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Italy Nomad Desk

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.

US obligations from Italy
ItemWhat it isWhere
Form 1040Annual return on worldwide incomeIRS
Foreign tax credit (Form 1116)Credit for Italian income tax paidIRS
Foreign earned income exclusion (Form 2555)Excludes some foreign earned income if you qualify; amount changes yearlyIRS
FBAR (FinCEN 114)Report foreign accounts above $10,000 aggregateFinCEN
Form 8938Foreign financial assets above thresholdsIRS
US–Italy treatyResidence tie-breakers, pensions, creditsIRS 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

Checked: . Rules change; confirm current values on the official pages above before you file.