am_Unition US citizens living abroad are obliged TO REPORT their income to the IRS. If they pay taxes in their country of residence, greater than they would owe to the US, then they pay NOTHING to the US. David has been an American in Canada for 27 years and has never paid the US a penny. This is an issue that Democrats Abroad has worked on and there’s a good chance that they will get it changed to residence-based taxation instead of citizen-based. Still, better to stay and fight.
Most people won't have sufficient income to be double taxed but it is a concern. From the IRS "If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude your foreign earnings from income up to an amount that is adjusted annually for inflation ($105,900 for 2019, $107,600 for 2020, $108,700 for 2021, and $112,000 for 2022). In addition, you can exclude or deduct certain foreign housing amounts" -- https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion In addition, while I don't know about Canadian banks, European banks don't like dealing with Americans due to reporting requirements set by the US government, so it can get real difficult to live abroad as a US citizen. It becomes a messy maze of regulation real fast.
Thanks for this, c_hawk! I'm super guilty of outsourcing research, both professionally and in my personal/hubski life. :/