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4 Ways to Live in the USA and Pay (Almost) No Taxes

You can live in the United States without paying US taxes, but it involves sacrifices. Many people seek to pay lower taxes by earning income worldwide and moving to tax-friendly locations.


People have varied opinions about visiting or living in the United States. Some may pursue US residency despite potential tax challenges. 

Live In The States Without Paying US Taxes

Let’s break those seeking tax-free US status into two groups:

The Two Kinds of Potential Tax-free US Residents

Being born in the US makes you a citizen subject to worldwide income taxation. You can still live in the US part-time or renounce citizenship to avoid this tax.

1. US Citizens and Permanent Residents

Non-US citizens can benefit from US tax advantages if they avoid the Substantial Presence Test and earn income from non-US sources. Renounced US citizens are treated the same as other non-citizens.

2. Non-US Citizens, Including Former US Citizens

1. Live there part-time 2. Become a student or scholar 3. Become a diplomat 4. Move to Puerto Rico or the US Virgin Islands

Ways to Live in the United States Tax-Free

To maintain tax-efficient living in the US, ensure you stay under the 120-day average, applicable to both US and non-US citizens, including former US citizens.

1. Live There Part-Time

International students in the US get a five-year exemption from the Substantial Presence Test, but US source income may still be taxed. Proper tax filing is necessary, and this exemption doesn't apply to US citizens.

2. Become a Student or Scholar

Depending on your diplomatic status, your income may still be subject to taxation by your home country or the host country. If you have a second citizenship in a low-tax country, it might offer tax advantages while serving as a diplomat in the United States.

3. Become a Diplomat

US citizens can lower their taxes by relocating to Puerto Rico or the US Virgin Islands, paying about 4% on their income, but they must spend most of their time on the chosen island.

4. Move to Puerto Rico or the US Virgin Islands

There's no magic way to live in the US tax-free, and it often comes with trade-offs. Consider the possibility of enjoying what you want overseas and create a tax-efficient Nomad Capitalist lifestyle through legal means like offshore companies, bank accounts, and second residencies.


Our experienced team can help you legally reduce your tax rate offshore, protect your assets, invest overseas, obtain a second citizenship, and improve your peace of mind. We’ve helped 1,500+ HNWI entrepreneurs and investors and we can help you, too.

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