In this article, we will look at the 5 tax free retirement countries for US citizens. If you wish to check out our detailed analysis of the complex world of US tax filing, go to 10 Tax Free Retirement Countries for US Citizens.
5. Belize
Insider Monkey Score: 11
The Qualified Retirement Program (QRP) allows eligible individuals who have met certain income requirements to live or retire in Belize. As such, those who are paying an income tax in Belize can apply for various exclusions and exemptions that will prevent them from paying tax on the same income to the IRS. The country is even more attractive for US expats because its markets also accept American dollar currency, English is the official language here, and it is a neighbor to countries such as Mexico that individuals can go to for affordable healthcare.
4. Costa Rica
Insider Monkey Score: 12
Costa Rica is one of the most popular retirement destinations in the world. The cost of living is affordable, the climate is warm and pleasant, and residents get to enjoy a high quality of life. Costa Rica is also a tax free retirement country that US citizens can retire to. In the country, only income earned within the country is subject to the Costa Rican tax. The government operates on the tax principle of territoriality, meaning that all personal incomes outside the country are not taxed.
3. Panama
Insider Monkey Score: 18
Panama is one of the most tax-friendly nations in the world. Neither social security, 401(k) or any other income is taxed in the country. The country is also favorable to retire to, as there is no hassle of claiming foreign tax credits. The Pensionado visa, particularly, is lucrative to expats, offering major tax benefits to retirees. Some benefits that retirees enjoy under the visa are discounts on prescription drugs, discount on total bills for services in hospitals and clinics, discount on physician and surgeon fees, and much more.
2. Nicaragua
Insider Monkey Score: 20
Thousands of expatriates are attracted to Nicaragua every year owing to its affordable living costs and low property taxes. Individuals who are 45 years or older, having a monthly retirement income of $600 or more may retire to the country. Under its Retiree Benefits Program, individuals do not have to pay taxes on any out-of-country earnings. Amongst other benefits, they may even bring household goods worth up to $20,000 from their own home, and that too, to Nicaragua duty-free.
1. The Philippines
Insider Monkey Score: 21
Filipinos are known to be some of the most hospitable people in the world. No wonder the Philippines is an attractive retirement destination for many. Under its Special Resident Retiree Visa (SRRV), foreign retirees can buy property, open businesses, and only get taxed on income that they generate within the country. This is also because the Philippines has a tax treaty with the US in order to avoid having individuals getting double-taxed.
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