# US Citizens - "free filing" and other issues for 2015



## Bevdeforges

The IRS says that the information on its ever-popular Free-file system will be available on their website starting 15 January 2016. https://www.irs.gov/uac/Free-File:-Do-Your-Federal-Taxes-for-Free Since the closing of the overseas IRS offices last year, I suspect we won't have access to a handy dandy list of free filing sites that are usable by overseas residents. And, given the changes in offerings that have been free in the past, it's possible that the selection this year will be different from that in the past.

So, I thought I'd open up this thread (to save myself having to test out all the options). Please post your experiences and recommendations for free tax filing software once you've tried them out. (Do NOT post philosophical or political discussions about the morality or legality of the situation. Those will be moved to the regular discussion part of the board.)

Normally, there are only a few of the free filing sites that can be used by expat filers. Some of the "disqualifiers" to watch out for (based on prior years) are:


sites limited to residents of specific states (usually indicates that the federal forms are e-filed for free, but that you have to pay for a state filing)

key "overseas" forms are not available - such as 2555, 1116

age restrictions (for some reason some filing sites will only allow freebies for those under age 25 or 52 or over age 65)

There are a few other "tricks" to watch out for. Some software will allow you to prepare your return online, and possibly even e-file it for free. But if you want to print out a copy of what you are filing, it'll cost you.

Anyhow, as you find software available for free for tax preparation, please drop a note here and tell us about your experience. Which ones work. And which ones don't. And if all else fails, which ones offer the best "value for money" if you absolutely have to pay for the software. 
Cheers,
Bev


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## Bevdeforges

Just had a first look at the IRS Free File offers this year. There are 15 providers at the moment.

Went through the IRS site's "Help me find Free File Software" and got back two possibilities, from providers I've never heard of before.

Looking at the listing of Free File providers, eight of them specifically mention "filing with a foreign address" though most of those have age restrictions (both minimum and maximum).

Three providers have no age restrictions (though one of those will only do Free File returns for people resident in specific US states, so probably not overseas residents). And a couple of the providers have *minimum* AGI requirements of either $8,000 or $13,000. (So, if you exclude all your earned income and have only minimal other income, you may not qualify for their Free File services.)

Turbo Tax is interesting this year - their upper limit for AGI is half the Free File limit (i.e. $31,000 rather than $62,000). However, they don't mention anything about foreign addresses, so I suspect that's why they didn't appear on the responses I got from the "Help me find Free File Software" wizard. 

Anyhow, this is the list from the IRS site, and you may have to go through this listing to find the Free File services from the listed vendors.

Let us know if you run into problems with any of the sites specifically related to filing from overseas.
Cheers,
Bev


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## Bevdeforges

Given that the overseas IRS offices have all been shut down, I'm pleased to report that there is a concerted effort on the part of the IRS to provide more information on their website for us Overseas Taxpayers. Take a look at these pages and the links provided thereon:

https://www.irs.gov/Individuals/International-Taxpayers/Taxpayers-Living-Abroad
U.S. Citizens and Resident Aliens Abroad

Cheers,
Bev


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## Fjordlover

Hi Bev!

It's that time of year again, so here I am. I was just wondering if there are any changes this year that US expats need to be aware of when filing taxes. Last year we had to fill out an extra form for healthcare, so I was wondering if the IRS has any surprises in store for us as well this year.

Also, do you or anyone else know if Tax Act still is a good option for expats? I used it last year to double check my paperwork, and I found it easy and manageable.

Thanks again Bev for the steller work you do here! We expats really appreciate it!


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## Bevdeforges

I used the little "wizard" thing that is on the IRS website to help you find a free file site, and neither Tax Act nor Tax Slayer came up. This year Tax Act requires that you be age 52 or younger (which lets me out), and Tax Slayer seems to have the same age limit. Turbo Tax seems to be allowing all ages this year (though with a lower AGI limit) however they didn't pop up when I used the wizard. They have, however, been sending me e-mails claiming that I can still file for free with them. Haven't yet checked it out.

The only "new" things noted in Pub 54 are changes to the various thresholds and limits (like every year). I guess one advantage to having a dysfunctional Congress is that they can't make any serious changes to the tax code.
Cheers,
Bev


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## BBCWatcher

OLT (OnLine Taxes) offers free tax preparation this year. The forms that U.S. persons living overseas typically or often need are supported such as IRS Form 1116 (Foreign Tax Credit), 2555 and 2555-EZ (Foreign Earned Income Exclusion/Foreign Housing Exclusion), 8965 (Health Coverage Exemptions), 8938 (Statement of Foreign Financial Assets), 8812 (Additional Child Tax Credit), 4868 (Application for Automatic Extension), Schedule C (Profit/Loss from Business), and Schedule SE (Self-Employment Tax), as notable examples. The popular standalone disclosure filings -- IRS Forms 3520 and 3520-A, and FinCEN Form 114 -- are not supported. But that's a typical omission for tax preparation software. E-filing is free if it's available for your tax situation -- sometimes not, in which case you'd simply print out, review, sign, and mail your tax return.

H&R Block has a free edition too. It's missing IRS Form 8938, but a large percentage of U.S. persons living overseas don't need to file that form because they don't meet the threshold. Otherwise it looks like H&R Block has the same breadth of form coverage as OLT this year (tax year 2015).


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## byline

Thanks for those links, BBCWatcher!


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## MK15

byline said:


> Thanks for those links, BBCWatcher!


Yes, thanks for the links!

Ran into a snag with trying out OLT. It requires a SSN or ITN for my spouse when I select Married Filing Separately. I'm not Single; I've been married for 6 years, so that doesn't work. My spouse is not a US person and has no intentions of signing up for an ITN.

I put in a ticket to see if they can resolve that. On a paper form, I think you'd just write NRA for Non Resident Alien.


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## byline

MK15 said:


> Yes, thanks for the links!
> 
> Ran into a snag with trying out OLT. It requires a SSN or ITN for my spouse when I select Married Filing Separately. I'm not Single; I've been married for 6 years, so that doesn't work. My spouse is not a US person and has no intentions of signing up for an ITN.
> 
> I put in a ticket to see if they can resolve that. On a paper form, I think you'd just write NRA for Non Resident Alien.


Ouch, I'm in the same filing situation. Hope this can be resolved!


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## MK15

byline said:


> Ouch, I'm in the same filing situation. Hope this can be resolved!


Got a very quick but bad news response,



> 2016-03-03 15:54:40
> I apologize, our software is not set up to handle this scenario.
> 
> Thank you for using OnLine Taxes. Please let us know if we can be of further service. Have a great day.
> 
> Trisha



Tested H&R Block and it only needed spouse's name and DoB, so it let me run through the whole thing. Won't efile with a "blank return" though (all my income is foreign and used up by foreign exclusion), have to print off and mail in but at least it's free.


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## BBCWatcher

For OLT you could put in 000-00-0000 as a workaround to get their software to keep going forward, then make sure you replace the bad page(s) with corrected page(s) in a printed (not e-filed) tax return before you send it, manually copying everything else but replacing 000-00-0000 with NRA. It's not pretty, but it would work.

Thanks for the report, though.


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## byline

MK15 said:


> Tested H&R Block and it only needed spouse's name and DoB, so it let me run through the whole thing. Won't efile with a "blank return" though (all my income is foreign and used up by foreign exclusion), have to print off and mail in but at least it's free.


The Free File site noted age restrictions for H&R Block (17 to 50). I'm 57. Did you run into that? I've got to get to work on this soon, so I'm hoping one of the sites actually works for me.


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## BBCWatcher

byline said:


> The Free File site noted age restrictions for H&R Block....


The Free File site is a different site.

Perhaps you are familiar with the fact that practically everybody aboard an airline flight has paid a different price than practically everybody else on the same flight. There are different prices (and terms and conditions) in the world for exactly the same products depending on what promotions, coupons, and, yes, Web links you use or don't use. This is one of those occasions. Here is the link to use. Please let us know how it goes for you.


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## Bevdeforges

On the married, filing separately issue: Try the workaround BBC has suggested, but it that won't work, see how far you can get with the software entering either NRA or all 00s and then see if you can print out the resulting forms to mail in. If it won't let you past the part about entering your spouse's SSN or ITIN, then you're stuffed, but it's worth a try. 

At some point, it's actually easier to just fill in the forms by hand (or on the computer on the pdf "fillable" versions).
Cheers,
Bev


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## Fjordlover

Tried OLT, but I couldn't get it to do the 2555 form. Anyone else run into that problem?


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## Bevdeforges

Haven't tried OLT yet, but the "trick" to getting the 2555 form to fill itself out is usually related to how you report your earned income. Whatever you do, don't use the W-2 form entry for foreign earned income. There HAS to be another way to indicate that this is salary income, but not from a W-2. Scroll down every possible menu. 

The other way is to see if there is some way to "invoke" a form 2555 - or just start filling it out. That may pop up some sort of help thingee, or give you some clue about why you can't put the numbers in yourself and that could lead you to where you should be putting in the numbers.

This is one of those things where I find doing the pdf fillable forms easier at times than using tax software.
Cheers,
Bev


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## byline

BBCWatcher said:


> The Free File site is a different site.
> 
> Perhaps you are familiar with the fact that practically everybody aboard an airline flight has paid a different price than practically everybody else on the same flight. There are different prices (and terms and conditions) in the world for exactly the same products depending on what promotions, coupons, and, yes, Web links you use or don't use. This is one of those occasions. Here is the link to use. Please let us know how it goes for you.


I knew that. I have the H&R Block bookmarked. I was just noting what the Free File page said. I haven't had time yet to get started, so was hoping that someone who had would be able to comment on their experience, and whether they'd been able to get through despite the age restriction listed on the Free File site. I fear this is going to be quite time-consuming for me, and was hoping to cut down on as much wasted time as possible.


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## BBCWatcher

It's a different offer with different terms and conditions, just like myriad other businesses. If you see no age limit through door #2 (I don't), there is no age limit.


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## byline

Good point. I'm just trying to eliminate as many false starts as possible, knowing how mind-numbingly slow I am at this stuff. I'm about as far away from an accounting-minded person as you will find!


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## manny.j

Fjordlover said:


> Tried OLT, but I couldn't get it to do the 2555 form. Anyone else run into that problem?


I am in process of completing my tax-return with OLT and had no problems getting 2555 although we got 2555-EZ as we didn't fit the requirements for 2555.

My problem however at present is that when completing form 1116, we have both General and Passive incomes and when we go to print out the forms...this form is missing for submission...

Just emailed customer service requesting some feedback to determine the bug.


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## BBCWatcher

Yes, you should be getting a pair of Form 1116s generated if you have creditable foreign tax in two income categories.


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## manny.j

manny.j said:


> I am in process of completing my tax-return with OLT and had no problems getting 2555 although we got 2555-EZ as we didn't fit the requirements for 2555.
> 
> My problem however at present is that when completing form 1116, we have both General and Passive incomes and when we go to print out the forms...this form is missing for submission...
> 
> Just emailed customer service requesting some feedback to determine the bug.


This is the email I received from the customer-service at OLT regarding my concern of having Form 1116 missing prior to submission-

_"It appears you have already excluded the income using the form 2555. You can exclude the income and take the tax credit. If you still believe you qualify for the 1116 please provide additional details to help clarify.

Thank you for using OnLine Taxes. Please let us know if we can be of further service. Have a great night."
_

Does the above comment make any sense? 

*In 2013 tax year*- I had some income from self-employment and full time employment and completed form 2555 in ADDITION to Form 1116 i.e. both 1116 and 2555 forms were submitted.

*In 2015 tax year*- (currently been completed)- I did not have self-employment and just full-time job and completing form 2555-EZ (it was automatically selected by OLT), where Form 1116 is missing!

Also, we completed Schedule E for rental income in 2013 and 2015.

So is there a link between missing of Form 1116 is due to completing Form 2555-EZ and not standard Form 2555?

Many thanks...


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## BBCWatcher

OK, you should have a Form 1116 reflecting passive income (foreign income tax on bank interest, for example). If your income from work (earned income) is fully excluded via Form 2555 or 2555-EZ then you won't have a Form 1116 for that income -- it should be "missing." You cannot take a Foreign Tax Credit on excluded income.


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## manny.j

BBCWatcher said:


> OK, you should have a Form 1116 reflecting passive income (foreign income tax on bank interest, for example). If your income from work (earned income) is fully excluded via Form 2555 or 2555-EZ then you won't have a Form 1116 for that income -- it should be "missing." You cannot take a Foreign Tax Credit on excluded income.


Thanks BBCWatcher. 

This is the response I received a short while ago from OLT customer-service. 

Any thoughts? I just want to be sure I don't end up filing my taxes incorrectly...

------------------------------------------------------
_Hello,

Form 1116 Foreign Tax Credit is a refundable credit; it will cancel out your taxes only. It is not generating in your scenario because your taxes (line 44) is already $0. 

Rental income is not earned income, and it cannot be listed on Form 2555 or Form 2555 EZ.

Let us know if you need further assistance. 

Thank you, _
------------------------------------------------------

The above was in response to my question below....

------------------------------------------------------
_Hello,
As you may see from the information I submitted for Form 1116-
(a) Passive Income- We have earned bank interest- which to my understanding from past filing, should be submitted in Form 1116.
(b) General Income- For this in Form 1116, I stated my full-time employment income.
(c) Rental Income- For this purpose, I completed Schedule E.
(d) Form 2555/ 2555-EZ- Could you please clarify if rental income is regarded as Business income or not? I tried both the scenarios (regarding it as Business in one and other not) but when printing out the forms- it was still displaying in my case Form 2555._
------------------------------------------------------


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## BBCWatcher

That explanation doesn't make sense for a couple reasons. I like my explanation better. 

What are the facts of the situation?


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## Fjordlover

Bevdeforges said:


> Haven't tried OLT yet, but the "trick" to getting the 2555 form to fill itself out is usually related to how you report your earned income. Whatever you do, don't use the W-2 form entry for foreign earned income. There HAS to be another way to indicate that this is salary income, but not from a W-2. Scroll down every possible menu.
> 
> The other way is to see if there is some way to "invoke" a form 2555 - or just start filling it out. That may pop up some sort of help thingee, or give you some clue about why you can't put the numbers in yourself and that could lead you to where you should be putting in the numbers.
> 
> This is one of those things where I find doing the pdf fillable forms easier at times than using tax software.
> Cheers,
> Bev


I found a line where I could report foreign earned income and filled out all of the 2555 lines/questions, but it didn't generate the 2555 and left the corresponding lines on 1040 blank. I tried several times, but at the end I just gave up and did it by hand. It took all of 5 minutes to do it that way. Life is too short.


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## amphitecna

So I finally was able to sit down and do this. I am a homemaker, with no income, so my taxes are relatively simple (I technically don't need to file, but well, do anyway). Last year I used TaxAct to efile, it accepted the foreign address and the NRA spouse with no SSN. This year, the address doesn't seem to be a problem, but the lack of a social or tax ID for my spouse sure is. I tried entering all 0's as the workaround, to no avail. The instructions on the site say to enter "NRA" for the social, but it didn't accept that either. I was able to save and print the forms for free at least, and I guess I'm going to have to mail them. Would have preferred to e-file. I've sent suggestions to them, but dunno how or if they'll respond. Golly it would be nice to have a tax software package that consistently allowed us to e-file. I grow tired of this annual game.

Anyone know of a platform that will allow me to e-file? Prior to last year, I used HR block, but always had to print and mail with them.

Now off to the FBAR......


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## Bevdeforges

I wondered why TaxAct no longer showed up on the list of possible free-file options. I guess this may be it. However, I've also noticed that the IRS tends to change their requirements without notice and that could also be a factor here.

Last time I tried to e-file, TaxAct accepted the NRA for spouse's SSN just fine (and in fact included that in the instructions) but it was the IRS that rejected the filing due to "no spouse SSN." One of the reasons you may want to consider not filing if you don't have to. 
Cheers,
Bev


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## amphitecna

It shows up in mine still. Last year I efiled without trouble via them, sans SSN for my husband. I looked quickly through one of the others, and got stuck with the lack of SSN as well. Printing, filling in NRA in the SSN field, signing and sending was much less of a headache. 

I do continue to file just so I have a continuous record with them. I'm sure if that's worth anything or not, but it somehow gives me peace of mind. Of course with the end of 2015, also ended the statue of limitations on my back-filed FBars, so my mindset may change going forward.


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## Booth44

I just successfully efiled my 2015 return via TaxAct with having a Non Resident spouse with no SSN/ITIN. So perhaps the issue mentioned earlier in the thread has been resolved. I used the download version of the software though - not the free online version - so maybe that's the difference.


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## Bevdeforges

Thanks for the report! Do you have to pay to download the software? (Used to be they had a free downloadable option, but I didn't check for that this year.)
Cheers,
Bev


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## Booth44

Yes, the downloaded version costs US$13 or so, though that reminds me to mention that I had to upgrade to a higher version of the TaxAct software for 2015 to get form 8938.

The main benefit for the download version, at least for me, was to not have to worry about logging back in after a few minutes of inactivity as it seemed I was constantly having to do with the free online version.


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## Pitty

Hi,
I'm taking (FEIE). so for e-filing, I chose IRS fillable forms eventhough in the site the condition was having income more than $62000, 
then in IRS site I chose income higher than $62000 even though I wanted to take FEIE.
in the next page which is https://www.irs.gov/uac/before-start...fillable-forms
It didn't mention at all about income level of $62000 or more. So i went step by step and I e-filed it. 24 hours later i received a refusal letter with the following issue:

issue : Business Rule X0000-005 - The XML data has failed schema validation. cvc-complex-type.2.4.a. Invalid content was found starting with element 'Amt'. One of '{"http://www.irs.gov/efile"esc}' is expected.

The following information may help you determine the form at issue:
Field/Xpath: /efile:Return[1]/efile:ReturnData[1]/efile:IRS2555[2]/efile:OtherForeignIncomeGrp[1]/efile:Amt[1]
I checked my 2555 form, line 23 "Other Foreign Earned Income" and its amount which is zero (not blank).
do you think that i should add in line 23 ,interests from my schedule B, even though i have mentioned it in form 1040 line 8a?


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## BBCWatcher

No. IRS Form 2555 Line 23 is for earned income. Interest is not that.


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