Moving to Norway: Home With a Rental Unit, Deferred Annuities or the Bank? What Pencils for Most Families
Written by Hans Goldstein, EA, licensed insurance agent · CA 4273294Admitted to practice before the IRS
Short answer: for most families a home is the base, and a home with a small rental unit does best. Deferred income annuities (DIAs) earn their place only if you come back to the US and one of you is likely to live into the mid-90s. If you stay in Norway for life, the DIAs lose: Norway taxes every check at 22%, and a municipal nursing home takes up to about $68,000 a year of them. A home is not charged by the nursing home, carries little wealth tax and goes to your heirs. All payouts here are modeled, not quotes.
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Parents 70 and 68, moving to Norway, $1 million to place. I ran four choices through a model with Norwegian wealth tax, Norwegian and US income tax, the nursing-home charge and what the heirs get. Two cases: they come back to the US after 10 years, or they stay in Norway for life and the survivor ends up in a nursing home for the last 3 years.
What pencils for most families
| Same $1 million in… | Back in the US: yearly return if the second parent dies at 90 / 95 | Stay in Norway for life: dies at 90 / 95 | Norway wealth tax, first 10 years | Left to heirs at 90 | Nursing-home clawback |
|---|---|---|---|---|---|
| Home with a rental unit | 4.5% / 4.3% | 5.3% / 5.3% | $30,000 | about $1.9M to $2.0M | Small: only the rent counts, not the house |
| Home, no unit | 3.9% / 3.8% | 4.1% / 4.2% | $30,000 | about $1.9M to $2.0M | None: the house is not charged |
| 3 DIAs, life only | 2.9% / 5.0% | 0.9% / 3.7% | $0 | $0 | High: checks count as income, up to about $68,000 a year |
| Bank or bonds | 3.0% / 3.1% | 2.1% / 2.2% | $116,000 | $1.6M to $1.9M | Medium: the interest counts |
- The home with a rental unit leads in both cases. It returns 4.3% to 5.4% a year, carries about $30,000 of wealth tax over 10 years (counted at 25% of its value), leaves the most to heirs and is not charged by the nursing home.
- The DIAs win only in one corner: back in the US and one parent reaches the mid-90s (5.0% at 95, against 4.3% for the home with a unit; they cross around 93). If the second parent dies at 85 or 90, the home wins.
- Staying for life flips the DIAs. Norway taxes each check at 22% on the gross amount while you live there, and the nursing home takes most of what is left. Even at 100 the DIAs (5.1%) trail the home with a unit (5.4%).
- Life-only DIAs leave nothing to heirs. A cash-refund version pays checks about 10% lower (modeled) and returns the unpaid premium, but past age 88 the checks already paid exceed the premium, so heirs still get $0.
Assumptions: ages 70 and 68, DIAs starting in years 11, 14 and 17, 4.5% bank yield, 3% house growth, $2,600 a month of rent saved, 2.5% inflation, wealth tax at the 1% margin. A separate rental apartment (counted at 100% in the wealth tax) did worse: about 3.3% and $118,000 of wealth tax over 10 years.
Why the DIAs lose if you stay: the nursing-home clawback
In Norway a long stay in a municipal nursing home (sykehjem) is paid by the town, and the resident pays a share of income, not of capital. Under the egenandel regulation (section 3), the town may charge 75% of income up to 1 G less an allowance of NOK 10,950, and up to 85% of income above 1 G. G is NOK 136,549 from 1 May 2026. The resident keeps at least 25% of G, and the charge cannot exceed the real cost of the stay, which I model at about NOK 660,000 (roughly $68,000) a year. Income means pensions, other regular benefits, work, rent, and interest or other return on capital, after tax.
- Capital is not charged. A paid-off house, or cash, only counts through what it earns. A house earns nothing, so the charge on it is zero if you keep it unrented.
- Annuity checks count. The regulation names pensions and periodic income, not a US annuity, so I treat it as income. I found no ruling, so this is my reading. Checks reach the 85% band quickly: on my numbers the survivor pays about $68,000 a year with the DIAs, about $28,000 on a bank balance and about $8,000 on a rental unit.
- It costs about 1.4 points a year. Staying for life, the DIAs return 2.3% with no nursing-home years and 0.9% with three (dies at 90).
If you come back to the US, the Norwegian charge does not apply. US Medicaid and long-term-care rules are different, and an annuity counts as income there too; I did not model them.
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Estimates use the September 9, 2026 ImmediateAnnuities.com payout survey (life only) and a 15% cushion. Illustrative, not a quote.
At death: what the heirs get
- Norway. There has been no inheritance tax since 2014. Heirs take over the deceased’s tax basis, so gain is taxed only when they sell, and a home that qualified for the tax-free sale rule can pass that on.
- US. A US citizen’s heirs get a new basis at death (IRC 1014), including on a Norwegian home. The 2026 federal estate tax exemption is $15 million per person ($30 million for a couple), so most families owe none.
- The assets. A home, rental unit or bank balance goes to the heirs at full value. A life-only DIA stops at the second death and leaves $0.
The home with a rental unit
- No Norwegian income tax on the rent. Skatteloven section 7-2 exempts rent from your own home when the lease is at least 30 days and you use at least half of the home, measured by rental value. At $1,200 a month that is $14,400 a year. Multi-family houses are outside the rule.
- The house keeps its 25% wealth valuation. Skatteetaten’s handbook says a home can stay a primary home even though a small unit is rented out, as long as your own unit is not rented for any part. In a nursing-home case the home stays a primary home if it is not rented for pay.
- The IRS still taxes it. A US citizen reports the rent on the US return. I model 70% of it as taxable. The rent also counts as income for the nursing-home charge, which I assume.
Where a DIA ladder is still worth it
Return to the US and you may still want income you cannot outlive. A SPIA that pays now plus three DIAs starting 5, 10 and 15 years later is a homemade cost-of-living adjustment: sized for 2.5% inflation, the first check is about 6% above a SPIA with a COLA rider and the staircase stays ahead into the mid-80s (single man, $1.2 million, modeled). It also pushes tax later, because nothing is reported while a DIA waits, and only part of each check is income afterward (IRC 72(b)). Against a US rental, the ladder beats an unleveraged rental held to death with the step-up at around age 92 and a 65%-leveraged one around 98, and loses to both if heirs matter. Details in the DIA explainer and the QLAC explainer.
The timing rule for Norway still holds: checks received while you are a Norwegian resident are taxed at 22% on the gross amount, and a DIA that starts after you leave is not. See the 5-year page.
Run it on your own numbers
The calculator has the home, the rental unit, the nursing-home years and the heirs column. The case study walks through parents 70 and 68. I am a US-licensed agent, not a Norwegian tax or legal adviser, and payouts are modeled, not quotes.
Frequently asked questions
Free annuity gap analysis for Norway. Tell me your ages, your Social Security or pension, and whether you are single or a couple. I will show how far your income is from the Norway requirement and what a lifetime annuity would cost to fill the gap, in the sponsor’s or main applicant’s name where that matters.
Related reading
- Moving to Norway from the US: the hub
- DIA ladder vs real estate calculator
- Case study: parents 70 and 68, 10 years in Norway
- Moving to Norway for 5 years: wealth tax and annuities
- Norway wealth tax and real estate: why real estate is king
- Norway wealth tax for Americans and the US annuity exception
- Wealth tax by country and US annuities
Sources
- Lovdata: Forskrift om egenandel for kommunale helse- og omsorgstjenester, section 3 (long-stay nursing home charge)
- NAV: Grunnbeløpet (G) from 1 May 2026, NOK 136,549
- Skatteetaten: Inheritance tax is abolished (2014)
- Lovdata: Skatteloven section 7-2 (rent from your own home)
- Skatteetaten, Skatte-ABC B-11: primary and secondary home
- Skatteetaten: Wealth tax rates 2026
- Skatteetaten, Skatte-ABC 2025/2026 F-24 Livrenteforsikring (F-24-2.1 wealth, F-24-5.1 income)
- IRS: United States and Norway income tax convention (Articles 18, 22, 23)
- 26 U.S.C. 72 (exclusion ratio; 72(q)(2)(I) and 72(u)(4) immediate annuity; 72(q)(2)(D) life payments)
- 26 U.S.C. 1014 (basis of property acquired from a decedent)
- 26 U.S.C. 1031 (like-kind exchange of real property)
- 26 U.S.C. 1250 (depreciation recapture on real property)
Goldstein & Co. LLC dba Goldstein Insurance Services · Hans Goldstein, licensed insurance agent, CA lic. #4273294 · NPN 20602398 · 213-414-2808 · hans@hansgoldstein.com
Education, not tax, legal or immigration advice. Rules, thresholds and exchange rates change; confirm with the consulate or immigration authority and a local tax adviser before you act, and get answers in writing. Hans Goldstein is a licensed insurance agent (CA 4273294) and can only offer annuities to residents of states where he is licensed. Annuity payments are guaranteed by the issuing insurer’s claims-paying ability, not by any government. Payout figures are illustrations from a published survey, not quotes. Immediate annuities are generally irrevocable.