Two sets of rules, written independently, applying to the same person at the same time. This is where the gaps open.
Cross-border positions rarely fail because either jurisdiction was analysed badly. They fail in the space between them, where each advisor answered their own question correctly and nobody was engaged to ask what happens when the two answers are placed side by side.
For US citizens the position is more demanding still, because US reporting obligations continue regardless of where you live. The material below covers the US-specific obligations first, then the broader international questions that apply to anyone with income or assets in more than one place.
US citizens owe US taxes globally. FBAR thresholds, FATCA reporting, Foreign Earned Income Exclusion, and how Penshonado interacts…
Start here 2How Sint Maarten residents must report worldwide income — including French-side earnings — and how to correctly claim double taxat…
Start here 3Kingdom of Netherlands tax treaty participation, withholding on dividends and royalties, the FATCA agreement, and implications for…
Yes. The United States taxes its citizens on worldwide income regardless of where they live. Moving to Sint Maarten and obtaining Penshonado status reduces your Sint Maarten tax to 10%, but does not eliminate your US federal tax obligations. You must continue filing US tax returns annually.
FBAR (FinCEN Form 114) must be filed by US persons who have a financial interest in, or signature authority over, foreign bank accounts with an aggregate value exceeding $10,000 at any point during the calendar year. Living in Sint Maarten typically means maintaining local bank accounts, making FBAR compliance a standard annual requirement for US residents on the island.
FATCA (Foreign Account Tax Compliance Act) requires US persons to report foreign financial assets above certain thresholds on Form 8938 filed with their US tax return. Sint Maarten banks and financial institutions are required to report US account holders to the IRS under FATCA, making compliance non-negotiable.
The Foreign Earned Income Exclusion (FEIE) allows qualifying US citizens and resident aliens living abroad to exclude a portion of their earned income from US federal tax. To qualify, you must meet either the bona fide residence test or the physical presence test. US expats in Sint Maarten may qualify, but investment and passive income cannot be excluded under the FEIE.
Americans in Sint Maarten typically file: Form 1040 (annual US income tax return), FinCEN 114 (FBAR for foreign bank accounts), Form 8938 (FATCA statement of foreign assets), and potentially Form 2555 (Foreign Earned Income Exclusion) or Form 1116 (Foreign Tax Credit). The exact forms depend on your income type, asset values, and entity structures.
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