I did the tax forms myself when living abroad, precisely because I didn't earn enough income to afford the $1000 cost (in fact, it was perhaps twice this, in Switzerland, based on my cursory Googling at the time). It routinely took over a week of working days, which was only possible because I had a sympathetic boss and generous vacation time.

It's also quite stressful, since there are many ambiguous questions, most of the proprietary tax software is ill-equipped to consider the situation of an American living abroad, and a wrong answer can subject you to audit.

What are the consequences to not filing? My wife is a US citizen, and she hasn't filed for two years. I've met other US citizens that don't file either. So far I have not heard of any issues relating to not filing.

The issue is that the US can determine she didn’t file, file for her, and assess fines/tax. Once that gets to $50k she can’t renew her passport, and can no longer enter or leave the US as the law states she can’t use her foreign passport if a US citizen. If she lives in a country that assists the IRS with collection, they can reach in and take it. They have all her bank details from FBAR filing.

I know a US citizen who hasn’t filed in 34 years. I wonder what the penalty would look like if she ever takes a job in the US again.

Does she earn much? If her income is low enough, she may be exempt from filing.

https://www.hrblock.com/tax-center/income/other-income/how-m...

(Note that I am not a tax professional and you should not rely on anything I say.)

It doesn't matter. If she has bank accounts abroad exceeding the threshold, she's obliged to file just to disclose her foreign bank accounts.

Eventual expat here (clock is running on citizenship elsewhere through an investment program). I would not recommend filing your taxes yourself if you're a non-US resident with citizenship. It's cumbersome because of mechanizations to prevent tax evasion. There's room for improvement, but expats have very little pull congressionally in getting reform done to improve the experience. These fees should also be made deductible (tax prep fees no longer are).

With that said, $1k annually is a small price to pay to maintain your US citizenship through annual tax filings. The benefits (imho) outweigh the cost (employment access, residency, repatriation).

Tangentially, this sounds like a startup opportunity.

it's extremely easy to file the FBAR forms. and the rest are standard tax forms, and you even get to file later. I lived abroad and ran a US and Argentine company and had 2 accountants and a bookkeeper, so it can get complex when you have a lot of employees, but for the first few years abroad, when it was just me doing remote consulting, i just did it myself and it's not difficult.

It isn’t complicated to file FBAR, but why should we have to give all our bank account details to the US when citizens living there would only have to under criminal investigation? Also if the US decides you are owing taxes/fines and you live in a country that assists the IRS with collection, they have all your account details.

The penalties for making a mistake are such that you would be a fool to take the risk to save $1,000.

The Foreign Earned Income Exclusion is USD 107,600. If you make less than that, then the forms (Form 2555) are pretty easy.

If you make more, Form 1116 can be a pain to get right but if you have an accountant do it once you can figure out how to modify the form for subsequent years.

As the name implies, that only applies to Earned Income. Not investment or business income not taken as salary or any other form of income.