I noticed a lot of digital nomads have to take a pay cut or have money saved up. Is it even possible to be a US citizen and have a remote job with good pay? I say this because if I want to live in a foreign country for say 3-6 months and then return back the US I don’t want to be making only 30k a year.
How do you deal with the tax fraud though. Willing to get fired is one thing, the tax fraud is the real kicker
How is it tax fraud? If you’re paying US federal/state taxes as if you’re in the US, I don’t think the IRS is going to come after you. In the country for which you’re staying in, sure they may not really like that you’re working on a tourist visa but for them to find out and pursue you for it I think is unlikely.
One part is definitely the host country. Some countries are stricter about it than others.
The other part is state laws usually. E.g your employer is in California where you used to live but you put your family address in Washington because you don’t have a physical address in CA anymore. CA can come after you for lying about your address to try to avoid taxation. Your visitor visas aren’t proof that you don’t live in California. You’ve just committed tax fraud.
The state thing is not a big deal if you move to another state and wrap up your relationship with the high tax state first. If you go abroad directly, then like you said it might be more difficult for you to prove that you moved to the low tax state.
I’m doing something similar and I have family in a zero income tax state which I lived in briefly before going abroad.
I pay my US and after taxes after claiming the foreign earned income exclusion. I have a digital nomad visa that specifically excludes income. No tax fraud
It sounds like your tax home is in the U.S., which would mean you don’t qualify to claim FEIE.
I’m outside of the USA for 365 days. I qualify. Physical presence test.
I still pay taxes because I make over the limit.