Your Moving Abroad Checklist: Everything U.S. Expats Need Before the Big Move

So you’re doing it. You’re moving abroad. Maybe it’s for work, love, adventure, or just the overwhelming desire to live somewhere you can afford avocado toast AND rent. Whatever your reason, you’re joining a massive wave: over 116,000 Americans researched moving abroad in 2024 alone, and Q1 2025 saw a 102% jump in Americans expatriating compared to the previous quarter.

Here’s the relief you need right now: according to IRS data from 2016-2021, 62% of Americans who file from abroad owe $0 in federal taxes after applying available exclusions and credits. The tax situation that’s probably causing you anxiety right now? For most expats, it works out to zero dollars owed.

But here’s the thing about moving abroad that nobody tells you upfront: the before you leave part matters just as much as the after you arrive part. Get your ducks in a row before departure, and you’ll save yourself thousands of dollars and countless headaches. Skip these steps, and you’ll be scrambling to fix things from 6,000 miles away while trying to figure out which bus goes to the grocery store.

Let’s walk through exactly what you need to handle before you board that plane.

Why Are So Many Americans Moving Abroad Right Now?

The numbers tell the story. An estimated 5.5 million Americans currently live abroad, and that number keeps climbing. Portugal tops the list as the #1 destination Americans want to move to, followed by Spain, Mexico, Costa Rica, and Canada.

The reasons? They’re as diverse as the destinations.

Remote work has untethered millions from physical office locations. You can keep your U.S. salary while living somewhere your dollars stretch twice as far. Retirees are discovering they can live better abroad on fixed incomes. Young professionals are seeking adventure and international experience. Families want better work-life balance, safer communities, and affordable healthcare.

And let’s be honest, political and social factors also play a role. Recent surveys show 63% of young Americans have considered leaving the U.S.

Whatever your reason for moving, you’re not alone. You’re part of a growing community of Americans who have decided that life abroad is worth pursuing.

Make Sure You’re Tax-Ready Before Moving Abroad

A few decisions before you move can prevent years of filing issues later.

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How Do I Exit My State Tax System Before Moving?

This is the step most people skip, and it costs them dearly. Your federal tax obligations continue as a U.S. citizen abroad (more on that in a moment), but your state tax obligations? Those depend entirely on whether you properly exit your state’s tax system before you leave.

Some states are “sticky” and will chase you for taxes even after you move abroad. California, Virginia, New Mexico, and South Carolina are notoriously aggressive about maintaining that you’re still a resident. New York requires you to prove you severed ties and established a new domicile elsewhere.

Critical Steps to Exit Your State Tax System

• Document everything: Close or transfer your local bank accounts. Cancel your driver’s license and get one from a no-income-tax state if you’ll maintain a U.S. address. Update your voter registration. Sell or rent out your property (homestead exemptions = residency claims).
• Establish a new domicile before you leave: If you plan to maintain a U.S. address (perhaps with family), consider choosing a state with no income tax, such as Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, or Wyoming. Visit that state, get a driver’s license, register to vote, and open a local bank account.
• File a part-year resident return for your departure year: This officially documents when you left and calculates tax owed only for the months you lived in that state.
• Keep proof of your move: Lease agreements, flight itineraries, employment contracts, and utility bills from your new country. If your former state comes calling, you’ll need evidence you moved.

Example: Sarah, who lived in California, accepted a job in Germany starting June 1, 2025. She established Florida residency in May, got a Florida driver’s license, opened a Florida bank account, and registered to vote there before moving to Germany. She filed a part-year California resident return for January to May 2025 and now files as a Florida resident (which has no state income tax), even though she lives in Germany. This saves her roughly $6,000 annually on California state taxes.

Learn more about changing your state residency while living abroad.

What Are My U.S. Federal Tax Obligations After I Move?

Let’s clear up the biggest misconception right now: moving abroad does not end your U.S. tax filing obligations. As a U.S. citizen or green card holder, you must file U.S. tax returns regardless of where you live. The U.S. is one of only three countries in the world that taxes based on citizenship rather than residence.

But remember that relief statistic from the beginning? 62% owe $0 after using available protections. Here’s how:

Foreign Earned Income Exclusion (FEIE)

You can exclude up to $130,000 of foreign earned income (2025 tax year, filed in 2026) from U.S. taxation. If you’re married and both qualify, that’s $260,000 excluded. To qualify, you must meet either the Physical Presence Test (330 full days outside the U.S. in a 12-month period) or the Bona Fide Residence Test (genuine resident of a foreign country for a full tax year).

Foreign Tax Credit (FTC)

This gives you a dollar-for-dollar credit for foreign income taxes you pay. If you live in a country with higher taxes than the U.S. (most of Europe, Canada, Australia), this credit often eliminates your entire U.S. tax bill.

You Can Use Both

Many expats exclude the first $130,000 with FEIE and use the Foreign Tax Credit on any income above that amount.

Examples:

• James moves to London and earns $95,000. He claims the FEIE and excludes the entire amount. His U.S. taxable income: $0. His U.S. tax owed: $0.
• Maria moves to Spain and earns $160,000. She uses FEIE to exclude $130,000 and FTC on the remaining $30,000. Spain’s higher tax rate means the credit eliminates her U.S. tax liability. U.S. tax owed: $0.

You must file to claim these protections. No filing = no exclusions or credits = you owe taxes you shouldn’t have to pay.

Learn more about U.S. expat tax deductions and credits.

Do I Need to Report My Foreign Bank Accounts?

Yes, and this catches many new expats by surprise. If your foreign financial accounts exceed $10,000 at any point during the year, you must file an FBAR (Foreign Bank Account Report) by April 15, with an automatic extension to October 15.

This isn’t a tax form; it’s a reporting requirement. You’re not taxed on having the accounts; the U.S. government wants to know they exist. But the penalties for not filing when required are severe: up to $12,500 per violation per year for non-willful failures.

Start tracking your balances now. If your checking, savings, investment accounts, and any other financial accounts in foreign countries total more than $10,000 at any single moment, you’ll need to file FBAR.

Should I Rent or Buy Housing in My New Country?

For your first year abroad, rent. Seriously. Unless you have an ironclad, guaranteed long-term situation, give yourself time to figure out which neighborhood suits you, whether you’ll stay long-term, and how the local real estate market works.

Buying property abroad can be a wise investment, but it comes with complications:

• Foreign mortgage interest may not be deductible on your U.S. taxes
• Property gains are taxable by both the U.S. and your country of residence
• Local laws about foreign ownership vary wildly
• Exit strategies can be complex if you decide to move again

If you do buy property abroad, keep detailed records of the purchase price, any improvements made, and the foreign taxes paid. When you eventually sell, you’ll need this documentation to minimize U.S. capital gains tax.

Example: Tom rushed to buy an apartment in Barcelona in his first month there. Six months later, he realized he wanted to live in Madrid instead. Selling costs, exchange rate losses, and the hassle of remote property management cost him $18,000. His friend Lisa rented for a year, figured out exactly where she wanted to live, then bought. She saved herself from an expensive mistake.

What About Healthcare Insurance?

This one’s critical: Medicare does not cover healthcare outside the United States (except emergency care in minimal border situations). You need a plan for healthcare coverage before you leave.

Your Options

1. Local public systems (if you qualify as a resident): Countries such as Portugal, Spain, and Costa Rica offer public healthcare that expats can access, often at minimal cost.
2. Private local insurance: Many countries offer high-quality private insurance for 50-70% less than U.S. plans. Expect to pay $100 to $300/month, depending on your age and coverage.
3. International insurance plans: These plans cover multiple countries, including the U.S. They are suitable for digital nomads or individuals who travel frequently. Typically $500-$1,200 per month.
4. Travel health insurance: Short-term coverage while you establish residency and local insurance. Essential for your first few months.

Don’t wait until you arrive to figure this out. Research your healthcare options now and have a plan in place before departure.

How Do I Handle My U.S. Bank Accounts and Credit Cards?

Keep them. Moving abroad doesn’t mean closing your U.S. financial accounts. In fact, you’ll want to maintain them for several reasons:

• U.S. income (Social Security, pensions, investment income) needs somewhere to go
• Credit history matters if you ever return to the U.S.
• Some foreign banks require proof of U.S. financial accounts
• Currency exchange is easier with accounts in both countries

Before You Leave

• Notify your banks and credit card companies of your move
• Update your address to a U.S. address (friend, family, or mail forwarding service)
• Set up online banking and two-factor authentication
• Confirm your cards will work abroad without foreign transaction fees
• Get your bank’s international contact numbers

Then, once you arrive, open a local bank account for everyday expenses. You’ll use the U.S. account for receiving U.S. income and the local account for paying rent, utilities, and daily expenses.

What Documents Should I Take With Me?

Create both physical and digital copies of everything necessary:

1. Vital records: Birth certificates, marriage certificates, divorce decrees, children’s birth certificates
2. Financial documents: Bank statements, investment statements, property deeds, mortgage documents
3. Tax documents: Last three years of tax returns, receipts for major purchases
4. Medical records: Prescription lists, vaccination records, medical history summaries
5. Professional credentials: Diplomas, licenses, certifications, transcripts
6. Legal documents: Power of attorney, wills, trusts, custody agreements

Store digital copies in secure cloud storage you can access from anywhere. Bring physical copies of any documents you may need immediately.

How Do I Time My Move for Tax Purposes?

Your departure date matters more than you think. If you move mid-year, you’ll have split-year tax obligations and need to prorate your FEIE.

Best Case Scenario

Move early in the calendar year. If you move in January or February, you can qualify for the Physical Presence Test (330 days in a 12-month period) by December of the same year. This means you claim the FEIE on that year’s return.

Mid-Year Moves

You’ll prorate your FEIE based on qualifying days. Formula: ($130,000 × qualifying days ÷ 365) = your maximum exclusion.

Example: Lisa moves to Portugal on July 1, 2025. She qualifies for 184 days in 2025. Her prorated FEIE: $130,000 × 184 ÷ 365 = $65,534. She can exclude up to $65,534 of her 2025 foreign-earned income.

Track your days meticulously. Travel days where you’re in transit don’t count as full days abroad. Keep a detailed record of every trip, including flight itineraries and hotel receipts.

Should I Work with an Expat Tax Professional?

For your first few years abroad, absolutely yes. The cost (typically $530-$700 annually for straightforward returns) is worth the peace of mind and the certainty that you’re claiming every benefit available to you.

An expat tax specialist helps you:

• Choose between FEIE and FTC for your specific situation
• File required forms (Form 2555, Form 1116, Form 8938, FBAR)
• Plan your tax strategy for the following year
• Avoid common mistakes that trigger audits
• Stay compliant with both U.S. and foreign tax obligations

The money you save through proper planning usually exceeds the preparation fee multiple times over.

Your Next Steps: Building Your Pre-Departure Timeline

Beyond tax planning, successful relocation abroad requires careful attention to logistics and timing. Here’s your comprehensive timeline:

3-6 Months Before Departure

• Research your destination country’s visa requirements
• Begin state tax exit strategy
• Consult with an expat tax professional about your specific situation
• Research healthcare options and international insurance plans

2-3 Months Before Departure

• Open a bank account in a no-income-tax state if maintaining a U.S. address
• Apply for necessary visas and permits
• Notify banks and credit card companies of your move
• Organize and digitize important documents
• Research schools if moving with children

1 Month Before Departure

• Finalize housing arrangements (short-term rental for first few months)
• Purchase travel health insurance
• Set up a mail forwarding service or confirm a U.S. address for correspondence
• Buy an international SIM card or research local phone options
• Register with the U.S. Embassy in your new country (via STEP program)

After Arrival

• Open a local bank account
• Register with local authorities as required
• Establish local healthcare coverage
• Start tracking days outside the U.S. for the Physical Presence Test
• Keep detailed records of all move-related expenses

Ready to Make Your Move?

Moving abroad is one of the most exciting decisions you’ll ever make. Yes, there’s paperwork. Yes, there are tax implications. But hundreds of thousands of Americans do this every year and discover a life they never imagined was possible.

The difference between those who thrive abroad and those who struggle? Preparation. Handle these details before you leave, and you’ll spend your first months abroad exploring your new city, making friends, and settling into your new life rather than scrambling to fix preventable problems.

If you’re ready to be matched with a Greenback accountant, click the get started button below. For general questions on expat taxes or working with Greenback, contact our Customer Champions.

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This article is intended for informational purposes only and does not constitute legal or tax advice. Tax laws change frequently, and individual circumstances vary. For specific guidance on your situation, consult a qualified tax professional specializing in expat taxation.

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Related Resources

Essential Tax Guides for Moving Abroad

• U.S. Expat Taxes: The Complete Guide for Americans Living Abroad
• Do Expats Pay State Taxes? Guide for Americans Living Abroad
• How Do I Change My U.S. State Residency While Living Abroad?
• California Exit Tax: What Expats Need to Know

Understanding Tax Protections

• Foreign Earned Income Exclusion: How to Save on Taxes Abroad
• Bona Fide Residence vs Physical Presence Test
• U.S. Expat Tax Deductions & Credits: Maximize Your Savings
• How U.S. Expats Avoid Double Taxation

Foreign Account Reporting

• FBAR Filing Guide: Requirements & Deadlines for Expats
• FBAR vs FATCA: Which Do I Need to File?