The Tax Consequences of Moving Abroad
If you're thinking about moving overseas after the 2016 presidential election, know that the U.S. will continue to tax you.
Considering leaving the U.S. if your nightmare candidate wins in November? A growing number of people claim that they will move outside the U.S. if Donald Trump becomes president. Others want out if Hillary Clinton is elected.
If you move but keep your citizenship, the U.S. will continue to tax you. The U.S. taxes its citizens on their worldwide income, no matter where they reside. You also won’t be able to escape the rules on reporting foreign bank accounts.
Folks who decide to give up their U.S. citizenship could owe an exit tax if their average annual tax for the five years before expatriating exceeds $161,000 or they have at least $2 million of net worth. They’ll be treated as selling all their assets for fair market value on the day before their expatriation date and will be taxed on the profit from the deemed sale that exceeds an exemption of nearly $700,000.