Are You A U.S. Citizen Living Outside The United States? You Are Subject To Worldwide Taxation!

I am guessing (actually I know for sure) that you arrived here because of some aspect of being a U.S. citizen living outside the United States. Maybe you are a Green Card holder. Perhaps you are a former U.S. resident who has just learned that you may still be subject to U.S. “worldwide taxation” even though are a “tax resident” outside the USA. I also know how you are feeling.

“U.S. citizens” and “Green Card holders” are referred to as “U.S. Persons”. So, if you are a “U.S. Person Abroad”, well, life is pretty tough. in fact living as a “U.S. Person” outside the United States is: hard, expensive, confusing and (quite frankly) unsustainable.

Some of you are NOT in compliance with the intricate and (almost) impossible to understand web of tax and reporting requirements. Non-compliance has its share of problems.
Some of you ARE in compliance (as far as you know) with the intricate (and almost) impossible to understand web of tax and reporting requirements. Compliance also has its share of problems (stress, expense, anxiety).

Whether you are in compliance or not in compliance, you have problems. This is because:
U.S. citizenship is the one citizenship in the world that affects virtually every aspect of your life. in addition to the information on this blog, I help people with the following kinds of specific problems/questions (which include):
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I recently wrote a two-part series about the inadequate justification for the United States’ worldwide taxation of its nonresident citizens (Part I is available here; Part II is available here). Professor Michael S. Kirsch offers a different perspective in defense of this system. Instead of assessing the propriety of U.S. worldwide taxation on the basis of the legal benefits associated with U.S. citizenship, which lies at the heart of the “benefits rationale,” Professor Kirsch argues that, “it is reasonable to conclude that the retention of U.S. citizenship reflects a self-identification with the population of the United States (or the belief that the benefits of citizenship are worth the tax cost).”[i]

In justifying the worldwide taxation of U.S. citizens, Professor Kirsch relies on the psychological benefits of U.S. citizenship, namely, the ability of nonresident citizens to Read More

TaxConnections Picture - Dollar In OceanU.S. citizens and residents are taxed on their income from all sources worldwide. Worldwide taxation by the U.S. does not disarm the taxing power of other countries. Americans pursuing income outside of the U.S. are bound to encounter tax collectors asserting their own national claims. The world is awash in possibilities of double taxation. Below is a hypothetical illustrating international double taxation and its main cause: inconsistent sourcing rules in different countries imposing overlapping taxes.


John is a lawyer who practices in NYC. One day, he gets a call from Ali, a client in Yemen. Ali asks John to do some research on a question and to send his findings in the form of a memorandum. John goes ahead and does the work, consisting of some research and some writing, which takes twenty hours of his time.

John’s final product is a memorandum, which he sends to Ali, along with a bill for $ 4,000 reflecting his hourly rate of $ 200. A check for $ 4,000 arrives by return mail and John gives the matter little further thought.

At the end of the year, John receives an official-looking letter from the Treasury of Yemen, adorned with a seal and crests, asking him to pay $ 2,000 in income tax to the Yemeni Treasury with respect to his $4,000 of Yemen-source income. The letter explains that the rate of Yemeni income tax on the Yemen-source income of foreigners from professional services is 50%. Read More