If you lived in the US and would have a tax liability, you pretty much have the same responsibilities if you live in Nicaragua.
Even if you do leave the US, you might still have the same responsibilities reporting, for example, if you have a house like in the US. You might even have to still report as if you're living back in the US.
Being here in Nicaragua, it would be very important to find an accountant who can help and to guide you, whether your tax home is now Nicaragua or if you still have responsibilities and liabilities from whichever state in the US you're from, because your tax liabilities can change depending on which state you moved from when you came to Nicaragua.
But if you make the full move to Nicaragua in the sense that you now live full time and your tax home is a foreign country, in certain aspects doing so frees you a little bit of some of the responsibilities that you have. There are a few tax benefits that you could choose to fall under living outside the US, even if you are retired. It's important to know, for example, what those responsibilities are and what the requirements are so that when you do file, you file correctly.
If you are a US citizen you have US tax liability anywhere you are in the world irrespective of where you live. However, you may be able to exclude some of your income by using the Foreign Earned Income Exclusion that under certain circumstances would allow me to exclude earned income, which does not include passive income such as social security and pensions.
The amount of income that you're able to exclude has been increasing in the past years. For example, just last year, 2014, the limit was $99,200. This year, 2015, for those filing next year in 2016, the amount you will be able to exclude will be over $100,000. What makes it attractive to many people, especially those that are thinking of possibly opening a business in a foreign country such as Nicaragua, is that they could earn a pretty high salary and not have the same tax obligations as they would back in the US.
In order to qualify for the foreign earned income exclusion, the money cannot be earned in the US and also it can't be paid to you from a US corporation that is also located, in this case, in Nicaragua. The money would have to be earned received from a foreign company. The source of the income cannot be from the US.
In order to take advantage of the foreign earned income credit, the first thing that many of my clients do is to open a Nicaraguan corporation, because a Nicaraguan corporation allows them not only to receive a Nicaraguan residency but also and to immigrate Nicaragua. It also helps them if the business is making money that they could exclude that income (up to the limit allowed in the IRS code) from their taxes that would otherwise be owed in the US. They do, however, still have to report their income, even if no taxes are owed on it.
My answer here is a broad answer, and should not be used for specific tax advice. Please see your accountant to determine the best strategy for you.
(Dog lounging on the porch of a Caribbean cafe on Little Corn Island Nicaragua, pictured.)