I've been an expat for 13 years: Here's what I wish I'd known about U.S. taxes, banks, and more

"It's not just about the day to day cost of living."

A view of Copenhagen taken by the author.
Photo by Stephanie Bergeron Kinch

Many Americans dream about moving abroad, but as I've discovered over the past 13 years, it can be financially complex. While I prepared for all sorts of outcomes, there are still things that surprise me. 

This past summer, for example, my Danish bank sent me a letter demanding that I move all my investments somewhere else within a month. The problem, according to the bank, was the American part of my dual citizenship. 

The letter read, in Danish: "Stricter supervision by the North American authorities means that it is heavy and demanding for [this bank] to handle investments … Unfortunately, [this bank] will not be able to refer you to another bank since we cannot guarantee that other banks will accept trading in or holding securities."

I'm a debt-free dual Danish and American citizen. I'm self-employed and I have a mortgage that I pay every month. I have consistently paid into a private pension fund since my twenties, and I always pay my bills on time. I didn't expect to get rejected by my bank.

This wasn't the first time I was caught off guard by unexpected money and investment rules.   

When I bought my first house, I learned that I had to get special permission from the Department of Justice. To be able to purchase property in Denmark, you must either have permanent residency or have lived there for a period of five consecutive years.  

Since I was new to the country, extra paperwork was required to make me the co-owner of the house. While that issue was resolved, other situations, like this search for a new bank, have required both financial investment and a fair amount of time on my part.   

So for any American who is considering living abroad, here are a few key financial matters to keep in mind — and which I wish I'd known when I was starting out.

You may well have to file taxes in two countries

Filing taxes in two countries while working and living in just one is almost a uniquely American experience. The United States is one of two countries in the world where all citizens, even those who no longer live there, have to pay personal income tax. The other is Eritrea.

Thirteen years ago, I moved to Denmark to be with my Danish husband. I don't own any American property, have no investments or debt in the country, and am not entitled to Social Security or other welfare benefits. Aside from an annual vacation, I don't spend much time in the states anymore.

Still, every year, I fill out my American tax forms and inform the IRS of my Danish income. I fill out forms concerning all my bank accounts' values, including those I share with my husband.  

Fortunately, due to a treaty between Denmark and the U.S., I am not double-taxed. But I pay more than $500 each year for an accountant to help me get a handle on my returns. 

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Banks have to follow international regulations 

Thanks to legislation like 2010's Foreign Account Tax Compliance Act (FATCA), foreign banks are required to send the IRS bank account information on all their American customers with accounts worth more than $50,000.

Increasingly strict anti-money laundering and financial disclosure rules for American citizens have made it simply not worth it for banks to keep customers like me. These regulations were designed to discourage and prevent people from creating and using tax-free havens abroad. 

I have a number of friends and acquaintances who have been double-taxed on their investments, spent thousands of dollars on accountants, and gone on endless searches for banks, because of their American passport. 

It's a financial burden that many don't necessarily know to anticipate before making the move. 

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Renouncing U.S. citizenship costs money

In a May 2021 survey by Greenback Expat Tax Services, nearly one in four Americans living abroad polled reported "seriously considering" renouncing their U.S. citizenship. Of that cohort, 4 in 10 say that it is because of tax reasons. 

But renouncing U.S. citizenship can be an expensive proposition too. To start, there is a renunciation fee of $2,350. Higher-income earners also need to pay an exit tax based on the value of their earnings and property at the time of expatriation.

Even after that, the process can require hefty legal fees and several years to complete.

Pension fund complications can arise

For now, my bank has allowed me to keep my insurance, credit and savings accounts with them. But my pension fund had to move.

After much searching, I found a pension fund for academics that is also accustomed to working with international customers.

Unfortunately, moving my pension fund required me to fill out new health questionnaires, and my answers deemed me ineligible for their regular fund. Instead, I have to put my pension savings into a fund with less coverage for the first five years. Then I can fill out the health forms again and hopefully be accepted into the main fund.

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There is no guarantee that this pension fund won't send me a similar letter someday. At that point, I'll either go on another search for a bank that will accept my American passport or start the hard process of giving up my citizenship entirely.

If you have the opportunity to move abroad, it can be a wonderfully fulfilling experience. But it is also important to carefully consider your finances before taking up residence in your new home.

What will affect you is not just the day-to-day cost of living but also money-related situations that can crop up when you least expect them.  

Stephanie Bergeron Kinch is a freelance journalist based in Copenhagen, Denmark. For more information about her work, visit

Disclaimer: This is intended as general education and for informational purposes only, it is not intended as specific tax or investment advice. Please consult with a qualified professional for advice based on your personal situation.  

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