A recent inquiry caught our attention.
A U.S. citizen left California in 2020, established residency overseas, and had not returned to the United States since. Years later, he received a California Franchise Tax Board assessment for more than $5,000 related to investment and partnership income.
His immediate question was simple:
Why am I receiving a California tax assessment if I haven't lived there for years?
The answer is one many business owners, self-employed professionals, and aspiring expats do not discover until after the notice arrives.
Moving abroad and properly disconnecting from state and business tax obligations are often two very different things.
Relocation Does Not Automatically Close Tax Accounts
Many individuals spend months planning visas, housing, healthcare, travel logistics, and international banking.
Very few spend the same amount of time planning their tax exit strategy.
As a result, years later they may find themselves dealing with:
- California residency audits
- Franchise Tax Board notices
- State tax assessments
- Business personal property tax bills
- Open sales tax permits
- Active LLCs that were never dissolved
- Payroll accounts that were never closed
- IRS correspondence tied to old businesses
Simply leaving a state or moving overseas does not automatically terminate filing obligations. Government agencies generally require formal action.
The Most Common Mistake We See
Many business owners believe that because they stopped operating a business, the business is closed.
Unfortunately, that is not always true.
An inactive business may still have:
- Active Secretary of State registrations
- Open franchise tax accounts
- Payroll filing requirements
- Sales tax permits
- Property tax accounts
- Annual report obligations
Years later, those forgotten accounts can generate notices, penalties, estimated assessments, and compliance issues.
Why This Matters for Expats
International relocation introduces an entirely new layer of complexity.
Many Americans move overseas while still owning:
- LLCs
- S-Corporations
- Rental properties
- Investment accounts
- Partnership interests
- Online businesses
Without proper planning, these assets may continue creating state and federal filing requirements.
The result is often confusion, unexpected notices, and costly cleanup work that could have been avoided with proper planning before departure.
Introducing Our Business Exit & Closure Review
To help business owners avoid these issues, we launched the Business Exit & Closure Review.
This service helps identify whether a business was properly closed and whether any filing obligations remain.
Our review includes:
- Secretary of State status review
- IRS filing review
- State tax account review
- Franchise tax review
- Sales tax permit review
- Payroll account review
- Property tax account review
- Notice review and risk assessment
- Closure recommendations
The goal is simple: help business owners identify problems before government agencies do.
Pre-Relocation Tax Planning
One of the most valuable services we provide is pre-relocation tax planning.
Before moving abroad, business owners should understand:
- Ongoing federal filing obligations
- State residency considerations
- Business entity implications
- Banking and reporting requirements
- Foreign account reporting obligations
- Future tax exposure
Proper planning allows individuals to make informed decisions before relocating rather than responding to notices afterward.
Our Global Remote & Tax Intelligence center is designed specifically for this purpose — helping business owners, digital nomads, and expats understand what U.S. tax obligations may follow them overseas.
Post-Relocation Tax Support
The work does not end once you arrive overseas.
Many expats continue to face ongoing compliance requirements, including:
- Annual U.S. tax returns
- Foreign earned income reporting
- Foreign bank account reporting
- Business reporting obligations
- State tax correspondence
- IRS notices
- Entity maintenance requirements
Our post-relocation support helps clients understand and manage those responsibilities while living abroad.
Expat Tax Filing Services
For U.S. citizens and permanent residents living overseas, filing requirements often continue long after departure.
Our Expat Tax Filing Services assist with:
- Annual U.S. individual tax returns
- Foreign Earned Income Exclusion analysis
- Foreign tax credit review
- Self-employed expat tax planning
- Digital nomad tax support
- Foreign bank account reporting guidance
- State tax filing analysis
- Multi-country income reporting coordination
Whether you live in Thailand, Portugal, Mexico, the Philippines, Vietnam, Costa Rica, Spain, Colombia, Indonesia, or elsewhere — understanding your U.S. tax obligations remains essential.
The Real Question
When most people prepare to relocate internationally, they focus on where they are going.
A better question may be:
What obligations am I leaving behind?
A successful relocation plan should address both.
Before moving abroad, starting a new business, or assuming an old business is closed, take the time to confirm that your tax, filing, and business obligations have been properly addressed.
The cost of planning is almost always less than the cost of fixing a problem years later.
Planning a Move Abroad or Already Living Overseas?
Whether you are preparing to relocate, reviewing an old business, responding to a state tax notice, or filing taxes while living overseas, our team can help you build a practical tax strategy before problems arise.
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