U.S. Citizenship Exit Tax Calculator
Exit Tax Calculator
Calculate your potential exit tax liability when renouncing U.S. citizenship
What This Means For You
Enter your information above to see if you're subject to the exit tax.
More Americans are walking away from U.S. citizenship-not because they hate the country, but because they canât afford to keep paying taxes on their cryptocurrency gains. If you own Bitcoin, Ethereum, or other digital assets that have skyrocketed in value, the U.S. tax system can feel like a trap. Unlike most countries, the U.S. taxes its citizens on worldwide income, no matter where they live. That means if youâre living in Portugal, Singapore, or Switzerland and your crypto portfolio is worth $5 million, the IRS still wants its cut. For some, renouncing citizenship isnât rebellion-itâs financial survival.
Why the U.S. Tax System Feels Like a Crypto Trap
The IRS treats cryptocurrency like property, not currency. Every trade, every swap, every sale triggers a taxable event. If you bought Bitcoin for $1,000 in 2017 and sold it for $60,000 in 2023, you owe capital gains tax on $59,000. If youâre in the top tax bracket, thatâs nearly $15,000 in federal taxes alone-not counting state taxes. Now imagine doing that every time you move from BTC to ETH to SOL. For active traders, the paperwork is endless. For long-term holders with massive gains, the tax bill can be crushing. Most countries only tax you if you live there. The U.S. taxes you because you were born there-even if youâve never set foot in the country since you were five. Thatâs why expats with crypto are increasingly looking at renunciation. Itâs not about avoiding responsibility. Itâs about escaping a system that doesnât match their reality.The Cost of Walking Away: Exit Tax and $2,350 Fee
Renouncing U.S. citizenship isnât as simple as signing a form at the embassy. Thereâs a $2,350 administrative fee. But thatâs the smallest part of the price. The real cost is the exit tax. If youâre a "covered expatriate," the IRS pretends you sold everything you own the day before you give up your passport. That includes your Bitcoin, your NFTs, your real estate in Bali, even your art collection. If your net worth is over $2 million-or your average tax bill over the last five years was more than $206,000-you trigger the exit tax. The tax rate? Up to 23.8%. Thatâs capital gains tax plus the net investment income tax. So if your crypto holdings are worth $3 million, and youâre a covered expatriate, you could owe nearly $700,000 before you even leave. And hereâs the kicker: you canât just give away your assets the week before renouncing. The IRS looks back five years. If you transferred $1 million to your kid last year, thatâs still counted as yours for exit tax purposes. Thatâs why smart planners wait. They gift assets two or three years out, letting the IRSâs clock run down.How to Avoid the Exit Tax (Legally)
You donât need to be broke to renounce. You just need to be strategic. One common move? Transfer highly appreciated crypto to family members-parents, siblings, spouses-over time. The gift tax exemption is $18,000 per person per year in 2025. That means you can gift $36,000 to a couple, $72,000 to a family of four. Do this every year for five years, and you can move $360,000 out of your "exit tax base" without triggering gift tax. Itâs slow, but it works. Another tactic: lower your income. The exit tax threshold for average tax liability is adjusted for inflation each year. If your crypto gains were huge in 2021 and 2022 but youâve been quiet since, your five-year average might now be under $206,000. Thatâs your window. Wait until your income drops, then file for renunciation. Some people sell off part of their portfolio before renouncing to bring their net worth below $2 million. They keep enough to live on, pay the exit tax on the rest, and walk away clean. Itâs not glamorous, but itâs legal-and itâs happening more often than you think.
Countries That Welcome Crypto Expats
You canât just vanish. You need a new home. And not just any home-one that doesnât tax your crypto. Portugal doesnât tax capital gains on cryptocurrency for non-habitual residents. Thatâs a big deal. If you move there and qualify for the NHR program, your Bitcoin profits are tax-free. No reporting. No forms. No IRS breathing down your neck. Malta offers something rarer: citizenship by investment. Pay âŹ600,000 into government bonds, donate âŹ10,000 to charity, and rent or buy property. In 12-36 months, you get a Maltese passport. Then you renounce your U.S. citizenship. Now youâre a citizen of the EU with no crypto tax and no U.S. reporting. Singapore? Zero tax on foreign-sourced income, including crypto. And itâs one of the most stable, secure places on earth. Switzerland? No wealth tax on crypto held as private assets. Georgia? 0% capital gains on digital assets. Germany? Hold crypto for over a year, and itâs tax-free-even if youâre still a German resident. These arenât tax havens. Theyâre functional, modern countries with clear rules. And theyâre actively courting digital nomads and crypto investors.The Catch: You Canât Come Back
Renouncing U.S. citizenship is permanent. No do-overs. No "oops, I changed my mind." After you renounce, youâre a foreign national. To visit the U.S., you need a visa. That means interviews, fees, background checks, and no guarantee of approval. If you own property in Florida or have family in Texas, you canât just show up. You need a B-2 tourist visa. And if you ever want to work in the U.S., youâre back to square one-applying for a work visa like everyone else. And if youâre ever denied entry? Thereâs no appeal. No passport to fall back on. No consular help. Youâre on your own. Thatâs why almost everyone gets a second passport first. You donât renounce until youâre sure you have somewhere to go.
What Happens After You Renounce?
Once youâre no longer a U.S. citizen, youâre done with U.S. taxes on your worldwide income. But not everything disappears. If you still own rental property in Chicago, the IRS still takes 30% of your rental income unless you file a tax return and claim treaty benefits. If you get dividends from Apple stock, they withhold 30% unless you submit Form W-8BEN. You still have to file U.S. tax forms for U.S.-sourced income. And if you ever get caught lying on Form 8854-the official expatriation form-you could face penalties, fines, or even criminal charges. The IRS doesnât forget. They track you. But hereâs the upside: no more FBARs. No more Form 8938. No more reporting foreign bank accounts, crypto wallets, or digital assets. That alone is worth millions to people whoâve spent years terrified of a mistake.Is This Right for You?
This isnât for everyone. If your crypto portfolio is worth $500,000, the exit tax might cost you more than youâd save. If you plan to retire in the U.S., renouncing makes no sense. If you have kids who might want to study or work here, youâre locking them out. This strategy is for a small group: high-net-worth crypto investors with $2 million+ in assets, who live abroad, who never plan to return to the U.S., and who are willing to accept the permanent loss of citizenship. Itâs not a loophole. Itâs a legal exit. And itâs becoming more common as crypto wealth grows and global mobility increases.Whatâs Next for U.S. Crypto Tax Policy?
Thereâs been talk in Congress about switching from citizenship-based taxation to residency-based taxation-like every other country. But nothingâs passed. As of 2025, the system remains unchanged. The IRS is getting better at tracking crypto. Theyâre partnering with exchanges. Theyâre subpoenaing wallet data. Theyâre auditing expats. If youâre still a U.S. citizen and holding crypto abroad, youâre a target. For those who can afford it, renunciation is no longer fringe. Itâs a calculated financial decision. One that requires lawyers, accountants, and years of planning. But for some, itâs the only way to keep their wealth-and their freedom.Can you renounce U.S. citizenship just to avoid crypto taxes?
Yes, but itâs not that simple. The IRS looks at your intent. If youâre clearly renouncing to avoid taxes and you meet the criteria for a "covered expatriate," youâll owe the exit tax anyway. You canât outsmart the system by timing it right unless youâve planned years ahead. Renunciation for tax reasons is legal-but itâs not a shortcut.
How much does it cost to renounce U.S. citizenship?
The administrative fee is $2,350. But most people spend $10,000 to $50,000+ on legal and tax advisors. The real cost is the exit tax, which could be hundreds of thousands if youâre a covered expatriate. You also need to factor in the cost of obtaining a second passport, which can be $100,000+ depending on the country.
Can you get your U.S. citizenship back after renouncing?
No. Once you renounce, itâs final. The U.S. government cannot restore your citizenship unless you go through the full naturalization process as a foreign national-which takes years and isnât guaranteed. Thereâs no "reinstatement" option.
Do you still owe U.S. taxes after renouncing?
You owe taxes on U.S.-sourced income-like rental income from a U.S. property or dividends from U.S. stocks. But you no longer owe tax on your worldwide income. If youâve paid the exit tax and filed Form 8854, your global tax obligation to the U.S. ends.
What happens if you donât file Form 8854?
If you renounce without filing Form 8854, the IRS still considers you a U.S. taxpayer. You could be hit with penalties, interest, and even classified as a "covered expatriate" retroactively. You may also be barred from re-entering the U.S. as a visitor until you clear your tax status.
dhirendra pratap singh
November 12, 2025 AT 15:00OMG I CAN'T BELIEVE PEOPLE ARE JUST GIVING UP THEIR CITIZENSHIP đ Like... are you serious?? This is the LAND OF THE FREE, bro!! You're trading your identity for a tax loophole?? đľâđŤ
Ashley Mona
November 12, 2025 AT 15:01Actually, I get it. Iâm a U.S. citizen living in Canada and the crypto tax reporting is insane. Every tiny trade? A taxable event. The IRS doesnât care if youâre living abroad or not. Itâs not about hating America-itâs about surviving the bureaucracy. Iâve been thinking about renouncing for years. đ¤ˇââď¸
Edward Phuakwatana
November 14, 2025 AT 00:38Letâs zoom out here. The U.S. is the last major economy clinging to citizenship-based taxation-itâs a relic of 19th-century fiscal policy. Meanwhile, Singapore, Portugal, and even Georgia have built thriving digital economies by offering crypto-friendly regimes. This isnât tax evasion-itâs regulatory arbitrage at scale. The exit tax is brutal, sure, but for high-net-worth crypto holders, itâs a cost of doing business in a globalized world. The real tragedy? The U.S. government is chasing pennies while losing billionaires to jurisdictions that actually innovate. đâĄď¸đ
Michael Brooks
November 15, 2025 AT 14:26Renouncing is a huge deal. Youâre not just giving up a passport. Youâre cutting ties with family, healthcare, emergency help, everything. Iâve got friends who did it. Theyâre fine now⌠but they never visit home. Not even for weddings. Thatâs heavy.
David Billesbach
November 17, 2025 AT 01:15Of course theyâre renouncing. The IRS is literally tracking every Bitcoin wallet now. Theyâre using blockchain analytics firms. Theyâve got AI scanning wallet addresses. You think they donât know who you are? Youâre not smart-youâre just late to the party. And now youâre paying $700K to escape a system that was always watching. đľď¸ââď¸đ¸
Andy Purvis
November 18, 2025 AT 17:53imagine if we just changed the tax system instead of making people leave. like... what if we taxed based on where you live? wouldnt that be easier for everyone? i mean the world is different now. people move around. why are we still stuck in 1940s thinking?
Ruby Gilmartin
November 19, 2025 AT 00:28Letâs be brutally honest: most people who renounce donât have $2M in crypto. They have $2.5M and theyâre trying to game the system. The exit tax exists precisely to stop this. And yes, the IRS looks back five years. So if you gifted your BTC to your cousin last year? Youâre still on the hook. This isnât a loophole-itâs a trap for the overconfident.
Douglas Tofoli
November 19, 2025 AT 09:40yo i just renounced last year and let me tell u⌠the paperwork was insane. i spent 18 months working with a tax lawyer and an expat accountant. the $2350 fee? joke. i paid $42k in legal fees alone. and then the exit tax hit me for $187k. but now? no more FBARs. no more 8938. i sleep better. worth it. đ¤
William Moylan
November 19, 2025 AT 10:58THE IRS IS USING AI TO TRACK YOU. THEYâRE WORKING WITH BLOCKCHAIN.COM AND COINBASE. THEY KNOW WHO YOU ARE. THEY KNOW WHEN YOU SOLD. THEY KNOW IF YOU GIFTED. YOU THINK YOUâRE SMART? YOUâRE JUST A TARGET. AND WHEN YOU RENOUNCE? THEY STILL TRACK YOU. THEY STILL AUDIT YOU. THEY STILL HUNT YOU. THIS ISNâT FREEDOM. THIS IS A FALSE ESCAPE.
Elizabeth Stavitzke
November 20, 2025 AT 01:07So let me get this straight-youâd rather give up your American citizenship because you donât want to pay taxes on gains you made *because* America built the internet, the financial system, and the legal infrastructure that made crypto possible? How dare you. Youâre not a victim. Youâre a parasite.
Ainsley Ross
November 20, 2025 AT 06:50As someone whoâs helped clients navigate expatriation for over a decade, I can say this with certainty: the emotional toll is often greater than the financial one. People donât talk about the grief of losing their passport-their birthright. The ritual of renouncing at an embassy is solemn. Many cry. Some donât speak to family for years. This isnât just tax planning. Itâs identity loss.
Brian Gillespie
November 21, 2025 AT 02:27My dad renounced in 2019. He lived in Thailand for 20 years. He paid the exit tax. Heâs happy now. No more IRS letters. No more panic every April. But he hasnât been back to the U.S. since. Not even for his sisterâs funeral. Itâs a permanent line in the sand.
Joanne Lee
November 21, 2025 AT 18:41The legal framework around exit tax and covered expatriates is extremely nuanced. The IRSâs five-year lookback period for gifts is codified under IRC Section 877A. Failure to file Form 8854 triggers automatic covered expatriate status, regardless of actual net worth. Many individuals mistakenly believe theyâve avoided the tax by transferring assets-but the IRS has specific attribution rules. Professional advice is non-negotiable.
Laura Hall
November 22, 2025 AT 13:06i just want to say-people who do this arenât evil. theyâre just trying to survive a system that doesnât fit their life. i know a guy who moved to portugal, started a small crypto shop, and now heâs got his kid in school there. he didnât want to leave america-he had to. we should be talking about fixing the tax code, not shaming people for trying to make it work.
Arthur Crone
November 24, 2025 AT 04:47Renouncing is a scam. The IRS will come for you anyway. Theyâve got treaties with Portugal. Theyâve got data sharing with Singapore. You think they donât know your wallet address? Youâre not hiding. Youâre just delaying the audit.
Rebecca Saffle
November 24, 2025 AT 11:22You think youâre free when you renounce? Youâre just trading one prison for another. Now youâre a foreigner in every country you go to. No healthcare. No protection. No voice. And if you ever get arrested overseas? Good luck calling the U.S. embassy. They donât help you anymore. You chose this. Now live with it.
Adrian Bailey
November 25, 2025 AT 17:44so iâve been in japan for 7 years and iâve been holding btc since 2016. i never sold, so i didnât owe anything until now. but the idea of triggering a $500k tax bill just to get out of the system? no thanks. iâm just waiting for the law to change. iâve got time. the u.s. government isnât going to collapse overnight. but my portfolio? itâs still growing. patience > panic.
Rachel Everson
November 26, 2025 AT 10:21if youâre thinking about this, please talk to a real tax lawyer-not a reddit guru. the exit tax calculations are terrifyingly complex. and donât forget: if you have kids, theyâll inherit your tax problems even if youâre gone. iâve seen families torn apart by this. itâs not just about you.
Johanna Lesmayoux lamare
November 28, 2025 AT 03:55I moved to Spain last year. No crypto tax. No IRS. Just peace. I still file U.S. taxes on my rental property in Colorado. But my Bitcoin? Free. I sleep better. Iâm not running from America-Iâm living beyond it.
Debraj Dutta
November 30, 2025 AT 01:23As an Indian citizen with crypto holdings, I find the U.S. system bizarre. We tax only if you reside here. No global income tracking. Why canât America follow suit? Itâs not about loyalty-itâs about practicality in a global economy.