US Citizenship Renunciation Guide 2026

The exit tax treats covered expatriates as if they sold all worldwide assets at fair market value on the day before expatriation. Covered expatriates are those with net worth over $2M, average annual tax liability over $201,000 (2024), or who cannot certify 5-year tax compliance. Unrealized gains above the $866,000 exclusion (2024) are taxed at capital gains rates.

US persons must file Form 8938 (FATCA) for foreign financial assets over $50,000, FBAR (FinCEN 114) for foreign accounts over $10,000, and potentially Forms 5471, 5472, and 3520. All filings must be current for the 5 years before renunciation. Non-compliance makes you a covered expatriate by default.

1. Secure a second citizenship first — you cannot renounce without another citizenship.
2. Consult a US tax attorney specializing in expatriation.
3. File all outstanding US tax returns (5 years of compliance required).
4. Schedule a renunciation appointment at a US Embassy abroad (3–6 month wait).
5. Attend the appointment, sign the Oath of Renunciation (DS-4080), pay the $2,350 fee.
6. File Form 8854 with your final US tax return.
7. Close or restructure US financial accounts.

• Panama: Territorial tax. Friendly Nations Visa. Foreign income not taxed.
• Paraguay: Territorial tax. 3-year citizenship path. 10% flat tax on Paraguay-source income only.
• Georgia: Territorial tax. Virtual Zone companies pay 0% on foreign income.
• UAE: Zero income tax. Golden Visa for $545K+ real estate.
• Singapore: Territorial tax. Foreign-source income exempt if not remitted.

State Department renunciation fee: $2,350 (highest in the world). Tax attorney consultation: $500–$5,000+. Tax preparation for 5-year compliance: $2,000–$15,000+. Total typical cost: $5,000–$25,000+ before any exit tax liability.