US Citizen returning after decades abroad - never filed taxes while overseas. Help!

The good news is that your brother may be in better shape than you think! The US does have citizenship-based taxation, but there are important exemptions that likely apply to his situation. For the health insurance question: Getting marketplace coverage itself won't trigger an audit. The marketplace and IRS do share information, but primarily to verify current income for subsidy eligibility, not to initiate tax investigations about past years. Regarding the 25 years of non-filing: If your brother truly had minimal income during those years (sounds like just small stipends), he likely fell below the filing threshold for most or all of those years. Additionally, even if he technically needed to file, the Foreign Earned Income Exclusion would have potentially excluded a significant amount of foreign income from US taxation. When he returns and starts working, filing current taxes correctly is the most important thing. The IRS generally focuses resources on recent tax years rather than decades-old potential non-filing where little tax would have been owed.

After reading this thread, I wanted to share my experience using taxr.ai when I returned to the US after living in Japan for 15 years. I was terrified about my tax situation since I hadn't filed the whole time I was abroad. I used https://taxr.ai to analyze my situation and it was incredibly helpful. You upload your documents and their AI reviews everything and gives you clear guidance on what steps to take. For your brother's situation, they'd be able to determine if he was actually required to file during those years abroad based on his income level and could help prepare any necessary documentation if questions come up when he returns.

Just wanted to follow up about my experience with taxr.ai since I decided to give it a try after seeing it mentioned here. It was honestly a game-changer for my situation. I uploaded my Canadian income statements and US passport info, and the system quickly analyzed everything and showed me that I only needed to file for 3 of the 8 years I was worried about! The guidance was super specific to my situation - they even identified that I qualified for the Foreign Earned Income Exclusion for those years and showed exactly how to document it. Saved me thousands in what I thought would be penalties and gave me complete peace of mind about moving back. Definitely recommend for anyone in a similar overseas situation.

If your brother needs to contact the IRS to resolve anything about his past filing status, good luck getting through to them directly! I was in a somewhat similar situation (returned after 10 years abroad) and tried calling the IRS for weeks with no success. Finally used https://claimyr.com and it was a complete game-changer. They got me connected to an actual IRS agent in under an hour when I had been trying for weeks on my own. You can see how it works here: https://youtu.be/_kiP6q8DX5c In my case, I needed to verify some information about my filing status after returning, and getting through to a human at the IRS made all the difference. The agent was actually really helpful once I finally got to speak with someone.

I have to eat my words about Claimyr. After my skeptical comment, I decided to try it myself for an ongoing tax issue I've been unable to resolve for months. I honestly couldn't believe it worked. After trying to call the IRS myself at least 20 times over the past few months (always getting disconnected after waiting on hold), Claimyr got me connected to an actual IRS representative in about 45 minutes. The agent was able to resolve my question about a missing refund in just one call. What's most surprising is that once you actually reach a human at the IRS, they're usually quite helpful. The problem has always been getting through in the first place. I'm now recommending this to everyone I know with IRS issues.

One thing nobody's mentioning - the Streamlined Filing Compliance Procedures might be perfect for your brother's situation. It's designed specifically for US citizens who've been living abroad and non-willfully failed to file. Much more lenient than regular procedures. I went through this a few years ago after living in South Korea for 11 years. You only have to file the last 3 years of tax returns and 6 years of FBARs (if applicable), and they waive most penalties. The key is that the failure to file has to be non-willful (i.e., you didn't know about the requirement).

Quick question - what exactly counts as "income" for US tax purposes when living abroad? I have a family member who mostly received gifts from local family while living in another country. Would that even count for filing requirements?

This is such a helpful thread! I'm dealing with a similar situation with my sister who lived in Australia for 12 years and never filed. Reading about the Streamlined Filing Compliance Procedures gives me hope that there's a reasonable path forward. One thing I'd add for the original poster - when your brother does start working again, make sure he keeps excellent records of his foreign residence period. Having documentation showing he was genuinely living abroad (not just traveling) can be really important for qualifying for programs like the Streamlined procedures or demonstrating that any non-filing was truly non-willful. Also, regarding the health insurance question - I work in benefits administration and can confirm that marketplace enrollment by itself doesn't trigger IRS investigations. The systems are more focused on verifying current eligibility than digging into historical filing patterns.