US citizens and green card holders living abroad face complex tax obligations, including foreign income reporting, IRS filing requirements, and tax treaty considerations. Because of this, many Americans overseas work with an expat tax accountant (sometimes referred to as an international tax accountant or foreign tax accountant) to ensure they stay compliant and avoid costly mistakes.
But how much does an expat tax accountant cost? The answer depends on your situation, the accountant’s credentials, and the type of services you need.
What Determines the Cost of an Expat Tax Accountant?
Several factors affect how much an accountant charges for expat tax services:
- Who Prepares Your Return – Working with a CPA or EA generally costs more than hiring a tax preparer with no professional certification, but the expertise they provide can be crucial in avoiding costly mistakes.
- Complexity of Your Tax Situation – If you only have foreign salary income, your return will be straightforward. However, reporting self-employment, rental properties, foreign corporations, or investment income requires additional forms and expertise, increasing costs.
- Level of Support – Some firms handle your return without offering follow-up assistance, while others include IRS audit support and guidance if you receive a tax notice. Having an accountant who will assist with IRS notices after filing can make a significant difference.
- Access to Your Tax Professional – Many tax firms, especially large software-based ones, provide little to no direct access to the accountant working on your return. If you want the option to schedule calls and ask tax-related questions, you may need to choose a firm that prioritizes client communication.
Typical Cost Ranges for Expat Tax Services
Here are common price ranges for US expat tax preparation:
Basic Expat Tax Return ($600–$900)
Includes the preparation of Form 1040, along with either the Foreign Earned Income Exclusion (FEIE) or the Foreign Tax Credit (FTC) to help reduce double taxation. This option is ideal for expats with straightforward tax situations, such as those who earn a salary from a foreign employer without additional sources of income, investments, or complex reporting requirements.
Moderately Complex Tax Filing ($800–$1,200)
Covers additional reporting requirements beyond a basic return. This includes FBAR (Foreign Bank Account Report) filing for expats with foreign financial accounts exceeding $10,000, as well as reporting rental income, investment income, or multiple sources of foreign income. In some cases, it may also involve filing Form 8938 (FATCA) if foreign assets surpass the IRS reporting threshold.
Complex Tax Return ($1,200–$3,000+)
This type of return is necessary for expats with foreign business ownership, multiple rental properties, foreign pension plans, or passive foreign investment companies (PFICs), which require specialized reporting. Forms such as Form 5471 (foreign corporations), Form 3520 (foreign trusts and gifts), and Form 8621 (PFICs) often apply in these situations, adding to the complexity.
Given the risks of IRS scrutiny and potential penalties, expats with intricate financial situations benefit from working with a CPA or EA specializing in expat taxes, ensuring compliance with both US and foreign tax laws while maximizing tax benefits.
Streamlined Filing Compliance ($1,800–$3,000)
This program is designed for expats who have fallen behind on their US tax filings but can certify that their failure to file was non-willful. The streamlined process allows eligible expats to catch up without facing severe IRS penalties.
This filing includes three years of past-due federal tax returns, along with any necessary forms such as FBAR (Foreign Bank Account Report) filings for the past six years. Depending on the taxpayer’s financial situation, additional forms may be required, which can impact the overall cost.
Ongoing Tax Advisory & IRS Support ($150–$500 per hour)
This service is ideal for expats who need year-round tax planning, audit assistance, or help responding to IRS notices after filing their tax returns.
Tax Software vs. Hiring an Expat CPA or EA
Some expats opt to file using tax software, which can be cheaper than hiring an accountant. However, software programs are often designed for domestic US tax filers and may not fully cover expat-specific tax issues. They also lack personalized support, meaning if you receive an IRS notice, you may have to handle it yourself.
By contrast, working with a CPA or EA who specializes in expat taxes ensures your return is prepared correctly, and you have access to professional assistance if any issues arise with the IRS. Some firms even include post-filing support, meaning they will help you respond to IRS letters or audits, adding long-term value beyond just tax preparation.
Choosing the Right Expat Tax Professional
When comparing international or foreign tax accountants, consider:
-
Do you get direct access to the CPA/EA?
-
Does the firm provide IRS audit support?
-
Can they handle complex issues like foreign businesses or pensions?
-
What are their client reviews from other expats?
While cost matters, the expertise and protection you receive can save you far more in taxes, penalties, and stress.
FAQs About the Cost of Hiring an Expat Tax Accountant
1. How much does a tax accountant cost for expats?
Most expat tax returns range from $600 to $3,000+, depending on complexity. Simple salary-only returns are at the lower end, while returns with foreign businesses or trusts are at the higher end.
2. How much does an accountant charge per hour for tax advice?
Hourly rates usually range from $150 to $500, depending on the accountant’s experience and the service provided.
3. What is the typical tax preparation cost for expats?
On average, tax preparation costs for expats fall between $800 and $1,200 for moderately complex filings. However, the final price depends on your income sources and required IRS forms.
4. Is it worth hiring a foreign tax accountant instead of using software?
Yes, especially if you have foreign bank accounts, investments, or business income. A tax professional ensures compliance with both US and foreign tax laws and provides IRS support if needed.
5. Can an international tax accountant help with IRS notices?
Yes. Many expat accountants include IRS response services and audit support, which tax software does not provide.
6. What’s the difference between an expat tax expert and a regular CPA?
An expat tax expert specializes in US taxes for citizens abroad, covering areas like FBAR, FATCA, and tax treaties. A regular CPA may not be familiar with these additional filing requirements.
7. Do expat tax professionals provide ongoing tax support?
Yes. Many firms offer expat tax support year-round, including planning for future filings, estimated tax payments, and handling IRS correspondence.
8. Can a tax consultant for expats help me plan ahead?
Absolutely. A tax consultant for expats not only prepares returns but also provides guidance on structuring income, investments, or pensions to reduce taxes and stay compliant.
9. What if I haven’t filed my US taxes for several years?
A qualified expat CPA or EA can guide you through the IRS Streamlined Filing Compliance Procedures, helping you catch up while minimizing penalties.
10. How do I choose the right expat tax professional for me?
Compare services, credentials, and communication. Look for firms that:
-
Employ experienced expat tax professionals (CPAs/EAs).
-
Offer transparent pricing on tax preparation costs.
-
Provide direct access to an accountant and post-filing support.
