The FTC/FEIE, which by the way you can’t combine and which allows only one selection per eight years, does not free you of this and leaves you still sending huge amounts of your earnings to the IRS pointlessly after paying taxes to where you actually live and work. Retirement, foreign investment (which is local to me) such as company equity, home sales, etc gets taken away by a country to which I have no ties other than citizenship. That is because it covers wage income only and has numerous other limitations, including complete ineligibility if taken in conjunction with the other weak avenue (FTC) to only mildly offset a policy that should not exist to begin with. Those defending the US system are the ones who have never done it - or are at best passers-by with no financial planning or career path (including a pension) or family, taking a few years abroad on a modest salary and go home.Īs an American working abroad who is about to wire the IRS a ridiculous sum of my money earned while living and working in a home for a company that happens to not be in the US, I assure you the exemption you refer to (FEIE), which is CAPPED at that $107K, is insufficient. Citizenship based taxation instead of reasonable residency based taxation is vexatious, obdurate, and I’ve done it regularly and am doing it now. It’s the opposite of what you say, and not a “meme” but reality.
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