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Old 31.05.2018, 13:08
Taxbert Taxbert is offline
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Re: FAQ: Expat's Guide to US Tax

Now that Iíve done my 2017 taxes with my tax accountant and also gotten an estimate for my 2018 taxes, Iíd like to reply to the statement from runningdeer on 23.02.18, that initially brought my world crashing down in panic. He said:

ďretiring abroad and keeping US citizenship is financial suicideĒ

Well Iíd like to respond: ďit ainít necessarily soĒÖ

Although itís true that you can no longer claim the FEIE on your pension income to significantly cut down on your taxes, you can still do so by other means. You can use the Foreign tax credit and also reduce your taxable income with your contributions to the pension plan.

The bottom line for me: although my taxes would normally have been in the $15,000 range, theyíve come down to around $350. It still does not make it ok (in my opinion) for the US to impose taxes on its citizens abroad but itís definitely no financial suicide either.

Now although my accountant told me that my case is fairly representative, I obviously canít confirm that others retirees in CH wonít experience financial suicide with their US taxes. Iím just saying that itís not necessarily the case and I would strongly recommend anyone in that situation to get expert help.
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