US 10-37% vs Costa Rica 0% foreign income. Pensionado visa + FEIE.

By Daniel, Founder of CountryTaxCalc

Daniel has spent 5+ years researching tax systems across 95+ countries and all US states to make tax comparison accessible to everyone. For corrections, contact us.

Last Updated: April 2026

The Big Picture

๐Ÿฆ… USA

10-37% + state

Progressive Federal

Federal 10-37% + state taxes

๐Ÿ‡จ๐Ÿ‡ท Costa Rica

0-25%

Progressive

0-25% progressive (territorial)

Typical Annual Savings

At $100,000 income:

Use FEIE to exclude $126,500

That is Costa Rica popular retirement destination back in your pocket!

Tax Savings by Income Level

IncomeUS TaxCR TaxSavings10-Year
$100,000 $12,908 federal + state$0 Costa Rica (foreign income exempt)Use FEIE to eliminate US tax on $100KSave $129K federal with FEIE
๐Ÿ’ก

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USA Pros and Cons

โœ… Pros

  • US passport freedom
  • SS/Medicare benefits
  • Dollar strength
  • Consumer protections

โŒ Cons

  • Citizenship-based taxation
  • Federal 10-37% + state
  • FBAR/FATCA reporting
  • Global compliance

Costa Rica Pros and Cons

โœ… Pros

  • 0% on foreign income (territorial)
  • Pensionado visa for retirees
  • Pura Vida lifestyle
  • Political stability

โŒ Cons

  • US expats still owe IRS
  • 25% top rate on local income
  • Higher cost than other LatAm
  • Healthcare costs rising

Frequently Asked Questions

Q: Do US retirees in Costa Rica pay tax?

Costa Rica: 0% on foreign-source income (pensions, SS, investments). US: owe IRS globally BUT use FEIE to exclude $126.5K. Popular retirement destination with Pensionado visa.

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