Trump Vows to End Income Taxes on Americans Living Abroad
What You Need to Know
The pledge could potentially impact the roughly 9 million Americans the State Department estimates are living overseas
Today, all expats must file tax returns but those who make $126,500 or less aren’t required to pay any U.S. taxes.
The Republican nominee also has said he would push to lower the corporate tax rate to 15% from 21% only for firms that produce inside the U.S.
Donald Trump said he would eliminate U.S. income taxes on Americans living in other countries, the latest in a string of tax proposals in the final stretch of the 2024 campaign.
His pledge could simplify the tax obligations for U.S. citizens who live overseas.
Americans, regardless of where they live in the world, have to file tax information with the Internal Revenue Service, and some expatriates are required to pay U.S. taxes, in addition to levies in the country where they reside.
“I support ENDING the Double Taxation of overseas Americans!,” Trump, the Republican presidential nominee, said in a statement addressed to voters living abroad. “Let’s put America First, together. Register to Vote, and vote Republican.”
The pledge, which would require congressional approval, would reduce paperwork and, potentially, the tax bills for the roughly 9 million Americans the State Department estimates are living overseas. The former president’s proposal was reported earlier by the Wall Street Journal.
The government requires expats to file U.S. tax returns, but not all end up owing money to the IRS. The tax code offers credits to offset the cost of federal taxes owed.
In addition, people who make $126.500 or less aren’t required to pay any U.S. taxes.
Still, advocates to change the taxation of Americans abroad say these IRS rules are one reason why a few thousand people renounce their U.S. citizenship each year.
The U.S. tax rules also mean that it’s generally higher earning Americans abroad who face tax bills. Trump’s plan, depending on how it’s worded, could allow wealthy Americans to move to low-tax countries and avoid any tax obligations.
