International Tax
US Tax Attorney for Americans in Israel
Israel has one of the largest US citizen communities outside the United States — over 200,000 American-Israelis live in Israel. Many are dual citizens who face complex US-Israel tax overlap. Aliyah (immigration to Israel) has specific US tax implications. The IRS has intensified enforcement of FBAR compliance among Israeli-Americans with accounts at Israeli banks.
Key US Tax Issues for Israel
Israeli Bank Accounts and FBAR
US-Israelis with Israeli bank accounts, investment accounts, and brokerage accounts must file annual FBARs. Many US-Israelis have multiple accounts that collectively exceed the $10,000 threshold. Penalties for willful non-filing are severe.
Aliyah and US Tax Obligations
Moving to Israel (aliyah) does not terminate US tax obligations for US citizens. A US citizen living in Israel must still file US returns annually and report worldwide income.
Israeli Kupot Gemel and Pension Accounts
Israeli study fund accounts (Keren Hishtalmut) and pension accounts (Kupot Gemel) may be subject to US reporting and potentially PFIC treatment. Proper US-Israeli tax planning is essential before contributing large amounts.
Gifts from Israeli Family Members
Large gifts from Israeli parents or grandparents to US persons may require Form 3520 reporting. The $100,000 threshold applies to aggregate gifts from foreign individuals.
Common Questions
Do Americans living in Israel pay US taxes?
Yes. US citizens and Green Card holders must file US returns and report worldwide income regardless of where they live. The Foreign Earned Income Exclusion and foreign tax credits can significantly reduce double taxation.
Are Israeli bank accounts reportable on the FBAR?
Yes. Any US person with Israeli financial accounts with an aggregate value exceeding $10,000 at any point during the year must file an FBAR annually by April 15.
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Country-specific IRS and court information
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