German taxes for Americans: fitting in your US return

Live in Berlin and you'll deal with two tax offices: the German Finanzamt and the IRS. Germany's rates are higher than Uncle Sam's for most people, so in practice the German tax usually wipes out the US bill. You still have to file both.

The short version

Germany taxes you on worldwide income once you have a residence or habitual abode there, which for most newcomers means from the day you move in.
For 2026, the first EUR 12,348 is tax-free. Rates start at 14% and climb to 42% from EUR 69,879 of taxable income, with 45% from EUR 277,826 [9].
The solidarity surcharge of 5.5% only applies once your income tax is above EUR 20,350 (single, 2026). Church tax in Berlin is 9% of your income tax if you're a registered member of a church [1][2].
Your German return for 2025 is due July 31, 2026, or February 28, 2027, if a tax adviser or a wage tax help association files it [3]. Your US return is due June 15 for Americans abroad, with an extension to October 15 [4].
The US–Germany tax treaty (1989, with a 2006 protocol) [5] and the Social Security agreement, in force since December 1, 1979 [6], keep you from paying twice on most income and on Social Security.

USD conversions use the Federal Reserve H.10 rate of October 30, 2026: EUR 1 = USD 1.1163.

When Germany considers you a tax resident

Germany doesn't care about your passport. It taxes people who have a residence (Wohnsitz) in Germany, meaning a home they keep and use, or a habitual abode (gewöhnlicher Aufenthalt), generally more than six months of presence. Rent an apartment in Kreuzberg and register it, and you're an unlimited taxpayer from that point, taxed on income from anywhere in the world.

Once you register your address (the Anmeldung), the Federal Central Tax Office mails you a tax ID (Steuer-ID). Your employer needs it to withhold tax correctly. Employees are also put in a tax class (Steuerklasse), which sets how much is withheld; married couples can choose combinations. Our guide to the German tax ID and tax classes walks through them.

German rates for 2026

Germany uses a formula, not brackets like the IRS tables, so your rate rises smoothly with income. The key points for a single filer in 2026 [9]:

Taxable income (2026, single)	Marginal rate	About in USD
Up to EUR 12,348	0% (basic allowance)	up to USD 13,800
EUR 12,349 to 17,799	14% rising to about 24%	USD 13,800 to 19,900
EUR 17,800 to 69,878	about 24% rising to 42%	USD 19,900 to 78,000
EUR 69,879 to 277,825	42%	USD 78,000 to 310,100
EUR 277,826 and up	45%	USD 310,100 and up

Married couples filing jointly get double the brackets [1].

The solidarity surcharge

The Solidaritätszuschlag is 5.5% of your income tax, but most people no longer pay it. In 2026 it only kicks in when your income tax (not your income) is above EUR 20,350 for a single filer, or EUR 40,700 for a couple [1]. That threshold doesn't protect investment income, where the surcharge still applies on top of the separate withholding tax on capital income.

Church tax

If you're registered as a member of a church that collects tax, mainly the Catholic and Protestant churches, Berlin adds 9% of your income tax. Employers withhold it from your paycheck [2]. Watch the box on your Anmeldung form asking for your religion: tick a church and the tax follows.

If you want out, you declare your exit at the local court (Amtsgericht) for a EUR 30 fee (about USD 33). The tax stops at the end of the month your exit takes effect [2]. Plenty of Americans have been surprised by this one.

Filing your German return

Many employees with only a salary aren't required to file a German return, but plenty file anyway because they get money back for work expenses, moving costs or a mid-year start. You must file if you're self-employed, have income without withholding, or are in certain tax-class combinations.

Deadlines for the 2025 tax year [3]:

July 31, 2026 if you file yourself.
February 28, 2027 if a tax adviser (Steuerberater) or a wage tax help association (Lohnsteuerhilfeverein) prepares it. The associations are only for employees and pensioners.

Returns are filed electronically through the tax office's ELSTER portal or commercial software, much like e-filing back home. Expect it in German, though some tools offer English.

Your US return from Berlin

The IRS taxes US citizens on worldwide income no matter where they live [4]. So you'll file a Form 1040 every year too.

Deadlines: if you live abroad on April 15, you get an automatic extension to June 15, and you can request October 15 with Form 4868. Interest still runs from April 15 on any tax you owe [4].
Foreign tax credit (Form 1116): because German rates are high, most Americans in Berlin claim a credit for German income tax paid, which usually brings their US income tax to zero. Extra credits can be carried forward.
Foreign earned income exclusion (Form 2555): you can exclude up to USD 130,000 of earned income for 2025 and USD 132,900 for 2026 [7]. In Germany it's often less useful than the credit, but a US expat tax preparer can check which works better for you.
FBAR: report your German accounts on FinCEN Form 114 if they total more than USD 10,000 at any point in the year. It's due April 15, with an automatic extension to October 15 [8].
Form 8938: if you live abroad and file single, you report specified foreign assets above USD 200,000 at year-end or USD 300,000 at any time; double those for joint filers [8].

German banks report US account holders to the IRS under FATCA, so assume Uncle Sam already knows about your Sparkasse account.

The treaty and the totalization agreement

The US–Germany income tax treaty dates from 1989 and was updated by a 2006 protocol [5]. It decides which country gets first dibs on pensions, dividends, interest and business profits, and it includes tie-breaker rules. But like every US treaty, it has a saving clause: the US keeps the right to tax its own citizens almost as if the treaty didn't exist. For Americans, the treaty mostly matters for how credits are figured and for specific items like pensions and Social Security.

The US–German Social Security agreement has been in force since December 1, 1979 [6]. It stops you from paying into both systems on the same work:

Sent by a US employer for five years or less? You can stay in US Social Security and skip German pension contributions with a certificate of coverage from the SSA [6].
Hired locally in Germany? You pay into the German system, not US Social Security.
Self-employed? You're generally covered where you live and work. The certificate lets you avoid US self-employment tax if you're covered in Germany. Attach a copy to your US return each year [6].

Credits in both systems can also be added together to qualify for a pension. See our guide to tax treaties and totalization agreements.

Riester, German funds and the PFIC trap

German co-workers will tell you to open a Riester pension (a state-subsidized private plan) or to buy a cheap ETF savings plan. Slow down. Two warnings:

German funds and ETFs are usually PFICs in US eyes: passive foreign investment companies. That means punitive US tax rules and a Form 8621 for each fund, every year. Many Americans in Berlin keep their investments in US-domiciled funds at a US broker that still serves customers abroad.
Riester and similar products may not get the same tax-deferred treatment from the IRS as they do in Germany, and some hold funds that raise PFIC issues. The treaty's pension rules don't clearly cover every German product.

Our guide to PFICs explains the rules. A US expat tax preparer (or lawyer) can check your situation before you sign anything.

A yearly rhythm

January–March: collect your German wage tax statement from your employer and your US forms.
By April 15: pay any US tax owed to avoid interest.
By June 15: file your US return (or extend to October 15).
By July 31: file your German return, unless an adviser files later.
By October 15: file the FBAR if you used the automatic extension.

Want to know how other Americans in Berlin handle their filings? Ask in our community group for Americans in Germany.

German taxes for Americans: how the Finanzamt and the IRS fit together