The US is one of two countries that taxes citizens on worldwide income, regardless of where they live. For crypto-native digital nomads, this creates a real and recurring problem: you owe US tax on gains, your residence country may also want a piece, and without the right structure you’re paying twice.
The three tools that prevent double taxation
- Foreign Earned Income Exclusion (FEIE): exempts ~$130K of earned income from US tax if you spend 330+ days outside the US. Does not apply to capital gains.
- Foreign Tax Credit (FTC): credits foreign income tax paid against US liability. Works for capital gains in countries that tax them.
- Tax treaties: the US has bilateral treaties with most major jurisdictions. They define which country gets the first bite.
Crypto-specific complications
- The IRS treats crypto-to-crypto trades as taxable events.
- Many residence countries don’t (Portugal post-365 days, UAE, Singapore for non-business).
- The mismatch creates timing differences — gains taxable in the US that aren’t in your residence country.
Two structures that work
Puerto Rico Act 60: the only US jurisdiction with 0% on post-move crypto gains. Same passport, no expatriation.
Renounce US citizenship: the nuclear option. Triggers exit tax (potentially huge). Only justifies for principals over $5–10M+ net worth who actually plan to never move back.
ARCrypto coordinates with international tax counsel for members. Book a private call.