What Should I Consider If Im An American Moving To Germany

Relocating from the United States to Germany can be an exciting new chapter, whether for work, retirement, or a lifestyle change. But before you hop on that international flight, it’s essential to understand the key financial, legal, and cultural considerations that come with living abroad. Here’s what to think about before making the move.

Understand Your Tax Obligations

For any American moving to Germany, understanding your tax obligations is essential. Unlike most countries, the United States taxes its citizens on their worldwide income, even if they live abroad permanently. This means that even after relocating to Germany, you must file a U.S. federal tax return every year—and potentially pay U.S. taxes—regardless of where your income is earned.

At the same time, Germany also taxes worldwide income for its residents, which can lead to double taxation. However, the U.S.–Germany Tax Treaty and the Foreign Account Tax Compliance Act (FATCA) help mitigate this. The treaty determines which country has taxing rights over specific types of income (like pensions or dividends), and helps you avoid being taxed twice on the same earnings.

In 2025, if you qualify for the Foreign Earned Income Exclusion (FEIE), you can exclude up to $126,500 of foreign-earned income from U.S. taxation. Another tool is the Foreign Tax Credit (FTC), which allows you to offset your U.S. tax liability by the amount you’ve already paid to the German tax authorities. Depending on your situation, you may use one or a combination of these strategies.

Keep in mind: these benefits come with strict eligibility rules, filing deadlines, and reporting obligations, including FBAR (Report of Foreign Bank and Financial Accounts) if you hold more than $10,000 across foreign accounts at any point in the year.

Given the complexity, it’s highly recommended for any American moving to Germany to work with a cross-border tax professional. They can help you structure your finances efficiently, stay compliant in both countries, and avoid costly errors or penalties.

Secure the Right Residency and Health Coverage

Your first legal step is to secure the appropriate residency status. U.S. citizens can enter Germany without a visa for up to 90 days, but if you plan to stay longer—whether for work, family, retirement, or study—you’ll need a residence permit (Aufenthaltstitel).

There are several types of permits, including:

• Employment residence permits (for those with job offers from German employers)
• Freelancer/entrepreneur visas (for self-employed individuals)
• Retirement or family reunification permits
• EU Blue Card (for highly skilled professionals)

Each comes with specific requirements around proof of income, housing, and health insurance.

Speaking of which, health insurance is mandatory in Germany. You must show proof of coverage when applying for a residence permit. Germany has two main types:

1. Statutory Public Health Insurance (Gesetzliche Krankenversicherung)
   Most employees earning under €69,300 per year (2025 threshold) are required to join a public insurance provider. Contributions are income-based and shared between employee and employer. Coverage is comprehensive and includes doctor visits, hospital care, prescriptions, and maternity care.
2. Private Health Insurance (Private Krankenversicherung)
   Available to high earners, freelancers, and the self-employed, private plans can offer faster access to specialists and more customisable benefits. However, premiums are based on age, health status, and selected coverage—making it potentially more expensive over time.

Choosing the right health coverage as an American moving to Germany depends on your employment status, income level, age, and long-term plans. It’s worth discussing your options with a professional to make an informed, sustainable decision that satisfies both your needs and German legal requirements.

Plan for Retirement and Social Security

Relocating across borders can significantly affect your estate planning, especially if your existing will and legal documents were drawn up under U.S. law. Germany has its own set of inheritance rules, which differ considerably from those in the United States. For example, German inheritance law includes forced heirship, meaning certain family members—such as children and spouses—are legally entitled to a portion of your estate, regardless of what your will states.

This can create unintended complications if your U.S. estate plan doesn’t align with local laws. Additionally, inheritance tax (Erbschaftsteuer) in Germany applies to both residents and non-residents, and the rates vary depending on the relationship between the deceased and the heir, as well as the size of the estate. While U.S. citizens may also face federal estate taxes (above certain thresholds), Germany’s inheritance tax may apply independently.

If you have assets in both countries, you may need two wills—one in the U.S. and one in Germany—to have your wishes are carried out correctly. Coordination is key: poorly integrated wills can invalidate one another or lead to delays in probate.

For those with children or dependents, powers of attorney and health care directives should also be reviewed and adapted for German legal recognition. Working with estate planning professionals who understand the interplay between U.S. and German law is vital to protect your legacy and prevent unnecessary legal hurdles.

Review Your Investment and Banking Options

Germany is known for its efficient bureaucracy—but that doesn’t always mean it’s easy to navigate. Expect detailed paperwork, strict appointment systems, and a heavy reliance on in-person processes for tasks like registering your residence, setting up utilities, or applying for visas. Understanding the local concept of “Ordnung” (order) can help ease frustrations—things are done by the book, and you’re expected to follow suit.

One of the first steps after moving is registering your address at the local Einwohnermeldeamt (residents’ registration office). This registration, known as Anmeldung, is a legal requirement and necessary for obtaining your tax ID, signing up for health insurance, and opening a bank account.

Language barriers can add another layer of complexity. While many Germans speak English, official documents and procedures are often in German only. Learning basic phrases or hiring a relocation consultant or interpreter for critical appointments can make a big difference.

Socially, the culture may feel more formal than what you’re used to in the U.S. Titles are respected, punctuality is essential, and personal privacy is deeply valued. But once you’re settled, you’ll likely find strong community structures, excellent public services, and a high quality of life.

For those building a new life abroad, embracing these differences rather than resisting them is often the key to a smooth transition. With the right mindset—and a bit of patience—adjusting to your new home becomes far more rewarding.

Estate Planning and Legal Considerations

Relocating to another country isn’t just a logistical shift—it can have serious implications for your estate plan. Many Americans are surprised to learn that German inheritance laws operate quite differently from those in the U.S., and failing to adjust your estate documents accordingly can lead to unintended consequences.

In Germany, forced heirship laws apply. This means that certain heirs—such as children and spouses—are entitled to a portion of your estate by default, even if your U.S. will specifies otherwise. If your estate plan includes unequal distributions or disinherits a family member, it’s especially important to review how these provisions may be treated under German law.

Taxation is another area where differences matter. Germany imposes inheritance tax (Erbschaftsteuer) based on the relationship between the deceased and the beneficiary, with tax-free thresholds and rates that can differ significantly from U.S. estate tax rules. While the U.S. has generous federal exemptions (over $13 million per individual in 2025), Germany’s thresholds are much lower, especially for distant relatives or non-family beneficiaries.

For those with cross-border assets, a dual-will strategy is often worth exploring—one will to handle U.S.-based assets under American law, and another drafted locally to cover assets held in Germany. These must be carefully aligned to avoid conflicting instructions or legal disputes during probate.

If you’re an American moving to Germany, updating your estate plan is not just recommended—it’s essential. Consulting with professionals who understand both legal systems can help you safeguard your wishes and reduce tax exposure for your heirs.

Embrace Cultural and Administrative Differences

Adapting to life in Germany means adjusting to a new cultural and bureaucratic rhythm. What might feel overly formal or paperwork-heavy at first is, in fact, part of what many Germans consider well-organised and reliable governance. That said, the transition often requires patience and flexibility—especially in your first few months.

One of your first tasks after securing housing will be registering your residence with the local Einwohnermeldeamt (residents’ registration office), a process known as Anmeldung. This registration is mandatory and triggers many other administrative steps: getting a tax identification number, signing up for health insurance, and opening a bank account. Missing this step or delaying it can make even basic tasks unexpectedly difficult.

Appointments are often required, and punctuality is expected to the minute. You’ll likely find that Germans place a high value on formality in both professional and social settings. Titles matter, processes follow strict sequences, and flexibility is not always built into the system.

Language can be another hurdle. While many Germans speak excellent English, especially in major cities, official documents and in-person interactions often happen in German. Learning key terms—or bringing someone to help interpret—can be invaluable.

On the bright side, Germany offers an excellent quality of life, strong public services, and well-integrated communities. For anyone making the move from the U.S., immersing yourself in local customs, connecting with your neighbourhood, and learning even a bit of the language can transform culture shock into cultural appreciation.

What to Consider as an American Moving to Germany

Moving to Germany as an American offers exciting possibilities, but it also requires a careful review of your financial and legal situation. By preparing in advance and working with professionals who understand the nuances of cross-border living, you’ll be better equipped to enjoy everything your new life has to offer.

Need help aligning your financial plan with your move? Our international wealth professionals are here to help you navigate the transition with confidence.

Sources

IRS – Foreign Earned Income Exclusion (FEIE)
IRS – Foreign Tax Credit (FTC)
IRS – FBAR (Report of Foreign Bank and Financial Accounts)
IRS – FATCA (Form 8938)
U.S. Social Security Administration – International Programs: Germany
German Federal Ministry of Finance – Double Taxation Agreements
Germany Visa and Residency Information – Federal Foreign Office