Americans Retiring To Israel

What Every American Immigrant Should Know
Main Financial Challenges Nardis Advisors helps US Citizens with Managing and Accessing U.S. Retirement Accounts (401(k), IRA, Roth IRA), Taxation and Double-Reporting (U.S. IRS + Israeli Tax Authority), Investments and Investment Products Consistent with Israeli Law, Rolling Over and Consolidating Accounts, Inheritance, Estate, and Succession Planning Across Borders, Banking, Transfers, and Communication Barriers

At Nardis Advisors, we specialize in guiding Americans Retiring to Israel—through the complex rules governing U.S. assets, taxes, and estate exposure.

Overview

1

Managing and Accessing U.S. Retirement Accounts (401(k), IRA, Roth IRA)

The Challenge:

When Americans make aliyah or retire to Israel, their 401(k)s, IRAs, and other U.S. retirement accounts remain under U.S. jurisdiction.

However, managing, rolling over, or even accessing them can be complicated by:

– Custodian restrictions: Some U.S. brokerage firms no longer allow account holders with foreign addresses.

– Cross-border communication: Time zones and identity verification requirements can make transactions and customer service difficult.

– Required Minimum Distributions (RMDs): These must still be taken in compliance with U.S. tax law, even while living in Israel.

Best Practices:

– Roll over employer plans (like 401(k)s) into IRAs that permit international residents.

– Work with a U.S.-registered investment advisor legally allowed to serve clients in Israel (like Nardis Advisors)

– Maintain U.S. bank accounts for smoother transfers.
2

Taxation and Double-Reporting (U.S. IRS + Israeli Tax Authority)

The Challenge:

 The U.S. taxes its citizens on worldwide income, even after they move abroad. Meanwhile, Israel taxes residents on global income too (after the initial “oleh chadash” tax holiday expires).

Key issues include:

– Avoiding double taxation through the U.S.-Israel tax treaty.

– Correctly reporting pensions, investment income, and RMDs in both systems.

– Understanding which income is tax-deferred in one country but taxable in the other.

Best Practices:

– Use a cross-border CPA familiar with both systems.

– Coordinate investment withdrawals and timing to minimize tax overlap.
3

Investments and Investment Products Consistent with Israeli Law

The Challenge:

 Not all Israeli investment products are suitable or legal for US citizens resident in Israel.

For example:

– Israel mutual funds and ETFs may be classified as PFICs (Passive Foreign Investment Companies) under US  tax law — creating harsh tax consequences.

Best Practices:

– For Israel-based accounts: US citizens resident in Israel may hold these, but they should be invested only in securities that are not considered PFICs

– Consider keeping your longer-term investments in US based accounts, (unless you require regular access to the funds), 
4

Rolling Over and Consolidating Accounts

The Challenge:

Retirees often have multiple retirement accounts from various employers.

When they move abroad:

– Rolling them into a single IRA simplifies management.

– However, some custodians refuse rollovers for non-U.S. residents.

Best Practices:

– Roll over accounts before changing U.S. residency.

– Use custodians or advisory firms that service accounts with non US addresses
5

Inheritance, Estate, and Succession Planning Across Borders


The Challenge:

 – U.S. and Israeli inheritance laws differ dramatically:
Israel has no estate tax, but the U.S. does. And it is has significantly lower exemption threshold for non-US citizens resident outside the US

– U.S. citizens should create an estate plan for the US assets, especially even if their heirs live in Israel.

Inheritance of U.S. retirement accounts (IRA, 401(k)) by Israeli heirs can trigger complex tax reporting and withholding.

Best Practices:

– Plan ahead of time and work with qualified estate lawyers and investment advisors.
6

Banking, Transfers, and Communication Barriers

The Challenge:

Simple logistics often become complicated:

– Language barriers and different banking norms can delay access to funds. Americans Olim often have difficulty understanding how the Israeli banking system works

– Some retirees struggle with online access, security verifications, and two-factor authentication tied to U.S. phone numbers.

Best Practices:

– Keep both U.S. and Israeli bank accounts active, until one feels one no longer needs one’s US account.

– Work with advisors who provide ongoing communication support across time zones.
7

How Nardis Advisors Helps

Nardis Advisors is a Fee-Only Fiduciary advisory firm with deep expertise in cross-border U.S.–Israel financial management. Our clients include:

– Israelis with U.S. real estate or investment portfolios.

– Non-U.S. citizens holding American assets.

– Global families with members or heirs holding dual or multiple citizenships (British-Israeli, South African-Israeli, Australian-Israeli, European-Israeli, etc.).

We help you:

– Evaluate your estate tax exposure under U.S. law.

– Design compliant ownership structures to preserve access and minimize taxation.

– Coordinate with U.S. and Israeli accountants, attorneys, and custodians.

– Avoid investment pitfalls such as PFICs, non-compliant funds, or improperly titled accounts.

– Plan ahead to ensure assets are easily transferable to heirs without unnecessary U.S. tax.

In Summary: Why You Need a Cross-Border Fiduciary Expert

For Americans retiring to Israel, success means having:

– One advisor team fluent in both financial systems.

– Fiduciary commitment (advice in your best interest).

– Integrated planning — retirement income, investments, tax, and estate together.

That’s exactly the niche Nardis Advisors serves — a Fee-Only Fiduciary Advisor with over 30 years of combined experience, and founded in 2009 specifically to guide U.S. expats and retirees in Israel through these challenges.

Complimentary Initial Assessment

In this preliminary call, chat with one of our financial experts to determine which of our services best suit your unique needs.
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