Do dual citizens living abroad still need to file U.S. tax returns in 2025?
Executive summary
Yes: United States citizens — including dual citizens living abroad — remain subject to U.S. taxation and generally must file U.S. tax returns if their worldwide income meets the filing thresholds set by the IRS; protections such as the Foreign Earned Income Exclusion (FEIE) and the foreign tax credit often reduce or eliminate U.S. tax owed, but they do not erase the basic filing obligation [1] [2] [3].
1. Citizenship-based taxation: what the rule actually says
U.S. tax law operates on a citizenship-based model, meaning that a U.S. citizen’s worldwide income is subject to U.S. tax rules regardless of residence; the IRS explicitly states that U.S. citizens and resident aliens living abroad must report worldwide income and may qualify for exclusions or credits but remain within the U.S. filing system [1] [2]. This principle is reinforced across expat guidance and tax-practitioner sites, which repeatedly note that simply living overseas or holding a second passport does not eliminate the obligation to file [4] [3] [5].
2. Filing thresholds and practical triggers to file
Whether a dual citizen must file in a given year depends on the filing-status thresholds the IRS publishes (the Publication 54 table referenced by the IRS determines when gross worldwide income requires filing) and those threshold amounts vary by filing status and age [2]. Commercial guides and expat services quote specific 2025 numbers (for example single/married thresholds and various reported dollar amounts appear in sources), but the authoritative instruction is the IRS filing-requirements table in Publication 54 and chapter 1 — practitioners’ pages summarize typical thresholds but differ on exact figures, so the absolute authority is the IRS guidance [2] [6].
3. Tools that usually prevent double taxation — but still require reporting
The U.S. provides three main mechanisms that commonly (but not automatically) eliminate double U.S./foreign tax: the Foreign Earned Income Exclusion (FEIE), the foreign tax credit (FTC), and tax treaty provisions; these reduce net U.S. tax liability and in many cases result in no U.S. tax owed, yet taxpayers still must file to claim those benefits and report worldwide income [7] [3] [4]. For 2025 the FEIE amounts cited across sources are centered around $130,000, a figure cited repeatedly by tax providers and expat guides for the 2025 tax year [7] [4] [3].
4. Additional reporting obligations and pitfalls for expat dual citizens
Beyond Form 1040 filings, dual citizens often face extra disclosure forms that can carry steep penalties if missed: FBAR (FinCEN Form 114) rules apply when non-U.S. accounts exceed $10,000 at any time in the year; FATCA Form 8938 filing thresholds for foreign financial assets are substantially higher for taxpayers living abroad (commonly cited $200,000 at year-end or $300,000 during the year for single filers) [8]. Advisers warn that using FEIE and FTC requires careful coordination, that state tax residency can linger for some former residents, and that special categories like “accidental Americans” can be surprised by obligations despite little U.S. presence [9] [8] [4].
5. Disputes, enforcement tone, and what is not settled in these sources
Legal precedent cited by practitioners — notably Cook v. Tait — is invoked to affirm the United States’ authority to tax citizens abroad, and tax preparers and the IRS materials reflect active enforcement and compliance pathways [9] [1]. At the same time, commentary notes political and grassroots opposition to citizenship-based taxation and ongoing complexity that makes professional advice common among expats; the sources do not resolve policy debates or predict legislative change, and they do not provide a universal numerical filing cutoff applicable to every reader — the IRS tables and a taxpayer’s individual facts remain decisive [10] [2].