It’s all about average salary and take home pay. Americans rather have higher salaries and lower taxes and keep most of their money and deal with healthcare costs on an individual basis. Italians on the other hand opt for a shitty salary that keeps them poor their entire life with a lower standard of living but have free healthcare. Comparing these systems together is a waste of time. It has been debunked. Me personally, I rather keep all my money and deal with ailments as I get them and pay out of pocket if needed be which I don’t because I have insurance through my job. There are also good employers in the U.S. that cover your entire health plan. A friend of mine in Italy at my age still makes €1300 a month after two decades at the same job. I make $120k a year at my 5th job. I’m building wealth and acquiring assets and retiring at 45, he’s scraping by every month trying to stay under the line to qualify for social housing. The so called free healthcare is not free. It’s paid for by a stagnant economy and depressed wages that keep you a slave in a social system. I can’t imagine anyone making the same amount of money for 20 yrs and not revolting against the system because they can get checked for the stomach flu once every two years for free. It’s nonsense.
It would be worth a slide or two, or perhaps a whole. video to discuss parcheggiatori abusivi and how to deal with them. In my experience they can be troublesome, and can pop up where you least expect them.
Many Thanks Chip! We are moving to Southern Italy in a few days. I've always appreciated your excellent and straight forward approach and content. I've driven in Italy plenty over the years (and really enjoy it) with the AAA International Permit but am dreading taking the test as a resident. My mind set is, I WILL CRUSH IT, but the language this is gnawing at my brain. For me, I get the organized confusion of being in constant motion.
In a town of less than 50,000, like Rieti, not far from where we live, you can quickly get around on foot or by bicycle. We did this for over six months. Walking also did wonders for my health. Chip
Certainly some useful information here. I think it’s very important for people to understand the importance of the yield sign. In many cases it carries as much weight or more than a stop sign. If for example you have a yield sign and a merging lane has traffic approaching you then you MUST stop even if you could in your opinion safely carry on. The right of way at intersections with and without yield sign is EXTREMELY important to know. As for lane positioning ALL vehicles are required by law to keep to the right of the lane. Do NOT stay in the center. A tornante (not tornado which is a wind storm) is a hairpin turn and yes you do need to approach these with a moderate speed and caution. There are sites on line which provide for the purchase of the driver’s handbook in English. Buona guida !
read article 18 of the France & Italy tax treaty. Social security is only taxed by the country that funds the social security. So, the US would tax US social security and it would not be taxed in either France or Italy. Likewise a SS pension paid by France or Italy would only be taxed by those countries and not the US. Italians nationals living in Italy would be taxed in Italy [ not the US ] on their US SS pension , however these are govt pensions in Italy & not taxed in Italy. The term govt pension is broad and includes social security , not just a disability pension - SSI . Regarding Portugal & Spain. Portugal left out out pensions completely. So these are taxed as ordinary income. Spain originally had the same clauses in their original tax treaty with the US and covered social security pensions back in 1991. However, they got greedy and taxed these pensions, including SS as ordinary income after 2013. The French & Italian treaties cover social security pensions.
regarding tax treaties & social security .. France in ( 1996, 2004 treaty ) & Italy ( 1999 treaty ) - both cover pensions. ( Art 18 ). US Pensions like social security are only taxed in the country of source - USA. Not in France, not in Italy. Interesting that Portugal ( 1996 treaty ) left out pension completely out of the treaty. The result is that pensions like SS are taxed. The NHR was 10% , but now pensions are taxed like ordinary income. The tax rates in PT are very high. Spain on the other hand, had a 1991 treaty which excluded US pensions under art 20. It was very similar to the French & Italian tax treaty and was earlier ( 1991 ). But in 2013, Spain changed the treaty & got greedy and taxed US pensions like SS, 401k at full income escalating rates. Only US state govt pension were tax free. Makes no sense since the majority of US citizens have SS. Spain also has regional tax returns for each autonomy which are very high. Spain is not a good place for US retirees. The original treaty Spain had in 1991 was almost a mirror image of the France treaty of 1996. US pension were not taxed in Spain. Going back to Italy. If an Italian is an Italian national, they move back to Italy with a SS pension, then they will be taxed solely in Italy & not the US for this SS pension. There is a clause to prevent discrimination in tax matters for Italian nationals. However, they may be off the hook, because an Italian national with a govt pension ( SS is considered a govt pension ) is tax free under Italian law. Tax treaties are available at the IRS [dot] gov web site. These treaties are thick reading, however they also include separate technical information about what is included in these treaties. Each treaty has some differences, however the US tax treaty of France & Italy are very similar and contain the same article 18 that covers pensions, alimony, child care. These treaties cover all international tax issues for individuals & businesses. They even cover transfer pricing issues back in the 1990's. They were advanced then, and are still advanced.
I subscribed. I plan to retire at O-6 Colonel rank (23-24 years of service), my wife works for State Dept. (so being close to a consulate helps her continue work). I’ll email w some questions, love belle paese, been 8x there but trying to figure area & taxes/cost of living where to retire, am pretty flexible other than wife’s career…
So if my pension is 100k and I stay more than 183 days, I will be taxed at 43%, the max...that would be 43000 euro's...your health care is 64 dollars a month....Do I want to stay more than 6 months & 3 days?? NO WAY...
It’s not quite $43k. Just like in the US it’s bracketed… so you pay 43% of the last 50,000, 23% of the first 28,000 and 35% of the chunk between 28k and 50k. I’ll leave you to do the math and it’s still high but it’s not 43%. Closer to the 35% in fact
Bravo e Grazie - We are the stage where we have moved from CA to WA. New drivers license, car registration, WA physical address. I'm even getting a fishing license. WA is where we will be spending time when we return to the US.
What about healthcare in those 7% regions? Do you travel to Rome for example for healthcare? What about assisted living when the time comes? Can a widow apply who has no living family members?😊
Hello Chip, I would like to stay in Italy after I retire from USA maybe in few years. I just read somewhere that I might qualify for Italian citizenship based on my grandparents’ immigration from Italy. Is that possible? With Dual citizenship status, should I be concerned about paying tax for both countries , USA and Italy?
Dear Aquabo, I don't think so. As we stated above, the tax treaty allows you to avoid paying taxes in two places. I would contact Mr Gulizzi as he can answer your questions better than I. Chip
Chip this post is very helpful for my wife and myself. Now we have a much better understanding of what are tax situation will be once we establish Italian residency.
Chip, as a financial guy you knew facts were not adding up with the attorney in Rome, I am overjoyed at your tenacity. Mr. Guilizzi is knowledgeable and articulated the information in an easy to understand manner…love it when someone can accurately quote article and paragraph.
Ciao Chip and Christian! Recently had a zoom meeting with Christian regarding taxes as it relates to moving to Italy from US. He was very informative, listened to my unique situation, and gave me a good understanding of the various scenarios I gave him. Thanks Chip for recommending Christian🇮🇹👍
Great conversation. Clearly, taxes in Italy are complicated enough where the average person may not want to make the plunge before looking closely at their individual situation. Personally, I'd be curious to also know a recipe for maximizing my time in Italy while not qualifying as a tax resident to begin with. For example, doing the Schengen shuffle and/or slow traveling.
