Whether you are living in Oslo, Bergen, Trondheim or anywhere else in Norway, all US citizens are required to file a yearly US tax return, regardless of residency. However, the Foreign Earned Income Exclusion and Foreign Tax Credit, will often reduce an expats tax liability. Many of our expat taxpayers living abroad pay no taxes or very low taxes, however, filing is still mandatory even if a taxpayer does not owe taxes.
In addition, the US/Norway Tax Treaty may also help reduce a taxpayer’s tax liability and offer benefits to the taxpayer. It is important that any US citizen living inabroad know the details of the Tax Treaty, or they should choose an accountant who does.
Many US citizens living abroad are unaware of their requirement to file US taxes, and therefore have not filed since they left the US or they may have never filed. In this case, it may be best to consider the Streamlined Program. The Streamlined Program allows delinquent tax payers to become current with their tax liabilities with reduced or limited penalties.
The US has a totalization agreement with Norway with helps reduce double taxation for US expats living in Norway. These taxes are often not covered under the Foreign Earned Income exclusion and the Foreign Tax Credit. This agreement is especially helpful for those self employed expats living in Norway. For more information about totalization agreements and how it can save you taxes, see our blog at: http://universaltaxprofessionals.com/2016/01/20/what-is-a-social-security-totalization-agreement/.
Most US citizens living in Norway have a foreign (outside the US) bank account, and therefore may be required to file an FBAR, if you own over $10,000 in foreign financial accounts or have signature authority over those accounts at any point during the year. If you meet these requirements then you need to file an FBAR. The penalties for not filing an FBAR are severe.
If you are living in Norway an need to file your US taxes or have any other tax issues, feel free to email me at firstname.lastname@example.org.