Residency Matters: A Guide for Americans Living Overseas

Living abroad provides an exciting opportunity to immerse yourself in a new culture, gain international experience, and pursue your professional goals. However, many people worry about maintaining their residency status in the US while they are away from home. To provide guidance to those looking for more information on this subject, this blog post outlines how you can maintain residency in your US state of residence while living internationally. Whether you’re hoping to stay connected with family or are interested in retaining access to specific benefits associated with being a resident of a state-forming part of the United States—this article is here to provide helpful advice!

Even with a green card, you cannot maintain your permanent resident status if you decide to leave the US for an extended period of time and come back only for visits. If this occurs, border control staff may question whether or not you have given up on permanently residing in the United States.

Key Takeaways

• The United States is uniquely one of the few countries that tax their citizens regardless of geographical location.
• As an American who resides abroad, you are obligated to file a US federal tax return and pay your due taxes on all income earned throughout the world – no matter where you may be living at any given moment.
• In order to preserve your state residency, there are certain steps you must take including: maintaining a valid voter registration in the home state, having connections or family members residing in that particular state, holding on to important documents associated with the said state (such as a driver’s license), and filing taxes for that particular locality.

Understanding Residency

What is residency

Though navigating residency while living abroad may appear intimidating, it is essential to comprehend the true definition of residence. This typically relates to your permanent home base, where you are registered as a voter and pay taxes.

Why is it important

Have you ever wondered how to maintain your residency in a state while living abroad? It’s important to understand what residency is and why it matters. Residency determines your eligibility for things like voting, taxes, and accessing certain benefits. If you plan on returning to your state of residency, it’s essential to maintain your residency status. There are several ways to do this, such as keeping a permanent address, registering to vote, and filing your taxes while living elsewhere in your state of residency.

Factors that determine residency

Living abroad can provide an exciting adventure, but it’s important to remember that maintaining residency in your home state can have significant benefits. Residency determines eligibility for crucial federal benefits such as social security and education assistance. For permanent residents, residency can open the door to government-sponsored financial aid for education. And, for green card holders, maintaining residency in your state can provide the opportunity to receive in-state or resident tuition rates at select colleges and universities.

Steps to maintain residency

Establishing a physical address

First things first, you’ll need to first establish residency with a physical address in your home state. If you own a home, that’s perfect, but if not, you can use a friend’s or relative’s address. Just make sure to have all your mail delivered there, including important documents from USCIS. This will show that you still consider the state your permanent home, even if you are currently living elsewhere.

Filing taxes

While it can be difficult to sustain your residence in a state when you are overseas, there are certain techniques for managing this. A crucial action is that you must file taxes each year no matter if the income originates from abroad or not; simply classify yourself as a “resident” on the form.

To dodge future issues, be sure to file as a non-resident. If you find yourself in over your head with the process, don’t hesitate to seek out assistance from an experienced tax professional.

Maintain contact with family and friends

Embark on a life-changing adventure abroad, yet always remember to keep in contact with your beloved loved ones at home – doing so is paramount for maintaining residency. An effortless way to do this? Connecting regularly with family and friends.

Staying in contact with your home state through methods such as emails, written letters, and recorded phone conversations not only provides you with proof of your intention to remain a resident but is also an excellent starting point. However, this should not be the sole action taken when it comes to maintaining residency.

Maintaining a driver’s license

If you’re living overseas, it can be tricky to remain considered a resident of your home state. The most significant thing for achieving this status is keeping your driver’s license current. Your license should reflect the same address as all other documents from USCIS and any other official sources.

Staying up-to-date with your driver’s license not only preserves your residence status but also allows you to safely drive when you come home without worrying about any legal hassles.

Maintain social or professional memberships

Although it may appear daunting to keep your residency in a state while living abroad, there are certain approaches you can take to demonstrate that you still intend on residing there permanently. For example, paying state taxes and continuing active participation in any social or professional memberships such as golf club subscriptions – implies that the time spent outside of the United States was only for a short period.

Additionally, it’s an exceptional method to stay linked with your community while you’re on the go. To demonstrate that you still have a vested interest in your memberships, make sure to pay fees as soon as possible, join annual meetings and events, and acquire all newsletters or publications.

Potential issues to consider

Tax implications

Have you ever dreamed of living and working abroad? While it can be an exciting experience, it’s important to keep tax implications in mind, especially if you want to maintain residency in your home state. As a US citizen living overseas, you’ll still be subject to federal income tax on your worldwide income. However, the tax liability in your state of residence depends on whether you maintain a residence in your home state or have established residency abroad. 

Health insurance

Maintaining residency in a state while living overseas requires considering the various state income taxes and potential issues of health insurance. Beforehand, it is essential to investigate whether or not your current provider covers medical expenses incurred outside of the United States and how much they are willing to pay for such services.

When relocating abroad, you may need to buy supplementary insurance or change your provider entirely in order to stay covered. Moreover, it is essential that you investigate the healthcare system of the nation where you will be residing so as to recognize any constraints or issues related to acquiring medical care.

If you’re residing in Thailand or thinking to, make sure to read this article for more information about healthcare in the country.

Voter registration

Keeping current with your voter registration is critical in order to maintain residency status if you are living overseas. Voter registration is a key factor for determining where you live since it conveys that not only do you plan on returning home but also remain invested in the political decisions of your hometown.

If you want to be eligible to vote in the upcoming elections, it is critical that you register as a voter in your state of residence. Failure to do so can lead not only to losing your right and ability to participate but could also jeopardize any current or future residency status with the state itself.

So, staying up to date with your voter registration and familiarizing yourself with the voting deadlines and guidelines in your state is essential when you reside abroad.

Driver’s license

Keeping your driver’s license up-to-date and displaying the correct address is key for maintaining residency at home while living overseas. Your state driver’s license doubles as proof of identity, location, and ability to drive – all essential aspects when it comes to confirmation of residence.

Identification is essential for a broad range of activities, including opening bank accounts, registering services, and even voting.

Maintaining your driver’s license current and up-to-date with your home state address is essential, even when living abroad. Therefore, it is highly recommended that you abide by this practice while away from home.

Ignoring the need to prove your residency status may cause severe legal issues if you intend on driving once you come back to the United States. Therefore, it is essential that all necessary documentation be acquired prior to leaving for international travel.

Financial accounts

Residing overseas while keeping your financial accounts in order can be a precarious situation, due to several different factors. For instance:

Banking restrictions: Certain countries may have restrictions on foreign residents opening bank accounts or accessing financial services. This can make it difficult to manage finances and access funds while abroad.

Taxation: Residing overseas while still preserving residency in your country of origin can create complex tax proceedings. Filing taxes in both countries may be necessary, resulting in an arduous and costly process for you to endure.

Currency exchange: Keeping track of the ever-changing foreign exchange can be an arduous task when you store your finances in multiple currencies. These fluctuating rates can drastically alter the value of both your investments and savings, leaving you feeling uncertain about your financial future.

Fraud and security: When living overseas, financial account security and protection are paramount. It can be hard to keep track of activities in your accounts, making it more complicated to deter fraud or identity theft. Thus, taking precautionary measures such as monitoring account activity regularly becomes essential for safeguarding investment accounts against possible breaches.

Communication and access: Being abroad can make it challenging to stay connected with your financial accounts due to the obstacles of language barriers, time differences, and lack of access. It’s hard enough having a conversation with banks as is, but even more so when you’re located in another foreign country! Thankfully though, there are options available that help mitigate these problems by providing convenient ways for you to communicate and manage your finances efficiently.

Maintain Residency In a State While Living Abroad FAQs

What happens to my driver’s license if I live abroad?

If you are living abroad, it is illegal to obtain a driver’s license or state ID. However, if you wish to return home, the only legal route is by obtaining a U.S. passport from your local embassy and submitting an application for a driver’s license at the corresponding office once back in the United States.

Do I need to file taxes in my state if I live abroad?

The answer is a resounding yes – even if you live overseas, you are still considered to be a resident of your home state and must pay associated taxes. These state taxes could include income tax, property tax, or sales tax.

Can I keep my bank accounts in a state while living abroad?

To ensure the protection of your bank account name, simply modify the address to a family member or friend’s U.S.-based address and have all documents sent directly to you digitally.

Will maintaining residency in a state affect my immigration status?

U.S. immigration laws state that any individual admitted to the United States as an immigrant is expected to remain within its boundaries permanently, and staying away from home for more than a year could potentially erase their status as Lawful Permanent residents.

Can I apply for health insurance in my state while living abroad?

Depending on your health insurance policy and the laws of your state, it may be difficult to remain covered while abroad for an extended period. While typically policies are tailored for residents in a particular state, there might be exceptions or other alternatives that could suit you if this is not possible. It’s always best to consult with experts who can provide more information about what options are available for individuals living outside their home states.

Conclusion

Living abroad is an incredible opportunity to learn more about the world, have a unique experience, and stay connected with people on a global level. While this may pose some challenges when it comes to residency status and obligations, there are ways to maintain your residency in your chosen state while living overseas.

With some careful planning and research, you can take the plunge into an international adventure without the worry of losing important legal connections in the United States.

If you’d like more support or information related to maintaining residency in your home state while living abroad, subscribe to our newsletter for the best information about living abroad or wherever else your journey may take you. We encourage everyone to go out and explore their passions but make sure it’s done responsibly and thoughtfully. Here’s to exploring what’s next!