How Expats can Save Even More Money with US Taxes

September 20, 2024 | ExpatTaxGuide | 2 minute read
Expat Tax Guide | Everything you need to know about filing taxes abroad in 2025

Verified by IRS Enrolled Agents and CPAs

Want to know how to save money on your taxes? If you have a family, you can easily save money with US taxes through the Child Tax Credit and foreign housing exclusion.

The Child Tax Credit allows you to get refundable credit of up to $1,700 per child. Qualified housing expenses over $20,240 may help you qualify for US tax exemption.

The Child Tax Credit & Additional Child Tax Credit

The US provides financial assistance to parents through tax credits and refunds, regardless of where they live and work.

The Child Tax Credit is usually the non-refundable portion of this credit, while the Additional Child Tax Credit refers to the refundable portion. In this sense, ‘additional’ does not mean an additional credit or additional child! MyExpatTaxes specializes in getting US Expats their due Additional Child Tax Credit, even if that means amending prior year returns. To see if you are eligible for the refund, check out our Tax Tips for the American Family Abroad.

There are not many changes over the last years, only that the refundable amount has continued to increase by $100 every year.

	Tax Year 2022	Tax Year 2023	Tax Year 2024
Max Age Limit	17	17	17
Non-Refundable Child Tax Credit	$2,000	$2,000	$2,000
Additional Child Tax Credit	$1,500	$1,600	$1,700
Other Dependent Credit	$500	$500	$500

Max Age Limit

Only qualifying children dependents under the max age limit are eligible for the (Additional) Child Tax Credit. If your child was UNDER the maximum age limit on December 31st of that tax period, they are eligible. Otherwise, they will fall into the “Other Dependent” Credit bucket.

For example, your child turned 17 on December 1^st, 2024. They are not UNDER 17, so they are not eligible for the (Additional) Child Tax Credit on your 2024 Tax Return.

Child Tax Credit:

For 2024 Tax Returns

American expat families can claim a $2,000 tax credit for each of their dependent children under the age of 17 who have valid US Social Security Numbers.

Additional Child Tax Credit

For 2024 Tax Returns

If families do not owe US taxes, a max of $1,700 of the $2,000 credit per qualifying child is refundable.

Foreign Housing Exclusion

The Foreign Housing Exclusion allows US citizens abroad to deduct any excess of housing expenses paid by the employer over 16% of the Foreign Earned Income Exclusion (FEIE) amount of that year ($126,500 in 2025 for the 2024 tax season). Qualified housing expenses might be eligible for US tax exemption. However, there is a limit to how much foreign housing expenses you can deduct (more below).

In addition to foreign housing expenses, you can also get an exclusion from the following: home utilities, personal property insurance, accessory rentals, and household repairs. The exclusion does not include furniture you purchase online, domestic labor, and mortgage payments.

Qualify for the Foreign Housing Exclusion

To qualify for this expat tax benefit and save money with US taxes, you need to be eligible for the FEIE through this:

Pass the Physical Presence Test or the Bona Fide Residency Test
1. To pass the Physical Presence Test, You need to be outside the US for 330 full days in a consecutive 12-month period that begins or ends in the tax year.
2. To pass the Bona Fide Residency Test, You need to be a resident of a foreign country and be subject to local income taxes for at least an entire tax year.

Once you are sure you qualify for the FEIE, you can fill out Form 2555, informing the IRS which test you are eligible under. Better yet, you can fill it out electronically through our software!

The MyExpatTaxes software can determine if you qualify for this exclusion and receive a refund. We recommend reading our blog to learn more about the Foreign Housing Exclusion tax benefit. Saving money on your taxes abroad has never been so easy.

File your US Taxes with MyExpatTaxes