Several thousands of Americans do retire abroad each year and millions more are pursuing such an eventuality, due to the advantages and benefits that some foreign countries have over the US, such as better tax regimes and better quality of life. An important caution for such people retiring abroad is that they will continue to file US taxes, no matter which country they reside, unless they fully give up their US citizenship. Depending on the host country’s taxation system, such retirees may also have to pay local taxes, introducing the risk of double taxation. To avoid the unjust double taxation, the IRS introduced a number of tax exemptions which American expats can take advantage of, such as the Foreign Earned Income Exclusion and the Foreign Tax Credit. You may want to consult a US expat tax expert and stay on the safe side with Uncle Sam.