BREAKING: Major ACA/DEG analysis finds U.S. move to residence-based tax regime 'could be revenue-neutral'

The American Expat Financial News Journal (April 24, 2022)

BREAKING: Major ACA/DEG analysis finds U.S. move to residence-based tax regime 'could be revenue-neutral'

'A major – and eagerly awaited by many – economic analysis of how the U.S. might most easily and efficiently move to a residence-based tax regime, crowd-funded and organized by the American Citizens Abroad, has found that such a move could be done 'without the U.S. Treasury losing revenue'.

The residence-based tax (RBT) regime envisioned by the DEG researchers and ACAGF would enable Americans who have been abroad for 'at least three years prior to enactment' of the new regime to move 'seamlessly' to RBT from the U.S.'s current citizenship-based system if they wished to, although 'no one would be forced' to do so.

'No one would be made worse off, as the existing Foreign Earned Income Exclusion rules would remain for those wishing to use them.'  

'Under RBT, U.S. citizens residing overseas would not be subject to U.S. tax on foreign income,' although they would remain taxable on their U.S. income, as is the case in most major countries that currently have a residence-based tax system, such as the UK, France and Canada.'

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