Whenever a person is over-burdened with taxes and he decides to leave the country then he is known as tax exile. Instead of residing in the mother country, he has to reside in the foreign country. They can also be called as called as tax mitigations or tax avoidance. In most of the countries residents are taxed in order to develop the country. If the individual doesn’t contribute in the country’s development then he is send on exile in most of the countries.
US Rules for Tax exile –
Internal Revenue Code states that the income of US citizen is taxable
regardless of income earned or produced. A citizen of US can eliminate the tax liabilities only by announcing the citizenship or moving abroad. They will be liable for taxes just as if they are general residence or workers.
The citizen should appear at the US Embassy or consulate and prove that they have already obtained the citizenship.
You also need to sign the various documents proving proofs for your good mental state. An individual is then disallowed to return US, not even a visit.
An immigrant who has been granted permanent resident status is normally treated as the citizen for tax purposes. In order to become permanent the individual has to stay for at least for 122 days in a year.