Do Americans on Italy's nomad visa still file US taxes?
Updated · Taxes & family guide · Not legal advice
Yes. US citizens and green card holders file US returns on worldwide income wherever they live. If you also become an Italian tax resident, the US–Italy income tax treaty, the foreign tax credit and, in some cases, the foreign earned income exclusion are the tools that prevent paying full tax twice, and you must report foreign accounts on the FBAR if they exceed $10,000 in total at any point in the year.
| Item | What it is | Where |
|---|---|---|
| Form 1040 | Annual return on worldwide income | IRS |
| Foreign tax credit (Form 1116) | Credit for Italian income tax paid | IRS |
| Foreign earned income exclusion (Form 2555) | Excludes some foreign earned income if you qualify; amount changes yearly | IRS |
| FBAR (FinCEN 114) | Report foreign accounts above $10,000 aggregate | FinCEN |
| Form 8938 | Foreign financial assets above thresholds | IRS |
| US–Italy treaty | Residence tie-breakers, pensions, credits | IRS treaty page |
Credit or exclusion?
Italian tax rates are often higher than US rates at the same income, so many Americans in Italy rely on the foreign tax credit rather than the exclusion. This depends on your income and Italian regime; ask a US expat tax preparer.
Quick answers
- Do I pay tax twice?
- Usually not in full: the treaty and foreign tax credits reduce double taxation, but you file in both countries.
- Does my US state still tax me?
- Some states keep taxing former residents who don't cut ties. Check your state's rules.
- What about Social Security taxes?
- See INPS and the US totalization agreement.
What to do next
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Sources
- IRS: US citizens and resident aliens abroad
- IRS: United States–Italy income tax treaty documents
- FinCEN: Report of Foreign Bank and Financial Accounts (FBAR)
Checked: . Rules change; confirm current values on the official pages above before you file.