Double taxation depresses an American living in Israel

“Taxes in Israel are already very high, and the additional requirement to file in the U.S. creates constant stress and limitation….That makes it hard to move forward.”

— Brianna in Israel

Dear Members of Congress,

My name is Brianna, and I am an American citizen living in Israel—one of about 700,000. I was born in the United States and moved to Israel eight years ago. I was 25. I came here to live in a culture where Judaism is the majority religion and because Israel offered many opportunities for personal and professional growth. I was able to earn a master’s degree and attend free language courses. While I still very much identify as American, Israel has become my home.

But every year, I continue to file taxes in both Israel and the United States.

Taxes in Israel are already very high, and the additional requirement to file in the U.S. creates constant stress and limitation. I would like to consider becoming self-employed, but doing so would mean paying taxes twice, once in Israel and once in the United States. That makes it hard to move forward. For now, I remain an employee, but if my income rises beyond roughly $125,000 a year — around the level where exclusions and credits no longer fully protect me — I will start facing double taxation. It feels extremely limiting when I am trying to expand and grow my income.

Limited savings options

Saving money is also complicated. There is only one bank where I can invest without being taxed twice. As a result, I only invest in the United States. If I invest in Israel, I would have to pay double there as well. It is frustrating not to be able to participate fully in the financial life of the country where I live.

Life in Israel is already expensive, and salaries here are much lower than in the United States. Passing the Residence-Based Taxation for Americans Abroad Act, introduced by Congressman Darin LaHood, would remove some of the financial constraints I face. This law would make a real difference in my life and in the lives of millions of Americans living abroad who face the same double taxation burden.

I ask you to consider the impact that such a reform would have on people like me, Americans who care deeply about their country but live under the weight of a system that taxes us no matter where we reside. Living abroad should not mean living under two tax systems. I urge you to support a fair, residence-based approach to taxation for American citizens.

Sincerely,

Brianna N.

Israel