Financial Do’s and Don’ts for Americans Abroad

U.S. citizens and permanent residents face a complex web of tax, regulatory, and investment challenges when living overseas. This session will demystify the key financial planning considerations for Americans abroad, including citizenship-based taxation, the advantages and drawbacks of U.S. versus foreign investment vehicles, and critical compliance requirements. Through practical examples and real-world scenarios, attendees will gain the tools to protect client wealth, avoid costly mistakes, and deliver value-added cross-border advice.

Learning Objectives:
 

1. Master U.S. Tax and Reporting Obligations for Americans Abroad

Understand the scope of U.S. citizenship-based taxation, including who is subject to the worldwide tax net (citizens, legal permanent residents, and substantial presence test residents), regardless of physical location.

• Identify essential tax filings and informational returns required of Americans abroad, such as Form 1040, FBAR, and Form 8938, and recognize the severe penalties for non-compliance.
• Learn best practices for working with specialized expat or cross-border tax preparers to mitigate compliance risks.

2. Optimize Investment and Retirement Strategies for Cross-Border Clients

• Evaluate the benefits of favoring U.S.-based after-tax investments, including lower fees, broader investment choices, and regulatory protections compared to many foreign markets.
• Recognize the tax and administrative pitfalls of investing in foreign-domiciled managed investments (PFICs), and how to avoid the burdensome reporting and harsh tax treatment that can result.
• Understand the nuances of contributing to and distributing from U.S. retirement accounts while abroad, including the risks of early withdrawals and the impact of foreign tax authorities on distributions.

3. Avoid Common Financial Pitfalls and Plan for Major Life Events

• Identify the dangers of relinquishing U.S. permanent residency or citizenship without fully considering the financial and tax consequences, including potential exposure to the U.S. exit tax under the HEART Act.
• Learn why entering into long-term financial commitments (such as illiquid investments or real estate purchases) can be risky for clients with uncertain domicile status.
• Gain actionable guidance on managing equity compensation, term life insurance, and the treatment of U.S. tax-advantaged accounts (such as 529s, HSAs, and Roth IRAs) for Americans abroad.