I 
118TH CONGRESS 
2D SESSION H. R. 10468 
To amend the Internal Revenue Code of 1986 to establish an elective resi-
dency-based income tax for nonresident citizens of the United States, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 18, 2024 
Mr. LAHOOD introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to establish 
an elective residency-based income tax for nonresident 
citizens of the United States, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Residence-Based Tax-
ation for Americans Abroad Act’’. 
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SEC. 2. ESTABLISHMENT OF ELECTIVE RESIDENCY-BASED 
INCOME TAX FOR NONRESIDENT CITIZENS 
OF THE UNITED STATES. 
(a) IN GENERAL.—Part II of subchapter N of chap-
ter 1 of the Internal Revenue Code of 1986 is amended 
by adding at the end the following new subpart: 
‘‘Subpart E—Residency-based Income Tax for 
Nonresident Citizens of the United States 
‘‘Sec. 899. Election by nonresident citizens of the United States to be subject 
to residency-based income tax rules. 
‘‘Sec. 899A. Imposition of tax on deferred income of certain electing individ-
uals. 
‘‘Sec. 899B. Certificates of nonresidency. 
‘‘Sec. 899C. Regulations. 
‘‘SEC. 899. ELECTION BY NONRESIDENT CITIZENS OF THE 
UNITED STATES TO BE SUBJECT TO RESI-
DENCY-BASED INCOME TAX RULES. 
‘‘(a) IN GENERAL.—In the case of any electing indi-
vidual: 
‘‘(1) RESIDENCY-BASED
INCOME
TAX.—The 
rules of subsection (b) shall apply for the taxable 
year for which the election under this section is 
made and all subsequent taxable years until such 
election is terminated under subsection (d). 
‘‘(2) APPLICATION OF TAX ON DEFERRED IN-
COME.—The rules of section 899A shall apply as of 
the day before the election date (as defined in sec-
tion 899A). A termination of any election under this 
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section shall have no effect on the application of sec-
tion 899A. 
‘‘(b) APPLICATION OF RESIDENCY-BASED INCOME 
TAX.—In the case of any electing individual, the rules of 
this subsection are as follows: 
‘‘(1) IN GENERAL.—Section 7701(b)(1) shall be 
applied— 
‘‘(A) by treating any electing individual as 
an alien individual, 
‘‘(B) by substituting ‘not’ for ‘neither a 
citizen of the United States nor’ in subpara-
graph (B), and 
‘‘(C) by treating the United States as in-
cluding the possessions of the United States. 
‘‘(2) MODIFICATION
OF
SUBSTANTIAL
PRES-
ENCE TEST.—Section 7701(b)(3) shall applied with-
out regard to subparagraphs (B) and (C). 
‘‘(3) REQUIREMENT OF TAX RESIDENCY.—Not-
withstanding section 7701(b), an electing individual 
shall not fail to be treated as a resident of the 
United States unless such individual is a tax resi-
dent of a foreign country. 
‘‘(4) TREATMENT AS UNITED STATES PERSONS 
BASED
ON
RESIDENCY.—Section 7701(a)(30)(A) 
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shall be applied without regard to the phrase ‘a cit-
izen or’. 
‘‘(5) 
COORDINATION
WITH
FATCA
WITH-
HOLDING.—For purposes of section 1472, an elect-
ing individual with a certificate of nonresidency 
issued under section 899B shall be treated as having 
established status as an individual who is not a spec-
ified United States person. 
‘‘(6) EXEMPTION
FROM
CERTAIN
REPORTING 
AND RECORDS REQUIREMENTS WITH RESPECT TO 
FOREIGN
ASSETS
AND
TRANSACTIONS.—Sections 
6038D and 6046, and section 5314 of title 31, 
United States Code, shall not apply. 
‘‘(7) COORDINATION
WITH
RULES
ON
EXPA-
TRIATION.—Section 7701(a)(50) shall not be treated 
as applying with respect to the application of this 
subpart. 
‘‘(8) WAIVER
OF
TREATY
SAVING
CLAUSE.— 
The United States waives the application of each 
saving clause in any United States income tax treaty 
with respect to electing individuals. For purposes of 
the preceding sentence, the term ‘saving clause’ 
means any provision which would (but for this para-
graph) prevent the electing individual from benefit-
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ting from a provision of the treaty eliminating dou-
ble taxation. 
‘‘(c) ELECTING INDIVIDUAL.—For purposes of this 
subpart— 
‘‘(1) IN
GENERAL.—The term ‘electing indi-
vidual’ means any citizen of the United States who 
has in effect an election (made at such time and in 
such manner as the Secretary may provide) to have 
the provisions this subpart apply. 
‘‘(2) CITIZENS BORN ABROAD.—In the case of 
any citizen of the United States who is born outside 
the United States, such individual shall be treated as 
a electing individual until such time as such indi-
vidual becomes a resident of the United States 
under clause (ii) or (iii) of section 7701(b)(1)(A). 
‘‘(3) EXCEPTION FOR FEDERAL EMPLOYEES.— 
Notwithstanding any other provision of this subpart, 
an individual shall not be treated as an electing indi-
vidual for any taxable year if such individual is em-
ployed by the Federal Government at any time dur-
ing such taxable year. 
‘‘(d) RULES RELATED TO ELECTION.— 
‘‘(1) MANNER
OF
ELECTION.—An election 
under this section shall be made at such time and 
in such manner as the Secretary may provide and, 
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