The Problem
An individual can be considered a tax resident of two countries simultaneously (e.g., Israel and the US). This can result in both countries claiming the right to tax worldwide income. Tax treaties resolve this through 'tie-breaker' rules that determine a single country of residence for treaty purposes.
Tie-Breaker Rules
Treaty tie-breakers typically follow this hierarchy: (1) permanent home available – if in one country only, resident of that country; (2) center of vital interests – closer personal and economic connections; (3) habitual abode – where the person spends more time; (4) nationality; (5) mutual agreement between the countries.
Important Note: The information on this website is for general informational purposes only and does not constitute professional tax advice. Consult a qualified tax advisor before making financial decisions.