France is often mistakenly perceived across the Atlantic as a country with high taxes. However, for many US citizens, it is a particularly attractive tax destination, sometimes overlooked, when approached methodically and with foresight.
Whether you are looking to move abroad with your family, work remotely, start or grow a business, or prepare for retirement in Europe, France offers a secure legal and tax environment, supported by a bilateral tax treaty with the United States designed to avoid double taxation.
At RUFF & ASSOCIÉS, we have been assisting US citizens for several years with every stage of their projects in France: professional expatriation, setting up a company, asset management, or long-term relocation. This article provides a clear, detailed, and practical overview of the applicable tax measures, transforming apparent complexity into real opportunity.
A unique tax situation for US citizens residing in France
The main distinction for US citizens is based on a rare tax principle: the United States taxes its citizens on the basis of nationality, not just residence. Thus, even if they live permanently in France, US citizens are still required to declare their income each year to the US tax authorities.
At the same time, if your home, main professional activity, or center of economic interests is located in France, you are likely to be considered a French tax resident. In this case, France requires you to file a tax return covering all of your French and foreign income.
This dual reporting requirement does not automatically mean double taxation. However, it does make it essential to apply the Franco-American tax treaty correctly.
The French-American tax treaty : how to avoid double taxation
The tax treaty signed between France and the United States is a central pillar for American citizens with economic or personal ties to France. Its objective is clear: to avoid double taxation, while precisely defining which state has the right to tax each category of income and under what conditions.
It is essential to understand that this treaty does not eliminate reporting obligations. It only organizes the actual taxation, often through exemption mechanisms or tax credits. Misinterpretation of its provisions can lead to reporting errors, tax adjustments, or penalties, both in France and in the United States.
Tax residency in France : a decisive starting point for US citizens
French tax residency status is the cornerstone of your tax situation. It depends in particular on your main place of residence, your professional activity, and the location of your economic interests.
If you are considered a French tax resident, you are required to declare all of your income in France, including income from US sources. Although some income is taxable in the United States, this does not exempt you from declaring it in France.
Taxation of different types of income
Professional income of US citizens in France
Income from activities carried out in France is, in principle, taxable in France, whether it is salary, self-employment income, or executive compensation.
Please note that each professional situation must be analyzed carefully, so it is strongly recommended that you consult a professional to determine the tax regime applicable to your specific case. The reporting requirements and taxes due differ depending on whether you are an employee, self-employed, an entrepreneur, or a company executive, as well as on the location where the activity is carried out.
Financial income and investments from US sources
Dividends, interest, and capital gains from US sources are treated differently depending on the taxpayer’s nationality under the Franco-American tax treaty. Under the treaty, this income is eligible for a full tax credit in France, while remaining taxable in the United States.
This treatment differs from most tax treaties, which give France the right to tax this type of income (subject to the application of a tax credit). This tax break for US nationals is therefore significant and unique.
U.S.-sourced real estate income
Income from real estate located in the United States is taxable in the country where the property is located. However, taxation in the United States does not mean that there is no reporting requirement in France. If you are a French tax resident, you must report this income. Tax credits will only be taken into account when your tax return is processed.
American pensions and retirement benefits
The taxation of American pensions depends on their nature. In many cases, pensions paid from the United States remain taxable in the United States and not in France, in accordance with the provisions of the tax treaty.
Wealth and Real Estate Wealth Tax (IFI) : a temporary advantage to anticipate
US citizens who become French tax residents may, under certain conditions, benefit from a particularly favorable wealth regime. For the first five years after moving to France, real estate located outside France is not subject to Real Estate Wealth Tax.
This benefit is an important strategic lever for holders of international assets, provided they plan their arrival and asset structure correctly.
Reporting requirements in France and the United States : a major issue for American citizens
Even when income is not taxed in France, it must still be reported. This requirement applies to both income and bank accounts held abroad.
The taxation of US citizens in France leaves no room for improvisation. It requires a comprehensive analysis, a thorough understanding of the Franco-American tax treaty, and careful coordination between the tax systems of both countries.
At RUFF & ASSOCIÉS, we have developed specific expertise in supporting international clients, particularly US citizens. We help you secure your tax situation, comply with all your obligations, and optimize your wealth management in a strictly compliant manner.
Are you a U.S. citizen considering living, working, starting a business, or retiring in France ?
Every situation is unique and deserves personalized analysis. Whether you have already settled or are still considering your options, our teams are available to review your situation, answer your questions, and provide you with long-term support.
FAQ
Can RUFF & ASSOCIÉS request a TIN (tax identification number) for me ?
Of course, our team is accustomed to submitting the appropriate requests to the tax authorities in order to obtain your tax number. We can therefore assist you with all the steps involved in obtaining your tax number and creating your online account (specific to each taxpayer). Please note that this number is unique and specific to each taxpayer.
As a US citizen, do I have special obligations ?
From a tax perspective, there are no more or fewer obligations than for a national of another country. However, French banks may ask you to complete a specific declaration commonly referred to as self-certification.
Do I have to give my US tax return to French tax authorities ?
No foreign tax returns will be sent to the French tax authorities when you file your return. However, the French tax authorities are entitled to request additional documents from a taxpayer after they have filed their return, such as your US tax return.
Can we do a separate tax return ?
In France, the principle is a joint tax declaration; however, in some particular cases, we can do a separate tax return (under strict conditions).
Can I deduct the school fees of my kids ?
In France, tuition fees are not tax deductible. However, certain expenses related to your children (subject to conditions and limits) are eligible for tax deductions and reductions. This is particularly the case for childcare costs for children under the age of 6, expenses related to academic support, etc.
Do I get a French social security card if I submit a French taxreturn ?
No, filing a tax return in France does not entitle you to a Vitale card. To register with the French social security system, you must follow the specific procedures provided by the health insurance provider (depending on your situation).
This article was written in January 2026 by the tax department. Please note that this analysis is applicable as of today and does not take into account any changes that may occur; the data is subject to change.
