1) USE A TAX PROGRAMME OR A TAX PROFESSIONAL. That way, you don't have to start from square one, namely the ubiquitous "What forms do we have to file?".
2) You only have to do the past thee years. That's 2006, 2005, and 2004. If you wait another month, the three years will be 2007, 2006, and 2005, shaving off one year. If he had any US source income in the year he moved, then he also should file that year's return if he hasn't already done so.
3) As a greencard holder, you too are considered an American. You must also file a US tax return every year. Otherwise, they can take your greencard away from you, making next year's planned move a might more difficult.
4) The programme or the tax accountant will guide you through the whole process. Don't try to do the maths by hand. Just don't.
5) The tax credits are based on earned income. You'll need to run your return through the programme several different ways to see which method generates the most tax credits. The main options are: Foreign Earned Income Exclusion only, Foreign Tax Credits only, or a blended method. The programme will help only to a certain degree. A tax professional will do this for you automatically.
6) Your options for tax professionals are:
a) Stateside: Cheapest. Make sure you tell them about my point 5 above - they may not realize they can run it several ways and that the different ways will affect the child tax credits.
b) UK: More expensive, but you don't have to tell us how to suck eggs.
7) Your options for tax programmes: I like Turbotax, as it guides you through the process better than most programmes.
Whatever option you go for (programme, accountant, or pencil and paper), if you come up with any number other than a zero balance due, seek further advice from a paid professional before signing and paying. Most tax professionals will review someone else's work for free or for a bargain price in the hopes that they'll find an error and get a new client.
