Tax Guide for Americans in Argentina

Americans in Argentina: A Comprehensive Journey from Residency to Filing

Moving to Argentina as an American opens doors to a vibrant cultural scene, diverse landscapes, and a passionate approach to life. However, it also means navigating the complexities of dual tax obligations. You'll need to satisfy both the Argentine Administración Federal de Ingresos Públicos (AFIP) and the U.S. Internal Revenue Service (IRS). While this dual obligation can seem overwhelming, understanding the system is the first step to managing it effectively.

This comprehensive guide will walk you through every aspect of the tax landscape for U.S. expats in Argentina, from determining your tax residency status to leveraging U.S. tax relief provisions. Consider this your complete manual for achieving tax compliance while enjoying your Argentine experience. All figures and rules are updated for 2025 where applicable.

Part 1: Defining Your Status - Argentine Tax Residency for U.S. Expats

Your Argentine tax obligations depend fundamentally on whether you're considered a tax resident. Argentine residents are taxed on their worldwide income, while non-residents are only taxed on Argentine-source income.

You are generally classified as an Argentine tax resident if you reside in Argentina for more than 12 months, becoming a resident from the 13th month onward. The determination is based on the "facts and circumstances" test, which considers:

Primary Factors:

Physical Presence: Spending more than 12 months in Argentina indicates residency.
Permanent Home: Maintaining a home in Argentina that's continuously available to you.
Center of Life: Where your personal and economic interests are concentrated, including:
- Location of family
- Professional activities
- Bank accounts and investments
- Social connections and memberships
Registration with AFIP and Obtaining CUIL/CUIT

Tie-Breaker Rules

Since there is no income tax treaty between the U.S. and Argentina, there are no formal tie-breaker rules. If you could be considered a resident of both countries, you may face dual taxation, mitigated by U.S. foreign tax credits.

Understanding these rules is crucial for determining where you'll pay taxes on your worldwide income.

Part 2: Deconstructing the Argentine Tax System

Argentina uses a progressive tax system that taxes income based on brackets, with residents taxed on worldwide income.

Personal Income Tax (Impuesto a las Ganancias)

This includes:

Employment income (wages, bonuses, benefits)
Self-employment and business income
Capital gains
Pensions and social benefits
Rental income

Progressive Tax Rates (2025)

Taxable Income (ARS)	Tax Rate
0 - 101,679,575.26	25%
101,679,575.26 - 1,016,795,752.62	30%
1,016,795,752.62 and above	35%

Important Note: These brackets are adjusted for inflation. Rates apply after deductions. Non-residents are taxed at a flat 35% on Argentine-source income.

Capital Gains Tax

Capital gains are taxed at 15% for residents on certain assets, integrated into personal income tax for others.

Tax Rate: 15% on gains from securities, real estate, etc.

Wealth Tax (Impuesto sobre los Bienes Personales)

Argentina imposes a wealth tax on worldwide assets for residents exceeding ARS 100,000,000.

Rates: 0.5% to 1.75% progressive.
Assets include bank accounts, investments, real estate.
Liabilities are not generally deductible.

2025 Wealth Tax Rates:

Up to ARS 100,000,000: Exempt
ARS 100,000,001 - 300,000,000: 0.5%
ARS 300,000,001 - 1,000,000,000: 1%
Over ARS 1,000,000,000: 1.75%

Tax-Free Allowance: ARS 100,000,000 per person; adjusted annually.

Comparing Argentine vs. U.S. Tax Systems

Key Differences:

Argentina has fewer tax brackets but a lower top rate of 35%.
Argentine top rate of 35% applies at high thresholds due to inflation adjustments.
Argentina has a wealth tax, unlike the U.S.
Provincial taxes in Argentina, similar to U.S. state taxes.

Other Notable Argentine Taxes

Value-Added Tax (IVA):
- Standard rate: 21%
- Reduced rate: 10.5% (food, books, medicines)
- Higher rate: 27% (utilities)
- Unlike U.S. sales tax, VAT is included in displayed prices.
Property Tax (Impuesto Inmobiliario):
- Annual provincial tax on property ownership
- Typically 0.5-1.5% of property value
- Varies by province
Real Estate Transfer Tax (Impuesto de Sellos):
- Rate: 1-4% depending on province
- Paid by buyer or seller as agreed
Inheritance and Gift Tax:
- Provincial, rates up to 15-20%
- Exemptions vary by relationship and province
PAIS Tax:
- 30% on foreign currency purchases and services
- Applies to expats for certain transactions

Part 3: Your U.S. Tax Obligations While Living Abroad

Your U.S. citizenship means you must file U.S. tax returns annually, reporting worldwide income. The key is using available tools to prevent double taxation.

The Core Tools: FEIE vs. FTC

1. Foreign Earned Income Exclusion (FEIE):

Exclude up to $130,000 (2025) of foreign-earned income.
Applies to wages and self-employment income, not passive income.
Must meet either Physical Presence Test (330 days abroad) or Bona Fide Residence Test.

2. Foreign Tax Credit (FTC):

Dollar-for-dollar credit for Argentine taxes paid.
Often beneficial due to Argentine tax rates up to 35%.
Can carry excess credits forward or back.
Separates income into categories (general, passive, etc.).

Which to choose?

FEIE: Better if income is under the threshold and Argentine taxes are low.
FTC: Usually optimal for Argentina residents due to comparable tax rates.
You can use both, but not on the same income.

Housing Cost Exclusion/Deduction

If using FEIE, you may also exclude/deduct qualified housing costs exceeding a base amount:

Rent, utilities (except phone/TV/internet)
Real and personal property insurance
Residential parking
Base amount for 2025: $20,800

Reporting Requirements: FBAR & FATCA

FBAR (FinCEN Form 114):

Required if foreign accounts exceed $10,000 aggregate at any point.
Includes Argentine bank accounts, investment accounts, pension funds.
Filed separately from tax return by April 15 (automatic extension to October 15).

FATCA (Form 8938):

Higher thresholds than FBAR.
Single filers abroad: $200,000 year-end or $300,000 any time.
Married filing jointly abroad: $400,000 year-end or $600,000 any time.

Penalties for non-compliance are severe, non-willful FBAR penalties up to ~$16,000 per violation (inflation-adjusted for 2025); willful up to the greater of $161,000 or 50% of account balance. FATCA starts at $10,000.

State Tax Considerations

Many states continue claiming tax rights over expats:

Aggressive states: California, Virginia, New Mexico, South Carolina
Tax-friendly states (no income tax): Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, Wyoming

Consider establishing residency in a tax-friendly state before moving abroad.

Part 4: The U.S.-Argentina Tax Treaty

There is no comprehensive income tax treaty between the U.S. and Argentina to prevent double taxation. However, there is a Tax Information Exchange Agreement (TIEA) that facilitates the exchange of tax information.

Key Implications

No Savings Clause or Tie-Breakers: U.S. citizens may face double taxation on certain income, mitigated by FTC.
Pension Income: Potentially taxable in both countries; use FTC.
Investment Income: No reduced withholding rates; standard rates apply.
Real Estate: Taxable in the country where located.
Business Profits: Taxable where earned.

Part 5: The Practical Guide to Filing Your Taxes

Tax Filing Deadlines: A Combined Timeline

Event	Deadline	Notes
Argentine Tax Return	June 15	For the preceding year
Argentine Tax Return (Extension)	June 23	Possible extensions announced annually
U.S. Tax Return (Standard)	April 15
U.S. Tax Return (Expat Extension)	June 15	Automatic 2-month extension
U.S. FBAR Filing	April 15	Automatic extension to October 15
U.S. Tax Return (Further Extension)	October 15	Must file Form 4868
Argentine Wealth Tax Return	June 15	Filed with income tax

How to File Your Argentine Return

CUIL/CUIT: Essential tax ID for all services.
- Required for filing.
- Obtained through AFIP.
Filing Options:
- AFIP Website: Free official portal (in Spanish).
- Tax Preparation Software: Commercial options available.
- Tax Advisor (Contador): ARS 50,000-200,000+ depending on complexity.

How to File Your U.S. Return

Tax Software: Ensure it supports foreign income and tax credits.
Expat Tax Professional: Recommended for complex situations.
Key Forms: 1040, 2555 (FEIE), 1116 (FTC), 8938 (FATCA).

Part 6: Key Argentine Tax Deductions and Benefits

Employment-Related Deductions

Commuting Expenses:
- Deductible if not reimbursed.
Incentive Regime for Large Investments (RIGI):
- Tax benefits for investments over USD 200 million.
- Reduced rates, exemptions for qualifying projects.
- Must meet specific requirements.
- Valid for up to 30 years.
Other Work Deductions:
- Professional training
- Union dues
- Work tools
- Home office expenses

Personal Deductions

Mortgage Interest:
- Limited deduction for primary residence.
Healthcare Costs:
- Medical expenses exceeding 5% of income.
Educational Expenses:
- For self or dependents.
Charitable Donations:
- Up to 5% of income.
Domestic Services: Up to ARS 4,507,506.
Dependents: Spouse, children deductions.
Rent: Deductible up to certain limits.

Tax Credits

Personal Deduction: ARS 4,507,506 maximum (2025).
Child Credit: Based on number of children.
Disability Credit: Available.
Elderly Credit: Based on income and age.

Part 7: Special Considerations for Different Expat Situations

The Remote Worker

Working remotely for a U.S. company while living in Argentina:

Argentine Perspective:
- Work performed in Argentina = Argentine-source income after residency.
- Employer may need to withhold Argentine taxes.
- You're responsible for Argentine social security.
U.S. Perspective:
- Still U.S.-source income if employer is American.
- Standard withholding continues.
- Claim FTC for Argentine taxes.
Solutions:
- Employer of Record services.
- Converting to contractor status.
- Local employment contract.

The Entrepreneur

Argentine Business Structures:

Empresa Individual (Sole Proprietorship): Simple setup, unlimited liability, profits taxed personally.
SRL (Limited Liability Company): Minimum capital ARS 100,000, corporate tax 25-35%.

Tax Benefits for Entrepreneurs:

Self-Employed Deduction: Various expenses.
R&D Incentives: Deductions for innovation.

U.S. Considerations:

Argentine entity treated as corporation.
Consider check-the-box election.
Watch for CFC and PFIC rules.

The Retiree

U.S. Social Security: Taxable in U.S., potentially in Argentina; use FTC.
U.S. Private Pensions: Taxable in Argentina as resident.
Argentine Pension: May qualify after residency.

The Student

Argentine Tax Implications: Student income often below threshold.
U.S. Tax Implications: Education credits may apply, FBAR for Argentine accounts.

The Investor

Critical PFIC Issue: Most foreign funds are PFICs, punitive U.S. tax treatment, stick to U.S.-domiciled funds.
Argentine Investment Account Types: Taxed under wealth tax, capital gains at 15%.

Part 8: Common Pitfalls and How to Avoid Them

The No Treaty Trap

Problem: Potential double taxation without treaty relief.

Solution: Rely on FTC, plan income sources carefully.
The Wealth Tax Surprise

Problem: Forgetting to report worldwide assets.

Solution: Include all assets over threshold, use year-end values.
The Social Security Gap

Problem: No totalization agreement.

Solution: Pay into both systems if required, consider voluntary contributions.
The Registration Requirement

Problem: Delaying CUIL/CUIT registration.

Solution: Register promptly upon arrival.
The Inflation Adjustment Oversight

Problem: Not accounting for bracket adjustments.

Solution: Check AFIP updates annually.

Part 9: Year-by-Year Tax Strategy Timeline

Year 1: Establishing Residency

Register with AFIP, obtain CUIL/CUIT
Apply for incentives if eligible
Open Argentine bank accounts (triggers FBAR)
Determine FEIE vs. FTC strategy
Register with AFIP

Year 2: Optimization

Review and adjust tax strategies
Maximize available deductions
Consider Argentine tax-advantaged investments
Plan investment strategy around PFIC rules
Evaluate property deductions if buying

Year 3-4: Mid-term Planning

Prepare for wealth tax implications
Consider permanent residency
Review pension planning
Evaluate business structure if self-employed

Year 5+: Long-term Considerations

Qualify for long-term benefits
Consider Argentine citizenship tax implications
Review estate planning needs

Pre-Return Year: Exit Planning

Understand emigration tax implications
Time asset sales appropriately
File final Argentine tax return
Obtain emigration documents
Plan for partial year residency

Frequently Asked Questions (FAQ)

Do I really need to file in both countries?

Yes. U.S. citizens must file U.S. returns regardless of where they live. Argentine residents must file Argentine returns. Use FTC or FEIE to avoid double taxation.
How does the wealth tax work?

Residents pay 0.5%-1.75% on worldwide assets over ARS 100,000,000. Exemptions for certain assets.
Can I avoid double taxation without a treaty?

Yes, through U.S. foreign tax credits for Argentine taxes paid.
Is health insurance mandatory?

Residents must have coverage; costs vary, subsidies for low income.
How are RSUs and stock options taxed?

Taxed as income when vested/exercised in Argentina; U.S. similar.
What about cryptocurrency?

Treated as assets, gains at 15%; U.S. every transaction taxable.
Can I keep my U.S. investment accounts?

Yes, but report for wealth tax; some brokers restrict.
Should I buy or rent?

Tax: Limited mortgage deduction, no capital gains on primary if held long.
How do I handle my 401(k) or IRA?

Distributions taxable in Argentina; professional advice needed.
What records should I keep?

7 years: income, banks, receipts, conversions, returns.

Your Path to Tax Success

Living in Argentina as an American presents unique tax challenges, but with proper understanding and planning, these challenges are entirely manageable. The key points to remember:

Argentine progressive system with wealth tax differs from U.S.
Comparable rates make Foreign Tax Credit advantageous.
No treaty, so rely on unilateral relief.
Avoiding PFIC investments is crucial.
Professional guidance is invaluable.

Argentina offers an exceptional quality of life, and while the tax system may seem complex initially, thousands of Americans successfully navigate it each year. With the knowledge from this guide and appropriate professional support when needed, you can confidently manage your tax obligations while enjoying everything Argentina has to offer.

Remember that tax laws change frequently. Stay informed through the AFIP and IRS websites, join expat communities, and don't hesitate to seek professional advice for complex situations. Your investment in proper tax planning will pay dividends in both peace of mind and potential tax savings throughout your Argentine journey.