Retiring abroad is a great way to enjoy the life of your dreams. You waited long for it and saved up to ensure it would be all you hoped. Although your life may have slowed down and you can relax more, there is one thing you have not escaped—the U.S. federal income tax.
Even though you are living in expatriate retirement, you still must pay income taxes, whether from the United States or a foreign source. The Internal Revenue Service (IRS) states that the things you must pay taxes on remain mostly the same. You will still pay taxes on your earned income, estate, retirement income, gift tax returns, and more.