Table of Contents
Who this is for
This article is written for US citizens living in France — employees, self-employed individuals, and retirees — who need to manage their tax obligations on both sides of the Atlantic in 2026.
⚠ Disclaimer
This article is provided for general informational purposes only. Tax rules — both US and French — change regularly: legislative amendments, updated thresholds, treaty protocols, or new IRS guidance published after the date of writing may render some information out of date. Nothing in this article constitutes personalised tax advice. We recommend consulting a qualified tax professional regarding your individual situation.
Being a US citizen in France means facing a dual tax obligation. The United States taxes its citizens on their worldwide income, regardless of where they live. France, in turn, taxes all individuals who are tax residents on their worldwide income. The result: an American living and working in France must file two annual tax returns — one with the IRS, one with the French tax authority.
This guide covers the key obligations for tax year 2025 (filed in 2026), the mechanisms available to avoid double taxation, and the most common pitfalls to avoid.
Your US Tax Obligations
The United States is one of the few countries in the world that taxes based on citizenship rather than residency. Every US citizen — whether living in Paris, Lyon, or New York — must file a federal income tax return (Form 1040) each year, provided their income exceeds the applicable filing thresholds.
The Main Mechanisms to Avoid Double Taxation
Two tools allow expats to reduce or eliminate their US tax on income already taxed in France.
Foreign Earned Income Exclusion (FEIE) — Form 2555
This allows you to exclude a portion of your foreign earned income from your US taxable base. For tax year 2025, the exclusion ceiling is $130,000 per qualifying individual, per IRS instructions for Form 2555. To qualify, you must meet either the bona fide residence test — having established a stable residence in France for a full calendar year — or the physical presence test (330 full days in a foreign country over any consecutive 12-month period).
Foreign Tax Credit (FTC) — Form 1116
This allows you to credit taxes paid in France directly against your US tax liability, dollar for dollar. Since French tax rates are generally high, the FTC often covers the full US tax liability — with no exclusion ceiling. French CSG and CRDS social contributions have been recognised by the IRS since 2019 as creditable foreign taxes, further strengthening this mechanism.
FEIE or FTC?
These two mechanisms cannot be combined on the same income. For expats subject to high French tax rates, the FTC is often more advantageous than the FEIE. The optimal choice depends on each taxpayer’s individual situation.
2026 Filing Deadlines for Americans Abroad
US citizens residing outside the US receive an automatic two-month extension. Key dates for tax year 2025:
- April 15, 2026: deadline for paying any US tax owed. Even with a filing extension, interest and late-payment penalties accrue from this date on any unpaid balance.
- June 15, 2026: automatic filing deadline for taxpayers living abroad (no request required).
- October 15, 2026: further extension available by filing Form 4868 before June 15.
Your French Tax Obligations
French Tax Residency
In France, an individual is considered a tax resident if any of the following applies: their principal home or main place of abode is in France; their main professional activity is carried out in France; or France is the centre of their economic interests. In practice, the vast majority of Americans who live and work in France are French tax residents — and must therefore declare their worldwide income to the French tax authorities.
The Income Tax Return (Form 2042)
The annual income tax return is filed using Form 2042, available online at impots.gouv.fr. Foreign-source income — including US salaries, dividends, or rental income — must be declared. The 1994 France-US tax treaty (amended in 2004) provides mechanisms to allocate taxing rights between the two countries and eliminate double taxation, in particular through a French tax credit on income already taxed in the US.
Filing deadlines for the 2026 income tax return (covering 2025 income):
- May 19, 2026: deadline for paper returns.
- Late May – early June 2026: online filing deadlines, staggered by department number.
Impôt sur la Fortune Immobilière (IFI — French Real Estate Wealth Tax)
The IFI applies to individuals resident in France whose net real estate assets exceed €1.3 million as of January 1 of the tax year. Rates are progressive (from 0.5% to 1.5%) and are declared via Form 2042-IFI, filed alongside the income tax return. New residents in France benefit from a specific rule: for the first five years following their arrival, only real estate located in France is included in the taxable base — not worldwide property.
FBAR and FATCA: Reporting Your Foreign Accounts and Assets
As a US citizen living in France, you are subject to specific reporting obligations on your foreign financial accounts and assets. These are separate from the income tax return and carry their own thresholds and deadlines.
FBAR (FinCEN Form 114)
The Report of Foreign Bank and Financial Accounts (FBAR) is required for any US citizen whose aggregate foreign financial account value exceeded $10,000 at any point during the calendar year. This covers bank accounts, brokerage accounts, and other financial accounts held at foreign institutions — including French checking accounts and savings accounts. The FBAR is filed separately from the tax return, via the FinCEN BSA E-Filing System. Deadlines for 2026 follow the same pattern as the tax return: April 15, with an automatic extension to October 15.
Form 8938 (FATCA)
Form 8938 is filed with Form 1040 and covers specified foreign financial assets. Reporting thresholds for taxpayers living abroad are: $200,000 at year-end or $300,000 at any point during the year for single filers; $400,000 at year-end or $600,000 at any point for married couples filing jointly. These thresholds are higher than those applicable to US residents.
FBAR ≠ Form 8938
These two obligations overlap but are not identical. FBAR covers a broader range of financial accounts; Form 8938 extends to certain non-financial assets (interests in foreign entities, for example). It is possible to be subject to both obligations simultaneously.
The France–US Tax Treaty: What It Covers — and What It Doesn’t
The France–US tax treaty dates from 1994 and was amended by a protocol signed in 2004. It aims to allocate taxing rights between the two countries and eliminate double taxation. However, it contains an important limitation for US citizens: the saving clause (Article 29).
The saving clause states that the United States retains the right to tax its citizens as if the treaty did not exist. In practice, a US citizen resident in France cannot invoke the treaty to escape US taxation. The treaty primarily serves to avoid double taxation — through the foreign tax credit mechanism — but does not remove the US filing obligation.
Key treaty provisions for expats:
- Retirement plans: plans established in the US (such as 401(k) or IRA accounts) are taxed in the country where the plan was established. A US citizen in France receiving distributions from a US 401(k) declares this income to the IRS.
- CSG and CRDS: since the IRS’s 2019 ruling, these French social contributions are recognised as creditable foreign taxes under Form 1116, allowing US expats in France to reduce their US tax liability accordingly.
- Tiebreaker rule (Article 4): used to determine tax residency when a person is considered resident in both countries under domestic law. It examines, in order: permanent home, centre of vital interests, then nationality.
2026 Tax Calendar at a Glance
| Deadline | Obligation |
|---|---|
| April 15, 2026 | US tax payment deadline (even with a filing extension). FBAR filing deadline (automatic extension to October 15). |
| May 19, 2026 | French income tax return paper filing deadline (Form 2042). |
| Late May – early June 2026 | French online filing deadlines, staggered by department number. |
| June 15, 2026 | Automatic US return filing deadline (Form 1040) for taxpayers abroad. |
| October 15, 2026 | Maximum US filing extension deadline (Form 4868 required by June 15). Automatic FBAR extension deadline. |
Five Common Mistakes to Avoid
- Confusing the filing extension with a payment extension. The June 15 extension does not defer the payment due date — interest and penalties accrue from April 15 on any unpaid balance.
- Overlooking the FBAR. This obligation is separate from the tax return. The $10,000 threshold applies to the aggregate value across all foreign accounts and is assessed at any point during the year, not just at year-end.
- Failing to report French-source income to the IRS. All income — salaries, dividends, rental income — must appear on Form 1040, even if already taxed in France.
- Choosing FEIE when FTC would be more advantageous (or vice versa). The optimal strategy depends on income levels, effective tax rates, and whether you have passive income.
- Overlooking the IFI if you own real estate in France. The €1.3 million threshold is assessed on the net value of your real estate portfolio as of January 1.
How Expand CPA Can Help
Managing tax obligations on both sides of the Atlantic requires dual expertise: a command of US tax law (IRS, FBAR, FEIE, FTC) and an in-depth knowledge of French tax rules. Expand CPA is a Franco-American firm specialising in expat and international taxation, with offices in Paris, New York, and Tel Aviv.
The firm assists Americans living in France with their US federal tax returns (Form 1040, Forms 2555 and 1116, FBAR and Form 8938), their French tax obligations, and IRS regularisation procedures (Streamlined Compliance Procedures) for taxpayers who have not been filing. For more information: expand-cpa.com/en/services/us-taxes/ and expand-cpa.com/en/services/french-tax-advisor/.
Frequently Asked Questions
Does a US citizen always have to file a US return if they live in France?
Yes, provided their income exceeds the applicable filing thresholds. The US filing obligation is based on citizenship, not residency. Mechanisms exist (FEIE, FTC) to avoid double taxation, but they do not remove the obligation to file.
What are the Streamlined Compliance Procedures?
This is an IRS programme allowing US taxpayers who have not met their tax obligations in a non-willful manner to regularise their situation. The programme allows late returns, missing FBARs, and required certifications to be submitted without facing the standard penalties. It is particularly relevant for expats who were unaware of their US obligations.
Do France and the US tax the same income?
Largely yes, which creates a risk of double taxation. The 1994 France–US tax treaty and the foreign tax credit mechanism (Form 1116) prevent double taxation in most cases. The treaty’s saving clause (Article 29) preserves the US right to tax its citizens regardless of the treaty.
Are French social contributions (CSG/CRDS) deductible in the US?
Since the IRS’s 2019 ruling, the CSG and CRDS are recognised as creditable foreign taxes. US expats in France can include them in the foreign tax credit calculation (Form 1116), reducing their US tax liability accordingly.
