Do I lower my US income tax liabilities if I retire or work in Panama?
Tabitha Paddock - Greenback Expat Tax Services
Unfortunately, your US tax liability is the same whether you are in the US, or outside the US. However when you are living outside the US, you can qualify for some HUGE exclusions and credits which you wouldn't otherwise be eligible for. Together these can limit (or even eliminate) any US tax liability.
The biggest tax advantages available for those living abroad are the Foreign Earned Income Exclusion, the Foreign Tax Credit, and the Foreign Housing Allowance.
Unfortunately, your US tax liability is the same whether you are in the US, or outside the US. However when you are living outside the US, you can qualify for some HUGE exclusions and credits which you wouldn't otherwise be eligible for. Together these can limit (or even eliminate) any US tax liability.
The biggest tax advantages available for those living abroad are the Foreign Earned Income Exclusion, the Foreign Tax Credit, and the Foreign Housing Allowance.
Posted April 11, 2013