Tax residence in Germany for U.S. citizens and green card holders

Germany treats you as a tax resident if you have a home there that you keep and use (Wohnsitz) or if you stay more than 6 months in a row — even across two calendar years. As a U.S. citizen you remain taxable in the United States as well; the U.S.–Germany treaty decides which country is your treaty residence and how double taxation is relieved.

Check your status: United States and Germany

Free, no sign-up, about 3 minutes. Conclusion under U.S. law, compared with the law of Germany and the tax treaty.

When Germany treats you as a tax resident

In Germany the dwelling itself is decisive: if you keep a flat or room that you can use at any time, you are resident — regardless of days spent and of where your centre of vital interests is.

The German six months are counted continuously and are not tied to the calendar year: a stay from October to April already creates a habitual abode.

You have a home in Germany — under § 8 AO this is a Wohnsitz (domicile), so under German law you are resident with unlimited tax liability, even if your centre of vital interests is in the United States.
You stayed in Germany continuously for more than six months for a purpose other than a visit or holiday — under § 9 AO this is a habitual abode from the first day, and you are resident in Germany.

When you are a nonresident

Your stay was only a visit, holiday or medical treatment of up to one year and you have no home in Germany — no habitual abode arises; you are not resident in Germany.
You have no home in Germany and your uninterrupted stay did not exceed six months — you are not resident in Germany. German-source income (in particular wages for work physically performed in Germany) is still subject to limited tax liability there.

Where the rules of Germany clash with U.S. tax rules

Collision: a German home makes you German-resident while the U.S. taxes you too. For Germany a dwelling you can use at any time (Wohnsitz) is enough: you are resident with worldwide tax liability even if your centre of vital interests is in the United States (BFH, I R 74/16), and no minimum number of days is required (BFH, I R 58/16). The United States taxes its citizens and green-card holders on worldwide income regardless of where they live, and other individuals under the substantial presence test. Both countries therefore claim you as resident. Article 4(2) of the U.S.–Germany Convention breaks the tie: permanent home → centre of vital interests → habitual abode → nationality → mutual agreement.
Collision: treaty residence in Germany does not end U.S. tax on a U.S. citizen. Even if the treaty tie-breaker makes you a resident of Germany, the United States keeps taxing you as a citizen: under the saving clause (Art. 1(4)(a)) the Convention does not affect U.S. taxation of its citizens, and former citizens and long-term residents may be taxed for ten years after losing that status (Art. 1(4)(b)). Double taxation is relieved by Art. 23(5): Germany taxes first and credits only the U.S. tax the treaty would allow on a non-citizen (e.g. on U.S.-source dividends); the United States then credits the remaining German tax, treating the income as German-source to the extent needed (re-sourcing). How the credit, the foreign earned income exclusion and U.S. filing work is explained in the U.S. part.
Collision: six continuous months in Germany vs. calendar-year counting in the U.S.. Germany counts six months of uninterrupted presence regardless of calendar-year boundaries, and residence then applies from the first day (§ 9 AO). A stay from October to April therefore makes you German-resident even though you spent fewer than 183 days in Germany in each calendar year. U.S. residence of a citizen does not depend on days at all; for non-citizens the substantial presence test counts days in the United States per calendar year. Expect to be resident in both countries for part of such a stay and check the treaty tie-breaker.

What else to know

Green-card holders: Germany looks for a real U.S. connection. Germany treats a U.S. citizen or green-card holder as a U.S. resident for treaty purposes only if that person has a substantial presence, permanent home or habitual abode in the United States (Protocol, para. 2(a)). The saving clause covers U.S. residents «as determined under Article 4» and U.S. citizens (Art. 1(4)(a)), so a green-card holder whom the tie-breaker assigns to Germany is in a different position from a citizen — the U.S. consequences are explained in the U.S. part. Treaty residence in Germany has to be shown: in Topsnik the U.S. Tax Court rejected a green-card holder's claim to be a German treaty resident because he did not allege that he was subject to German tax on his worldwide income, and held that his permanent-resident status lasted until he formally abandoned it (Form I-407).
Year of moving: Germany splits the year, the U.S. does not for citizens. In the year you arrive in or leave Germany, Germany taxes worldwide income only for the period of unlimited liability, and foreign income for the rest of the year raises the rate (§ 32b EStG). The United States taxes a citizen for the whole calendar year. Match the periods when claiming credits so that the same months' income is not left double-taxed.
Working in Germany while not German-resident. Even as a non-resident of Germany you owe German tax on wages for work physically performed in Germany (§ 49(1) no. 4(a) EStG), unless all conditions of Art. 15(2) of the Convention are met: no more than 183 days in Germany in the calendar year, an employer that is not a German resident, and pay not borne by a German permanent establishment. Note that the treaty counts days per calendar year, not per 12-month period.
Social security: U.S.–German totalization agreement. The U.S.–German Social Security Agreement (effective 1 December 1979, amended with effect from 1 January 1986 and 1 May 1996) prevents paying social security in both countries on the same work. Employees are normally covered where they work; an employee sent by a U.S. employer to Germany for five years or less generally stays in U.S. Social Security and is exempt from German contributions, with a certificate of coverage as proof. Self-employed people who move their business for five years or fewer stay covered by the country they came from. This agreement covers social security only, not income tax.

How dual residence is resolved

If both countries treat you as a resident, Art. 4(2) of the treaty applies: Convention between the United States of America and the Federal Republic of Germany for the avoidance of double taxation … with respect to taxes on income and capital (signed 29 August 1989), as amended by the Protocol of 1 June 2006. The tests are applied in order — permanent home, center of vital interests, habitual abode, nationality, and finally mutual agreement between the tax authorities. U.S. citizens remain taxable in the United States under the saving clause.

Terms you will come across in Germany

Wohnsitz: domicile — a home you keep and use
gewöhnlicher Aufenthalt: habitual abode — more than 6 months of continuous stay
unbeschränkte Steuerpflicht: unlimited tax liability on worldwide income (resident)
beschränkte Steuerpflicht: tax only on German-source income (nonresident)
Ansässigkeitsbescheinigung: certificate of tax residence
Finanzamt: local tax office

Questions

I am a U.S. citizen — do I still pay U.S. tax if I live in Germany?

Yes. The United States taxes its citizens on worldwide income wherever they live, and the treaty keeps that right through the saving clause (Art. 1(4)). You file Form 1040 every year; double taxation is relieved mainly by the foreign tax credit (Form 1116) or the foreign earned income exclusion (Form 2555), plus the treaty's relief article (Art. 23).

Which treaty applies between the U.S. and Germany?

The 1989 Convention, signed on 29 August 1989, as amended by the Protocol of 1 June 2006 (in force 28 December 2007). Dual residence of individuals is resolved under Art. 4(2): permanent home, center of vital interests, habitual abode, nationality, then mutual agreement.

How many days can I work in Germany for a U.S. employer before Germany taxes my salary?

Under Art. 15(2) of the treaty Germany cannot tax the salary if you are there no more than 183 days in the calendar year and the pay is not borne by a German employer or permanent establishment. Under German law alone, a home in Germany or more than 6 months of stay makes you resident.

Sources

Legislation and official guidance

§ 1(1) EStG — Individuals with a domicile (Wohnsitz) or habitual abode (gewöhnlicher Aufenthalt) in Germany have unlimited tax liability, i.e. they are taxed on worldwide income.
§ 8 AO — A person has a domicile (Wohnsitz) where they keep a dwelling under circumstances indicating that they will retain and use it.
§ 9 AO — Habitual abode means presence that is not merely temporary. An uninterrupted stay of more than six months is always a habitual abode, from the first day; short interruptions are disregarded. Exception: stays solely for visits, recreation, medical treatment or similar private purposes lasting no longer than one year.
§ 9 sentence 3 AO — The six-month rule does not apply if the stay is solely for a visit, recreation, medical treatment or a similar private purpose and does not exceed one year.
§ 1(3)–(4) EStG — Without a domicile or habitual abode, liability is limited to German-source income (§ 49). On application, a non-resident can be treated as having unlimited liability if at least 90 % of their income is subject to German tax.
§ 49(1) no. 4(a) EStG — Employment income is German-source income if the work is performed or used (verwertet) in Germany.
Art. 4(2) U.S.–Germany Convention — A dual-resident individual is deemed resident of the State where he has a permanent home available; if in both, where his personal and economic relations are closer (centre of vital interests); then habitual abode; then nationality; otherwise the competent authorities settle the question by mutual agreement.
Art. 1(4)–(5) U.S.–Germany Convention (as amended by Art. I of the 2006 Protocol) — Art. 1(4)(a): except as provided in para. 5, the Convention does not affect U.S. taxation of its residents (as determined under Article 4) and its citizens. Art. 1(4)(b): former citizens and long-term residents may be taxed under U.S. law for ten years after losing that status. Para. 5 keeps certain benefits, including Arts. 23, 24 and 25.
Art. 23(5) U.S.–Germany Convention (as replaced by Art. XII of the 2006 Protocol) — U.S. citizen resident in Germany: (a) Germany credits only the U.S. tax the Convention allows the U.S. to impose, not tax imposed solely by reason of citizenship; (b) the U.S. credits the German tax remaining after (a); (c) to the extent needed for (b), the income is deemed to arise in Germany (re-sourcing).
Protocol to the U.S.–Germany Convention, para. 2(a) (with reference to Art. 4(1); text of the 2006 Protocol, Art. XVI) — Germany treats a U.S. citizen or green-card holder as a resident of the United States only if that person has a substantial presence, permanent home or habitual abode in the United States.
§ 2(7), § 32b EStG — Income tax is assessed annually. In the year of arrival or departure, worldwide income for the period of unlimited liability and German-source income for the rest of the year are combined; foreign income and treaty-exempt income raise the tax rate (Progressionsvorbehalt).
Art. 15(2) U.S.–Germany Convention — Wages for work done in the other State are taxable only in the State of residence if the employee is present there for no more than 183 days in the calendar year concerned, the employer is not a resident of the other State, and the pay is not borne by the employer's permanent establishment there (the 2006 Protocol, Art. VII(6), deleted the words «or a fixed base» in subpara. (c)).
U.S.–Germany Social Security Agreement (SSA, POMS RS 02001.100) — The agreement became effective on 1 December 1979; supplementary agreements took effect on 1 January 1986 and 1 May 1996 (the latter modified the coverage rules).
SSA pamphlet «U.S.–German Social Security Agreement» — For employees working in Germany, the employer requests a certificate of coverage (form D/USA 101) from the German sickness fund that collects German social security contributions; self-employed people who transfer their business to the other country for five years or fewer remain covered by the country they came from.
SSA pamphlet «U.S.–German Social Security Agreement» (archived 2012) — Employees normally are covered by the country where they work; an employee sent by the employer to the other country for five years or less stays covered by the home country and is exempt in the host country.
EStG
Art. 23(1), (3)–(4) U.S.–Germany Convention (2006 Protocol, Art. XII) — Para. 1: the U.S. credits German income tax paid by its citizens and residents. Para. 3: Germany relieves German residents through a dual method of exemption (3(a)) and credit (3(b)); para. 4 lists cases where Germany credits instead of exempting (Technical Explanation to the 2006 Protocol).
Technical Explanation to the 2006 Protocol, Art. II — Germany treats a U.S. citizen or green-card holder as a U.S. resident only if such person has a substantial presence (see section 7701(b)(3)), permanent home, or habitual abode in the United States — i.e. a reasonably strong economic nexus with the United States is required.
Art. 4(2)(a) of the Convention — A dual-resident individual is deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home in both States, of the State with which his personal and economic relations are closer (centre of vital interests).
Art. 4(2)(b) of the Convention — If the State in which he has his centre of vital interests cannot be determined, he is deemed to be a resident of the State in which he has an habitual abode. This step also applies if you have no permanent home in either State.
Art. 4(2)(c), (d) of the Convention — If he has an habitual abode in both States or in neither, he is deemed resident of the State of which he is a national (c); if he is a national of both States or of neither, the competent authorities settle the question by mutual agreement (d).

Case law

Bundesfinanzhof (BFH), 1st Senate, I R 58/16, 2018-07-24 — A Wohnsitz under § 8 AO does not require a minimum number of days actually spent in the dwelling each year; even irregular visits can maintain a domicile. A person can have several domiciles at the same time.
Bundesfinanzhof (BFH), 1st Senate, I R 38/13, 2013-11-13 — A dwelling is any premises suitable for living in, even modest ones; what matters is that the person can use them at any time they wish and keeps them for their own residential use.
Bundesfinanzhof (BFH), 3rd Senate, III R 6/20, 2020-11-12 — Whether the circumstances indicate an intention to retain and use a dwelling is mainly a question of fact in each individual case.
Bundesfinanzhof (BFH), 1st Senate, I R 26/10, 2011-06-22 — Short interruptions count towards the six-month period of presence; there is no fixed limit on days of absence — they are assessed in light of the length of the whole stay.
Bundesfinanzhof (BFH), 1st Senate, I R 74/16, 2018-10-23 — Having a home abroad does not exclude unlimited tax liability in Germany, even where the foreign home is the centre of vital interests. The centre of vital interests matters only when applying a double tax treaty.
United States Tax Court, Topsnik v. Commissioner, 146 T.C. 1 (2016), docket 2482-14, 2016-01-20 — A German national holding a U.S. green card claimed to be a German resident under the U.S.–Germany treaty. The court found he was not a «resident» of Germany under Article 4, noting he did not allege that he was subject to German taxation on his worldwide income. His lawful-permanent-resident status ended only when he formally abandoned it (Form I-407, 20 Nov 2010), and he was taxed on the gain, including the deemed sale under § 877A.

Updated 2026-11-04. The result is for information only and is not tax or legal advice. Tax authorities and courts may interpret the rules differently, including because of circumstances not covered here, and the law changes. Consult a qualified adviser before making decisions.

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