Is the grass really greener on the other side? When it comes to becoming an expatriate, you may want to do your homework before ditching the passport.
Expatriation can be a difficult transition for legal and tax reasons.
This was the subject of a recent Forbes article titled “Thousands Leave U.S. Over Taxes---5 Rules If You're Tempted.” Here are the five points cited (and further explained) in the article:
- There are distinct immigration and tax rules;
- Tax motivation is irrelevant;
- Consider tax filings carefully;
- Plan before you go; and
- Expatriating really means leaving.
Taxation is not the only reason to expatriate or the only difficulty you will face. Expatriation means an entire restructuring of your legal and financial life, so the laws of both the U.S. and your new country need to be considered.
Before saying goodbye to the U.S., expect extra thorough scrutiny from the IRS.
Reference: Forbes (August 12, 2013) “Thousands Leave U.S. Over Taxes---5 Rules If You're Tempted”