Hi all,

I'm a dual citizen, Spanish & US, and I'm currently living and working in the US but planning on moving to Spain sometime soon. After years working in the land of the free for different employers, I've accumulated many tax advantaged accounts such as 401k, Traditional IRA, Roth IRA, HSA, and I also have a regular taxable brokerage account, some company stock and some savings, etc. No real estate. The goal was to FIRE at some point in the future and enjoy the fruits of my labor in Spain, but after doing some research I found out that if I sold or made withdrawals from my US based investments while as a tax resident in Spain I would be double taxed. That is, I would have to pay the expected IRS US taxes on withdrawals or capital gains AND also yet more capital gain taxes to Hacienda (circa 20%) because of being a tax resident in Spain, which was a huge disappointment and would completely ruin the ROI of such investments and the whole FIRE plan.

For this reason I've been trying to find alternatives to avoid paying those resident taxes while in Spain, but I was thinking that maybe I should sell ALL my US based accounts before moving to Spain, pay taxes and any penalties (e.g. 401k 10%) to IRS, accept those losses and then move with all my cash back to Spain and start investing yet again in ETF Index funds from Spain with euros or in a real estate portfolio that can yield passive income over time.

My question to you: should I sell all my US based assets, pay the correspondent IRS taxes and penalties BEFORE moving to Spain to avoid the double taxation I would get as a Spanish tax resident if I were to sell them later while already residing in Spain? If I don't do this, I will get double taxed on every stock I sell, every 401k and Roth withdrawal I do in the future, which sucks (not to talk about the logistical nightmare of having to deal with filing taxes to both countries for all that asset movement).

I am moving to Spain to be closer to family and start one of my own, so probably won't move back to the US, but this stuff is complicated AF and is driving me nuts and wondering if someone has been in a similar situation in the past.

Is my logic wrong? What would you all do?

Cheers and thank y'all for your help!

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