A single-page overview for US citizens, green-card holders, and long-term US permanent residents living outside the United States. Foreign account reporting (FBAR / FATCA), foreign earned income exclusion (§911), foreign tax credit (§901), controlled foreign corporation rules (GILTI / Subpart F), Passive Foreign Investment Company (PFIC) exposure, treaty tie-breaker mechanics, Streamlined Filing Compliance Procedures for taxpayers correcting historical gaps, and the §877A exit tax for those considering formal expatriation. Every topic links to a full reference walk-through.
The United States is one of only two countries in the world — Eritrea is the other — that taxes its citizens on worldwide income by citizenship, not by residence. Every other developed country taxes only its residents. That single difference is the source of almost every complication an American abroad will face for the rest of their life.
The practical consequence is unambiguous. Every US citizen, every US green-card holder, and every long-term US permanent resident must file a US federal income tax return every year, reporting worldwide income, regardless of where they physically live, whether they earn a single dollar of US-source income, or whether they have set foot on US soil in a decade. The obligation runs with the passport (or the green card), not with the residence. A US citizen living in Berlin for thirty years and earning entirely in euros still owes an annual Form 1040 to the IRS.
This obligation is separate from — and additional to — whatever the host country requires. A US citizen resident in Germany files a German tax return under German law and a US federal return under US law. The two systems talk to each other through a bilateral income tax treaty and through the mechanics of the foreign tax credit (§901) and the foreign earned income exclusion (§911), which together prevent the same dollar from being taxed twice at the combined economic rate. But the two filings are legally independent. Even in years where the treaty and the credit mechanics reduce the US bill to zero, the return itself is still required.
The tax treaty tie-breaker rules for residency exist to allocate sourcing rights between two countries that both consider a taxpayer resident under their internal rules. They do not, and cannot, eliminate the US filing obligation of a US citizen. This confuses many people every year and is the single largest driver of the historical noncompliance that the IRS's Streamlined Filing Compliance Procedures were designed to fix. If you have never filed a US return while living abroad and just discovered you were supposed to, the Streamlined program is almost certainly the path forward. Section 4 of this page walks it.
The specialist cross-border practitioner conversation for an individual US person abroad reduces reliably to seven topics. Some apply to almost everyone (FBAR, FEIE or FTC). Some apply to a subset with specific facts (GILTI for CFC owners, PFIC for anyone with local mutual funds, §877A for the departing). Each card below opens the full walkthrough where one exists in the Baratelli Institute reference set.
The Streamlined Filing Compliance Procedures are the IRS program for US taxpayers who failed to report foreign income or file the required foreign-asset returns and whose failure was not willful. The program was launched in 2012 and expanded in 2014. It has since become the standard remedy for the very large population of US persons abroad who simply did not know they were supposed to file a US return while living outside the country.
The program has two variants. Which one applies turns entirely on where the taxpayer physically lives.
| Feature | Streamlined Foreign Offshore Procedures (SFOP) | Streamlined Domestic Offshore Procedures (SDOP) |
|---|---|---|
| Who qualifies | US taxpayer who meets the non-residency requirement (physically outside the US for 330+ days in one of the three tax years covered) | US taxpayer resident in the United States who fails the SFOP non-residency test |
| Willfulness certification required? | Yes — Form 14653 non-willful certification | Yes — Form 14654 non-willful certification |
| Amended returns required | 3 years of amended Form 1040s | 3 years of amended Form 1040s |
| FBAR (FinCEN 114) returns required | 6 years of delinquent FBARs | 6 years of delinquent FBARs |
| Miscellaneous offshore penalty | 0% — no penalty | 5% of the highest aggregate balance of the covered foreign financial assets over the covered period |
| Late-filing / accuracy penalties on the amended returns | Waived | Waived |
| Interest on the tax owed | Payable | Payable |
| The practical rule | The right program for the American abroad who discovers the gap while still living abroad | The right program for the American at home whose foreign accounts predate the discovery |
Willfulness is the whole game. If the IRS determines that the failure to file was willful — that the taxpayer knew of the obligation and deliberately did not comply — neither Streamlined variant is available. The taxpayer is instead exposed to the Foreign Bank Account Report civil willful penalty, which under 31 U.S.C. §5321(a)(5)(C) is the greater of $100,000 or 50% of the account balance per violation year, and to potential criminal exposure. The non-willful FBAR penalty, by contrast, is capped at $10,000 per unfiled Form 114 and applies on a per-form (not per-account) basis, as clarified by the Supreme Court in United States v. Bittner, 598 U.S. 85 (2023). The non-willful certification signed under penalties of perjury is not a form; it is a document that has to be defensible on the merits, and a qualified practitioner is essential.
For the applied framework: the Institute's International Tax & Cross-Border Wealth guide (Vol XII) Chapter 5 walks the practitioner-grade Streamlined engagement end to end — the willfulness analysis, the return prep sequence, the accompanying certification narrative, and the post-submission monitoring.
The list below is not exhaustive. It reflects the countries where the Baratelli Institute sees the highest recurring practitioner-question volume from US persons abroad, weighted by both population and complexity per taxpayer. Every row assumes the taxpayer is a US citizen or green-card holder resident in the country listed.
| Country | US income tax treaty in force? | Signature complication | Institute reference |
|---|---|---|---|
| United Kingdom | Yes — 2001 US-UK treaty (with 2002 & 2003 protocols) | Savings clause preserves US taxing rights on citizens; ISAs are not US-tax-recognised wrappers; UK pension treatment is treaty-favorable but requires care | Country Comparison Matrix |
| Germany | Yes — 1989 US-Germany treaty (with 2006 protocol) | US-Germany totalization agreement handles Social Security allocation; German solidarity surcharge and church tax are creditable; Riester and Rurup pension products need PFIC-adjacent analysis | Country Comparison Matrix |
| India | Yes — 1989 US-India treaty | Indian mutual funds are PFICs for US owners; NRE / NRO / FCNR accounts are all reportable on FBAR and generally on Form 8938; Indian PPF and EPF need specific treatment | Form 8938 vs FBAR reference |
| Canada | Yes — 1980 US-Canada treaty (with five protocols) | RRSP is treaty-favorable but Form 8891 was retired — RRSPs still require FBAR; TFSAs are not treaty-recognised and are foreign trusts for US purposes; RESP treatment is punitive | Country Comparison Matrix |
| Portugal | Yes — 1994 US-Portugal treaty | Post-NHR-reform regime (2024): the old Non-Habitual Resident 10-year window is closed to new entrants; the IFICI successor targets qualifying professionals; treaty planning has shifted | Country Comparison Matrix |
| Ireland | Yes — 1997 US-Ireland treaty | 12.5% corporate rate makes any US-owned Irish CFC fail the §954(b)(4) high-tax exclusion threshold; GILTI hits at the shareholder level absent §962 election | GILTI walkthrough |
| Netherlands | Yes — 1992 US-Netherlands treaty (with 2004 protocol) | 30% ruling is a Dutch payroll benefit, not a US-tax benefit — US filer still reports the full salary; Dutch box-3 wealth tax is not creditable against US tax | Country Comparison Matrix |
| Switzerland | Yes — 1996 US-Switzerland treaty (with 2019 protocol) | Lump-sum (forfait) taxation is a Swiss cantonal-level regime; the US taxpayer still pays full US tax on worldwide income; pillar-2 and pillar-3 pensions need treaty analysis | Country Comparison Matrix |
| Australia | Yes — 1982 US-Australia treaty (with 2003 protocol) | Superannuation is not treaty-recognised as a US-qualified pension — the analysis is unsettled; industry-standard positions treat contributions and earnings as currently taxable to the US owner | Country Comparison Matrix |
| Singapore | No — no US-Singapore income tax treaty in force | Singapore taxes territorially at 0% on foreign-source and capital gains; without a treaty, no treaty-based benefits are available, but the §901 foreign tax credit for Singapore tax paid is still available on a per-basket basis | Country Comparison Matrix |
The full country-by-country walk is in the Baratelli Country Comparison Matrix. The Foundations PDF library also carries a printable country-comparison reference at the Foundations page.
This page is a reference for orientation. It is not tax advice, and it cannot be tax advice, because tax advice requires facts. Every consequential decision in the cross-border tax stack turns on facts that a landing page cannot know: the taxpayer's specific residency history, the composition of the foreign account and asset base, the entity structure of any foreign business interest, the interaction with treaty positions taken in prior years, and the willfulness posture of any historical noncompliance. A US person abroad making any of the following decisions needs qualified counsel in both jurisdictions — not just a US CPA:
Practitioner selection matters. A CPA who handles domestic returns competently is not necessarily equipped for a CFC-owner return or a PFIC-heavy portfolio. Look for a firm that identifies as international-tax-specialist, holds credentials in both jurisdictions where possible, and prices the engagement in a way that reflects the actual complexity of the work. Cheap cross-border returns are almost always wrong cross-border returns.
This landing page is the free orientation layer. The applied treatment lives in the paid volume — the same voice, the same practitioner-grade depth, but with the worked casework, the multi-year modeling frameworks, and the compliance sequences drawn out end to end.
What the paid guide adds beyond this free page:
Every statute, regulation, court decision, and IRS publication cited or relied on in the body above. Verified against the current IRC and Treasury regulations at the snapshot date.