Reading these forums, it seems there is some confusion on the law concerning how Mexico taxes it's foreign permanent residents. I have read that Mexico taxes ALL worldwide income for these residents. Of course, for US citizens that set up tax advantaged investments(e.g. tax-free municipal bonds, qualified dividends, etc.) the thought of paying Mexican taxes on these would make me pay FAR higher taxes in Mexico than the US; even after a tax credit! Would my SSA payments and annuity payments get taxed also?
I have read that many(most?) US residents holding permanent residency status in Mexico just does not file taxes there. True?
Any clarifications would be appreciated.