US Taxes for Americans Living in New Zealand

Key takeaways

Moving to New Zealand does not end U.S. filing. The saving clause in Article 1(3) of the U.S.–New Zealand treaty (as replaced by the 2008 Protocol) lets the United States tax its citizens as if the treaty did not exist, except for a short list of carve-outs.
Social Security is the big treaty carve-out. Under Article 18(1)(b), social security payments made by one country to a resident of the other or to a U.S. citizen are taxable only in the paying country, and this rule is expressly exempt from the saving clause. In practice: U.S. Social Security is taxed only by the U.S.; New Zealand Superannuation received by a U.S. citizen resident in New Zealand is taxed only by New Zealand.
The foreign tax credit (FTC) usually beats the foreign earned income exclusion (FEIE) in New Zealand. New Zealand's top rates (33% from NZ$78,101 and 39% from NZ$180,001) generally produce more tax than the U.S. on the same wages, so the FTC typically reduces U.S. tax on NZ wages to zero, generates carryforwards, and keeps the refundable additional child tax credit available (it is barred for Form 2555 filers).
There is no U.S.–New Zealand totalization agreement. New Zealand is not on the Social Security Administration's list of agreement countries. U.S. self-employment tax applies to self-employed Americans in New Zealand, and neither the FEIE nor the FTC reduces it.
The treaty does not protect U.S. retirement accounts. The treaty contains no article that defers New Zealand tax on 401(k)/IRA/Roth growth or recognises Roth tax-free treatment. New Zealand has its own foreign-superannuation rules, with a 4-year exemption for lump sums for new residents.
New Zealand's FIF rules changed in 2026 in a way that specifically helps U.S. citizens. The Taxation (Annual Rates for 2025–26, Compliance Simplification, and Remedial Measures) Act 2026 (assent 30 March 2026, effective 1 April 2025) created an elective "revenue account method" taxing foreign shares on realisation (dividends plus 70% of gains), with an "extended" version open to people taxed on a citizenship basis, which Inland Revenue says can apply to all foreign shares, including listed ones.

Who this applies to, and why living in New Zealand changes nothing on the U.S. side

U.S. citizens are taxed on worldwide income wherever they live

IRS Publication 514 states that U.S. citizens are taxed by the United States on worldwide income wherever they live. The IRS FEIE page repeats that U.S. citizens and resident aliens living abroad are taxed on worldwide income. Moving to Auckland or Christchurch does not change this; it only changes which relief mechanisms are available.

This guide is written for U.S. citizens. Green card holders are also U.S. tax residents under the Code, but the treaty treats them differently (see the tie-breaker below).

The saving clause

The 2008 Protocol (Article I) replaced Article 1(3) of the 1982 Convention. The new paragraph provides that, except as provided in paragraph 4, the Convention does not affect each country's taxation of its residents (as determined under Article 4) and its citizens. It also allows a former citizen or former long-term resident to be taxed under domestic law for ten years after losing that status.

The Treasury Technical Explanation (TE) to the 2008 Protocol calls this "the traditional saving clause found in all U.S. tax treaties" and gives the example of a New Zealand resident who is also a U.S. citizen: the saving clause lets the U.S. include that person's income in worldwide income under normal Code rules.

What the saving clause does not override (Article 1(4))

Article 1(4) of the 1982 Convention was not amended by the Protocol. It preserves, even for U.S. citizens:

Preserved for everyone (Art. 1(4)(a))	Preserved only for non-citizens without immigrant status (Art. 1(4)(b))
Art. 9(2) correlative adjustments	Art. 19 Government Service
Art. 18(1)(b) social security	Art. 20 Students
Art. 22 Relief from double taxation	Art. 26 Diplomatic agents
Art. 23 Non-discrimination
Art. 24 Mutual agreement procedure

Practical consequence: a U.S. citizen in New Zealand can rely on the social security rule and on the treaty's foreign tax credit mechanics, but not on most other treaty limits on U.S. tax.

New Zealand residence, briefly

Inland Revenue's temporary tax exemption page describes the two residence tests relevant to new arrivals: being in New Zealand for more than 183 days in any 12-month period, or establishing a permanent place of abode. New Zealand residents are taxed on worldwide income, subject to the transitional resident exemption (section 6).

What the U.S.–New Zealand treaty actually says

Documents and dates

Convention: signed at Wellington on July 23, 1982; entered into force November 2, 1983.
Protocol: signed in Washington on December 1, 2008; entered into force November 12, 2010 (U.S. Treasury press release; New Zealand MFAT treaty record). Effective in the U.S. for withholding taxes on amounts paid on or after January 1, 2011 and for other taxes for taxable periods beginning on or after January 1, 2011; in New Zealand, for income years beginning on or after April 1, 2011 (Inland Revenue tax policy treaty page).
Technical Explanation: Treasury's TE to the 2008 Protocol. The TE states that where a paragraph of the existing Convention was not amended, the earlier technical explanation remains the official explanation. (The original 1982 Treasury Technical Explanation was not located among IRS treaty documents for New Zealand and was not reviewed; points below that depend on unamended 1982 text rely on the treaty text alone.)

Residence and the tie-breaker (Article 4)

The Protocol replaced Article 4(1). Residents are persons liable to tax by reason of domicile, residence, citizenship, place of management, place of incorporation or similar criteria. The original 1982 text expressly excluded from U.S. residence a person taxed "by reason of citizenship but who is not resident" in the U.S.; that exclusion does not appear in the replacement paragraph. (The TE to the Protocol does not comment on the removal of this exclusion, and its practical effect for U.S. citizens in New Zealand was not found in the sources reviewed.)

The individual tie-breaker in Article 4(2) runs, in order: permanent home available; centre of vital interests; habitual abode; nationality (the Protocol replaced "citizen" with "national" in sub-paragraphs (c) and (d)); then mutual agreement.

Why it matters less for citizens: because of the saving clause, a tie-breaker in New Zealand's favour does not stop the U.S. taxing a citizen. For a green card holder, the TE explains that someone who is a U.S. resident under the Code but tie-breaks to New Zealand is taxed by the U.S. only as the treaty allows, while still being treated as a U.S. resident for other purposes. The TE also notes that a person treated as a treaty resident of another country who does not waive treaty benefits is not treated as a lawful permanent resident for that year when counting toward "long-term resident" status, which matters for the U.S. expatriation rules.

How the main categories of income are allocated

Income	Article	Rule (summary of treaty text)	Effect for a U.S. citizen in NZ
Wages	15	Taxable where the employment is exercised (183-day / foreign-employer exception)	NZ taxes; U.S. also taxes via saving clause, with FTC
Self-employment / professional services	7 (Art. 14 deleted by Protocol)	Business profits taxable in residence state unless attributable to a permanent establishment	Same: both tax, U.S. credits NZ tax
Dividends	10 (replaced)	Source-state limit 15% (5% for 10%+ corporate holders; 0% for certain 80% corporate holdings)	U.S. dividends: U.S. taxes citizen fully; NZ credits only the 15% treaty-rate amount (Art. 22(2)); see re-sourcing below
Interest	11 (replaced)	Source-state limit 10%; exemptions for governments, government-guaranteed debt and unrelated banks/finance businesses
Royalties	12 (replaced)	Source-state limit 5%
Capital gains	13	Real property gains taxable where the property is; other gains generally only in residence state	Saving clause preserves U.S. tax on a citizen's gains
Private pensions	18(1)(a)	Pensions for past employment taxable only in residence state	NZ has the exclusive treaty right, but the U.S. still taxes citizens (saving clause)
Social security	18(1)(b)	Taxable only in the paying state, including when paid to a U.S. citizen	Exempt from saving clause (see Social Security below)
Annuities	18(2)	Taxable only in residence state	Saving clause applies
Government pay/pensions	19	Generally taxable only by paying state, with exceptions for residents who are citizens of the other state	Saving-clause carve-out applies only to non-citizens
Other income	21	Residence state, but source state may also tax

Relief from double taxation and the citizen "re-sourcing" rule (Article 22)

Article 22 is the engine for U.S. citizens in New Zealand:

Art. 22(1): the U.S. allows a credit for New Zealand income tax, subject to U.S. law limitations.
Art. 22(2): New Zealand credits U.S. tax on U.S.-source income of a New Zealand resident, but the credit cannot exceed the U.S. tax that would apply if the resident were not a U.S. citizen. For U.S. dividends, that means New Zealand gives credit for roughly the 15% treaty rate, not the full U.S. tax a citizen pays.
Art. 22(3): the U.S. then allows a credit for the New Zealand tax remaining after New Zealand's credit, without reducing the portion of U.S. tax that New Zealand credited.
Art. 22(4)(c): for this purpose, income of a New Zealand resident who is a U.S. citizen is deemed to arise in New Zealand to the extent needed.

The TE to the Protocol confirms that Article 1(4)(a) "preserves the benefits of special foreign tax credit rules applicable to the U.S. taxation of certain U.S. income of its citizens resident in New Zealand." The Form 1116 instructions note that U.S. citizens in certain treaty countries may claim an additional credit on U.S.-source income and refer to a worksheet in Publication 514. They also state that the separate-basket requirement for treaty re-sourced income does not apply to income re-sourced by double-taxation relief rules that apply solely to U.S. citizens resident in the treaty country, and that Form 8833 may be required for re-sourced income. (Whether New Zealand appears on Publication 514's list of treaty countries for the additional credit could not be confirmed; the portion of Publication 514 containing that list was not retrieved.)

What is distinctive about this treaty

Social security for U.S. citizens (Art. 18(1)(b)). The rule expressly covers payments to "a citizen of the United States" and is a saving-clause exception.
No pension-contribution or pension-accrual article. The table of articles contains no provision deferring tax on growth in the other country's retirement plans or relieving contributions to them. The Protocol added a definition of "pension fund" (which lists KiwiSaver schemes and, per the TE, U.S. 401(a), 403(b), 457(b) plans, IRAs and Roth IRAs), but the TE explains that this definition serves the residence and limitation-on-benefits provisions; it does not create a deferral rule.
No teachers/professors article. Only Article 20 (Students) exists.
Independent personal services article deleted. The Protocol removed Article 14; such income now falls under Articles 5 and 7.
Trust permanent establishment rule (Art. 7(9)). The TE says New Zealand requested this paragraph because, under New Zealand trust law, only trustees might otherwise be treated as having the permanent establishment, and that it was added solely to address New Zealand law.
Exit-tax coordination (Art. 13(7)). An individual taxed on a deemed disposition when ceasing residence in one country may elect a matching step-up in the other. The TE explains this was designed with the U.S. section 877A expatriation tax in mind.
New Zealand's credit cap for citizens (Art. 22(2)) described above.

FEIE vs. foreign tax credit in New Zealand

For the general mechanics of each tool, the stacking rule, and worked 2026 examples outside New Zealand-specific rates, see our guide on FEIE vs. Foreign Tax Credit.

The two tools

FEIE (Form 2555). To claim it, you need foreign earned income, a tax home in a foreign country, and either bona fide residence for an uninterrupted period that includes a full tax year or physical presence abroad for at least 330 full days in 12 consecutive months (IRS FEIE page). The 2026 maximum is $132,900 (IR-2025-103; Rev. Proc. 2025-32). Remaining income is taxed at the rates that would apply without the exclusion (the "stacking" rule, applied via the Foreign Earned Income Tax Worksheet). You cannot take a credit or deduction for foreign taxes on excluded income (Publication 514). If you revoke the choice and want to re-elect it within 5 tax years, you need IRS approval via a ruling request (IRS revocation page).

FTC (Form 1116). Credits New Zealand income tax against U.S. tax on foreign-source income, by category (general for wages, passive for interest and most dividends). Unused credits are carried back one year and forward ten (Publication 514, carryback example).

Why the FTC usually wins in New Zealand

New Zealand individual rates from 1 April 2025 (unchanged on Inland Revenue's page at the time of writing):

Taxable income (NZ$)	Rate
0 – 15,600	10.5%
15,601 – 53,500	17.5%
53,501 – 78,100	30%
78,101 – 180,000	33%
180,001 and over	39%

2026 U.S. single brackets: 10% to $12,400; 12% to $50,400; 22% to $105,700; 24% to $201,775; 32% to $256,225; 35% to $640,600; 37% above. 2026 standard deduction: $16,100 single / $32,200 joint (IR-2025-103).

Worked comparison, 2026, single filer, NZ wages only

Assumptions: wages are the only income; NZ tax is computed on the annual figure (ignoring the April–March vs. calendar-year mismatch and ACC levies); conversion at 1.719 NZ$ per US$, the IRS 2025 yearly average for New Zealand, used as a proxy because the IRS 2026 average will not be published until 2027. (The actual 2026 average rate is unknown; results scale with it.)

Salary (NZ$)	In US$	NZ income tax	NZ tax in US$	U.S. tax before credits (std. deduction)	Excess credits carried forward	U.S. tax with FEIE
100,000	58,173	NZ$22,877.50 (22.9%)	13,309	4,801	8,508	0
150,000	87,260	NZ$39,377.50 (26.3%)	22,907	10,367	12,540	0
300,000	174,520	NZ$96,077.50 (32.0%)	55,892	30,619	25,273	6,125 before credits on the non-excluded slice; 0 after crediting the NZ tax allocable to it

Reading the table:

At ordinary NZ salaries, both methods usually bring U.S. tax on wages to zero. The difference is in the side effects.
FTC side effects: excess credits carry forward (useful if you later have higher-taxed years, or U.S. tax on foreign-source general income); you can still claim the refundable additional child tax credit, which Schedule 8812 states is not available if you file Form 2555.
FEIE side effects: simpler for some filers, but above $132,900 of earnings you need the FTC as well for the excess, and the 5-year re-election restriction applies if you later switch.
IRA contributions: the IRS international IRA page states that excluded amounts must be added back when determining compensation for IRA limits, while also stating contributions are limited to compensation "includible in your gross income." (How these two statements interact for an FEIE filer should be confirmed against Publication 590-A, which was not reviewed for this guide.) With the FTC, NZ wages remain U.S. gross income and count as compensation without that question arising.

Timing mismatch

New Zealand's tax year runs 1 April–31 March; the U.S. year is the calendar year. Publication 514 explains that, on the accrual method, foreign taxes generally accrue on the last day of the foreign tax year, and that cash-method taxpayers can elect to claim credits when taxes accrue (by checking "Accrued" on a timely original Form 1116; once made, the choice binds later years). Many NZ residents need this election to align NZ tax with the U.S. year. (The best method for a given taxpayer depends on facts; no IRS guidance specific to the NZ April–March year was found.)

No agreement

The SSA's list of countries with which the U.S. has social security agreements (31 countries, most recently Romania effective September 1, 2026) does not include New Zealand.

Employees

Working for a New Zealand employer: New Zealand does not levy a social security payroll tax comparable to FICA; employees pay the ACC earners' levy (1.75% for 1 April 2026–31 March 2027, on earnings up to NZ$156,641, maximum NZ$2,741.22 — Inland Revenue). Whether U.S. FICA applies to a U.S. citizen working for a non-U.S. employer abroad was not addressed in the sources reviewed. (IRS guidance on FICA for U.S. citizens employed by foreign employers was not retrieved; the SSA overview describes U.S. coverage extending to citizens employed abroad by American employers.)
Working for an American employer (or a foreign affiliate covered by a section 3121(l) agreement): the SSA states U.S. Social Security covers U.S. citizens employed abroad by American employers regardless of assignment length. Without an agreement, there is no certificate-of-coverage mechanism to exempt anyone.
ACC levy and the FTC: (Whether the ACC earners' levy is a creditable foreign income tax under Treas. Reg. §1.901-2 was not determined; Publication 514 explains that taxes funding retirement, disability and similar benefits are not payment for a specific economic benefit if not based on individual characteristics, but no IRS position on the ACC levy was found.)

Self-employed

The SSA states U.S. Social Security covers self-employed U.S. citizens wherever they work.
The IRS self-employment-tax-abroad page states you must pay SE tax if net earnings from self-employment are $400 or more, and that you must pay SE tax on all net profit even if you claim the FEIE. The Schedule SE instructions say foreign self-employment earnings cannot be reduced by the FEIE.
With no totalization agreement, there is no New Zealand certificate of coverage to claim exemption. U.S. SE tax is therefore a real, unavoidable cost for self-employed Americans in New Zealand. (The 15.3% combined rate, the 92.35% net-earnings factor and the 2026 Social Security wage base were not re-confirmed from 2026 IRS sources for this guide.)

Benefits in retirement

U.S. Social Security received while living in New Zealand: Article 18(1)(b) — taxable only in the United States.
New Zealand Superannuation received by a U.S. citizen resident in New Zealand: taxable only in New Zealand under Article 18(1)(b), and Article 1(4)(a) keeps this out of the saving clause. (No IRS publication confirming this specific treatment for NZ Superannuation was found; whether Form 8833 disclosure is required or an exception under Treas. Reg. §301.6114-1 applies was not determined.)
The SSA overview explains that without an agreement, careers split between two countries cannot be "totalized" to meet U.S. insured-status requirements.

U.S. retirement accounts (401(k), IRA, Roth)

What the treaty says — and doesn't

No deferral or Roth protection. As noted, the treaty has no article requiring New Zealand to defer tax on growth inside U.S. plans or to respect Roth tax-free status.
Distributions: Article 18(1)(a) gives the residence state (New Zealand) the exclusive treaty right to tax "pensions and other similar remuneration ... in consideration of past employment." The U.S. still taxes citizens via the saving clause. Under Article 22(4)(b), New Zealand treats U.S. income as U.S.-arising for its credit only if the U.S. may tax it under the Convention other than solely because of citizenship; for a citizen's pension the U.S. taxes only because of citizenship, so the intended result appears to be that New Zealand taxes first and the U.S. credits New Zealand tax under Article 22(3)/(4)(c). (This reading is drawn from the treaty text; no IRS or Treasury guidance applying it to 401(k)/IRA distributions was found. Whether IRA distributions (not tied to employment) fall under Article 18(1)(a) or Article 21 (Other Income) was not found in the sources reviewed.)

What New Zealand does on its side

Inland Revenue's foreign superannuation page describes:

Periodic pension payments: most treaties give New Zealand the right to tax pensions, so most people pay NZ tax on them.
Lump-sum withdrawals and transfers (to New Zealand or Australia): taxed under the schedule method (default — tax on a percentage that rises with years of NZ residence) or the formula method (tax on actual gains). A New Zealand scheme offering "scheme pays" can pay 28% on the assessable amount for transfers.
4-year exemption: lump sums within roughly four years of becoming resident are exempt (start/end dates track the 183-day and permanent-place-of-abode tests).
Interests in foreign superannuation schemes have, since 1 April 2014, only been taxed under the FIF rules if they are a "FIF superannuation interest" (Inland Revenue FIF exemptions page).

(No Inland Revenue guidance specifically classifying U.S. 401(k)s, traditional IRAs or Roth IRAs as "foreign superannuation schemes" was found; the classification determines which rules apply.)

The Roth problem: because the treaty does not require New Zealand to follow U.S. Roth treatment, a Roth withdrawal that is tax-free in the U.S. may still be taxable in New Zealand under the lump-sum rules — with no U.S. tax to credit. (No primary source confirming New Zealand's treatment of a qualified Roth distribution was found.)

Contributions after you move

A NZ employer cannot contribute to your 401(k), and New Zealand gives no deduction for IRA contributions (no such provision was found in the treaty or Inland Revenue sources reviewed).
U.S. IRA limits for 2026: $7,500, or $8,600 if 50 or older (IRS international IRA page). See the FEIE interaction point in FEIE vs. foreign tax credit above.

Local investments: PFICs, KiwiSaver and the FIF regime

For the full mechanics of the default §1291 regime, the QEF and mark-to-market elections, and Form 8621 reporting, see our guide on PFICs.

PFIC risk on New Zealand funds

Form 8621 instructions define a PFIC as a foreign corporation meeting either the income test (75% or more of gross income is passive) or the asset test (at least 50% of assets produce passive income). Default (section 1291) treatment taxes "excess distributions" and all gains on disposal at the highest rate for each prior year with an interest charge; QEF and mark-to-market elections are alternatives.

New Zealand unit trusts, PIE funds and ETFs domiciled outside the U.S. are commonly PFICs if classified as corporations for U.S. purposes. (U.S. entity classification of specific NZ fund structures (unit trusts, PIEs) was not confirmed from a primary source.)
Filing: generally one Form 8621 per PFIC. An exception from Part I applies if aggregate PFIC stock is $25,000 or less ($50,000 joint) at year-end and there was no excess distribution or disposition gain.
An exception from Part I also exists for PFICs held through "an arrangement treated as a foreign pension fund under a U.S. income tax treaty" (Treas. Reg. §1.1298-1(c)(4)). (Whether KiwiSaver qualifies is unclear. The NZ treaty defines KiwiSaver as a "pension fund" for residence and limitation-on-benefits purposes but contains no rule treating it as a pension for deferral; no IRS guidance on this point was found.)

KiwiSaver

Contributions (NZ side): the default employee and employer rate rose from 3% to 3.5% on 1 April 2026 and is scheduled to rise to 4% on 1 April 2028; the government contribution is 25 cents per dollar, capped at NZ$260.72 a year, and is not available to people earning over NZ$180,000 (Inland Revenue; business.govt.nz).
U.S. side: no IRS guidance specific to KiwiSaver was found. Key open questions, none confirmed in a primary source: whether employer contributions are U.S. income when made (e.g., under section 402(b) rules for non-qualified foreign plans); whether the scheme is a foreign grantor trust; whether annual growth is currently taxable; and PFIC exposure on underlying funds.
Foreign trust reporting (Forms 3520/3520-A): Rev. Proc. 2020-17 exempts "tax-favored foreign retirement trusts" that meet six conditions. KiwiSaver appears to meet the "tax-favored" limb through the government contribution, which the Rev. Proc. lists as a qualifying tax benefit. However, condition (3) requires that only contributions from personal-services income be permitted, and condition (4) requires contributions to be limited by a percentage of earned income, $50,000 a year, or $1,000,000 lifetime. (Whether KiwiSaver meets conditions (3) and (4) was not confirmed; KiwiSaver's rules on voluntary contributions were not reviewed against them.) Rev. Proc. 2020-17 does not affect FBAR or Form 8938 reporting.

New Zealand's FIF regime and the new revenue account method

Standard FIF rules (Inland Revenue): individuals whose attributing FIF interests cost NZ$50,000 or less in total do not calculate FIF income; if the threshold is exceeded at any time, all interests are subject to the rules. Common methods tax 5% of opening market value (fair dividend rate) or, for individuals, actual return if lower (comparative value). New Zealand and Australian-resident listed companies and NZ PIE holdings are outside the personal threshold calculation. (The PIE exclusion and the "whole portfolio once over threshold" point are described by Kernel Wealth and become.nz, non-government sources; Inland Revenue's exemptions page confirms the threshold rule in general terms.)

Why this collides with U.S. tax: Inland Revenue's own Act commentary states that double taxation can arise because the FIF rules tax unrealised income while another country taxes gains on sale, with neither tax creditable against the other, and that this "is particularly an issue for United States (US) citizens and Green Card holders."

The revenue account method (RAM), from 1 April 2025 — per Inland Revenue's Act commentary (published 12 May 2026):

Elective; taxes dividends at marginal rates and 70% of disposal gains or losses; losses ring-fenced to RAM income and carried forward.
Eligible people: natural persons who became NZ resident (not transitional, not treaty-non-resident) on or after 1 April 2024 and were non-resident for at least five years before; transitional residents whose transitional residence ends on or after 31 March 2024 can qualify. A family trust qualifies if its principal settlor does.
Ordinary RAM: only pre-residence, unlisted foreign shares with no effective redemption facility.
Extended RAM: available to a person "generally liable to tax in another country on the disposal of those shares on the basis of their citizenship or a right to work and live in that country," where that country has a tax treaty with New Zealand. Inland Revenue's own example is a U.S. citizen. The commentary states the extended RAM may apply to all foreign shares. (Whether "all foreign shares" covers interests in foreign mutual funds/ETFs organised as unit trusts was not confirmed; the commentary's examples address shares and an index fund only in the ordinary-RAM context.)
Election timing: in the first year the person has FIF income (generally the later of the end of transitional residence and exceeding the NZ$50,000 threshold). Electing out later triggers a deemed disposal and cannot be undone.
Exit: leaving New Zealand triggers a deemed disposal at market value, which crystallises only if the interest is sold within three years of departure. Renouncing U.S. citizenship ends extended-RAM eligibility with a deemed disposal of listed/redeemable shares.
Corporate reorganisations: for extended RAM interests, NZ treatment follows the U.S. treatment (e.g., a tax-free U.S. share-for-share exchange is also non-taxable in NZ).
Pending changes: (Deloitte NZ reports (September 2026) that the Taxation (Annual Rates for 2026–27, FBT Simplification, Foreign Investment Funds, and Remedial Measures) Bill proposes raising the de minimis threshold to NZ$100,000 from 1 April 2026 and widening RAM access; this is a bill, not law, and was not verified on Inland Revenue's site.)

Transitional residents

Inland Revenue: new migrants who were not NZ tax resident in the previous 10 years automatically get a roughly four-year exemption on most foreign-source income (interest, dividends, FIF income, rent), but not on employment or personal-services income. The exemption ends early if you apply for Working for Families, include exempt income in your IR3, or tell Inland Revenue you no longer want it.

U.S. interaction: during this window, U.S.-source investment income bears no NZ tax, so there is no NZ tax to credit — the U.S. tax on it is a real cost (as it would be in the U.S.).

FBAR, FATCA and banking

FBAR (FinCEN Form 114)

Required if the aggregate value of foreign financial accounts exceeds $10,000 at any time in the calendar year; filed with FinCEN, not the IRS; due April 15 with an automatic extension to October 15 (IRS comparison chart).
Penalties: inflation-adjusted civil penalties; the chart cites pre-August 2016 figures of up to $10,000 non-wilful and the greater of $100,000 or 50% of balances for wilful violations, plus possible criminal penalties.
KiwiSaver: (Whether a KiwiSaver account is an FBAR-reportable "financial account" was not confirmed from FinCEN's FBAR instructions, which were not reviewed. The IRS comparison chart marks foreign mutual funds as reportable on both FBAR and Form 8938.)

Form 8938 (FATCA)

Thresholds for taxpayers living outside the U.S.: more than $200,000 at year-end or $300,000 at any time (single/MFS); $400,000 / $600,000 (joint). Filed with the return (IRS comparison chart).
Penalty: up to $10,000, plus $10,000 for each 30 days after IRS notice, up to $60,000.
Rev. Proc. 2020-17 notes that specified foreign financial assets include interests in certain foreign retirement, pension and non-retirement savings funds (Treas. Reg. §1.6038D-3) — relevant for KiwiSaver.

FATCA in New Zealand and bank access

New Zealand's FATCA agreement with the U.S. entered into force on 3 July 2014 and is implemented by the Double Tax Agreements (United States of America – FATCA) Order 2014 (Inland Revenue tax policy treaty page). (The agreement's model type and its specific reporting mechanics were not reviewed.)

(Whether New Zealand banks or fund managers restrict accounts for U.S. persons was not found in primary sources; anecdotal reports exist but are not relied on here.) Separately, some U.S. brokerages may restrict accounts for customers with foreign addresses. (Not confirmed from a primary source.)

State taxes: the domicile principle

For the general mechanics of state domicile tests, see our guide on state taxes after moving abroad. Leaving the U.S. does not automatically end state tax residence. States generally tax based on domicile or statutory residence, and some states make it difficult to break domicile while you keep a home, driver's licence, voter registration or other ties there. If you lived in a state that taxes worldwide income before moving to New Zealand, document the change of domicile at the time you leave. State rules differ and were not reviewed for this guide. (No state-specific primary sources were reviewed; the treaty does not cover state income taxes except for Article 23 non-discrimination, per the TE.)

Full worked example (2026)

Profile: Sam, U.S. citizen, single, no children, moved to Wellington in 2020 (transitional residence long expired). In calendar year 2026:

Salary from a NZ employer: NZ$150,000 (assume the same rate across both NZ tax years touched by 2026)
NZ bank interest: NZ$2,000 (resident withholding tax at 33%)
KiwiSaver at the 3.5% default
No U.S.-source income; no FIF interests above the threshold

Exchange rate: 1.719 NZ$/US$ (IRS 2025 yearly average used as a 2026 proxy). (Actual 2026 rate.)

New Zealand side

Item	NZ$
Income tax on NZ$150,000 (1,638 + 6,632.50 + 7,380 + 23,727)	39,377.50
RWT on interest (33%)	660.00
ACC earners' levy (1.75% × 150,000; under the NZ$156,641 cap)	2,625.00
Employee KiwiSaver contribution (3.5%; from after-tax pay)	5,250.00

U.S. side (FTC route)

Line	US$
Wages (150,000 ÷ 1.719)	87,260
Interest (2,000 ÷ 1.719)	1,163
AGI	88,424
Standard deduction	(16,100)
Taxable income	72,324
Tax: 1,240 + 4,560 + 22% × 21,924	10,623
FTC limitation — general basket (wages)	10,483
FTC limitation — passive basket (interest)	140
NZ tax available — general (39,377.50 ÷ 1.719)	22,907 → credit 10,483; carryforward 12,424
NZ tax available — passive (660 ÷ 1.719)	384 → credit 140; carryforward 244
U.S. income tax due	0

Notes on simplifications:

The ACC levy is excluded from the credit. (Creditability not determined.)
Employer KiwiSaver contributions (3.5% = NZ$5,250, subject to NZ employer superannuation contribution tax) are excluded. (Whether and when they are U.S. income was not determined.)
The calendar/NZ-year mismatch is ignored; in practice NZ tax must be matched to the correct U.S. year (see FEIE vs. foreign tax credit above).

U.S. side (FEIE route)

Excluding US$87,260 of wages leaves interest of US$1,163, below the standard deduction: U.S. tax 0, but no carryforwards, and the NZ tax on the excluded wages is permanently unusable for U.S. purposes.

Filings Sam still needs

Form 1040 with Form 1116 (two baskets) — due June 15, 2027 under the automatic 2-month extension for taxpayers living abroad, with a statement attached (IRS); interest runs on any tax unpaid after April 15.
FBAR if aggregate NZ accounts (including, potentially, KiwiSaver) exceed $10,000 at any time.
Form 8938 only if specified foreign financial assets exceed $200,000 at year-end or $300,000 at any time.
Any PFIC, foreign trust or Form 8833 filings that apply to KiwiSaver or NZ funds (see Local investments above).

Common mistakes Americans make after moving to New Zealand

Stopping U.S. filing on the assumption that NZ tax or the treaty replaces it. The saving clause says otherwise.
Claiming the FEIE by default without testing the FTC, losing carryforwards and, for families, the refundable additional child tax credit.
Assuming the treaty protects a Roth IRA or 401(k) in New Zealand. It contains no such article.
Buying NZ unit trusts, PIE funds or non-U.S. ETFs without considering PFIC treatment.
Ignoring the FIF threshold for U.S. brokerage holdings once transitional residence ends — and, for eligible U.S. citizens, missing the one-time timing for the RAM election.
Forgetting U.S. self-employment tax as a contractor or sole trader in New Zealand; there is no totalization agreement to exempt you.
Mismatching tax years — reporting NZ tax for the April–March year against the wrong U.S. calendar year.
Leaving KiwiSaver off FBAR/Form 8938 without analysis.
Not documenting a change of state domicile before leaving the U.S.
Assuming NZ will fully credit U.S. tax on U.S. dividends. Article 22(2) caps NZ's credit at the non-citizen treaty rate; the rest is handled by the U.S. re-sourcing credit.

Frequently asked questions

Do I still have to file a U.S. return if I pay all my tax in New Zealand?

Yes. The treaty's saving clause (Art. 1(3), as replaced by the 2008 Protocol) preserves U.S. taxation of citizens, and IRS Publication 514 confirms citizens are taxed on worldwide income wherever they live. Credits or the FEIE may reduce the U.S. tax to zero, but the return is still due.

No, under the treaty. Article 18(1)(b) makes social security payments taxable only in the paying country, including payments to a U.S. citizen, and Article 1(4)(a) keeps this rule outside the saving clause.

Is there a totalization agreement between the U.S. and New Zealand?

No. New Zealand is not on the SSA's list of agreement countries. Self-employed U.S. citizens owe U.S. self-employment tax on net earnings of $400 or more, and the FEIE does not reduce it (IRS).

FEIE or foreign tax credit — which should I use in New Zealand?

Usually the FTC. NZ rates (33% from NZ$78,101; 39% from NZ$180,001) generally exceed U.S. tax on the same wages, so the FTC typically eliminates U.S. tax on NZ wages, builds carryforwards, and keeps the refundable additional child tax credit, which Schedule 8812 bars for Form 2555 filers. Model your own numbers before electing.

Is my KiwiSaver a PFIC or a foreign trust?

Not confirmed. No IRS guidance specific to KiwiSaver was found. Rev. Proc. 2020-17 may exempt it from Forms 3520/3520-A only if it meets all six "tax-favored foreign retirement trust" conditions, which has not been confirmed; PFIC treatment of underlying funds is an open question. Get advice specific to your scheme.

Can I use New Zealand's new revenue account method for my U.S. brokerage account?

Possibly. Inland Revenue's Act commentary says the "extended" RAM is available to eligible people taxed on a citizenship basis by a treaty country (its example is a U.S. citizen) and can apply to all foreign shares, taxing dividends plus 70% of realised gains. You must meet the residence conditions (resident from 1 April 2024 after five years' non-residence, or transitional residence ending on or after 31 March 2024) and elect in the first year you have FIF income.

When to hire a professional

Consider cross-border advice (a U.S. preparer experienced with Form 1116 and PFICs, working alongside a New Zealand chartered accountant) if any of these apply:

You hold KiwiSaver, NZ unit trusts/PIE funds or non-U.S. ETFs.
You hold U.S. shares or funds costing more than NZ$50,000 and need to choose a FIF method, including whether to elect the RAM.
You plan withdrawals or transfers from a 401(k), IRA or Roth while NZ resident.
You are self-employed, own a company or are a beneficiary/settlor of a NZ trust.
You are a green card holder (treaty tie-breaker and expatriation consequences).
You have unfiled U.S. returns or FBARs — see our guide on the Streamlined Filing Compliance Procedures.
You are considering renouncing U.S. citizenship — see our guide on the US exit tax (Art. 13(7) election; NZ extended-RAM deemed disposal).

Sources

Source	URL	Used for	Page date
IRS — New Zealand tax treaty documents	https://www.irs.gov/businesses/international-businesses/new-zealand-tax-treaty-documents	Index of Convention, Protocol, TE	Last reviewed 13-Aug-2026
U.S.–New Zealand Income Tax Convention (1982)	https://www.irs.gov/pub/irs-trty/newzld.pdf	Arts. 1, 4, 7, 10–23 text; signature and entry into force	Signed 23 Jul 1982
Protocol amending the Convention (2008)	https://home.treasury.gov/system/files/131/Treaty-NewZealand-Protocol-12-1-2008.pdf	Replaced Arts. 1(3), 2, 3, 4(1), 10–12, 16, 22, 23, 25; deletion of Art. 14	Signed 1 Dec 2008
Treasury Technical Explanation of the 2008 Protocol	https://home.treasury.gov/system/files/131/Treaty-NewZealand-Protocol-TE-11-6-2009.pdf	Saving clause, residence, pension-fund definition, Art. 7(9), Art. 13(7)	Dated 6 Nov 2009 (per file name)
U.S. Treasury press release tg958	https://home.treasury.gov/news/press-releases/tg958	Protocol entry into force and effective dates	Not shown
NZ MFAT treaty record	https://www.treaties.mfat.govt.nz/search/details/t/3663/318	Protocol entry into force 12/11/2010	Not shown
Inland Revenue Tax Policy — United States treaty page	https://taxpolicy.ird.govt.nz/tax-treaties/united-states-america	Effective dates; FATCA agreement in force 3 Jul 2014	Not shown
SSA — U.S. International Social Security Agreements	https://www.ssa.gov/international/agreements_overview.html	No NZ agreement; coverage of citizens abroad and self-employed	Not shown (certified 2019-11-25 metadata; list includes 2026 entry)
IRS IR-2025-103 (2026 inflation adjustments)	https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill	2026 brackets, standard deduction, FEIE $132,900	9-Oct-2025
IRS — Foreign earned income exclusion	https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion	FEIE tests; SE tax not reduced; stacking	Last reviewed 12-Jun-2026
IRS — Revoking the FEIE choice	https://www.irs.gov/individuals/international-taxpayers/revoking-your-choice-to-exclude-foreign-earned-income	5-year re-election rule	Last reviewed 14-Mar-2026
IRS — Individual retirement arrangements (international)	https://www.irs.gov/individuals/international-taxpayers/individual-retirement-arrangements	2026 IRA limits; FEIE add-back language	Last reviewed 06-Aug-2026
IRS Publication 514 (2025)	https://www.irs.gov/publications/p514	Worldwide taxation; credit choice; carryback/forward; FEIE disallowance; accrual rules; social-security-type taxes	2025 edition
Instructions for Form 1116 (2025)	https://www.irs.gov/instructions/i1116	Baskets; treaty re-sourcing; Form 8833; additional credit for citizens	2025
Instructions for Form 8621 (12/2025)	https://www.irs.gov/instructions/i8621	PFIC definition; $25,000/$50,000 exception; pension-fund exception	Rev. 12/2025; last reviewed 30-Apr-2026
Rev. Proc. 2020-17	https://www.irs.gov/pub/irs-drop/rp-20-17.pdf	Tax-favored foreign retirement trust conditions	2020
IRS — Comparison of Form 8938 and FBAR requirements	https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements	Thresholds, due dates, penalties, asset types	Last reviewed 19-Sep-2026
IRS — Yearly average currency exchange rates	https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates	NZD 2025 average 1.719	Last reviewed 17-Sep-2026
IRS — Self-employment tax for businesses abroad	https://www.irs.gov/Individuals/International-Taxpayers/Self-Employment-Tax-for-Businesses-Abroad	$400 threshold; FEIE does not reduce SE tax	Not shown
Instructions for Schedule SE (2025)	https://www.irs.gov/pub/irs-prior/i1040sse--2025.pdf	FEIE cannot reduce SE earnings	23-Oct-2025
Schedule 8812 (Form 1040) 2025 draft	https://www.irs.gov/pub/irs-dft/f1040s8--dft.pdf	ACTC not available with Form 2555	Created 30-Jul-2025
IRS — Automatic 2-month extension for citizens abroad	https://www.irs.gov/individuals/international-taxpayers/us-citizens-and-resident-aliens-abroad-automatic-2-month-extension-of-time-to-file	June 15 due date; statement; interest	Not shown
Inland Revenue — Tax rates for individuals	https://www.ird.govt.nz/income-tax/income-tax-for-individuals/tax-codes-and-tax-rates-for-individuals/tax-rates-for-individuals	NZ rates from 1 April 2025	Last updated 03-Jun-2025
Inland Revenue — Temporary tax exemption	https://www.ird.govt.nz/roles/nz-tax-residents/exemption	Transitional resident rules; residence tests	Last updated 17-Jun-2026
Inland Revenue — Foreign superannuation	https://www.ird.govt.nz/income-tax/income-tax-for-individuals/types-of-individual-income/foreign-superannuation	Lump-sum methods; 4-year exemption; pensions	Last updated 29-Sep-2026
Inland Revenue — FIF rules exemptions	https://ird.govt.nz/income-tax/income-tax-for-businesses-and-organisations/types-of-business-income/foreign-investment-funds-fifs/foreign-investment-fund-rules-exemptions	NZ$50,000 threshold; foreign super FIF rule since 2014	Not shown
Inland Revenue — Act commentary, Taxation (Annual Rates for 2025–26, Compliance Simplification, and Remedial Measures) Act 2026	https://www.taxpolicy.ird.govt.nz/publications/2026/ac-compliance-simplification-act	Revenue account method; extended RAM; US-citizen double tax issue	Published 12-May-2026
NZ Legislation — Act 2026 No 8	https://legislation.govt.nz/act/public/2026/8/en/latest/	Assent date 30 March 2026	Not shown
Inland Revenue — KiwiSaver changes	https://www.ird.govt.nz/kiwisaver-changes	3.5% default from 1 April 2026; 4% from 2028; government contribution	Last updated 13-Mar-2026
business.govt.nz — KiwiSaver changes	https://www.business.govt.nz/news/get-ready-for-kiwisaver-changes	NZ$180,000 income cut-off for government contribution	Not shown
Inland Revenue — ACC earners' levy rates	https://www.ird.govt.nz/income-tax/income-tax-for-individuals/acc-clients-and-carers/acc-earners-levy-rates	1.75% and NZ$156,641 cap for 2026–27	Not shown
Kernel Wealth (secondary)	https://kernelwealth.co.nz/blog/the-usd50-000-tax-question-understanding-the-de-minimis-rule	PIE exclusion from threshold	Not shown
become.nz (secondary)	https://www.become.nz/articles/fif-rules-nz-overseas-investment-tax-guide	Whole-portfolio rule once over threshold	Not shown
Deloitte NZ (secondary)	https://www.deloitte.com/nz/en/services/tax/perspectives/the-fifth-wave-the-fif-reforms-continue.html	2026–27 bill proposals	Sep-2026

A note on scope: this guide is general information, not tax or legal advice. Which treaty provisions and elections apply to you, how the saving clause and Article 1 interact in your case, and how New Zealand treats your specific accounts all depend on your own facts. Get advice from a US preparer experienced with Forms 1116, 8621 and 8938 and a New Zealand tax adviser before you rely on anything in this guide.

U.S. Taxes for Americans Living in New Zealand: The 2026 Guide