Form 1040 – US Individual Tax Return for all US citizens

May 10, 2020 | FATCA, FBAR, IRPF Spanish Tax Return, US Tax Return 1040 / 1040NR | 4 comments

You must file a Form 1040 is you are a US Person (US citizens, Green Card holders and resident Aliens), no matter where you live or if you pay taxes in a foreign Country.

Normally the deadline for filing is April 15th but this year has been extended for everybody until July 15th 2020.

You need to know that if your filing status is Single, you must file the return if your gross worldwide income was at least $12,200 and if you are Married Filing Separately the threshold is only $5.

A new law passed in December 2019 has extended tax breaks but also caused delays for many 2019 forms, instructions, and publications. These new changes are separate from the big ones that went into effect in 2018 from the Tax Cuts and Jobs Act of 2017. That law also has some updates for 2019.

The rates remain the same this year, ranging from 10% to 37%. The tax brackets, or income ranges, increased slightly for inflation.

Rate Single Married, Filing Separately Married, Filing Jointly Head of Household
Taxable income over…
10% $0 $0 $0 $0
12% $9,700 $9,700 $19,400 $13,850
22% $39,475 $39,475 $78,950 $52,850
24% $84,200 $84,200 $168,400 $84,200
32% $160,725 $160,725 $321,450 $160,700
35% $204,100 $204,100 $408,200 $204,100
37% $510,300 $306,175 $612,350 $510,300

The Child Tax Credit now reduces your taxes up to $2,000 per child under 17. (This change went into effect last year.) Many more families now qualify for the credit as income limits have gone up to $200,000 for individual filers (the same as last year and up from $75,000 two years ago) and $400,000 for married filing jointly (the same as last year and up from $110,000 two years ago)

This is a “refundable” credit, meaning you can get up to $1,400 per child back even if your 2019 tax bill is $0. You must claim the credit on your tax return to get it.

Any child you claim for the Child Tax Credit must now have a Social Security number. They must have the number by the due date of your tax return (including extensions).

You can also claim the Foreign Earned Income Exclusion

In most of the cases, it is mandatory to file and pay taxes in Spain first and offset those taxes paid in the US with the Foreign Tax Credit (FTC),  which can be used according to the Treaty Between the U.S.A. and Spain to avoid double taxation.

Schedule B is required if you had a financial interest in or signature authority over a financial account in a foreign country at any time during 2018.

You might also be required to file Form 5471 (Information Return of U.S. Persons with Respect To Certain Foreign Corporations, if you are officer, director and/or shareholder (more than 10%) of certain foreign corporations, to report the current status of the foreign corporation. And Form 8621 (Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund) if you are shareholder of a Passive Foreign Investment Company (PFICs) or Qualified Electing Fund (=Fondos de inversión). A single Form 8621 must be file for each Mutual Fund. Remember that the increase of value during the year will be taxed as ordinary income. Pension funds are excluded from the Form 8621.

The IRS recommends contacting experienced Tax Preparers, like us, to be sure that you are filing your 1040 properly and completely.


  1. Angeles casanovas Aledo

    What can I do to get the stimulus check?

    • Antonio Rodriguez

      You do not need to do anything, the US Treasury will send you the check or deposit it in your US bank account if the have it on file.

  2. william simms

    My family and I are thinking of moving to Spain, although I am confused on the tax rules. I would be keeping my U.S. job, working remote, which the company would be using a W2 and tax rules based on my last location which is Nevada. They stated I would be responsible for any adjustments/taxes owed based on any rules on living in Spain. I have 3 kids and my wife, making under 120k, would I be able to file a 1040 as normal?

    • Antonio Rodriguez

      As US Citizen you have two annual fiscal obligation with the IRS: to file the 1040 (as you have done before) and the FBAR (whenever you get Spanish bank account) and as resident in Spain, another two obligations with the AEAT – Spanish Tax Authorities, Modelo 100 IRPF (Annual Income Tax Return) and Modelo 720 (similar to the FBAR, reporting your assets outside Spain).
      According to the treaty between Spain and the US to avoid the double taxation, you must report and pay your taxes here in Spain (almost one third more to what you are paying in the US) and deduct that amount with the Form 1116 Foreign Tax Credit in your US Tax Return… The normal result would be that you do not have to pay anything to the IRS, so our suggestion would be to ask your employer not to withhold any amount in the W2, because you will always get it as a refund few weeks later after you filing the 1040. Please do not hesitate to send as an email or call our office if you have further questions or doubts. Antonio


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