Avoid Double Taxation as a U.S. Citizen with Dual Citizenship

U.S. citizens with dual citizenship may face double taxation if they do not file the necessary paperwork on time. The U.S. taxes worldwide income, and without claiming foreign tax credits, exclusions, or treaty benefits, individuals could be taxed by both countries. To avoid penalties and overpayment, it’s essential to stay compliant with IRS requirements and foreign tax laws.

To mitigate the risk of double taxation as a U.S. citizen with dual citizenship in a foreign nation such as Austria, Brazil, Croatia, Germany, Greece, Italy, Poland, Portugal, Russia, Slovakia, or Spain, it is prudent to utilize available tax treaties and credits. The United States imposes taxes on its citizens’ global income. However, numerous countries maintain tax treaties with the U.S. that aim to eliminate double taxation by providing exemptions or reduced tax rates on specific income types. Furthermore, the Foreign Tax Credit (FTC) can be employed to reduce U.S. tax liabilities by allowing you to claim a credit for taxes paid to the foreign jurisdiction.

Alternatively, the Foreign Earned Income Exclusion (FEIE) permits the exclusion of a portion of your foreign-earned income from U.S. taxation, provided you satisfy the residency criteria. To ensure adherence to regulations and optimize potential benefits, it is recommended to seek guidance from a tax professional well-versed in both U.S. and international tax legislation.

IRS Tax document apostille

To prevent double taxation between the United States and a foreign nation, it may be necessary to file a tax return accompanied by an apostille, submit IRS documentation with an apostille, and utilize Form 6166 as evidence of U.S. tax residency. Also, these documents frequently need to be translated into the language of the foreign country

Tax-related documents from a foreign country that need to be submitted to the IRS or USCIS must be translated into English to meet official requirements. These translations must be completed by a competent, certified translation company to ensure they are officially accepted.

Apoling Solutions provides accurate, certified translations and will be glad to assist you with all your document translation needs.