US naturalization: the reduced fee may be scrapped

In the United States, naturalization is the final step on a long road, and until now it was the only one where the government took the applicant's financial situation into account.

If you earned little, you could apply for a reduced fee or, under certain conditions, have it waived entirely. This affected people who have lived, worked and paid taxes in the country for years and only skip the last step because they do not have the money.

If that option disappears, the American passport becomes effectively out of reach for a certain group. Not legally, but in practice.

A proposed rule is not law. Until a final rule is published, the current fees apply, including the reduced option and the waiver.

So if you qualify and would depend on a reduction, do not wait. In this area of law, months and sometimes a year pass between proposal and final rule, and what usually counts is the filing date.

It is the same logic as with the civics test last October: what matters is not the date of the interview but the day the application was filed.

Knowing this rule can save you a lot of money and trouble in a year full of changes. It almost always applies in this area of law, and it rewards anyone who files earlier than they have to.

Let's be honest: if you come from Europe and qualify for naturalization, you have probably never thought about a fee waiver. The filing fee runs to four figures, unpleasant but manageable.

This change matters for another reason: it fits a pattern running through this year. Higher H-1B fees, new fees for asylum cases, a fee for expedited visa appointments, the end of reductions.

The American immigration system is increasingly funded by applicants, and increasingly selects by ability to pay.

Before talking fees, look at the requirements, because that is where far more applications fail.

Waiting period. Usually five years as a permanent resident, or three years if married to a US citizen and the marriage has lasted the whole time.

Physical presence. At least half of that time actually in the country. Not registered, present.

Continuous residence. A single absence of more than six months calls continuity into question; one of more than a year usually breaks it. For business owners commuting between two countries, this is the most common trap.

Residence in the district. Three months before filing, within the jurisdiction of the office.

Good moral character. The term sounds soft; the process is not. It covers criminal records, unpaid child support, false statements in earlier applications and unfiled tax returns.

If you apply for citizenship, you have to show you have met your tax obligations. And US tax liability means worldwide income, wherever it was earned.

If you held a green card for years, had income in Europe and never reported it, you do not have a fee problem. You have a problem older than any rule, and it has to be solved before you apply, not after. The way to do that is explained in Streamlined Filing.

Since October 20, 2025, applications filed from that date face the 2025 civics test: a pool of 128 questions, twenty of which are asked in the interview. If you filed earlier, you get the old test with one hundred questions and ten asked in the interview.

The test can be learned, and the agency publishes the full list. It is never the reason a case fails. The file is.

If you want to know whether your file will hold up, talk to Mount Bonnell Advisors in Austin, Texas. The overview is in Becoming a US citizen.

You can read this fee change in isolation. Or you can place it in the pattern running through this year, and then the picture is clear.

The American immigration system is increasingly funded by applicants. The agency has always been largely fee-funded. What is new is that reductions and waivers are disappearing and that fees are deliberately set high enough to steer behavior.

For you as a European business owner, this is mostly no problem, because you usually belong to the group this system favors: qualified, self-funded, with a business behind you.

Just don't pretend it is a neutral development. An immigration system that sorts by ability to pay is a political choice, and this country made it this year.

Do you need the passport, or do you need security?

If you need security because you have moved all your assets and your whole life here and cannot afford to lose your status, naturalization is the answer, and a four-figure fee is a detail.

If you live between two countries, have assets in Europe and do not rule out going back, permanent residence is often the better choice, because it gives you the same practical rights without the lifelong tax tie.

Run the numbers once, calmly, with your own figures, and then decide. Not because of a proposed rule, and not because all your friends are doing it.

If you want to naturalize, know the process, because it takes longer than most people plan for.

After filing comes the receipt notice, then the biometrics appointment, then eventually the interview notice. Depending on the location, several months to more than a year pass between filing and interview.

In the interview, your application is reviewed, your English is tested and you are quizzed on civics. If you pass, you get a date for the oath ceremony, and only with the oath do you become a citizen.

Several more weeks can pass between interview and oath. If you travel abroad during that time, plan carefully, because being away at the wrong moment can cost you the date.

If you run a company, this process has a practical problem: it requires you to be present, and not on your schedule. Notices arrive with only a few weeks' lead time.

That is why we tell clients: schedule your naturalization for a period when the business can run without you for two weeks. If it can't, work on that first, because a business that depends on one person being there is a risk anyway.

The naturalization application is the moment the agency looks at a person's entire file once more. Everything you have told US authorities over the past ten or twenty years gets cross-checked.

For the vast majority of people, that is harmless. For some, it is the moment an old mistake surfaces: an overstay fifteen years ago, a statement in a visa application that was no longer true, a tax return that was never filed.

Hence the advice that cannot be repeated often enough in this area: have your file reviewed before you apply, not after. A withdrawn application is a formality. An application denied for a false statement is a problem for the rest of your life.

Put the two options side by side, with your own numbers.

As a permanent resident you can live and work anywhere, start companies, buy property, and your children go to school like everyone else's. You pay the same taxes and must report your worldwide income. You cannot vote, and you can lose your status.

As a citizen you have all of that, plus the right to vote, plus the certainty that nobody can take it away from you. In return, you must file for life, even if you leave the country for good, and getting out is a formal, expensive process with tax consequences.

If you are staying, the math is clear. If you are not sure, it isn't. And if you hold substantial wealth in Europe, it is even less so.

You make this decision once. It deserves careful calculation.

Namely: do you want to naturalize at all? For many European entrepreneurs the honest answer is no, and that is a perfectly good answer.

American citizenship is not a residence permit with a nicer design. It is a lifelong tax tie. Anyone who takes it on reports their worldwide income to the IRS, wherever they live, until death or a formal renunciation.

What it offers in return is security. You can lose a green card: through long absences, a criminal record, or mistakes in applications. You cannot lose citizenship.

The decision sits between these two poles, and it comes out differently for everyone. A retiree with property in Bavaria will decide differently from a founder whose entire wealth is tied up in an American company.

Consultation & implementation

If you'd like to find out what this means for your own situation, the best step is to book a consultation.