Leaving the country costs an American nothing. Giving up the passport can: a covered expatriate is taxed as if everything were sold the day before, on gains above $910,000 in 2026.
In short, current to September 2026
Source: the Patrician.ch board, an original ranking of 100 residence addresses across 48 countries and territories. Tax rates, thresholds and routes are sourced. Cost, safety, schools, sun and beauty are Patrician.ch editorial indices. Figures current to September 2026. Updated . Cite as: Patrician.ch, US exit tax 2026: who owes it on renouncing, and how much, patrician.ch/answers/us-exit-tax/, September 2026.
| Test | Covered if | Basis |
|---|---|---|
| Tax liability | Average annual net income tax above $211,000 for the 5 years before the expatriation date | IRC 877A(g)(1)(A), Rev. Proc. 2025-32 |
| Net worth | $2,000,000 or more on the expatriation date, worldwide, not indexed | IRC 877(a)(2)(B) |
| Certification | No certification on Form 8854 of full US tax compliance for the 5 prior years | IRC 877(a)(2)(C) |
A citizen from birth of the US and another country who is still a citizen and a tax resident of that country, and has not been a US resident for more than 10 of the last 15 years, escapes the first 2 tests. So does someone who renounces before age 18 and a half with no more than 10 years of US residence. Neither escapes the certification test.
Net unrealized gain across all worldwide property, long-term, at the top rate of 23.8% (20% plus the 3.8% net investment income tax).
| Net gain on the day before | Exclusion | Taxable | Tax |
|---|---|---|---|
| $910,000 | $910,000 | $0 | $0 |
| $2,000,000 | $910,000 | $1,090,000 | $259,420 |
| $4,000,000 | $910,000 | $3,090,000 | $735,420 |
| $10,000,000 | $910,000 | $9,090,000 | $2,163,420 |
Sources: IRC sections 877, 877A, 2801 and 6039G. Rev. Proc. 2025-32, sections 4.37, 4.38 and 4.42. Department of State final rule, Federal Register document 2026-04931. The exclusion applies to the total net gain, not asset by asset, and losses offset gains. Retirement accounts and deferred pay sit outside it. Form 8854 is filed with the return for the year of expatriation, and failing to file carries a $10,000 penalty.
The board ranked on what $1,000,000 keeps for a resident who no longer files as an American. Until the certificate of loss of nationality, the US return still applies on top.
Staying American and moving anyway: where a US citizen pays the least tax and the best country for Americans to move to.
Which states have an exit tax · California · New Jersey · New York · Maryland · Massachusetts · Where a high earner should live in the US · Exit tax by country
Yes, under IRC section 877A, but only for a covered expatriate giving up citizenship or a long-term green card.
Moving abroad while keeping the passport triggers nothing. The citizen keeps filing US returns on worldwide income.
Someone who meets any 1 of 3 tests on expatriating: average annual net income tax above $211,000 over the prior 5 years in 2026, net worth of $2,000,000 or more, or no certification of 5 years of US tax compliance.
The net worth test is not indexed for inflation.
Tax on net unrealized gain above $910,000 in 2026, as if everything were sold the day before expatriating, at up to 23.8% for long-term gains.
On $4,000,000 of gain it is $735,420. Retirement accounts are taxed in full as ordinary income on top.
The State Department fee is $450 for appointments from April 13, 2026, down from $2,350.
A covered expatriate also owes the exit tax, and every expatriate files Form 8854.
Only a long-term resident: a green card held in at least 8 of the last 15 taxable years.
The same 3 tests then decide whether they are covered.
Yes, but if you were a covered expatriate the recipient pays 40% on gifts and bequests above $19,000 a year in 2026, under IRC section 2801.
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The general case, ranked: Where should high earners live in 2026 · Best country to live in if you are rich · Best countries for high earners after tax · Europe · United States · Americans moving abroad · Tax calculator · Keep Index 2026
Tax figures use a simplified marginal model with indicative 2026 brackets for a non-US single filer, ignore social contributions, most deductions, wealth taxes, and treaties, and are not advice. Residence rules change often. Verify before acting.