Panama has one of the cleanest territorial tax systems in the world: if you earn your money outside Panama, Panama does not tax it. That principle has made the country a reliable choice for digital nomads, remote workers, and retirees restructuring their tax situation. But the details matter, and the marketing often blurs them. This guide explains exactly how the system works, where the lines are drawn, what triggers a Panamanian filing requirement, and what US citizens specifically still owe the IRS no matter how far south they move.