Retirement savings, stock options, real estate, and any sort of investment account makes your U.S. tax return go from "a 1040" to a towering mountain of special forms. A lot of them also lose you the right to e-file, for some reason. And many aren't supported by tax software, or are handled incorrectly.
A lot of "foreign" banks – i.e. your _local_ banks – won't even talk to you. They tell you to make your investments in the U.S. instead, so you get to pay international wire transfer fees and foreign currency exchange fees on every investment. And if you want to move it back, you get to pay them again.
You won't necessarily owe any tax in the U.S., but you sure pay for it in either filing time (10s to 100s of hours) or expat tax accountant fees.
And, extra maddeningly, a number of American institutions won't even talk to you, either.
Try calling up Vanguard or Charles Schwab if you're just a normal person who lives abroad and see how quickly they'll tell you "sorry! we don't want your business"
Even if you still have a permanent US address (i.e., not just some post box).
Well that and most banks refusing American customers because they don't want to deal with FBAR/FINCEN reporting.
My American friends here in Europe have a really difficult time opening a bank account due to this rule.
> Since ordinary people pretty much all earn less than this..
Ever lived in Switzerland? Or London?
> I am not an accountant or lawyer and this is not advice..
It's worse than that, it's just ignorant of the tax and financial reality of being an overseas American.
It's a pretty terrible systems.
Also (note that I am not an accountant or lawyer and this is not advice), most ordinary people won't see any problem with taxation while abroad beyond the actual inconvenience of filing a 1040 because the foreign earned income exclusion (https://www.irs.gov/individuals/international-taxpayers/fore...) allows you to exclude foreign earned income up to $100,000 from US taxation. Since ordinary people pretty much all earn less than this, they only have to pay taxes to whatever country they are actually in. Only people who are rich enough to hire accountants have to worry about double taxation, and they can probably avoid it by other means that are well-studied among rich peoples' accountants.