A friend forwarded me the Forbes list over lunch last Friday, with a single line above it: “Italy made it — see, you were right.”
She meant it kindly. She is also the third person this year to send me a ranking as though it was meant to answer some unasked question I’ve been having all along.
In reality, that Forbes list is not bad. It is more careful than most of what gets published in this genre, and I would rather praise it than pick at it. But the Italy entry is about two hundred words long, and a two-hundred-word entry surely cannot carry a decision that would reshape your health care, your lifestyle, your tax residency and your distance from your family and friends.
What the list gets right
Forbes named ninety-six locations across twenty-four countries, twelve of them European. The criteria are sensible: cost of living, taxes, healthcare quality and cost, crime and political stability, ease of getting back to see family, and whether you can function socially without mastering the local language.
The genuinely new element is climate and natural hazard risk. Forbes dropped its recommendations for Bordeaux and for several places in Spain, including the Costa del Sol, on wildfire and heat grounds. It also notes, against its own decision, that less than 1% of the land mass in Spain and France has actually burned. That is a fair way to handle an uncomfortable data point, and it is more than most lists do.
For Italy the entry lists Bologna, Florence, Le Marche and Lombardy, and describes the healthcare as excellent with access to the public system. Broadly, that is right.
Three things in the Italy entry to correct
The first is small. Le Marche is described as being in the Abruzzo region. It is its own region, sitting immediately north of Abruzzo along the Adriatic. “Lombardi” is Lombardia, or Lombardy. These are typos rather than errors of substance, but they matter if you are typing region names into a property search.
The second is the money. Forbes says the Elective Residency Visa requires a couple to show at least $51,000 in annual retirement income. The published minimums are about €31,000 for a single applicant and roughly €38,000 for a couple, which at current rates is well under the Forbes figure.
The Forbes number is not unreasonable as practical guidance. Consulates apply their own discretion, and the ones in North America have historically asked for considerably more than the printed floor. But it is presented as the requirement rather than as an estimate of consular practice, and a couple with €40,000 in pension income may read that sentence and conclude they are ineligible when in fact they are just simply not comfortably above the bar.
The third is an omission, and it is the significant one.
There’s something the list does not mention
Under article 24-ter of the Italian income tax code, a foreign pensioner who moves tax residence to a qualifying town in one of eight southern regions — Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise and Puglia — can elect a flat 7% substitute tax on all foreign-source income, not only the pension. It runs for the year of transfer and the nine that follow. The main conditions are that you were not tax resident in Italy in the five preceding years, and that you arrive from a country with a tax information exchange agreement in place.
Until this spring the qualifying town had to have no more than 20,000 residents. Law 34/2026, in force from 7 April, raised that ceiling to 30,000, which brings in a band of mid-sized towns with hospitals, rail links and airports that the small-borgo version of the regime effectively excluded. Certain towns in the central Italian earthquake zones, some of them in Le Marche, also qualify, though advisers currently read the applicable population threshold there differently and this is worth confirming rather than assuming.
Why this is less dramatic for Americans than it sounds
Two caveats, and they are important ones.
Under the US–Italy treaty, US Social Security benefits paid to an American who is not also an Italian national are taxable only in the United States. Italy does not get to tax them, which also means the 7% election does nothing for that slice of income.
And American citizens keep filing with the IRS wherever they live. The election reduces an Italian bill that would otherwise run at ordinary rates of 23% to 43%; it does not reduce the US floor underneath. The benefit is real, but it concentrates in traditional IRA and 401(k) drawdowns, private pensions, foreign dividends, rents and capital gains — not in Social Security.
None of this suggests the regime is a gimmick. For the right income mix it is one of the more generous arrangements in Europe. It just means the headline rate is not the number you will actually pay.
What should you do with this information?
Is the town you actually like eligible? Eligibility is a legal list, not a vibe. A comune of 34,000 on a beautiful stretch of coast is outside the regime, and a plainer town twenty minutes inland may be inside it.
What does your income look like, line by line? The election is worth modelling against your real composition of Social Security, retirement account withdrawals and investment income before it influences where you look at houses.
How far is the nearest emergency department? Tax regimes are designed to move people into places that need more residents. Those are often the same places with the thinnest hospital coverage, and that trade deserves its own conversation.
Back to the lunch
My friend was not exactly wrong. Italy belongs on a list like that one, and if the list is what starts the conversation, it has done something useful.
It just cannot finish it. A ranking tells you a country is plausible. It does not tell you which of that country’s thirty-odd tax and residency arrangements you fall into, and that is where one’s money and the disappointment both live.
If you have looked at the 7% regime seriously — or looked at it and decided against it — I would like to know what tipped the decision. Was it the eligible-town list, the healthcare, or something quieter than either? Write me and let me know. I’d love to hear from you.
A note on the numbers
The visa figures come from published consular guidance and practitioner summaries current as of August 2026; there is no single official schedule, and consulates vary. The tax provisions are drawn from article 24-ter of the TUIR as amended by Law 34/2026, in force from 7 April 2026, and from the Agenzia delle Entrate’s guidance page for the foreign pensioners’ regime. Treaty treatment of Social Security is drawn from an IRS advisory letter interpreting article 18 of the US–Italy convention. Accessed August 2026. None of this is tax advice, and the eligible-town question in particular should be checked with a professional against the current ISTAT population figures.