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US Tax Help for Americans in the Dominican Republic
Short answer: Americans in the Dominican Republic still file a US return on their worldwide income, whether they work remotely, run a business or are retired. All State Tax Resolution, led by Sabih Shafi, an Enrolled Agent, prepares the US side. There is no income tax treaty or Social Security agreement between the US and the Dominican Republic, so the details of your income matter more.
Key takeaways
A US citizen or green card holder living in the Dominican Republic files a US return on worldwide income, and the IRS says the rules are generally the same as at home.
Where you do the work decides whether income is foreign earned income. Where you are paid, or where your employer sits, does not.
The exclusion is up to $130,000 for 2025 and $132,900 for 2026. It does not reduce self-employment tax.
No treaty and no Social Security agreement: a remote worker for a US employer can keep paying US Social Security and Medicare tax.
Dominican banks identify US customers and report them to the IRS through the Dominican tax authority.
Do Americans in the Dominican Republic have to file a US return?
Yes, in most cases. The IRS says the filing rules are generally the same whether you live in the US or abroad, and that you are taxed on worldwide income from all sources. A move to Santo Domingo, Punta Cana, Cabarete or Sosúa does not end that for a citizen or a green card holder.
The regular due date is April 15. If you live outside the US and your main place of business or post of duty is outside the US on that date, you get an automatic two extra months, to June 15, by attaching a statement. Interest on unpaid tax still runs from April 15. Form 4868 adds four more months, to October 15, but only for filing, not for paying.
Working remotely from the Dominican Republic
We often see remote workers here. The IRS says the source of earned income is the place where you perform the services. Where or how you are paid has no effect, even if your employer is in New York and the pay lands in a US bank account. Work you do while sitting in the Dominican Republic is foreign earned income. Work you do during a visit to the US is not.
To use the foreign earned income exclusion you also need a tax home in a foreign country, and one of two tests. The bona fide residence test needs an uninterrupted stay in a foreign country that includes an entire tax year. The physical presence test needs at least 330 full days in foreign countries in any 12 months in a row. A green card holder can use the residence test only as a citizen or national of a country with a US income tax treaty. The Dominican Republic has none, so a Dominican citizen with a green card living there needs the 330-day test. Trips home count against you. If you have no regular place of business, the IRS says your tax home may be where you regularly live, and if you have neither, it is wherever you work.
One more point catches remote workers. The IRS says US social security and Medicare taxes generally do not apply to wages for work you do outside the US, unless an exception applies. Working for an American employer is one of the exceptions. So the exclusion may cut your income tax while your payroll taxes continue. We check this with you before the first payroll problem shows up.
Self-employed or running a business from the Dominican Republic
If you freelance or run your own business, the foreign earned income exclusion reduces your regular income tax, but the IRS says it does not reduce your self-employment tax. The Social Security Administration says US coverage extends to self-employed US citizens and residents wherever they work, so they are almost always covered by both countries. An agreement is what fixes that, and the Social Security Administration's list of agreements does not include the Dominican Republic.
So a freelancer in the Dominican Republic normally owes US self-employment tax on net earnings. Whether the Dominican system charges its own contributions is a local question we do not answer. We make sure your US numbers are right and your records support them.
Exclusion, credit and the missing treaty
The exclusion is claimed on Form 2555. It leaves up to $130,000 of foreign earnings out of US income tax for 2025, and up to $132,900 for 2026, per person. The IRS says it does not apply to pension or annuity payments, including social security benefits, or to pay from the US government.
The foreign tax credit, claimed on Form 1116, reduces your US tax by qualifying foreign income taxes. The IRS says you cannot take a credit for tax on income you exclude. If you pay little or no income tax locally, the credit has little to offset. We run both ways so you see which comes out better.
The IRS list of US income tax treaties does not include the Dominican Republic, so there is no treaty article to point to. Everything rests on US rules, which is why a clean exclusion and credit analysis matters.
Accounts in the Dominican Republic: FBAR, Form 8938 and FATCA
FBAR (FinCEN Form 114). FinCEN says you must file if your foreign financial accounts together exceed $10,000 at any time in the calendar year. It is filed online with FinCEN, not with your return, and is due April 15 with an automatic extension to October 15.
Form 8938. It is attached to your return. For a person living abroad by the IRS definition, the thresholds are above $200,000 on the last day of the year or $300,000 at any time for a return that is not joint, and $400,000 or $600,000 for a joint return. It does not replace the FBAR.
The Dominican tax authority, the Dirección General de Impuestos Internos, says on its FATCA page that financial entities must identify US citizens and residents among their clients and send the details to the IRS through the authority, once a year. The US Treasury also lists an agreement with the Dominican Republic as in force. Assume your accounts are visible to the IRS.
Behind on US filing from the Dominican Republic?
The streamlined foreign offshore procedures exist for people abroad whose failures were non-willful, meaning negligence, inadvertence, mistake or a good faith misunderstanding of the law. The IRS asks for returns for the most recent three years with a passed due date, FBARs for the most recent six years, all tax and interest paid with the returns, and Form 14653 certifying the conduct was non-willful. You also need no US abode and at least 330 full days outside the US in one of the three years.
The IRS says a filer who qualifies and follows the instructions is not subject to failure-to-file, failure-to-pay, accuracy-related, information return or FBAR penalties, unless an exam finds fraud or a willful FBAR violation. A civil exam or criminal investigation already underway rules the procedures out. If your conduct may have been willful, talk to us first.
State taxes after you move
California's Franchise Tax Board treats you as a resident if you are domiciled in California but outside the state for a temporary or transitory purpose. Other states have their own tests. We check your last state's rules instead of guessing.
How we help
I am Sabih Shafi, an IRS Enrolled Agent, federally licensed to represent taxpayers before the IRS in all 50 states. We work by phone and video, in English or Spanish, with Americans anywhere in the Dominican Republic.
Your US return: Form 1040 with Form 2555 or Form 1116, run both ways.
Remote and self-employed income: we sort foreign from US work days and check payroll tax and self-employment tax.
Foreign account reports: FBAR and Form 8938 checks.
Missed years: several unfiled years prepared, with a straight answer on whether streamlined fits.
A flat fee quoted in writing before work starts.
Frequently Asked Questions
I work remotely for a US company from the Dominican Republic. Do I still owe US tax?
Yes. You are taxed on worldwide income. You may exclude part of your pay as foreign earned income if you have a foreign tax home and meet a residence or 330-day test.
Is there a US tax treaty with the Dominican Republic?
Not on the IRS list of US income tax treaties, which does not include the Dominican Republic.
Does the exclusion cover my self-employment tax?
No. The IRS says the excluded amount reduces regular income tax but not self-employment tax.
Do I need to file an FBAR for my Dominican bank account?
If all your foreign accounts together exceed $10,000 at any time in the year, yes. Balances are added across accounts.
Can you prepare my Dominican tax return?
No. We prepare the US side only, and work with the figures your local preparer gives us.
I have not filed in years. Where do I start?
Book the free review before filing anything. We see which years are missing and whether streamlined or plain late returns fit.
General information, not tax advice for your situation.
Related Reading
Talk to an Enrolled Agent
This article is general information, not individual tax advice. If you want to talk through your own IRS or state balance, book a free 20-minute review or call or text us directly.
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