Do I need to file my US federal taxes as an American living abroad?

Yes. The US is the only developed country who requires its citizens to file and pay taxes no matter where they live.
You do not have to file if you do not cross the income filing requirement threshold. But you have to file even if you do not cross this threshold in special situations, such as, if you have net income from self-employment activity of $400 or more, or if you are the owner of a foreign corporation, these are just a couple examples.
The IRS has more details in this link below:
Who needs to file a tax return | Internal Revenue Service

When do I need to file my US tax return as a citizen living abroad?

All taxes filed with the IRS must be filed by April 15th if you live in the US. If you live outside the US, your deadline is automatically extended to June 15th. Extensions can be applied for you if you need more time to prepare your taxes. Taxes owed to the IRS if any, however, are due by April 15, any unpaid amount accrues interest and penalties when paid after that deadline, if no extension is in place.
As a matter of fact, to avoid this complication, we file an extension, for October 15, for all our clients. If you need an extension filed book a call with Admin at US Taxes International with the link below:

Can US citizens living abroad apply for a filing extension?

As a person living abroad, your due date is automatically June 15 without the need to file an extension. If there is any tax due, your US and state tax is still due on April 15th. This allows persons who are waiting to file their foreign taxes first to have time to file their taxes in the United States. If more time is needed, an even later extension can be applied until October 15.

Will I pay taxes in my host country as well as the US on my income?

You are considered a tax resident of most countries by either residing or centering your life in the country for more than 183 days. In addition, most countries, such as Spain, tax your worldwide income. So, yes, you must file and pay taxes in your host country first and then file your US taxes.
By using the Foreign Tax Credit and the Foreign Earned income Exclusion you can avoid double taxation on your foreign earned income.
If you have earned income, you may even be owed a refund from the IRS if you have children who have US social security numbers. This is because there is a part of the child tax credit that is refundable, even if you work abroad for a foreign employer or are self-employed.

The Foreign Tax Credit (“FTC”) and the Foreign Earned Income Exclusion (“FEIE”)

Foreign Tax Credit

Taxes paid to a foreign country can be off set on your US tax return. By filing IRS Form 1116, you can claim these taxes paid as a credit or a deduction to your owed taxes in the United States, but the credit is preferable and most people take the credit.

For example: :

You are filing your US income tax as “single”.
While living and working in a foreign country you earned $120,000.
You could owe $30,000 on these wages in the United States.
You paid $40,000 to the foreign country where you are living on this earned foreign income.

Considering you paid $40,000 in taxes to the foreign country; you can use this as a tax credit to reduce the $30,000 you owe in the US to $0.

Foreign Earned Income Exclusion

You could exclude all or part of your foreign wages and foreign self-employment income by filing Form 2555. This exclusion could reduce your owed taxes to nothing.

The maximum amount you can exclude for 2024 is $126,500 per person. This means that you will owe taxes only on any amount of foreign income earned that exceeds this amount.

If any taxes were paid to the foreign country, this amount can be credited using the Foreign Tax Credit, and could reduce the amount owed to $0.
You can use both the exclusion and the credit, but not on the same income. We calculate your taxes both ways and pick the one that is most advantageous.

Find more details on the Foreign Earned Income Exclusion.

Can I claim the Child Tax Credit while living abroad?

Yes, Americans living abroad are able to claim the Child Tax Credit and the Additional Child Tax Credit.

You may claim up to $1,700 per child.
You must make a minimum of $3,001 to apply the credit.
You will receive 15% of your income over $3000 up to $1,700 of credit per child.
The full amount received for each child is compounded based on the earned income amount.

To calculate your refundable credit, take 15% of your earned income, minus the 3000 required to apply the credit. This is the amount you could receive as a refund from the Child Tax Credit.

For example: If you were to earn $10,000, you would receive:
(10,000 – 3000) * .15 = $1050. It does not matter that you have 5 children, the credit is limited to 15% of your earned income over 3,000. In order to receive a full credit amount for all 5 children, you would need to make at least $59,000 a year. Interest, dividends, rent received from a property, maternity leave, etc. is not earned income. Earned income is from work either as an employee or self-employed.

I didn’t know I was supposed to file my taxes in the US? Is there some way I can correct this, without penalty?

Many Americans living abroad simply do not know or realize that they must continue filing their taxes in the US. We can help you correct this mistake as soon as possible at any time during the year.

You should file your delinquent taxes as soon as possible, if you are behind on filing. If you are behind one or more years, we can help you file a Streamlined Offshore Filing Procedure. Filing using this amnesty program allows you to fulfil your filing requirements without penalty of delinquency if you lived outside the US for at least 330 days during the last 3 years. The tax returns must be filed using special procedures and a statement explaining why you did not file is necessary.

To file under this program, you should file the last three delinquent tax returns (if delinquent 3 years or more) and the last six delinquent FBARs.

As a note, any refunds you would have received, including Child Tax Credit, 2021 COVID stimulus (if filed by April 15, 2025), or any other refundable credits, will be received when filing within 3 years of the filing deadline of that tax year.

If you were not out of the US at least 330 days in one of the last 3 years, and you want to come into compliance there is a similar procedure called Streamlined “domestic” Fling Procedure. To learn about any of these procedures, book a call link below:

How do I file if I am married to a foreigner?

There are three options for filing: Married filing jointly, Married filing separately, or Head of Household.

If you file jointly, your spouse’s income will become subject to taxes in the US. It increases your tax threshold, but this benefit sometimes does not outweigh the tax liability and responsibility of you both filing. This is not a good idea for most people.

Filing separately allows you to file your income while not filing the income of your spouse. This is most commonly used among Americans living abroad.

If you have dependents living with you that are also citizens of the US or have a SSN, you can file as Head of Household. You must also pay at least 50% of the support of the children and your house.

What is an FBAR and do I need to file it?

FBAR is a report of foreign bank accounts that have a combined balance of more than $10,000 at any point during the year. We can also help you file this, along with the streamline or by itself with your tax return, if this is your first year filing taxes as a citizen living abroad.