90 Limited stay with U.S. passport

The U.K. works very well because U.S. passport holders routinely get 6 month stamps there.

Yes, there is a permit that you can get which will extend your stay
up to a year if you are self-employed and receive your income from outside Italy. After a year you just have to get it renewed. It's called a old">"Permesso di soggiorno per lavoro autonomo/indipendente"

I have an internet business and am planning to head to Italy in July so I have been doing a ton of research as an American going to live in Italy.
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Here are the details about the permit:

Self-Employed

If you’re an EU-national or a permanent resident with a certificato di residenza you can work as self-employed ( lavora in proprio) or as a sole trader ( commerciante in proprio) in Italy. If you wish to work as self-employed in a profession or start a freelance business in Italy, you must meet certain legal requirements and register with the appropriate organisations, e.g. the local chamber of commerce ( camera di commercio).

Note that a standard permit to stay doesn’t automatically allow you to work as self-employed and needs to be changed to a permesso di soggiorno per lavoro autonomo, which depends on your nationality and status.

Under Italian law, a self-employed person must have an official status and it’s illegal to simply hang up a sign and start business. People setting up in a self-employed capacity must provide evidence of their status, such as membership of a professional or trade body, a VAT number, or registration on a trade register.

Members of some professions and trades must have certain qualifications and certificates recognised in Italy. You should never be tempted to start work before you’re registered as there are harsh penalties, which may include a large fine, confiscation of machinery or tools, deportation and a ban from entering Italy for a number of years.

EU nationals are entitled to work as a self-employed person (or an employee) without waiting for a residence permit to be issued. This document is merely a means of proof and not a condition of your entitlement to live in the country. If you’re an EU national and obtained a residence permit as an employee, this doesn’t prevent you from changing status during its period of validity and setting up in a self-employed capacity.

Hope this helps...

I am about 2 hours or so from your area, in Southern Lazio.  We often go to San Donato as my husband plays golf there.  Abruzzo is beautiful!

In very basic terms, if you stay past 90 days on the visa waver program, you become an illegal alien.  When they catch you they can ban you from visiting any of the Schengen countries (roughly all of Europe) for as long as ten years.  That's going to cause some problems with your Italian house, don't you imagine?

Unlike in the U.S., the Italian way of life is much more invasive when it comes to your personal affairs.  Every time you purchase something of significant value they record your Codice Fiscale (sort of a personal I.D. number which functions much like a SSN).  Then they check that against your income and they can ask you to justify any inconsistency.  That is hard to do for a Clandestino.

I occasionally mail packeges.  When I do, they copy and/or record EVERYTHING.  The last time I returned a 15€ pair of mail order shoes to the U.K. the process took a full 45 minutes, (not including waiting in line) mostly because of how much personal information they recorded.  They sent the shoes to the U.K. and sent a large envelope of my personal data to Genoa.

In 50 years of driving in the U.S. I was not stopped once for a random check of my documents.  Here in Italy I get stopped about every two months.  They generally ask me about exactly where I live, why I came to Italy, and about my future plans.  It's hard to tell if they're just curious or actually doing a little background check, but I don't worry because I'm legal.  If I were not, it would definitely make me nervous.

I have a health card, an identity card, a drivers license, a Permesso de Soggiorno, etc. etc.  I'm asked to show these documents all the time and some sort of information is copied and recorded for even very ordinary things.  For example, I recently purchased tires and they recorded my Codice Fiscale.  I also stayed in a Bed and Breakfast where they needed every identifying detail plus a photocopy of my Permesso de Soggiorno.  They reported my presence, along with all the other guests, to the authorities, something every hotel does every day. 

Then there is the unusual situation to consider.  I would NOT want to run over and injure a bicycle rider if I were a Clandestino.  I would also not want to fall seriously ill, or find myself in a legal situation (like being mugged) if my papers weren't in order.

Of course, the authorities are unlikely to put two and two together for no reason as long as nothing unusual happens. And, even if they catch you, they may not do anything to you.  Some people (not me) elect to take that chance. Still,  I can't imagine conducting a real life here in Italy while trying to fly under the radar.  It's just too complicated, at least for me.  If I were 17  years old and everything I owned fit into my back pack and my plan was to stay for 120 days in Italy and damn the consequences, I wouldn't worry.  But as a functioning adult with a house and other assets at risk,  I personally would feel very uncomfortable living my life as an illegal alien.  People do it though.

Actually I use my Canadian Passport when I travel in Italy, the hotel clerks claim it is easier for them ...so I assume they are just as tired of the bureaucratic quagmire as we are...