Dual citizenship in Germany for US citizens living abroad in 2024

2024 promises to be an exciting year for US expats who are considering applying for German citizenship, as a new law looks set to make dual citizenship possible for many more people. Mike Wallace from Greenback Tax Services looks at what’s changing, and what this means for US citizens living in Germany. 

Living abroad as a US citizen can be an enriching experience, offering new opportunities and cultural immersion. If you're an American living in Germany, you may be wondering about obtaining dual citizenship. In 2024, this is likely to become a real and exciting possibility for many more US citizens living in Germany. In this article, we will explore the requirements and benefits of gaining dual citizenship as a US citizen living abroad in Germany.

Eligibility for dual citizenship

To be eligible for dual citizenship in Germany as a US citizen, you must meet certain conditions. There are two primary pathways to consider:

• Residency: If you have been living in Germany for a certain number of years (currently at least eight years - but soon due to be changed), you can apply for dual citizenship.
• Birth connection: If you were born in Germany or have at least one German parent, you may be eligible for dual citizenship.

For a considerable time, Germany maintained a stringent approach to citizenship. Individuals who naturalised in Germany, along with their children, were traditionally required to give up their original nationality before they could be granted German citizenship. This policy reflected Germany's historically cautious stance towards dual citizenship, prioritising a singular national allegiance.

The coalition government's initiative

In a significant policy shift, the new coalition government of Germany, comprising the Social Democrats, Greens, and Free Democrats, embarked on a journey to overhaul the citizenship laws in 2021, significantly reducing the hurdles for international citizens seeking to gain German citizenship. 

This initiative culminated in the drafting of a new law by January 2023, which gained approval from the cabinet in August last year. The legislation is now poised for review by the Bundestag, Germany's federal parliament. 

The anticipation is high for the law's passage, expected to occur in early 2024, especially since it only requires a simple majority. Following this, President Frank-Walter Steinmeier, an SPD party member and a proponent of the law, is expected to sign it into effect.

Proposed reforms to German citizenship laws

The proposed legislation, likely to be implemented by April 2024, signifies a monumental change in Germany's stance on dual citizenship. Key highlights of the proposed changes include:

• Facilitation of multiple nationalities: The new law would enable non-EU naturalised Germans, as well as children born in Germany to foreign parents, to retain multiple citizenships. This marks a departure from the erstwhile norm of forcing long-term residents to choose between German citizenship and their existing nationality.
• Streamlined citizenship process: The reform aims to reduce the residency requirement for citizenship applications from eight years (six for those with “exceptional integration”) to five years, and to just three years for individuals demonstrating significant integration through employment, education, volunteer work, or achieving C1 level proficiency in German.
• Relaxed language requirements: There are plans to ease language proficiency prerequisites for applicants aged 67 and above and for certain groups who face challenges in learning German.
• Automatic citizenship for children: Children born in Germany to foreign parents will be granted automatic citizenship if their parents have resided in Germany for five years, a reduction from the previous eight-year requirement.

Please note that each individual situation is unique, and it is recommended to consult with legal experts or the German embassy for personalised advice regarding your eligibility. These reforms are still subject to final approval and enactment, meaning the information might be speculative until the law is officially passed and implemented.

Applying for dual citizenship

Once you determine your eligibility, you can start the application process for dual citizenship. To begin, you will need to submit an application to the Federal Office for Migration and Refugees (Bundesamt für Migration und Flüchtlinge, BAMF).

This application requires various documents, such as your birth certificate, passport, proof of residence, and evidence of language proficiency. Depending on the rules of your home country, you may also need to provide a declaration of loyalty to the German Constitution and renounce any other citizenships you hold.

To ensure a smooth application process, it is advisable to seek assistance from immigration lawyers, as they can guide you through the required paperwork and provide expert advice tailored to your circumstances.

Benefits and obligations of dual citizenship

Acquiring dual citizenship in Germany as a US citizen offers several benefits. German citizenship is highly coveted, providing rights and privileges such as:

• Unrestricted access to Europe: Dual citizens can live, work and study in Germany, the EU, the EEA and Switzerland without major restrictions.
• Voting rights and citizenship inheritance: German citizens have the right to vote in German elections and can pass their citizenship on to their children.
• Travel freedom: The German passport, renowned for its strength, permits visa-free travel to 190 countries. In 2023, it ranked second in the Henley Passport Index, emphasising its global power and utility.

However, it's important to be aware of the responsibilities that come with dual citizenship. Additionally, individuals with dual citizenship are expected to abide by the laws and regulations of both countries.

Tax and legal considerations

 Before obtaining dual citizenship in Germany, it is crucial to understand the tax and legal implications. Dual citizens may have tax obligations in both countries, so staying informed about the tax laws of both Germany and the US is essential.

This is where the expertise of experienced tax professionals becomes invaluable. By consulting with an expert, you can gain a clear understanding of the tax requirements for dual citizens and receive guidance on how to effectively manage your tax obligations in both Germany and the US.

They can also help you identify potential tax benefits or credits that may be available to you as a dual citizen and ensure that you are taking advantage of all available opportunities to minimise your tax liability.

Seeking professional advice

Dual citizenship in Germany offers US citizens living abroad an opportunity to embrace their host country while retaining their American nationality. By satisfying the eligibility criteria and completing the application process, individuals can enjoy the benefits and rights that come with German citizenship. However, it's crucial to seek expert advice and fully understand the legal and tax implications before proceeding with dual citizenship.

Remember, every situation is unique, and seeking guidance from tax professionals and the German embassy will help ensure a smooth and successful endeavour towards dual citizenship. With proper planning and knowledge, US citizens living in Germany can make informed decisions and fully embrace their new home while maintaining their connection to the United States. 

If you have any questions, don’t hesitate to contact Greenback Expat Tax Services so you can stay on top of both your German and US tax obligations! If you'd like to discuss your specific tax situation, or just need general advice, don't hesitate to sign up for a consultation or create an account to get started. They will be happy to help!