Moving abroad often brings love, adventure, and new tax questions. If you’re a US citizen married to a non-US spouse, your filing options can directly affect how much you owe and what you must report to the IRS.
As a US expat married to a nonresident alien – someone with neither US citizenship nor a Green Card – you have some choices to make. Generally, married couples must either file jointly or file separately. It depends on the circumstances if claiming your foreign spouse on your tax return is beneficial or not.
If you are new to expat taxes, check out our Expat Tax Guide.
The residency election – What it means and how it works
If you want to file jointly with your non-US spouse, you must make a residency election, a one-time choice to treat your spouse as a US tax resident.
What it does:
- Allows joint filing, the higher standard deduction, and certain credits.
- Requires reporting your spouse’s worldwide income to the IRS.
- Remains valid until revoked (you can revoke it only once).
How to make it:
- Attach a signed statement to your joint tax return declaring both spouses choose to be treated as US residents under IRC §6013(g).
- Include your spouse’s name, address, and taxpayer ID (SSN or ITIN).
Before you elect: If your spouse has significant income or assets abroad, this choice can increase tax and reporting duties under FBAR and FATCA.
If they have little or no income, it can meaningfully reduce your total US tax bill.
Filing jointly with a foreign spouse can lower your tax bill – but not always
In some cases, you can significantly lower your tax bill by claiming your foreign spouse on your tax return. However, in some instances filing separately would save you money.
Here are three key considerations for married filing jointly or separately with a foreign spouse:
1. Tax impact of foreign spouse’s income and assets
If your foreign spouse has little or no income, filing jointly can help lower your tax bill. In order to do that, your spouse must obtain an Individual Taxpayer Identification Number (ITIN).
On the other hand, if your foreign spouse has a high income and/or high-value investments and you include your spouse in your filing, your tax liability would significantly increase. In that case, it may be better for you not to file jointly.
If you file separately, you could shelter up to $185,000 (in 2024, or $190,000 in 2025) of your assets from reporting (on the FBAR or Form 8939) and also from US taxation on the income from these assets by gifting them to your non-resident foreign spouse. Of course, gifting significant assets only to avoid taxes and disclosure requires a substantial amount of trust in the foreign spouse.
2. Deductions and exclusions
If you choose to file a joint return with your foreign spouse, you can be eligible for higher deductions and exclusions, depending on the combined income levels.
Especially when it comes to the Foreign Earned Income Exclusion (FEIE), your filing status can make a big difference.
If you file a tax return as “Single,” “Head of Household,” or “Married Filing Separately,” you can exclude up to $124,500 (in 2024, $130,000 in 2025) from your foreign income by claiming the Foreign Earned Income Exclusion on Form 2555.
If you however opt for a “Married Filing Jointly” return, and you and your spouse both work abroad, you may be able to each exclude up to $101,300 of your earned income, doubling the exclusion.
3. Contributions to tax-deferred accounts
If you don’t include your foreign spouse in your tax filing, your spouse will not be recognized as a US taxpayer. Therefore, he or she will not be able to make contributions to any tax-deferred, US-based account (such as an IRA). Neither will you be able to contribute on his or her behalf.
When filing separately might be smarter
Sometimes it’s safer and more efficient to file separately from your foreign spouse. This option keeps your finances and reporting obligations separate.
When separate filing makes sense:
- Your spouse has high income or valuable assets abroad.
- You want to avoid FATCA or FBAR reporting on your spouse’s accounts.
- Your spouse already pays foreign taxes that would complicate US filings.
- You prefer to keep your spouse’s financial details private.
Tax and reporting note: Filing separately generally means higher taxes and fewer credits, but it limits exposure. You also keep the option to gift up to $190,000 (2025) per year to a nonresident spouse without US gift tax, a useful estate planning tool if done carefully.
Filing from overseas with a non-US spouse: FAQs for expats
Can I file jointly with my non-US spouse?
Yes, by making an election to treat your spouse as a US resident for tax purposes, you can file jointly.
What must your spouse do to be included in a joint return?
Your spouse needs an SSN or must apply for an ITIN (via Form W-7) so they can be listed on the return.
What happens to my spouse’s foreign income if I make the election?
If you treat your spouse as a US resident, you must report their worldwide income on your joint return.
When is it better to file separately instead of jointly?
If your spouse has high foreign income or assets, it may push your combined tax liability higher or cause more reporting burdens.
Can I revoke the election treating my spouse as resident?
Yes, under certain conditions you can revoke the election, though rules apply around timing and suspension.
Does election affect my eligibility for FEIE or other exclusions?
It can. Making the election may impact how deductions, exclusions, and credits phase out, and may limit treaty benefits.
So, should you include your foreign spouse on your US taxes?
As you can see, there is a lot to consider and we are only scratching the surface of this complex topic. Those three considerations above are important; however, there are more nuances and things to take into account regarding the tax impact of your foreign spouse.
Also, keep in mind that this election to include your foreign spouse can only be made once, and it can only be revoked one time. Consequently, the tax impact of this decision is long-lasting and not to be taken lightly.
A lot of money can be at stake if you don’t have a clear understanding of the options and their consequences. If you need help with your expat taxes, don’t hesitate to reach out to us.
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