Since October 8, 2025, the U.S. government has been partially shut down due to a funding impasse in Congress. One of the most affected agencies is the IRS (Internal Revenue Service), which is now operating with limited capacity. For U.S. expats, the IRS shutdown brings significant delays, reduced access to services, and added complexity in managing U.S. tax obligations while living abroad.
What has stopped at the IRS?
Due to furloughs, many core IRS services are paused. This includes:
IRS office closures and inactive phone lines (including the international helpline)
Suspension of mail processing, paper returns, refund checks, and corrections
Manual processing of forms used by expats, such as:
Form 2555 (Foreign Earned Income Exclusion), Form 1116 (Foreign Tax Credit) and Form 8938 (FATCA asset reporting)
These delays affect any tax process requiring human review, documentation by mail, or certification.
What is still working for expats?
Some IRS systems remain operational:
E-filing for tax returns
Online payment platforms (e.g. IRS Direct Pay, EFTPS)
Automated notices and reminders (including penalties)
The IRS website remains available for general updates, though response times and support are limited.
Specific impacts for U.S. expats
The IRS shutdown impacts Americans living overseas in several key areas:
1. Delays in processing expat-related forms
Forms that involve foreign income, tax credits, or FATCA reporting are likely to face extended delays.
2. No access to IRS support
The international helpline and Taxpayer Advocate Service are unavailable. There is no live assistance for questions, appeals, or disputes.
3. ITIN applications on hold
If you are filing jointly with a foreign spouse or dependents needing an ITIN, your application will not be processed during the shutdown.
4. Tax deadlines remain in force
Despite the shutdown, legal tax deadlines for expats still apply. The IRS continues to:
Accept filings via e-file
Register online payments
Generate late penalties through automated systems
However, you may be unable to resolve penalties or errors until IRS staff return.
What U.S. expats can do now
Despite the current shutdown, there are ways to stay compliant:
Submit your tax return via e-file
Digital filings are logged and timestamped.
Make online payments on time
Use IRS-authorized systems and keep records.
Retain all documentation
Save digital proof of submission and payment in case of follow-up.
Monitor IRS.gov and Treasury updates
These are the first to reflect changes in processing or deadline policies.
Work with a tax advisor familiar with expat filings
A qualified professional can help track your filings and prepare for resolution once the IRS resumes normal operations.
Expats Overseas
Even a short government shutdown can result in long processing delays at the IRS. For U.S. expats, this creates additional risk — especially for those filing from abroad with more complex requirements. Deadlines still apply, and digital filings remain the best way to ensure compliance.
At Expats Overseas, we continue to monitor IRS announcements and help our clients avoid unnecessary penalties or confusion during this shutdown period.
Navigating US expat tax obligations can be complex, but you don’t have to face them alone. Expats Overseas is your comprehensive solution for US expat tax filing, ensuring compliance with both US and local tax laws while helping you avoid double taxation.
Remember, the final FBAR deadline is a critical date on your expat calendar, and the penalties for missing it can be severe. By staying informed and timely filing your FBAR through our expert guidance, you can enjoy the expat life with peace of mind, knowing that your US tax obligations are in good hands. Contact Expats Overseas today to secure your financial future.
Need support with your U.S. tax filing during the 2025 IRS shutdown?
Get in touch – our team is ready to assist U.S. expats worldwide.
