Mistakes are inevitable; it’s a fact of life. But, when it comes to taxes, mistakes can be costly. As an American abroad, your tax requirements are much different than those of U.S. residents. Here are some pitfalls to avoid to ensure you don't face any unnecessary penalties.
FATCA, the Foreign Account Tax Compliance Act, is fully implemented this year. This means foreign banks will be reporting to the IRS the bank account details of U.S. persons. For 2016, this will include your name, address, SSN, bank account number, account balance, interest/dividend income received and gross proceeds from the sale of assets (i.e., stocks/funds). This information will be in the IRS hands on September 30, 2017.
Tax season is just around the corner. Here are some common mistakes or misunderstandings expats have regarding their US taxes that could be costly.