. expats who move abroad excited to start fresh — new country, new job, new opportunities. But there’s one thing that often gets overlooked in the excitement: U.S. tax obligations.

If you’ve recently moved overseas for work, this one’s for you.

The Story That Sparked This Lesson

A few years ago, one of my clients relocated abroad. Between setting up a new life, managing work, and settling into a different culture, U.S. taxes were understandably the last thing on their mind.

By the time April rolled around, they realized they had missed a few key details:

• A few foreign bank accounts they opened to manage daily expenses.
• Rental income from a property overseas.
• Investment income earned abroad.

At first glance, it didn’t seem like much. But as we dove into the details, it became clear that these small oversights had big tax implications.

The Hidden Traps: What Happens When You Miss Reporting

When you live or work outside the U.S., your tax picture gets more complicated. The IRS expects you to report worldwide income and foreign assets — even if you’re paying taxes abroad or think your accounts are too small to matter.

Here’s what my client had to deal with:

1. FBAR Filings (Foreign Bank Account Reporting)

If you hold foreign financial accounts with an aggregate balance of $10,000 or more at any time during the year, you must file an FBAR (FinCEN Form 114). Missing this can result in hefty penalties — up to $10,000 per non-willful violation.

2. Reporting Foreign Rental Income

That overseas rental property? It’s taxable in the U.S., too. You must report rental income and can deduct related expenses, just as you would for a U.S. property. In some cases, you might also qualify for a foreign tax credit to avoid double taxation.

3. Year-End Tax Elections

Certain foreign entity elections and income classifications must be made before December 31. Missing these deadlines can mean weeks of extra paperwork and possible penalties — something my client learned the hard way.

The Real Deadline Isn’t April — It’s December 31

Many expats think that as long as they file their taxes by April (or June with an extension), they’re fine. But in reality, tax planning for expats happens before the year closes.

Why?
Because most tax-saving strategies — such as foreign tax credit optimization, entity classification elections, and income timing adjustments — must be done before December 31 to be effective.

A little foresight in December can prevent:

• Missed filings
• Avoidable penalties
• Lost deductions or credits
• Costly compliance headaches in the spring

Proactive Steps for Expats Before Year-End

To keep your cross-border tax situation clean and compliant, here’s what to do before the year ends:

1. Review your foreign bank accounts. Make sure balances and account details are ready for FBAR reporting.
2. Track all sources of income, including wages, investments, and rental income abroad.
3. Consider timing of income and deductions. Shifting certain income into next year or paying expenses early could improve your tax position.
4. Check eligibility for exclusions. If you qualify for the Foreign Earned Income Exclusion (FEIE) or Foreign Housing Exclusion, plan your days abroad carefully to meet the physical presence or bona fide residence test.
5. Consult a qualified international tax professional before December 31 to identify any elections or reporting requirements that could save you money.

The Bottom Line

If you’ve moved abroad for work, remember this: Your real tax deadline isn’t April — it’s December 31.
That’s when smart planning can make all the difference between smooth filing and costly surprises.

A little preparation before year-end can save you stress, time, and thousands of dollars in the long run. So, take a moment now — review your foreign accounts, check your income sources, and make sure your cross-border tax picture is clear before the year closes.