General Discussion

For US citizens abroad, we get taxed at the full amount in the country of residence, no deductions, but we are not taxed in the USA. I wish it were that was for all income. A 50% income tax would be paradise compared to what I'm up against now. Here in Germany, I get taxed at 50% of the Social Security payout, no 15% deductions like US residents get. Also, since I still work for a U.S. employer and am paid in the USA, I also pay $9900 to the IRS in Social Security taxes deducted from my US wages. This leaves me, net effect, with about a 33% net take-home on what Social Security pays me out every month. Actually, due to Germany's denying relevant parts of the Double Taxation Treaty, this is pretty much in line with the approximate 73% effective income tax rate I have to pay between the USA and Germany. According to the latest form I got from Social Security, my 2026 monthly payout is about $5000, or $60,000 a year. The Germans take out half of that in taxes, so, I'm down to $30,000 a year. The USA takes $9900 in Social Security taxes, so that leaves $20,100 out of $60,000 that stays with me at the end of the year. It's better than nothing, and I have no say in the matter anyway. The German government definitely gets the best part of that deal.