Dual Citizenship and Moving Abroad
Entitlements, limits, and administrative nuisances
Writing on election day in the United States, 5 November 2024, I’m assuming that Americans readers will be focused on just one thing today, and for some days thereafter. And since it’s clear from many commentaries on Substack1 and elsewhere that the election, as well as the divisive social/political climate, have provoked thoughts of emigration, I thought I’d comment briefly on one potential aspect of leaving the country for elsewhere: dual citizenship.
For information I hold dual citizenship, in the U.S. and Ireland. Born in the U.S., I moved with family to Ireland in 2009 for work as well as to assure long-term access to affordable and quality healthcare. We became Irish citizens through naturalisation after five years of working with a green card and annual trips to the Garda National Immigration Bureau (GNIB) to renew visas. My Irish heritage did not entitle me to citizenship—it was my great-grandparents who emigrated from south Donegal to Massachusetts—and unlike some other countries this placed me one generation removed from claiming citizenship by descent.
For many, though, citizenship of a second country through descent is a possibility. Details of which countries have such policies are easy to find.2 But the question is, what’s to be gained by having dual citizenship, what entitlements does it bring, and what are its limits?
Advantages are easy to identify and include the right to work, residency, voting rights (if resident), entitlement to a passport, consular protection, healthcare, access to educational opportunities, etc. Within the European Union there is the further right to move among member states and to transfer one’s rights in the country of citizenship to another E.U. jurisdiction. For an American moving abroad it also allows one to forego the often challenging administrative processes of obtaining and renewing visas, the nature of which vary considerably from country to country.
Being a citizen of a second country might not relieve you of certain other responsibilities, however—such as obtaining basic competence in a national language if you take up residence there. Obtaining citizenship and a passport does not also automatically register an individual for important services, such as a social security number, national healthcare identifier, or a tax ID.
There are some financial matters to consider. The U.S. has passed legislation intended to prevent U.S. citizens from using international banks and other financial services to avoid taxation. This legislation is the Foreign Account Tax Compliance Act (FATCA), and it obliges banks internationally to report on financial holdings of U.S. citizens.3 (This is also required of individuals when filing their US income tax return.) Due to the administrative burden this imposes on private banks, some banks will not, by policy, provide account services to holders of U.S. citizenship.
There are some constraints on other financial services as well. If, for example, one holds investments in U.S. institutions (such as Charles Schwab, Fidelity, T. Rowe Price, etc.), one cannot legally obtain direct investment advice from those institutions while resident abroad. One should also be aware that a U.S. citizen living abroad will be unlikely to be able to purchase or even own investments in U.S. mutual funds, with some exceptions.4
Dual citizens and U.S. citizens resident abroad should also be aware of national policy with regard to capital gains (some countries will tax capital gains on sale of international properties) and inheritance or succession. And of course there is income tax: be prepared to file taxes in the U.S. and any other country you become resident in (I currently enjoy the privilege of filing taxes in three countries). My feeling is that reading and understanding the tax treaty between the U.S. and any other country of potential residence is a basic requirement.5
Then there are unexpected and unpredictable financial issues that arise from specific circumstances. If an American had acquired Greek citizenship and moved to Greece in 2016, for example, the constraints on personal financial accounts imposed by the Greek government at that time—such as the €60 daily limit on withdrawals from banks—would apply to you as a Greek citizen, but would not affect citizens of other countries. But of course this kind of thing is a risk nigh impossible to assess.
There are limits to entitlements granted to dual citizens in the new country of residence that may be less well known, and here I’ll speak only with regard to E.U. member states. While citizenship and residency can make available a wide range of privileges available to ordinary citizens, some social supports may remain off-limits. That is because some such supports are available only to those who have made contributions to the national social security system in one’s place of residence. For example, if you have not worked in a country and paid social charges there, you would generally not be entitled to unemployment payments or disability income. (This is how it is in the U.S. as well.) Such entitlements only become available once one has worked long enough and/or paid sufficiently into a country’s social security system to accrue enough credits for an entitlement.
One right available to E.U. citizens is the ability to move across national borders within the E.U. for work or residency. This right does not relieve one of the need to register as being resident for tax purposes or for national administrative or social services. It is also the case that one’s entitlements to some social services in a second E.U. country are based on the rights granted by the country of citizenship. When you move from one E.U. country to another, you formally transfer those rights to your new country of residence, effected by the filing of the appropriate forms.6 These cover benefits such as healthcare or unemployment payments.7
For example, when I moved from Ireland to France, it was necessary to file a Form S1, a certificate of entitlement to healthcare, issued by the Irish health services, with the national Assurance Maladie in France. This enabled registration with the French national healthcare system and issuance of the Carte Vitale, which one presents to health service providers when making payments. It is important to understand, however, that any limitations in healthcare coverage in one’s “home country” are observed in the new E.U. jurisdiction. So, for example, the Republic of Ireland does not cover emergency medical expenses of someone travelling in the United States; if you are an Irish citizen resident in France, that limitation is therefore observed by the French Assurance Maladie in considering coverage for such expenses as well. French citizens living in France, by contrast, are entitled to full coverage for foreign emergency medical costs.
Obtaining dual citizenship can provide a range of distinct advantages, but it will not put you immediately on an equal footing with lifelong citizens of a new country of residence. Nor will it relieve certain administrative burdens in both the U.S. and in a new country of residence. Once you are living in a new country there will also be a range of local issues and constraints to be aware of. But for many, these concerns are secondary to the desire to live in a society where one’s values are widely shared and reflected in national social policies.
Two recent examples from Brent Hartinger on Substack: "Should Trump Win, How Easy Is It For Americans to Move to Another Country?" Brent and Michael Are Going Places, https://www.brentandmichaelaregoingplaces.com/p/if-trump-wins-how-easy-is-it-to-leave ; and "Should You Move to Europe?", Brent and Michael Are Going Places, https://www.brentandmichaelaregoingplaces.com/p/should-you-move-to-europe-23c
See “Dual Citizenship,” Wikipedia https://en.wikipedia.org/wiki/Multiple_citizenship (consulted 4 November 2024); and Christian Henrik Nesheim, “The Complete List of EU Citizenship by Ancestry/Descent Policies,” IMI Daily https://www.imidaily.com/europe/the-complete-list-of-eu-citizenship-by-ancestry-descent-policies/ (consulted 4 November 2024)
Internal Revenue Service, “Foreign Account Tax Compliance Act (FATCA)” https://www.irs.gov/businesses/corporations/foreign-account-tax-compliance-act-fatca (consulted 4 November 2024).
See the useful article from American Citizens Abroad, “Mutual Fund Restrictions” https://www.americansabroad.org/mutual_fund_restrictions#:~:text=Because%20foreign%20jurisdictions%20are%20unable,back%20in%20the%20United%20States (consulted 4 November 2024)
Internal Revenue Service, “United States income tax treaties - A to Z” https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z (consulted 4 November 2024)
A list of such forms ia available here: “Standard forms for social security rights,” Your Europe https://europa.eu/youreurope/citizens/work/social-security-and-benefits/social-security-forms/index_en.htm.
Of course, qualifying for benefits such as unemployment or disability payments also assumes one has paid sufficiently into the home country’s social security system.