FATCA Pushes “Accidental” Americans to Give Up US Citizenship • Hacker News Board

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#151

Post by gambiting » Sun, Dec 27, 2020, 7:12 PM UTC

Symbiote wrote: post #136

gambiting wrote: post #10

Earlier quoted context omitted.

Yeah it's stupid. But many countries have similar weird rules about this. In the UK the fee is about £400 so not too bad, but for instance in Poland the only way to do this is to write a letter addressed to the current President of Poland and only they can grant it(my understanding is that they always do, it's pretty much an automated process, but you do actually have to send a letter to the president).

What reason would there be to give up British citizenship? The only one I can think of, is to aquire a different citizenship that doesn't allow dual citizens (like China). Although even then, the guidance on the British government site suggests they will go along with whatever crap China wants (like destroying a British passport) but allow keeping British citizenship, issuing a new passport afterwards, if requested t…

This was a very big deal during earlier days of Brexit discussions, as dual German-British citizens were in a pickle - German constitution only allows German citizens to hold a citizenship of another EU country, which the UK was going to stop being. So German citizens were faced with a choice - they had to revoke one of their citizenships. Fortunately the German government passed emergency legislation which allowed the British citizens to retain their German citizenship as well.

And then, well, someone times people renounce because they don't live there and they don't agree with the policies of that country.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#152

Post by Brian_K_White » Sun, Dec 27, 2020, 7:13 PM UTC

clubber88 wrote: post #130

voisin wrote: post #6

The US could solve most of its expat issues if they simply said foreign accounts are those accounts foreign to your current place of residence. By saying foreign means foreign to the US, they’ve made it very challenging to form banking relationships in expats’ countries of residence. The next step would be to repeal citizenship based taxation in favour of residency based taxation like every other country on earth (ex…

And take away their right to vote. I’m an expat and I’m not allowed to vote and I don’t owe my home country any taxes (Canadian in the US) That’s the way it should be. I shouldn't tell my home country how to live a life I have no stake in, and they should not charge me taxes for services they cannot render abroad. End taxation and voting abroad!

Spoken like someone who is not stationed abroad, just for one off the cuff easy example.

Perhaps I'm wrong but there must be countless reasons and situations like that which make this simple idea in fact merely simplistic.

I certainly expect to still receive all manner of services while abroad. I expect my property to still be mine and protected by the police. My home should not revert to being owned by the state just because I went on vacation. I damned well do expect to be able to vote in whatever country I hold citizenship rather than mere residence.

If I move to some other country fully, and want to participate in it's policy direction, then I expect to do whatever is required to gain the new citizenship and reliquish the old.

Maybe double dipping shouldn't be allowed, but being remote should mean essentially nothing by itself.

Even fairly extended residence where you have a local job and rent a home etc shouldn't constitute some sort of automatic change of citizenship. That should only happen if and when you actively choose to do it. People get sent places for work. People go places for school or research. People have to take care of family. People are in the military. There are all kinds of situations requiring a person to be somewhere other than home, for any amount of time, even years, without changing what is "home" and what is "away".

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#153

Post by BXLE_1-1-BitIs1 » Sun, Dec 27, 2020, 7:14 PM UTC

If you were born in the US to a foreign parent before October 1953 and moved back to that parent's country, and remained there three years past the age of 22, your US citizenship lapsed. That provision of the Immigration and Nationality Act was repealed effective October 1978. Many retirees can benefit from this.

Children born in the US to diplomats, and possibly foreign military on posting, do NOT receive US citizenship on birth.

There are a number of provisions in the Immigration and Nationality Act where US citizenship can be lost. Elective office and becoming an officer in a foreign military (think reserves) can lose US citizenship.

A careful reading of current and repealed provisions of the INA will show ways to automatically lose US citizenship.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#154

Post by eesmith » Sun, Dec 27, 2020, 7:14 PM UTC

dasudasu wrote: post #141

Digit-Al wrote: post #76

Earlier quoted context omitted.

> A surprising number of Americans seem to think it's reasonable to tax non-residents, so such legislation may be hard to get passed. So let's get this straight. On one side you have Americans who think it's reasonable to tax people who don't live in the country and thus don't use any of the services that tax pays for and then on the other side you have Americans who believe that all tax is theft under the threat of…

It's not true to say they necessarily don't use any of the services. The US still defend its citizens abroad, and might evacuate you in case some disaster happens, do hostage rescue using the full power of its military and intelligence agencies, and will generally provide consular help and speak on your behalf should you get into trouble.

Odd then that no other country (except Eritrea) follows the US footsteps. The UK and many other countries have the ability to defend its citizens abroad, evacuate them, engage in hostage negotiations, etc.

(As I recall, in the UK that cost is paid via part of your passport fees. Not via world-wide taxation and monetary oversight.)

That should be "most of its citizens abroad." As we know from Anwar al-Awlaki, the US may decide to remove due-process rights of its citizens and use its military power to kill them.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#155

Post by smnrchrds » Sun, Dec 27, 2020, 7:16 PM UTC

lixtra wrote: post #58

smnrchrds wrote: post #41

Earlier quoted context omitted.

In Iran, you have to first finish your military service, currently 2 years, then apply to the president's office, which (almost?) never approves an application anyway.

And your children will be Iranian as well.

Yes. If you are male. Children of female citizens have to apply to get citizenship.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#156

Post by eesmith » Sun, Dec 27, 2020, 7:19 PM UTC

throwawayiionqz wrote: post #140

Mediterraneo10 wrote: post #131

Earlier quoted context omitted.

> If US banks had the same reporting requirements to EU countries regarding EU dual citizens accounts US banks wouldn’t. The reason that the EU is wary of ending up on the USA’s bad side, is that European banks rely on large New York banks for clearing international transfers. They can’t not do business with the USA. American banks don’t have the same dependency on the EU.

FATCA is an agreement signed between countries, not between the US and foreign banks. The US certainly has more leverage with the USD than the EU with the EURO but trade agreements are made of various things and the US cannot simply bully the EU and Asian countries with FATCA indefinitely. I can't wait to see how this plays out in the next 10 years.

There's the US involvement with SWIFT, including seizing intra-EU payments - https://en.wikipedia.org/wiki/Society_for_Worldwide_Interban...

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#157

Post by eesmith » Sun, Dec 27, 2020, 7:26 PM UTC

Mediterraneo10 wrote: post #18

ttul wrote: post #5

Why it must cost over $2,000 to give up something that others spend much more trying to acquire is a total mystery. Surely it does not cost $2,000 to make a note of someone’s ex-citizenship.

> Surely it does not cost $2,000 to make a note of someone’s ex-citizenship. Of course. Still, doesn’t renunciation of US citizenship actually require an act of Congress annually, under which all recent applicants are included? That the price was jacked up to $2000 is outright exploitation of desperate people, but certainly there would be some administrative fee (like the earlier one, which was generally considered r…

> doesn’t renunciation of US citizenship actually require an act of Congress annually, under which all recent applicants are included?

No. At least, none that I've heard of, and https://en.wikipedia.org/wiki/Relinquishment_of_United_State... makes no mention of it.

There is a quarterly publication of those who have renounced citzenship - https://en.wikipedia.org/wiki/Quarterly_Publication_of_Indiv... . But that appears to have been put into place mostly to try to shame rich people who expatriated, under an invalid idea that most renunciations were from rich people trying to avoid paying US taxes.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#158

Post by names_are_hard » Sun, Dec 27, 2020, 7:28 PM UTC

djohnston wrote: post #137

siberianbear wrote: post #33

Earlier quoted context omitted.

The $100k you're referring to is the Foreign Earned Income Exclusion [1]. If you're an American working abroad, you don't need to pay income tax on your first $107,600. The exclusion does not apply to self-employment tax or investment income. That's not even the real problem, though. The problem is that banks don't want to deal with the FATCA compliance issues and just refuse to deal with Americans, period. I've expe…

Does this mean you get double taxed on everything over 107?

No. If you earn more than the allowable amount for the Foreign Earned Income Exclusion (FEIE), you claim the Foreign Tax Credit instead. Under the FTC, you essentially pay the higher of the two tax rates. Except the accounting can get tricky if you have multiple sources of income that are taxed at different rates between the US and the foreign country.

For example, if you earn 200k in a foreign country and that country charges you 75k on 190k of that, and decides that 10k doesn't count for some reason. Suppose the US rates are such that you owe 60k on 190k, then the FTC erases that 60k. But you might still owe 3k on the remaining 10k that the foreign country ignored.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#159

Post by names_are_hard » Sun, Dec 27, 2020, 7:33 PM UTC

wiredfool wrote: post #101

sjg007 wrote: post #24

I thought there were tax treaties, basically you don't pay taxes on the first $100k if you paid into the national tax system of the country you are in. I can imagine FICA taxes though might be difficult. Maybe US social security would deny benefits if you claimed them without any contributions and residence abroad.

There are actually two exclusions for countries on the treaty list, one is the first ~100k of income, and the other is a tax credit for taxes paid in the other country. So, if you happen to be an expat in a higher tax country (which is certainly Europe), then you won't owe taxes in the US. You still have to file, which can cost $500 for an accountant to make sure everything is correct, but owing taxes isn't really an…

As a US citizen in Israel, I do owe some money to the US every year even though I pay more to Israel overall than I would if I only paid the US. This is because the FTC is applied to each dollar of income separately, so in the few places where Israeli taxes are lower than the US I get to pay the US. In a sense you get the worst of both tax regimes.

Re: FATCA Pushes “Accidental” Americans to Give Up US Citizenship

#160

Post by paddez » Sun, Dec 27, 2020, 7:43 PM UTC

Symbiote wrote: post #136

gambiting wrote: post #10

Earlier quoted context omitted.

Yeah it's stupid. But many countries have similar weird rules about this. In the UK the fee is about £400 so not too bad, but for instance in Poland the only way to do this is to write a letter addressed to the current President of Poland and only they can grant it(my understanding is that they always do, it's pretty much an automated process, but you do actually have to send a letter to the president).

What reason would there be to give up British citizenship? The only one I can think of, is to aquire a different citizenship that doesn't allow dual citizens (like China). Although even then, the guidance on the British government site suggests they will go along with whatever crap China wants (like destroying a British passport) but allow keeping British citizenship, issuing a new passport afterwards, if requested t…

There was an immigration case a few months ago which involved a person born in Northern Ireland attempting to use an immigration scheme for her husband which was only available to EU Nationals.

Because the British State conferred British Citizenship onto this person upon merely being born in Northern Ireland, despite this person identifying solely as Irish, they were unable to avail of this scheme.

The UK Home Office told this person to renounce their citizenship if they wished to available of this scheme. (This was all basically nullified by the EU Settlement Scheme coming up to Brexit, but it'll probably rear it's head again)

TL;DR Dual National wanted to avail of an EU Scheme, which was unable to be used by a British Citizen. One solution was to renounce British Citizenship.

https://www.irishtimes.com/news/ireland/irish-news/explainer...