U.S. citizens and residents are required to file U.S. income tax returns on their worldwide income, even if they live outside the U.S.
The Immigration and Nationality Act provides for the loss of nationality by voluntarily and with the intention of relinquishing nationality. The person who wishes to renounce U.S. citizenship has to consider immigration law as well as U.S. tax law because renunciation of U.S. citizenship may have effect on his or her U.S. tax obligations, in particular regarding the exit tax.
Even though you received a certification of loss of nationality, you might be obligated to file and pay U.S. taxes unless you file Form 8854. You might be treated as a “covered expatriate” if your average net income tax for the 5 years ending before the date of expatriation or termination of residency is more than a specified amount adjusted for inflation ($157,000 for 2014, $160,000 for 2015, $161,000 for 2016, $162,000 for 2017, and $165,000 for the year 2018), or your net worth is $2 million or more on the date of your expatriation or termination, or you failed to certify on Form 8854 that you have complied with all U.S. federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency. In this case, all the property of a covered expatriate is treated as sold on the day before the expatriation date for the fair market value and any gains shall be included in the covered expatriate’s gross income and taxed as an exit tax.
It is important to seek U.S. tax advice when you renounce U.S. citizenship and exit the U.S. tax system. There are various exceptions and exclusion in considering if you are required to pay an exit tax and calculating the exit tax.