For Americans
Leaving the United States
The U.S. taxes its citizens on worldwide income wherever they live. Moving abroad is only half the plan. We design the other half, and handle it for you.
Why moving is not enough
Your passport follows you to the tax office
Americans are facing high taxes, including global taxation tied to their citizenship. We coordinate international planning with tax, legal and other qualified professionals in the relevant jurisdictions.
Almost every country taxes people based on where they live. The United States is one of the very few that taxes based on citizenship. A Canadian who moves to Panama and becomes a Canadian tax non-resident can end Canadian taxation of worldwide income, while certain Canadian-source income remains taxable. An American who makes the same move generally keeps filing U.S. returns, and may keep owing U.S. tax, for as long as they hold the passport.
That is why a U.S. plan has more moving parts: where you live, how your income is earned and structured, whether you keep your citizenship, and what leaving could cost you on the way out.
The main routes
Four ways Americans reduce what they owe
Most plans combine more than one of these. Which fit depends on your income, your assets and how permanent you want the move to be.
Keep your citizenship
Live abroad and use the foreign earned income exclusion
U.S. citizens whose tax home is in a foreign country, and who meet either the physical presence test (330 full days in a foreign country or countries during a period of 12 consecutive months) or the separate bona fide residence test, can generally exclude a capped amount of foreign earned income from federal income tax each year, and may also claim a housing exclusion or deduction.
- The exclusion covers earned income, not investment income such as dividends or capital gains.
- It does not remove self-employment tax, unless a totalization agreement with your new country says otherwise.
- You still file a U.S. return every year, plus the reporting that comes with foreign accounts and companies.
Paired with a Latin American country that generally does not tax foreign-source income, this can lower the total bill substantially. It rarely brings it to zero.
Stay a U.S. citizen, change the source
Puerto Rico and Act 60
Puerto Rico is a U.S. territory with its own tax system. Under section 933 of the Internal Revenue Code, a bona fide resident of Puerto Rico generally does not pay U.S. federal income tax on Puerto Rico-source income. Puerto Rico’s Act 60 offers decrees with reduced local rates for eligible businesses and investors who move there.
It is the one option that keeps your passport, your time zone and the U.S. dollar. It also has strict residency tests, detailed sourcing rules for income and gains, and annual conditions under the decree. Getting any of these wrong can undo the benefit.
End citizenship-based taxation
Renounce your citizenship
Giving up U.S. citizenship ends citizenship-based taxation of your worldwide income. It does not end every U.S. tax obligation: earlier years, the final filings and U.S.-source income or U.S. assets you keep can still carry U.S. tax. It is permanent, it is done in person at a U.S. embassy or consulate abroad, and it can trigger the expatriation tax, often called the exit tax, if you are a covered expatriate.
Done well, it is the last step of a plan, not the first: a second citizenship in place, your assets reviewed for the exit tax, and your filings in order.
The groundwork
A second residency, then a second passport
Whatever you decide about your citizenship, you need somewhere to live legally and a country to be tax resident in. Many Latin American countries offer residency through investment, a pension or stable foreign income, and a relatively direct path to citizenship after several years of residence. That residence period is when you become eligible to apply; processing the application and issuing a passport take additional time.
A second passport is also what makes renunciation possible later: you should never give up a citizenship without already holding another.
Free · two minutes · no email needed to see it
What is the U.S. really costing you?
Enter your income and your state, choose where you would go, and see what you pay today, what you would keep, and what you would still owe the U.S. if you keep your passport.
Go deeper
Read before you decide
- The U.S. exit tax Who is a covered expatriate, how the deemed sale works, and why planning happens before you leave.
- Renouncing U.S. citizenship The consular process, the tax filings, and why a second citizenship comes first.
- Tax residency versus residence permit The distinction that decides where you actually pay tax.
- Staying, with a plan B Not ready to leave? Secure the option first.
If I move to Costa Rica or Panama, do I stop paying U.S. tax?
Not automatically. As long as you are a U.S. citizen you generally file U.S. returns and are taxed on worldwide income. Moving abroad can open up the foreign earned income exclusion and foreign tax credits, which may reduce what you owe, but the obligation to file stays.
Does the foreign earned income exclusion cover my business profits?
It can cover earned income from work you perform abroad, including self-employment income, up to the annual cap. It does not cover passive income, and it does not remove self-employment tax. How your business is structured matters a great deal.
Do I have to renounce my citizenship to save tax?
No. Many clients keep their citizenship and reduce their bill through residency abroad, the exclusion, Puerto Rico or better structuring. Renunciation is the only way to end citizenship-based worldwide taxation, though not every U.S. tax obligation, and it is a permanent personal decision we only plan with you once the alternatives are clear.
Will renouncing trigger the exit tax?
Only if you are a covered expatriate under the tests in the tax code. Many people who renounce are not. Whether you are, and what the deemed sale of your assets would cost, is something to calculate well before you book a consular appointment.
Where do I start?
With the numbers and a strategy. Run the cost-of-staying calculator, then book the Global Strategy Service: a one-hour deep dive, research on your case, and a follow-up with recommendations.
Next step
Get a plan built around your passport, your income and your assets
The Global Strategy Service maps your U.S. options end to end. General information only, not tax or legal advice. Your options depend on facts we have not reviewed yet.