🔎 Quick Turnaround English to Italian Legal Translator in Sicily
Full-Service Translation for Citizenship, Property, Inheritance, SRL Formation & More
If you’ve ever tried navigating Italian bureaucracy, you know that precision is everything — and nothing stalls a process like an incorrect or delayed translation. Whether you’re applying for citizenship, buying a house in the countryside, or dealing with estate matters, having a qualified legal translator who works quickly and accurately is essential.
Based in Sicily, we provide high-quality English ⇄ Italian legal translation with fast turnaround. But beyond speed, we offer deep legal knowledge and document experience.
⚖️ Common Situations Requiring Legal Translation in Sicily
Here’s what people most often need our help with — and why it matters:
🏛
Citizenship (Cittadinanza)
Whether you’re applying for Italian citizenship by descent (jure sanguinis) or through residency, you’ll need:
Translations of birth, marriage, and death certificates
Naturalization records, name change documents
Sworn translations (traduzioni asseverate) accepted by Italian courts and consulates Accuracy here isn’t just preferred — it’s required. Even a minor name inconsistency can delay your recognition for months.
🏡
Property Transactions
Buying or selling property in Italy often involves:
Preliminary purchase agreements (compromessi)
Notarial deeds (atti notarili)
Powers of attorney (procure speciali)
Land registry documents (visure, volture)We ensure that all translations match Italian legal terminology and are accepted by notaries and local offices.
📚
Academic Degrees & Equipollenza
If you studied outside of Italy and are applying for:
Degree recognition (equipollenza)
Enrollment in Italian universities
Professional licensingYou’ll need certified translations of diplomas, transcripts, and possibly syllabi. We know how to format these for acceptance by CIMEA, universities, and public offices.
👨👩👧👦Immigration & Residency
Immigration procedures often require:
Criminal record checks
Proof of income or employment
Translations for nulla osta applications or family reunificationWe handle all translations in formats suitable for Questura, Prefettura, or municipal offices.
🏢 Company Formation (SRL, ETS, SCA, etc.)
Entrepreneurs forming a Società a Responsabilità Limitata (SRL) or non-profit (ETS) need:
Articles of incorporation
Company bylaws (statuto)
Powers of attorney
Cross-border shareholder or board documents
We translate everything to meet commercial registry (Registro delle Imprese) standards.
⚰️ Trusts, Wills, Inheritance & Estates
Dealing with Italian inheritance law? You’ll need translations of:
Wills (testamenti)
Inheritance declarations (dichiarazioni di successione)
Death certificates and legal heir documentation
Trusts and cross-border probate documents.
We also assist with usucapione, voltura, and communications with notaries or heirs.
✒️ Procure Speciali (Powers of Attorney)
Living abroad but need to handle legal matters in Italy? We translate:
General and special powers of attorney
Apostille annotations
Identity documents and declarations for notary use
These are often time-sensitive and used in property sales, legal filings, or citizenship recognition.
🏛 Court Documents & Evidence
For cases involving:
Civil litigation
Family law
International claims or enforcement of foreign judgments
We provide certified and sworn translations valid for use in Italian courts.
💼 What Sets Us Apart
📆 Rapid Turnaround – Same or next-day delivery for most documents
📑 Sworn Translations (traduzioni giurate) – Valid for use in tribunals, comuni, and consulates
📁 Digital-ready Delivery – Documents in PDF, Word, or scan formats with PEC compatibility
🔐 Confidential & Professional – Handled with strict privacy and professional formatting
📍 Sicily-Based, Internationally Connected
We are based in central Sicily, with experience in Palermo, Agrigento, Catania, Trapani, and Enna — and we serve clients around the world. Whether you’re managing legal affairs from the U.S., U.K., Canada, or Australia, we’re your on-the-ground legal language partner.
📞 Ready to Get Started?
Send us your documents — we’ll reply quickly quote and timeline. Need it urgently? No problem. Let us know
Contact us today and get the peace of mind that comes from fast, accurate, and legally valid translations.
The short answer is that it will depend on the document and the use. But in most cases you do need to have your U.S. documents translated into Italian for official use in Italy — especially when submitting them to public offices (e.g. Comune, Prefettura, Agenzia delle Entrate, notary, or court). But the type of translation and additional requirements depend on the document and the context.
When You Usually Need a Translation in Italy
Common U.S. Documents That Often Require Translation:
Birth, marriage, or death certificates
Divorce decrees
Criminal background checks (e.g. FBI Identity History Summary)
University degrees and transcripts
Power of attorney (Procura)
Corporate documents (for company formation or contracts)
What Kind of Translation Is Required?
There are three main types:
1. Simple Translation
For informal or internal use only (not accepted by most government offices).
2. Sworn Translation (Traduzione giurata)
This is a certified translation done by a translator who swears before an Italian court (or a notary) that the translation is accurate. Required for most official purposes in Italy.
3. Legalized/Apostilled & Translated Documents
If the original document comes from the U.S., you generally need:
An Apostille (under the Hague Convention) from the U.S. Secretary of State
A sworn translation into Italian of both the document and the apostille
Can I Translate the Document Myself?
It depends, usually no. Translations must generally be performed by an authorized translator in Italy, or in some cases by a professional in the U.S. followed by a declaration of accuracy and possible authentication by an Italian consulate. Some consulates and offices will accept informal translations, in particular consulates as their staff are usually bilingual.
Helpful Hints
If you’re an Italian citizen or have proficiency in Italian often times documents can be produced directly in Italian, notarized and apostilled directly in the United States. There is no requirement that documents signed in the US be in English. Often times substantial time and money can be saved by conducting as many steps as possible directly in Italian language using US legal infrastructure.
Often times you’ll be referred to the Consulate when there’s a quicker and cheaper alternative.
You may be bounced back and forth between offices in Italy as no one knows the correct procedure. Always call ahead and make an appointment.
It’s not uncommon for office staff to not know the correct procedure for foreign documents, come prepared with the legal requirements as you may know more about the specifics for the US than they do.
Don’t be shy to hire a professional, we’re masters in US and Italian Bureaucracy and can save weeks or months!
Do you need an Italian legal translator? We provide fast turnaround service directly in Italy. We’re digital-native and all online!
Italian taxes are often perceived as high — and in many cases, they are — especially when compared to other countries with similar GDP per capita. The reality is more structural, historical, and cultural. Here’s a breakdown of why Italian taxes are high — and what that really means.
1. Social Security Insurance versus Italian Pensions
One of the biggest reasons for Italy’s high taxes is its public pension system, which is far more generous — and more expensive — than that of the United States.
In Italy:
Public pensions account for over 16% of GDP (one of the highest in the developed world).
Employees and employers together pay around 33% of gross salary into the pension system.
The system is pay-as-you-go, meaning today’s workers fund today’s retirees.
Retirees often receive 70% or more of their final salary, depending on contributions and career length.
In contrast, in the United States:
Social Security spending is about 5% of GDP, less than one-third of Italy’s.
Workers pay 12.4% of their income (split 50/50 between employer and employee), but only on income up to an annual cap (~$168,600 in 2024).
U.S. Social Security replaces about 30–40% of a typical worker’s pre-retirement income.
The contrast is significant: Italian workers contribute more over a longer period and in return receive more generous public pensions. However, this generosity comes at the cost of a heavy contribution burden on current labor income, particularly as the population ages.
While the U.S. Social Security system functions primarily as a limited insurance program, Italy’s system is a comprehensive public pension model. As a result, it’s common in Italy for individuals to rely almost entirely on the state pension, whereas in the United States, most workers supplement Social Security with private retirement savings, such as 401(k)s or IRAs, which are now a routine part of retirement planning.
2. Private vs Public Healthcare
Healthcare: Tax-Funded in Italy vs Private Premiums in the U.S.
The second pillar of Italy’s high tax model is its universal, tax-funded healthcare system, which contrasts sharply with the private insurance system in the U.S.
In Italy:
Healthcare is provided largely through the Servizio Sanitario Nazionale (SSN).
Funded through general taxation and a payroll-based regional health contribution (~7% of gross income).
Most care is free or low-cost at point of service, including hospital visits, surgeries, maternity care, and general practitioner services.
Total healthcare spending is about 8.7% of GDP, with about 75% coming from public funds.
In the United States:
Healthcare is largely privately funded, with premiums, deductibles, and out-of-pocket expenses forming a major financial burden.
Public programs like Medicare and Medicaid cover some populations, but most working Americans rely on private insurance through their employer or the ACA.
U.S. healthcare spending exceeds 17% of GDP, nearly double that of Italy, yet Americans often face higher personal healthcare costs and less universal access.
In effect, much of what Italians pay in taxes, Americans pay in insurance premiums and medical bills — but the Italian system covers everyone, while U.S. coverage is more fragmented and tied to employment or income eligibility.
3. Tax Evasion and the Informal Economy
Italy has a historically high rate of tax evasion, especially among small businesses and the self-employed. This creates a vicious cycle:
The state raises taxes on compliant taxpayers
Compliant taxpayers feel overburdened
This incentivizes more evasion
Estimates place the Italian shadow economy at 15–20% of GDP — among the highest in Western Europe. Due to high taxes this often is a self-perpetuating problem.
4. Complex and Fragmented Tax Code
Italy’s tax system is notoriously complex and bureaucratic, with overlapping local, regional, and national taxes, plus:
Multiple VAT rates
Complicated property and inheritance taxes
Dozens of tax credits and deductions that change annually
This complexity increases compliance costs and makes enforcement harder, fueling both avoidance and evasion.
5. High Social Contributions, Not Just Income Tax
What most people think of as “taxes” in Italy often includes mandatory social security contributions (INPS), which can be 25–33% of gross income for workers.
For example:
A salaried worker’s total tax burden can exceed 45% (including IRPEF, regional tax, municipal tax, and INPS)
A self-employed person may pay 25–28% just to INPS, before even touching income tax
This makes labor very expensive to hire and maintain.
6. Low Property and Capital Taxation
Interestingly, Italy does not have especially high taxes on wealth or capital compared to many Northern European countries. Property taxes are modest (especially on primary residences), and there is no national wealth tax, though financial assets abroad must be declared and taxed (IVAFE, IVIE).
To compensate for this, labor and consumption are taxed more heavily.
Conclusion: Reform Is Necessary, but Deeply Challenging
There is no doubt that Italy needs structural tax reform to boost competitiveness, encourage entrepreneurship, and ease the burden on workers and businesses that operate in full compliance. The system today leans heavily on taxing labor and consumption, while many forms of wealth, capital, and under-the-table income remain lightly taxed or completely untaxed. The result is a highly visible and uneven burden, especially for salaried workers and honest self-employed individuals.
This imbalance is compounded by an aging population, a shrinking workforce, and significant non-compliance, all of which stretch public finances while narrowing the tax base. As fewer workers fund growing pension and healthcare obligations, those who follow the rules often feel penalized for doing so.
Reforming the system would require more than just rewriting tax brackets. It would mean:
Broadening the tax base through simplification and stronger enforcement,
Rebalancing the system to reduce pressure on labor income, and
Restoring public trust in institutions and tax justice.
But these changes are politically sensitive and structurally complex. Italy’s tax architecture is tightly intertwined with its regional funding models, social security systems, and a long history of mistrust between citizens and the state. As a result, even modest reforms often stall in the face of entrenched interests or political instability.
Until that dynamic changes, the burden will remain disproportionately high — especially on those who comply fully with the rules — and Italy’s fiscal system will continue to struggle with the twin challenges of fairness and economic efficiency.
Buying a €1 home in Sicily or Italy can be an incredible opportunity, but it doesn’t come without obligations—especially if you’re a U.S. citizen. While Italy may offer you a symbolic entry into homeownership, the IRS still expects you to report your foreign holdings, earnings, and capital gains with the same level of detail as if the property were located in the United States.
This guide breaks down exactly how to handle your Sicilian property on your U.S. tax return—whether you’re using it as a rental, a second home, or your primary residence.
Ownership Reporting Requirements
The good news: simply owning a foreign property in your own name does not, by itself, trigger any IRS filing requirement. You don’t need to report the physical property directly.
However, if the home is held through a foreign company, trust, or partnership, you may be required to file forms like 5471 (foreign corporation), 8865 (foreign partnership), or 3520 (foreign trust). Failure to file these can lead to steep penalties, even if no tax is due.
If you use a foreign bank account for property expenses, and your total foreign account balances exceed $10,000 at any point during the year, you must file the FBAR (FinCEN Form 114). Additionally, if your total foreign financial assets exceed $50,000 (single) or $100,000 (married), Form 8938 (FATCA) may apply.
Investment Property vs. Personal Use
The tax treatment of your €1 home depends largely on how you use it.
If you rent it out, you must report the rental income on Schedule E and pay U.S. tax on the net earnings, even if you pay tax in Italy as well. You can deduct eligible expenses such as utilities, insurance, repairs, and depreciation. Foreign real estate is depreciated over 40 years.
If you use it solely as a second home, there is no income to report, and you can’t deduct maintenance costs or depreciation. However, property taxes and possibly mortgage interest may be deductible under general rules.
If the home is used both for rental and personal purposes, you’ll need to allocate expenses proportionally based on days used for each purpose.
The Foreign Housing Exclusion or Deduction
If you’re actually living in your Sicilian property and earning income abroad, you may be eligible to claim the Foreign Earned Income Exclusion (FEIE) and the Foreign Housing Exclusion or Deduction using Form 2555.
The FEIE allows you to exclude up to $126,500 (2024) of foreign earned income. On top of that, you may also be able to exclude qualifying housing expenses such as rent, utilities, and residential maintenance, subject to location-specific caps.
This exclusion applies only if you pass the Physical Presence Test (330 full days abroad in a 12-month period) or the Bona Fide Residence Test. If you own your property, housing expenses are more limited—you cannot exclude an imputed rental value, but you may still be able to deduct utilities and certain costs associated with maintaining the home.
Selling the Property and Capital Gains Tax
Even if you bought the house for €1, the IRS will expect you to report any gain upon sale. Use Form 8949 and Schedule D to report the sale and calculate capital gains. Your cost basis includes the purchase price plus documented improvements, notary fees, and related transaction costs—all converted to USD at the exchange rate in effect on each date.
If you use the property as a second home, you are not eligible for the §121 home sale exclusion. However, if the property was your primary residence for two of the last five years, you may exclude up to $250,000 ($500,000 married filing jointly) of gain.
Like-Kind Exchanges and Foreign Property
Foreign real estate is only like-kind to other foreign real estate. You cannot exchange a U.S. property for one in Italy or vice versa. However, if you’re selling one foreign investment property and purchasing another—for example, a home in Sicily for another in Portugal—a like-kind exchange is still possible if all IRS requirements are met.
The property must be held for investment or business use, not personal enjoyment, and the transaction must follow strict identification and timing rules.
Final Thoughts
Owning a €1 home in Sicily may feel like an adventure—and it is. But as a U.S. taxpayer, you have a duty to properly classify the property and report any related income, expenses, and gains. Whether it’s a weekend house, a rental project, or your long-term retirement home, your U.S. tax obligations follow you wherever you go.
Be especially cautious if you hold the property through a foreign entity or if you earn rental income, as these introduce complex reporting requirements. Always maintain documentation for expenses, renovation costs, and any use of foreign bank accounts.
If you’re unsure how your property fits into the U.S. tax system—or if you’re planning to renovate, rent, or sell—it’s worth consulting a specialized tax advisor (that’s us!) with international experience to keep you compliant and avoid surprises down the line.
For Americans working in Italy—whether as freelancers, business owners, or employees—navigating the world of social security contributions can be overwhelming. You may be wondering: will I have to pay into both U.S. Social Security and Italy’s INPS? What happens when I retire? Do I lose access to my U.S. benefits?
Fortunately, the U.S.–Italy Totalization Agreement exists to prevent exactly these kinds of problems.
What Is a Totalization Agreement?
The U.S. has signed Totalization Agreements with over 30 countries, including Italy, to avoid dual social security taxation and to coordinate benefits for people who split their careers between countries.
The U.S.–Italy agreement was signed in 1973 and entered into force in 1978. It was a historic agreement and one of the first of its kind. It’s an excellent example of the long and close relationships the two countries share. Its goals are:
To ensure you don’t pay into two social security systems for the same work
To combine coverage periods from both countries to qualify for benefits
To assign social security coverage to just one country at a time, based on your work situation
How the Agreement Works in Practice
1.
Which Country Gets to Tax You for Social Security?
The agreement uses a “territoriality rule”:
If you’re working in Italy, you pay into Italy’s system (INPS)
If you’re working in the U.S., you pay into U.S. Social Security
2.
Temporary Assignments (Up to 5 Years)
If your U.S. employer sends you to Italy for 5 years or less, you can continue paying into U.S. Social Security and avoid INPS. This is a specific procedure that the employer must follow.
To do this:
Request a Certificate of Coverage from the Social Security Administration (SSA)
Correct Forms and Registrations
Present it to INPS to avoid Italian contributions
The reverse applies to Italians sent to the U.S.
3.
Self-Employment
If you’re self-employed in Italy (e.g. Partita IVA), you’re generally covered by INPS, not U.S. Social Security—even if you exclude income under the FEIE (Form 2555).
Combining Work Periods (Totalization for Eligibility)
If you don’t qualify for U.S. or Italian benefits on your own, you can combine contributions (called “totalization”) to meet minimum eligibility thresholds.
For example:
U.S. Social Security requires 40 quarters (10 years) of work
If you worked 5 years in the U.S. and 7 years in Italy, you may still qualify using the agreement
Each country calculates your benefit based only on the earnings within its system, but may use the combined time to determine eligibility and final payout.
U.S. citizens with a Partita IVA in Italy must pay close attention to self-employment (SE) tax rules.
If you’re enrolled in an INPS scheme—such as Gestione IVS (for artisans and merchants) or Gestione Separata (for freelancers)—you are covered by the Italian social security system. Because Italy has a Totalization Agreement with the United States, you are exempt from U.S. SE tax in this case.
However, if you have self-employment income but are not enrolled in INPS, or if your income comes from a country that does not have a Totalization Agreement with the U.S., you may still owe U.S. SE tax at 15.3% on up to $176,100 of earnings (as of 2025).
Working in a Third Country (e.g. Spain or Germany)
If you live or work in a third country that also has a totalization agreement with both the U.S. and Italy (e.g. Germany, Spain, France), things can become more complex.
Generally:
You are only covered by one country’s system at a time
The country of your employer or self-employment usually determines where you pay
You may be able to combine work periods across all three countries to qualify for a pension, depending on bilateral treaties and in which country you make your first benefit request.
However, the U.S. does not allow multilateral aggregation, so only periods from one foreign country at a time can be combined with U.S. coverage. The EU, by contrast, may allow combination across EU countries. (Regulation (EC) No 883/2004)
This means you may have to strategically choose which country to apply through based on which is most beneficial for your circumstances.
What If You Have a Pension From a Country With No Agreement?
If you receive (or will receive) a pension from a country that does not have a totalization agreement with the U.S. (e.g. Argentina, Venezuela, or many developing countries), the situation changes:
You must pay into both systems if you’re working between that country and the U.S.
You may not be able to combine work periods to qualify for benefits
The U.S. Windfall Elimination Provision (WEP) may reduce your U.S. Social Security if the foreign pension is considered a substitute for U.S. Social Security
It pays to be strategic about where you apply for your pension. It is important to run the calculation under all three systems and perform the steps in the right order in the right country.
If you’re eligible for a foreign pension and U.S. Social Security, consult a tax advisor to determine whether WEP will reduce your benefits and whether any foreign tax credits apply.
Common Mistakes and Problems
Failing to request a Certificate of Coverage when working abroad, leading to unexpected double contributions.
Assuming the FEIE excludes self-employment tax — it doesn’t
Overlooking WEP when receiving both U.S. and foreign pensions
Choosing the wrong ATECO code in Italy and being placed in the wrong INPS category
Assuming your Partita IVA income doesn’t need to be reported in the U.S. — it does!
Final Thoughts
The U.S.–Italy Totalization Agreement is a powerful tool for avoiding double social security taxation and ensuring you don’t lose out on benefits when you split your career between countries. But it’s only effective if used properly.
If you’re self-employed in Italy, sent abroad on assignment, or nearing retirement with credits in multiple countries, make sure you understand how to:
Acquire an INPS Certificate to prove your Coverage
File Form 8833 with your U.S. tax return
Track your INPS and SSA contributions
Avoid unnecessary tax or loss of benefits
Need help? We are experienced tax professionals familiar with both U.S. and Italian systems who can make sure you stay compliant—and save money.
If you’re an American earning income in Italy—whether freelancing, consulting, or running a short-term rental business—you’ll likely need a Partita IVA. When you open one, you must choose a tax regime: forfettario or ordinario. This is completely different from anything similar in the US.
What is a Partita IVA (P.Iva)?
Here’s a clearer and more structured rewrite of your text, while keeping the original meaning and tone:
The closest U.S. equivalent to a Partita IVA (P.IVA) would be a Sales Tax Certificate, but the systems are fundamentally different. Italy operates under a Value Added Tax (VAT) system, not the U.S. sales tax model.
Functionally, a Partita IVA is similar to a sole proprietorship under U.S. common law. When you register a business with the Agenzia delle Entrate, you’re essentially registering the business in your own name and receiving authorization to operate commercially.
The Agenzia delle Entrate will not open a P.Iva for a non-resident individual. Non-residents will need to operate through another type of entity, usually by forming a Srl.
As part of the registration, you must select one or more ATECO codes, which are similar to NAICS codes in the U.S. However, unlike NAICS codes, ATECO codes in Italy are not just descriptive—they can also determine your eligibility for certain activities or incentives. For example, there are specific codes for different types of retailers, distributors, technicians, or installers. Choosing the wrong code can make you ineligible for grants, tax credits, or sector-specific authorizations.
In the U.S., business categories and operations tend to be more informal and decentralized. In contrast, the Italian system is more regulated and codified, with a stronger emphasis on clearly defined categories and activities.
The two accounting models:
Regime Forfettario (Flat-Rate Scheme)
The Regime Forfettario was created in an order to bring more businesses out of the grey economy and into the tax system. It greatly increases simplicity in administration and accounting but offers substantial drawbacks for business owners that are used to maximizing deductions. When speaking to individuals about the forfettario regime, often times they have never had a regular accounting system and often aren’t aware of how much they’re leaving on the table.
The forfettario regime is designed for individuals earning under €85,000 annually. It offers a simplified tax structure:
Tax is applied to a fixed percentage of your income (called coefficiente di redditività), not your actual profit. For most services, this is 78%. This replaces deductions. When used efficiently especially in businesses with very few expenses it can be very powerful.
A flat tax rate of 15% applies (5% for new businesses for the first 5 years if eligible). This is a huge incentive.
No VAT obligations: you do not charge or deduct VAT.
No detailed bookkeeping is required. But electronic invoicing is still mandatory in Italy.
Depending on your profession you will also need to make mandatory minimum INPS (Social Security) payments. These can be relatively proportionate or very high depending on your ATECO code. To learn more about INPS/Social Security Read our Article.
Example: On €40,000 of income, you’d be taxed on €31,200 (78%), paying €1,560 if using the 5% rate.
Best suited for freelancers and small service providers with low expenses who want simple compliance.
Regime Ordinario (Standard Accounting)
This is the traditional regime, similar to U.S. self-employment taxation. It’s based on actual profit (income minus expenses) and requires full bookkeeping:
Progressive income tax (IRPEF) ranging from 23% to 43%.
VAT must be charged on invoices and paid quarterly.
Full deductions allowed for business-related expenses.
Requires an accountant and quarterly filings.
This regime is appropriate if you exceed the forfettario income limit, have significant expenses, or invoice clients who require VAT.
U.S. Tax Considerations
Even if you pay Italian tax, U.S. citizens must report all global income. Fortunately, foreign tax credits or the U.S.–Italy tax treaty typically prevent double taxation. The forfettario regime can simplify reporting to the AdE but if you don’t maintain good records this may complicate claiming the business deductions in the US. Since P.Iva is considered self employment income it usually qualifies for the Foreign Earned Income Exclusion (FEIE) which has an exclusion limit of $130,000 (2025) per qualifying individual. This means that all income under that limit will only be subject to Italian tax rates, but unfortunately they will still need to be itemized on Schedule C as if it was a going concern in the US.
Conclusion
For new or part-time professionals in Italy, the forfettario regime is usually the simplest and most tax-efficient option. As your business grows or your expenses increase, the ordinario regime may become more advantageous.
If you’re unsure which is best for your situation, it’s worth consulting a commercialista familiar with both Italian and U.S. tax obligations. If you couldn’t guess who that is, it’s us. Schedule an appointment!
Often times clients ask us the easiest way to form a company in Italy. There are many different entities types in Italy, and they do not reflect American customs very closely. Over the last decades entity forms have slowly converged but there remains substantial differences between the US and Italian systems.
Firstly, we need to pick an entity type:
Quick Summary of Entity Types in Italy
Italian Entity Type
U.S. Equivalent
Limited Liability
Separate Legal Entity
Corporate Taxation
SRL (Srls)
LLC or S-Corp
✅ Yes
✅ Yes
✅ Yes (IRES)
SPA
C-Corp
✅ Yes
✅ Yes
✅ Yes (IRES)
SNC
General Partnership
❌ No
❌ No
❌ (partners taxed)
SAS
Limited Partnership
Mixed
❌ No
❌ (taxed at partner level)
Ditta Individuale
Sole Proprietorship
❌ No
❌ No
❌ (personal tax)
Cooperativa
Cooperative
✅ Yes (mostly)
✅ Yes
✅ Yes (with benefits)
ETS / APS / ONLUS / Foundation
Non-Profit
✅ Yes
✅ Yes (with public act)
✅ (often exempt)
1. SRL – Società a Responsabilità Limitata
Best for: Small to medium-sized businesses, freelancers, startups
Comparable to: U.S. LLC, S- Corp or Private C-Corp (depending on elections)
The SRL is the most popular type of limited liability company in Italy. It has a flexible structure, low minimum capital (as little as €1), and limited liability protection. Owners (called soci) are only liable up to the amount of capital contributed.
Key features:
Pays corporate tax (IRES) at 24% + IRAP (~3.9%)
Dividends taxed at 26% (with treaty reduction possible)
Can have one or more shareholders
Can be managed by shareholders or external directors
U.S. Note: If you own >50%, the SRL will be a Controlled Foreign Corporation (CFC) for U.S. tax purposes.
2. SPA – Società per Azioni
Best for: Large companies, raising capital, foreign subsidiaries
Comparable to: Public U.S. C-Corporation
The SPA is a joint-stock company typically used by larger businesses. It requires a minimum capital of €50,000 and is heavily regulated. Shares are more freely transferable than in an SRL.
Key features:
Suitable for stock exchange listing or major funding
Strong governance structure with a board of directors
Subject to statutory auditing
Generally overkill for small businesses or startups.
3.
SNC – Società in Nome Collettivo
Best for: Small family businesses or partners with strong trust
Comparable to: U.S. General Partnership
All partners in an SNC are personally and jointly liable for the company’s debts. There’s no corporate tax: income passes through to the partners’ individual returns.
❌ Not recommended for foreigners or anyone wanting asset protection.
4.
SAS – Società in Accomandita Semplice
Best for: Silent investor + active manager setup
Comparable to: U.S. Limited Partnership
An SAS has two kinds of partners:
General partner (accomandatario): has full liability
Limited partner (accomandante): liability is limited to their capital
Often used when investors want to fund a venture without being actively involved.
5.
Ditta Individuale – Sole Proprietorship
Best for: Solo entrepreneurs or freelancers
Comparable to: U.S. Sole Proprietorship
Easy to set up, low cost, but offers no legal separation between the business and personal assets. The owner is personally liable for all debts.
⚠️ Taxed as personal income, and cannot bring in partners.
6.
Cooperativa – Cooperative Society
Best for: Collective businesses, agriculture, social ventures
Comparable to: No clear US equivalent
Owned by its members, often workers or producers. Profits are partly reinvested and partly distributed. Offers tax incentives, especially for agricultural or social cooperatives.
🔎 Some forms benefit from indivisible reserves, making them interesting for long-term land or capital projects.
7.
ETS / ONLUS / Foundation – Non-Profit Entities
Best for: Charities, cultural associations, religious or educational missions
Comparable to: U.S. 501(c)(3) Non-Profit
Italy has several non-profit categories:
ETS (Ente del Terzo Settore): newly regulated third-sector entities
APS, ONLUS: older system, being phased out
Fondazione: a foundation with assets dedicated to a purpose
🎯 These may be exempt from IRES, can receive donations, and may access public funding, especially in the south of Italy.
🔍 What Should a U.S. Citizen Consider?
Limited Liability Is Key: SRL is your safest and most versatile option.
Watch Out for U.S. Reporting: If you own a foreign entity, you may have to file Form 5471, FBAR, or Form 8938.
Plan for Withholding Taxes: Dividends paid to you are subject to 26% tax unless reduced by treaty.
Choose an Accountant Who Knows Both Systems: Mistakes in classification or filings can lead to penalties in both countries.
Corporate Formation
Because most Americans in Italy will want to form a Srl or Srls let’s go through the steps:
Step 1: Decide on Key Company Details
Before anything is filed, you need to define:
Company name (unique and approved by the local chamber of commerce)
Corporate purpose (oggetto sociale) – what the company does
Registered office address (sede legale)
Shareholders – who owns the company, and their percentages
Director(s) – who will manage the company
Initial share capital (minimum €1, but usually €10,000+ is recommended)
📑 Step 2: Draft the Statuto and Atto Costitutivo
You’ll need two documents:
Atto Costitutivo (Deed of Incorporation, US Articles of Incorporation)
Statuto (Equiv. to US Operating Agreement or Bylaws)
These define how the SRL will operate. They must include capital structure, governance rules, profit distribution, and powers of directors.
✅ If you’re opening with a standard structure (e.g., two owners, 50/50), many notaries can offer model templates.
Step 3: Sign the Deed with an Italian Notary
This is the formal incorporation. It must be done in front of an Italian notary (notaio), either in person or via a Power of Attorney (Procura Speciale) if you’re abroad.
Required documents:
Valid ID/passport
Codice fiscale (Italian tax code) for each shareholder and director
PEC (certified email address) for the company
Anti-money laundering declarations
Proof of capital payment (either a bank statement or declaration)
If you do not understand Italian you will need to have either an interpreter or have the documents legally translated.
If you’re not in Italy, you can give power of attorney to someone else to sign on your behalf. This is done with a procura speciale.We can arrange this for you.
Step 4: Deposit Share Capital
Capital can be:
€1–9,999: paid upon formation, but liability is not limited until paid in full
€10,000 or more: at least 25% must be paid in, unless it’s a single-member SRL, in which case 100% must be deposited
The capital is deposited into a dedicated bank account, usually opened provisionally at a bank and finalized after registration.
Step 5: Register the Company
The notary submits everything electronically to:
Registro delle Imprese (Companies Register at the local Chamber of Commerce)
Agenzia delle Entrate (Tax Agency) for your SRL’s VAT number (Partita IVA)
INPS/INAIL if you’re hiring employees
📆 Processing time: typically 7–15 days after the notary appointment
🧾 Step 6: Activate VAT and Accounting Setup
You must:
Register for VAT (Partita IVA) and choose your tax regime
Appoint a commercialista (accountant) for ongoing bookkeeping and tax compliance
Set up electronic invoicing and PEC email
Italy has strict e-invoicing and digital bookkeeping rules—it’s essential to have a professional accountant handle this from day one. This can’t be understated. We’re not aware of any other company that is as strict with invoicing.
🧳 What if You’re a Foreign Shareholder?
As a U.S. citizen, you can own and operate an SRL in Italy without residency. However:
You’ll need a Codice Fiscale
You must appoint a legal representative
If you’re not a resident or an Italian citizen, some banks may restrict or delay opening business accounts—so plan ahead
🏦 What About Banking?
After incorporation:
You can finalize your bank account
The provisional account becomes fully operational
You’ll gain access to Italian online banking, card issuance, and payroll systems
US Persons should be aware that not all banks will accept Americans due to FATCA reporting.
💡 Tip: Work with a business-friendly bank branch or ask your notary/accountant to introduce you.
📌 Timeline Overview
Task
Approx. Duration
Gather documents
1–2 days
Drafting statuto
2–5 days
Notary appointment
3–7 days
Registration & VAT
7–15 days
Banking & accounting setup
5–10 days
Total: 2 to 4 weeks, but can be faster with good planning
💡 Pro Tips for U.S. Entrepreneurs
Consider a Holding Structure: If you plan to own multiple businesses or receive dividends, a holding company(Italian or Irish, for example) may offer tax advantages. We work with both countries.
Avoid becoming Italian tax resident by accident if you’re only here short-term. Tax residency comes with high costs if you’re not prepared.
Use a commercialista familiar with U.S. tax law, especially for reporting SRL ownership on IRS Forms 5471 and FBARs.
Evaluate tax regimes, such as the regime forfettario (if applicable) or reduced IRES rates for reinvested profits.
Final Thoughts
Opening an SRL in Italy is very doable for U.S. citizens, especially with the right legal and accounting support. Whether you’re launching a local venture or managing international operations, the SRL offers a strong balance of protection, flexibility, and tax efficiency.
Just remember: Italy’s process is formal and legalistic. English language professionals and materials are uncommon, so don’t go it alone—a trusted notary and commercialista will make the difference between frustration and a smooth launch.
U.S. Citizens Owning an SRL in Italy: What You Need to Know About Resident vs Non-Resident Taxation
Thinking about moving to Italy or investing in an Italian business? Many Americans who look at buying property in Italy or Sicily are entrepreneurial and immediately want to entertain the idea of starting a business. This can get complicated quickly with corporate residency, personal residency and Tax Treaties.
Here’s a breakdown of how residency status affects your tax obligations as an American owning one or more SRLs in Italy.
👤 What Is an SRL?
An SRL (Società a Responsabilità Limitata) is the Italian equivalent of a Limited Liability Company (LLC). It’s a separate legal entity that pays corporate tax (IRES) at a flat rate of 24%, (like a US C-Corp) plus regional taxes (IRAP) of around 3.9%depending on the region.
🏠 Resident vs Non-Resident: What’s the Difference?
The Italian tax system classifies individuals as tax residents or non-residents, and this has big implications for how dividends from your SRL is taxed.
Italian Tax Resident
You’re considered a tax resident in Italy if you meet any one of these conditions for more than 183 days in a calendar year:
You are registered with the Anagrafe della Popolazione Residente (Registry of Residents).
Your center of vital interests (family, economic, or social life) is in Italy.
You are physically present in Italy for the majority of the year.
What does this mean for SRL owners?
You’ll be taxed in Italy on your worldwide income, including:
Salaries or director’s fees paid by the SRL.
Dividends from the SRL.
Rental income, investment income, etc.
Dividends are taxed at a flat 26% withholding rate, but as a resident, this is your final tax. This can result in a very high effective tax rate.
You must file an Italian tax return (Modello Redditi PF) and potentially a foreign asset declaration (Quadro RW).
Italian Tax Residents should entertain holding structures in both Italy and the EU, as well as administrator salary and owner dividend strategies to defer withholding tax.
Non-Resident
If you do not meet any of the conditions above, you are considered non-resident.
What does this mean for SRL owners?
You are only taxed in Italy on Italian-source income. For example:
Dividends from an Italian SRL.
Income from property or services in Italy.
Dividends distributed to you are still subject to a 26% withholding tax, unless reduced by a double taxation treaty (e.g., U.S.-Italy tax treaty lowers this to 15%, or even 5% if you own more than 10% of the SRL).
You don’t pay Italian taxes on foreign income or assets.
Withholding Tax paid in Italy can be claimed against your US tax burden using the Foreign Tax Credit.
If part of a group inter-entity shared services and other strategies can make taxation more efficient.
💡 Tax Planning Tips for Americans
Be strategic about residency: If you plan to live in Italy part-time or run your SRL remotely, you may be able to avoid becoming a tax resident—and the worldwide income requirement.
Use tax treaties: The U.S.-Italy Tax Treaty helps reduce double taxation on dividends, interest, and royalties. But you must claim treaty benefits properly.
Consider your U.S. obligations: As a U.S. citizen, you must report global income to the IRS, regardless of where you live. You’ll also have to file FBAR and possibly Form 5471 if you own more than 50% of a foreign corporation. You can never escape US taxation as a US Citizen.
Work with a cross-border tax expert: Navigating Italian taxes and complying with U.S. rules (like GILTI or Subpart F income) requires specialized knowledge. JSBC is one of only a handful of firms that specializes specifically in the Italian-American experience.
Watch Out: U.S. Tax on Foreign Corporations
Even if your SRL pays taxes in Italy, the U.S. may still impose additional tax on your share of the profits. Some key things to know:
CFC Rules: If you own more than 50% of the SRL (alone or with related parties), the SRL is a Controlled Foreign Corporation (CFC). You may owe U.S. tax even on undistributed earnings.
Foreign personal holding company (FPHC): It is important that the Srl is an active business to avoid FPHC rules.
GILTI Tax: The Global Intangible Low-Taxed Income (GILTI) regime can hit U.S. shareholders of foreign corporations with a surprise tax bill—though individuals may be able to mitigate this with planning.
Fortunately due to Italy’s relatively high tax rate these rules often do not apply.
✈️ Thinking of Moving to Italy?
Before making the leap, consider:
Whether to delay establishing residency, or avoid residency entirely until you’re fully informed and set up.
Applying for special tax regimes like the “Impatriati Regime” which can reduce Italian income tax by 70–90% for up to 10 years. These regimes often are less effective for US Citizens.
Structuring your SRL and ownership in a way that optimizes both Italian and U.S. taxation.
Very High Net Worth Individuals may want to consider renouncing US Citizenship as many Italian Americans are exempt from the “exit tax”.
Contact JSBC for a consultation
Final Thoughts
Owning an SRL in Italy as an American can be a smart move—especially if you’re passionate about living and doing business in Italy. Reinvesting profit can be tax advantaged versus US personal income tax rates.
Plan ahead, structure wisely, and always consult a dual-competent tax advisor. The right structure can protect your income, minimize tax exposure, and ensure your Italian business dream stays a profitable one.
This is NOT an easy question! We’ll give you an overview, but you’ll really want to schedule an appointment for this one.
If you’re an American living in—or earning income from—Italy, you may be wondering how much Italian income tax you’re required to pay. The answer depends on whether you’re considered a tax resident or non-resident under Italian law. Here’s a breakdown of how it works, what rates apply, and how to avoid double taxation.
Are You a Tax Resident in Italy?
Under Italian law, you are considered a tax resident if any one of the following applies for more than 183 days in a calendar year:
You are registered as a resident of an Italian municipality
You maintain your habitual residence in Italy
Your center of vital interests (economic and personal) is in Italy
If you qualify as a resident, you are subject to tax on your worldwide income in Italy. If not, you are only taxed on income sourced in Italy.
🧾 Taxes for Residents
If you are a resident of Italy, you must file an Italian tax return (Modello Redditi or 730) and declare all global income, including:
Employment or self-employment income
Rental income (both Italian and foreign)
Investment income and dividends
Pensions
Capital gains
📊 Income Tax Rates (2024)
Italy uses a progressive tax system:
Income Bracket (EUR)
Tax Rate
0 – 28,000
23%
28,001 – 50,000
35%
Over 50,000
43%
Plus:
Regional taxes: ~1.2%–3.3%
Municipal taxes: ~0.1%–0.9%
Social contributions: if you’re self-employed or operating a business
Fortunately, there are many tax incentives and planning strategies available that can significantly reduce your tax burden in Italy. However, it’s crucial to consider your tax situation before declaring residency or moving to Italy. Many of the special tax programs require you to apply or declare your intent in advance, before officially becoming a resident. Planning ahead can make a major difference.
⚖️ U.S.–Italy Tax Treaty
Italy has a tax treaty with the United States to prevent double taxation. As a U.S. citizen, you still must file your U.S. tax return, but you may claim a Foreign Tax Credit (FTC) on your IRS Form 1116 for taxes paid in Italy.
Additionally, you may be eligible for the Foreign Earned Income Exclusion (FEIE) (Form 2555) if you meet physical presence or bona fide residence tests.
Taxes for Non-Residents
If you are a non-resident, you are only taxed on income earned in Italy, such as:
Rental income from Italian property
Business or professional activity carried out in Italy
Employment physically performed in Italy
Italian dividends or interest
Non-residents are subject to flat withholding taxes on some types of income:
Type of Income
Typical Tax Rate
Rental income
21%–30% (depending on cedolare secca eligibility)
Dividends
26% (may be reduced under treaty)
Capital gains
26% (on Italian-sourced assets)
Non-residents are not eligible for many tax deductions and credits available to residents. It is very important to have an accountant that understands the USA – Italy Tax Treaties. Not properly understanding both systems can result in extra taxes, double taxation or penalties.
💡 Special Tax Regimes for New Residents
Italy offers attractive tax incentives for new or returning residents. These are always changing, so check that these are still available when you read this article:
1. Impatriate Regime
Workers moving to Italy can exclude up to 70% of income (90% in southern regions) from taxation for 5 years, renewable under certain conditions.
2. €100,000 Flat Tax for High Net Worth Individuals
New residents can opt to pay a €200,000 flat tax (2025) per year on all foreign income—no matter the amount—plus €25,000 for each additional family member. Unfortunately this isn’t as good as it could be for USA Citizens because US Citizens are still subject to tax on their global income.
Key Tips for Americans
Declare your Italian income on your U.S. tax return—you are taxed on worldwide income as a U.S. citizen.
File FBAR and FATCA forms if you have over $10,000 in foreign accounts.
Work with an accountant like us that specializes in Americans in Italy and Sicily
Track residency days carefully—tax residency kicks in faster than many people realize. It’s usually better to avoid Italian tax residency.
Final Thoughts
Whether you’re living in Italy full time or simply earning rental income from a Sicilian villa, you will owe taxes in Italy—but how much depends on your residency status and type of income. The good news? With the right planning, you can avoid double taxation, take advantage of special regimes, and remain compliant in both countries.
Living la dolce vita doesn’t mean ignoring the taxman—but with good planning it doesn’t have to be stressful!
How It Compares to U.S. “Power of Attorney”(POA) and Why It Matters
If you’re buying property, incorporating a company, or handling legal matters in Italy from abroad, chances are you’ll need a procura speciale—a legal tool often misunderstood by non-Italians. While it’s sometimes translated as a “special power of attorney,” the Italian version is much more formal and specific than what many Americans are used to.
Here’s what you need to know.
What Is a Procura Speciale?
A procura speciale is a notarized legal document that grants someone the authority to act on your behalf for one specific legal act—such as signing a deed, forming a company, or accepting an inheritance. It’s task-specific, tightly worded, and expires when the task is completed.
It is typically required for:
Real estate transactions
Court appearances
Signing contracts before a notary
Submitting succession or tax documents
Unlike casual authorizations, a procura speciale is binding and must be drafted in formal legal Italian and signed before a notary public.
🔄 How It Differs from a
Procura Generale
A procura generale is like a general power of attorney: it allows the agent to act across a wide range of legal and financial matters on your behalf. It remains valid until revoked or expired and is used for broader, ongoing representation—such as managing assets or companies.
Feature
Procura Speciale
Procura Generale
Scope
Single task
Multiple tasks
Duration
As stipulated
Usually ongoing
Requires Notary
Yes
Yes
Use Case
Real estate, inheritance
Business, asset management, elderly affairs.
🇺🇸 How Italian Procure Differ from U.S. Powers of Attorney
While the concept is similar, there are key differences between Italian procure and U.S. POAs:
Durability: In the U.S., POAs can be durable (remain valid after incapacity). In Italy, procure with few exceptions automatically expire if the principal becomes incapacitated.
Medical Authority: U.S. POAs can include healthcare decisions. In Italy, medical authority is handled separately via advance directives (DAT).
Formality: Italian procure are much more formal, notarized, and specific. A U.S.-style POA will not be accepted in Italy unless properly translated, notarized, and apostilled.
Cross-border validity: A U.S. POA can only be used in Italy if it’s properly legalized (apostilled) and, in many cases, translated and reviewed by an Italian notary.
What About a Delega?
A delega is often confused with a procura, but it’s something entirely different.
A delega is a simple authorization letter, typically used for minor tasks like picking up registered mail, submitting documents, or attending basic appointments.
It doesn’t require a notary and has no legal standing in notarial acts or court matters.
Feature
Procura Speciale
Delega
Legal Status
Formal legal act
Informal authorization
Requires Notary
Yes
No
Use Case
Real estate, legal matters
Post office, errands, delivering documents
Scope
Legally binding
Administrative only
Bottom line: A delega is a note. A procura is a contract.
🧭 When Should You Use a Procura Speciale?
If you:
Can’t travel to Italy for a closing
Are incorporating a company remotely
Need someone to sign notarial documents or act in court
Are managing an inheritance or donation
…you’ll need a procura speciale. It allows a trusted person to act on your behalf in a legally valid way—just for that task, and nothing more.
🔐 Final Tips
Sign your procurabefore an Italian notary, or before a U.S. notary with apostille and certified Italian translation
Be specific—vague language may lead to rejection
Consult an Italian notary or lawyer to ensure it’s valid for the intended act
Contact us for a consultation about how to resolve your problems. We have a network of professionals to resolve every part of American life in Italy.
In Italy, legal precision matters. While a U.S. power of attorney might work for many things at home, it often won’t be accepted abroad unless adapted to the Italian system.