Why Record Numbers of Americans Are Seeking Second Residency in 2026
The demand for golden visas among US citizens has reached an all-time high in 2026. Applications from Americans to European golden visa programmes increased by 67% in the 12 months ending March 2026, according to immigration law firm tracking data. The drivers are well-documented: political polarisation, concern about long-term US fiscal stability, state-level tax pressure (particularly in California, New York, and New Jersey), and a growing awareness that the rest of the world offers competitive quality of life at lower cost.
But obtaining a golden visa as an American comes with a unique layer of complexity that citizens of most other countries do not face. The United States taxes its citizens on worldwide income regardless of where they live — making American expats subject to a filing regime that can include FBAR, FATCA Form 8938, Form 2555 (Foreign Earned Income Exclusion), and potentially Form 5471 if they hold shares in foreign corporations. This guide cuts through all of it.
The American Tax Overlay: What Every US Citizen Abroad Must Understand
FBAR (FinCEN 114): Reporting Foreign Bank Accounts
If you have financial interest in or signatory authority over foreign bank accounts, and the aggregate value exceeds $10,000 at any point during the calendar year, you must file an FBAR (Report of Foreign Bank and Financial Accounts) with FinCEN by April 15 (automatic extension to October 15). Failure to file carries civil penalties up to $10,000 per non-wilful violation, and up to $100,000 or 50% of the account balance per wilful violation. Every American who opens a bank account in their residency country must be aware of this obligation from day one.
FATCA Form 8938: Reporting Foreign Financial Assets
FATCA (Foreign Account Tax Compliance Act) requires US taxpayers with specified foreign financial assets exceeding $200,000 (single filer living abroad) or $400,000 (joint filer) at year-end to report them on Form 8938 filed with their federal tax return. This is separate from and in addition to the FBAR. Foreign brokerage accounts, foreign pensions, and interests in foreign entities all count.
The Foreign Earned Income Exclusion (FEIE)
The FEIE, claimed on Form 2555, allows Americans who meet the bona fide residence test or physical presence test to exclude up to $126,500 of foreign-earned income from US federal income tax in 2025 (indexed annually for inflation). Critically, the FEIE applies only to earned income — wages, salaries, self-employment income. It does NOT apply to passive income such as dividends, interest, capital gains, or rental income. Americans living on passive income or investment returns abroad will still owe US tax on that income, subject to foreign tax credits.
Dual Citizenship: The US Position
The United States does not have a law prohibiting dual citizenship. The State Department's policy is that voluntarily obtaining foreign citizenship with the intent to relinquish US citizenship constitutes expatriation — but simply obtaining a second passport for travel, residency, or security purposes, while maintaining your US ties and continuing to file US taxes, does not trigger loss of citizenship. The vast majority of Americans who obtain golden visas and second passports retain their US citizenship without any issue.
Exit Tax: Relevant Only If You Plan to Renounce
The exit tax under IRC Section 877A applies only to US citizens who formally renounce their citizenship and who meet the thresholds of a "covered expatriate" (net worth exceeding $2 million, or average annual net US income tax liability exceeding $206,000 for the 5 preceding years, or failure to certify 5 years of tax compliance). The exit tax treats all assets as sold on the day before expatriation at fair market value. For most Americans obtaining a second residency or passport without renouncing, the exit tax is irrelevant.
State Tax: The California and New York Problem
California and New York are aggressive about claiming tax residency even after a person moves abroad. California will attempt to maintain you as a tax resident unless you have clearly severed your California domicile — which requires a genuine move with no intention to return, change of voter registration, driving licence, bank accounts, and primary mailing address. New York City imposes a city income tax on residents that continues until you establish a new permanent place of abode. Americans from these states should obtain detailed state tax advice before establishing foreign residency.
Top Golden Visa Programmes for US Citizens in 2026
| Programme | Min Investment | Type | US-Specific Note | Tax Benefit |
|---|---|---|---|---|
| 🇵🇹 Portugal IFICI | €280,000 | Golden Visa | FEIE-eligible; NHR 20% flat tax | Strong |
| 🇬🇷 Greece | €250,000 | Golden Visa | 100,000 lump sum tax option | Strong |
| 🇲🇹 Malta MRVP | €600,000 | Citizenship | EU passport; FATCA-compliant banks | Moderate |
| 🇦🇪 UAE | $280,000 | Golden Visa | 0% income tax; FBAR reporting required | Strong |
| 🇵🇦 Panama | $300,000 | Permanent Residency | Territorial tax; FBAR required | Strong |
| 🇬🇩 Grenada CBI | $235,000 | Citizenship | E-2 visa treaty with USA | Very High |
| 🇮🇹 Italy | €300,000 | Investor Visa | 7% flat tax for new residents | Strong |
| 🇨🇾 Cyprus | €300,000 | Residency | Non-dom; 0% on dividends/interest | Strong |
Portugal: The Most Popular Golden Visa for Americans
Portugal consistently ranks as the top golden visa destination for American applicants. The investment fund route (€280,000 minimum into qualifying AIF or venture capital funds) allows Americans to obtain EU residency within 5 months. After 5 years, they become eligible for Portuguese citizenship — an EU passport granting visa-free access to all 27 EU member states and 180+ countries globally.
Portugal's IFICI (formerly NHR) tax regime provides a 20% flat tax on Portuguese-source professional income for 10 years for new residents who have not been Portuguese tax residents in the previous 10 years. Combined with the FEIE for earned income and foreign tax credits, many American residents in Portugal significantly reduce their effective tax burden. Foreign passive income is taxed at standard Portuguese rates under the new IFICI framework.
Greece: The Golden Visa with the Most Tax Advantages for Americans
Greece's golden visa (from €250,000 in lower-demand zones, €800,000 in Athens and Thessaloniki) combined with its Article 5A lump-sum tax regime is compelling for wealthy Americans. The lump sum regime charges a flat €100,000 per year in Greek income tax regardless of actual foreign income — making it highly attractive for Americans with large investment portfolios who can use the Greek tax paid as a foreign tax credit against their US liability.
Greece's 7-year citizenship path is also among the fastest in the EU for non-EU investors who meet minimal physical presence requirements.
The Grenada Advantage: An E-2 Treaty Route for Americans
Grenada is the only Caribbean citizenship-by-investment country that has a bilateral investment treaty with the United States, making Grenadian citizens eligible to apply for US E-2 investor visas. This creates a unique structure: an American can obtain Grenada citizenship (from $235,000), then use their Grenadian passport to apply for an E-2 visa, which allows them to live and work in the US as a non-immigrant investor. The E-2 is renewable indefinitely as long as the qualifying investment is maintained.
Why Would an American Want a Grenada E-2?
Americans themselves cannot apply for E-2 visas (it is a non-immigrant treaty visa for foreign nationals). However, an American who has renounced or is considering renouncing US citizenship, or one who has a foreign national family member who could use the Grenadian passport for E-2 access, benefits significantly. More commonly, dual national families where one spouse is not American use the Grenada CBI to obtain E-2 access to the United States.
UAE: Zero Tax Residency for American Investors
The UAE golden visa (from $280,000 in real estate) grants a 10-year renewable residency in a jurisdiction with 0% personal income tax. However, Americans living in the UAE still owe US taxes on their worldwide income. The UAE tax treaty with the US is limited in scope (covering shipping and air transport only), so Americans cannot use UAE residence taxes to offset US liability the way they can in treaty countries like Portugal or Greece. The UAE is most valuable for Americans seeking asset protection, business base diversification, and quality of life in a zero-tax environment — not for US tax reduction.
How to Choose the Right Programme as an American
Assess Your Tax Situation
Determine which US forms you currently file (FBAR, 8938, 2555) and model the impact of establishing foreign tax residency with your CPA
Define Your Objective
Are you seeking a backup plan, a permanent move, EU citizenship, or a tax-advantaged investment base? Different objectives point to different programmes
Check State Tax Implications
California, New York, and New Jersey residents need specific exit planning before establishing foreign domicile
Select Your Programme
Match investment amount, timeline to citizenship/residency, physical presence requirements, and tax treaty position to your needs
Open Compliant Foreign Accounts
Set up FATCA-compliant banking in your target country before or immediately after arrival, and register your accounts for FBAR
File US Returns from Abroad
US citizens abroad get an automatic 2-month extension to June 15 (plus an extension to October 15 on request), but interest still accrues on unpaid tax from April 15
Renunciation vs Dual Citizenship: The American Decision
The vast majority of Americans who obtain golden visas do not renounce their US citizenship. Renunciation is irreversible, costs $2,350 in State Department fees, requires filing Form 8854 to confirm tax compliance, and may trigger the covered expatriate exit tax for high-net-worth individuals.
Maintaining US citizenship while holding a second passport is legal and common. Many Americans hold EU passports (through ancestry or naturalisation) alongside their US passports. The obligation to file US taxes annually does not go away with a second passport, but the FEIE, foreign tax credits, and treaty benefits can significantly reduce the actual US tax owed.
Can a US citizen hold dual citizenship?
Yes. The United States does not have a law prohibiting dual citizenship. Americans who obtain a second passport for travel, security, or residency purposes — while continuing to file US taxes — retain their US citizenship.
Do Americans still pay US taxes while living abroad?
Yes. The US taxes citizens on worldwide income regardless of residence. Americans abroad can use the Foreign Earned Income Exclusion (up to $126,500 in 2025) and foreign tax credits to reduce US liability, but must file annually.
What is FBAR and do golden visa holders need to file it?
The FBAR (FinCEN 114) is required if you have foreign financial accounts with an aggregate value exceeding $10,000 at any point during the year. Any American with a bank account in their residency country must file it annually.
Which golden visa programme is best for US citizens?
It depends on your objective. For EU citizenship, Malta or Portugal. For maximum tax efficiency, Greece (lump-sum regime) or Portugal (IFICI). For the E-2 visa angle, Grenada. For zero-tax residency, UAE or Panama.
Is the exit tax triggered by getting a golden visa?
No. The exit tax (IRC 877A) is only triggered by formally renouncing US citizenship and qualifying as a covered expatriate. Obtaining a second residency or passport does not trigger any exit tax.