Series 102: Individuals Who Need File US Tax Returns

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Whether you live in the US or abroad, there are triggers that will require you to file a US income tax return.

For individuals who are US citizens, green card holders, or those who meet the “substantial presence” test under US tax law, the rules for filing income, estate, and gift tax returns and paying for estimated taxes are generally the same whether you are in the US or abroad.

Filing Threshold for US Income Tax Returns

Generally, your obligation to file an income tax return depends on your filing status (single, head of household, married filing jointly, etc.), your age, and your level of income. You must file a income tax return for 2019 if your gross income derived from anywhere in the world is at least the amount shown for your filing status in the chart below—

Filing StatusAgeIncome Threshold to File
Single64 or younger $                            12,200
65 or older $                            13,850
Head of Household64 or younger $                            18,350
65 or older $                            20,000
Qualifying Widow(er)64 or younger $                            24,400
65 or older $                            25,700
Married Filing JointlyNot living with spouse at end of year $                                     5
Both spouses are 64 or younger $                            24,400
One spouse is 65 or older $                            25,700
Both spouses are 65 or older $                            27,000
Married Filing SeparatelyAll ages $                                     5

Note for the Self-Employed: The filing threshold to file a US income tax return is not so favorable if you have income from self-employment. Regardless of your filing status or age, if a person has net earnings from self-employment in excess of $400, you must file a US income tax return.

Filing Threshold for FinCen Form 114, Better Known as an FBAR

FinCen Form 114, Report of Foreign Bank and Financial Accounts (FBAR) is used to report US citizen’s financial interest in, or signature authority over bank, securities, or other financial accounts located in a foreign country. A US citizen only needs to file this form if their aggregate foreign account value is in excess of $10,000 at any time during their tax year.

Filing Threshold for Form 8938, Statement of Specified Foreign Financial Assets

Form 8938, Statement of Specified Foreign Financial Assets, is a form that requires very similar reporting to that of the FBAR. Generally, a US citizen needs to report their direct or indirect interest in foreign financial account and other foreign assets if they meet the applicable filing threshold. Simply put, Form 8938 varies from the FBAR reporting as it pertains to direct holding of financial assets—where you wouldn’t be required to report corporate or partnership ownership interest on an FBAR (unless they are held in a securities or brokerage account), you are required to report such assets on Form 8938.

The threshold to file Form 8938 with your US income tax return depends on your filing status as well as where you live during the tax year. The chart below depicts the various filing thresholds for Form 8938—

Form 8938 – Individuals Living in the United State
Filing StatusForeign Asset Value Threshold
SingleGreater than $50,000 on the last day of the tax year or more than $75,000 at any time during the year.
Married Filing JointGreater than $100,000 on the last day of the tax year or more than $150,000 at any time during the year.
Married Filing SeparateGreater than $50,000 on the last day of the tax year or more than $75,000 at any time during the year.
Form 8938 – Individuals Living Outside the United State
Filing StatusForeign Asset Value Threshold
SingleGreater than $200,000 on the last day of the tax year or more than $300,000 at any time during the year.
Married Filing JointGreater than $400,000 on the last day of the tax year or more than $650,000 at any time during the year.
Married Filing SeparateGreater than $200,000 on the last day of the tax year or more than $300,000 at any time during the year.

Note for Those Living Outside the US: In order to qualify for the higher filing threshold for Form 8938, you must satisfy they “presence abroad” test. Generally, you meet this test if you are one of the following—

  • A U.S. citizen who has been a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year.
  • A U.S. citizen or resident who is present in a foreign country or countries at least 330 full days during any period of 12 consecutive months that ends in the tax year being reported.

If you do not meet the bright line 330-day test provided above and are trying to qualify as a “bona fide” resident of a foreign country, do not try this on your own! “Bona fide” is a term that is defined by years of case law, and an attorney should be consulted before taking that position.

Filing Threshold for Non-Resident Aliens

So, what is the filing threshold for those people who are not US citizens, green card holders, or meet the “substantial presence” test? Well the answer is simple—if you have any US source income, you must file an income tax return.

Additionally, if you are a non-resident alien engaged in a US trade or business, you must file an income tax return even if you do not have a $1 of income from the trade or business or your income is exempt from US tax under a tax treat or any section of US tax law.

Non-resident aliens who are required to make a income tax filing must file Form 1040-NR with the IRS. You must only report your US source income or income effectively connected with a US trade or business. Due to the complex nature of determining what is or is not US source income with respect to those living outside the US, please contact a tax attorney for advice.