In 2022, an estimated 4.4 million U.S. citizens lived abroad. If you are a U.S. citizen or permanent resident, chances are you still need to file federal income tax returns if your gross income exceeds a certain amount.
“There’s this idea that Americans can just pick up their little laptops and move their office, you know, to the coast of Spain without telling anyone and unfortunately, it doesn’t actually work like that,” Arielle Tucker, CPA and IRS Enrolled Agent and host of the podcast Passport to Wealth, tells CNBC Make It.
The U.S. and Eritrea are the only two countries in the world where taxes aren’t based on residency, and most countries have their own tax rules that, if you ignore, might end up costing you.
These are some of the options American expats have, including deductions, credits, and exclusions.
All the experts CNBC Make It spoke to suggest that one of the first steps people should take, besides researching the tax treaty between the country they want to travel to and the U.S., is to find an accountant who has experience filing federal taxes in both places.
