Meghan Markle, Prince Harry's royal baby tax dilemma

Meghan Markle and Prince Harry's first child has arrived, and – no matter where the baby is raised – he could face a lifetime of tax liabilities in the U.S.

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Buckingham Palace announced on Monday that the Duchess of Sussex had given birth to a son weighing 7 pounds and 3 ounces, as first reported by Sky News. The baby boy was named on Wednesday.

"The Duke and Duchess of Sussex are pleased to announce they have named their first born child: Archie Harrison Mountbatten-Windsor," the new parents wrote on Instagram.

While Markle announced that she intends to become a U.K. citizen, she has not said whether she plans to renounce her U.S. citizenship.

According to U.S. law, a child (born to one U.S. citizen and one “alien”) is considered a citizen if the U.S. citizen parent (born after Nov. 14, 1986), was physically present in the U.S. for five years prior to the birth – including at least two years under the age of 14.

That means the child would be a dual-citizen. The birth will need to be registered with the U.S. consulate.

Once that child comes of age, he will likely have assets and income exposed to the U.S. tax system, similar to Meghan.

But obligations could be triggered even sooner. As reported by The Wall Street Journal, if a child has "unearned income" in excess of $2,200 per year, the so-called "Kiddie Tax" kicks in. And accounts belonging to the child with assets exceeding $10,000 must be reported to the U.S. Treasury Department.

The U.S. is the only country with laws that require citizens to pay taxes no matter where in the world they reside, including if they have lived abroad their entire lives.

As previously reported by FOX Business, there was controversy over Meghan's status as a U.S. citizen and its potential to expose the royal family’s finances. If she is raking in more than $300,000 – which is likely considering her career as a successful television actress – she will be required to file a specific form that details her foreign assets, therefore potentially exposing her in-laws to financial scrutiny.

If Meghan combined bank accounts with her husband, or became a signatory, those accounts would have to be reported and disclosures made. That would bring Prince Harry’s financial details within the IRS’ reach.

The British royal family has largely managed to keep details of its financial situation private.

This could change if Meghan chose to renounce her U.S. citizenship – a lengthy process that is also not easy to undo should she change her mind. It will also likely take years before the Duchess of Sussex completes the process of becoming a British citizen, which must occur before she renounces her U.S. citizenship.

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Meghan's child, or children, could also choose to renounce their potential U.S. citizenships later in life.

Meghan and Harry's child will be seventh in line for the throne.

This article was originally published on March 30. It was updated on May 8.