Wealthy people are renouncing American citizenship • Hacker News Board

Re: Wealthy people are renouncing American citizenship

#181

Post by Justsignedup » Thu, Aug 05, 2021, 1:49 PM UTC

academia_hack wrote: post #42

It's so irritating to be an American that has moved overseas. Basically the only country in the world that charges taxes on money you make and spend somewhere else, just because of where you were born. Thanks to IRS regulations, 90% of investment firms will just reject me outright rather than deal with the paperwork. Getting someone to help file my inordinately complex taxes costs thousands of dollars more than I act…

This was to close certain problematic tax avoidance issues. People were fleeting from the US to avoid paying taxes, but kept all the benefits, or hid the money off-shore.

The problem here is that they never raised the amount you must report, because in the past, 150k used to be a lot. Now that should be closer to 500k. But like the minimum wage and tax brackets, they haven't kept it up with inflation. Not in the way they needed to at least.

Unfortunately the main loss from US citizenship loss is voting and potentially travel to the US. But the wealthy influence politics by lobbying not voting.

Now if Citizenship was required to fund lobbying... wooh that would be a big hit for those abandoning the US.

Re: Wealthy people are renouncing American citizenship

#182

Post by EE84M3i » Thu, Aug 05, 2021, 1:49 PM UTC

mythz wrote: post #162

EE84M3i wrote: post #149

Earlier quoted context omitted.

Hmm, I seem to recall hearing Australians also have complicated rules about being an "Australian resident for tax purposes" that is not the same as an Australian resident for other purposes, especially when you don't have Permanent Residence/Green Card and are on a time-limited visa (even if it's years long). So they don't technically fall into the "America and Eritrea" bad list, but still tax many Australians abroad…

This is untrue, if you're a citizen of Australia who is a non-resident you don't have to report or pay taxes on world wide income made outside of Australia.

There is an example[1] on their official site of an Australian living abroad in Japan and being a "resident for tax purposes" and thus being taxed, but not being a resident for other purposes.

[1]: https://www.ato.gov.au/Individuals/coming-to-australia-or-go...

Re: Wealthy people are renouncing American citizenship

#183

Post by dr-detroit » Thu, Aug 05, 2021, 1:50 PM UTC

PragmaticPulp wrote: post #94

academia_hack wrote: post #42

It's so irritating to be an American that has moved overseas. Basically the only country in the world that charges taxes on money you make and spend somewhere else, just because of where you were born. Thanks to IRS regulations, 90% of investment firms will just reject me outright rather than deal with the paperwork. Getting someone to help file my inordinately complex taxes costs thousands of dollars more than I act…

> It's so irritating to be an American that has moved overseas. Basically the only country in the world that charges taxes on money you make and spend somewhere else, just because of where you were born. This is exactly why these people are renouncing US citizenship: They’re living overseas as citizens of another country and, like anyone rich or poor, don’t want to be paying taxes to a country they aren’t living in.…

The nefarious part is reap all the advantages of American Democracy and then turn around and don't want to share their toys with middle class slobs.

Re: Wealthy people are renouncing American citizenship

#184

Post by JumpCrisscross » Thu, Aug 05, 2021, 1:50 PM UTC

mgbmtl wrote: post #128

PragmaticPulp wrote: post #94

Earlier quoted context omitted.

> It's so irritating to be an American that has moved overseas. Basically the only country in the world that charges taxes on money you make and spend somewhere else, just because of where you were born. This is exactly why these people are renouncing US citizenship: They’re living overseas as citizens of another country and, like anyone rich or poor, don’t want to be paying taxes to a country they aren’t living in.…

> surrendering US citizenship is a logical choice Only because of US laws. I have two citizenships, but one residency. In most Western countries, being a resident is associated with healthcare and pension, so having one residency is logical.

> Only because of US laws. I have two citizenships, but one residency.

U.S. citizenship carries extraterritorial benefits. For example, we're pretty good at getting our people out of thorny situations, even at great national expense. If someone isn't paying to support that, it makes sense to force a revocation decision.

Re: Wealthy people are renouncing American citizenship

#185

Post by hnthrwy1111 » Thu, Aug 05, 2021, 1:51 PM UTC

I'm an "accidental American" who has navigated this issue and it's incredibly easy. Just don't file. Every professional that writes blogs about this has a professional duty to give legal advice but the practical advice is just don't file. Look into what exactly triggers data to be sent to the IRS under your tax treaty and the policies of your financial institutions. Being "accidental" is the key here. If you tell your bank you aren't an American and you have a non-American birthplace and birth certificate they have absolutely zero way of knowing and your information will not be sent. If you have an American birthplace you can lie and say you renounced, but this carries some risk as the IRS maliciously publishes lists of renouncers so it's possible they could guess you lied. FATCA and FBAR are egregious violations of your rights. Not even the NSA has the right to spy on Americans abroad, but the IRS can do dragnet surveillance on American financial data from foreign countries with no probable cause and no warrants. You have a duty not to comply.

Re: Wealthy people are renouncing American citizenship

#186

Post by _0ffh » Thu, Aug 05, 2021, 1:51 PM UTC

pjerem wrote: post #101

alephnan wrote: post #73

Earlier quoted context omitted.

Cyprus gives you access to the EU while being a tax haven. https://www.vox.com/recode/2020/11/9/21547055/eric-schmidt-g...

Well, you know that you pay taxes on the country you live & work in ? So you have to find a job and a house in Cyprus. And on top of that, Cyprus is one of the few european countries that are not yet in the Schengen area. So you'll have to stay on the tiny 9,251 Square Kilometers.

> you'll have to stay on the tiny 9,251 Square Kilometers

No you won't, you'll just have to pass a border control whenever you leave or re-enter the country. That's hardly a huge hindrance, unless you're wanted.

Re: Wealthy people are renouncing American citizenship

#187

Post by shell0x » Thu, Aug 05, 2021, 1:51 PM UTC

circular_logic wrote: post #63

Interesting facts about renouncing American citizenship: - There is renunciation fee that has to be paid and currently stands at $2,350 (the highest in the world).[1] - A final tax return will sill need to be filed. [1] - An Expatriation tax is payable if [..] Your net worth is $2 million or more on the date of your expatriation. you will be treated as having disposed of your assets the day before your expatriation a…

While $2350 is expensive, compare that to Australia. My friend got sponsored by his partner for a partner visa and the fee is AUD7,850 for most applicants.

https://immi.homeaffairs.gov.au/visas/getting-a-visa/visa-li...

It's a huge rip-off like everything in this country.

The $2350 seem to be cheaper than fees for filing annual tax returns for the next 50 years :)

Re: Wealthy people are renouncing American citizenship

#188

Post by cblconfederate » Thu, Aug 05, 2021, 1:52 PM UTC

amcoastal wrote: post #3

Its really a great system we have here --- get insanely wealthy off the backs of Americans who pay tons more for basic services and then when it's time to pay back run off and keep your change. No wonder America is doing so well.

The rest of the world suffers much worse than that. Not only are the rich finding it easier to go to tax havens (because there's no taxation of foreign income), but they are also bleeding their best and most educated (education that they paid for) human capital to the richest cities western europe & us

(also americans overall are rich compared to the rest of the world at this time)

Re: Wealthy people are renouncing American citizenship

#189

Post by [deleted] » Thu, Aug 05, 2021, 1:52 PM UTC

syops wrote: post #29

altcognito wrote: post #2

They’ve been allowed for decades to avoid paying for the infrastructure and management of the country while simultaneously holding most of the influence. “Renouncing citizenship” means they’ll give up none of the influence, lose the taxes, live how and wherever they want. The best thing to do is forbid them re-entry into the country nor to hold controlling interest in any company in the US. Faced with actual conseque…

If a person has no income or capital gains from the U.S. and doesn’t live in the U.S. shouldn’t they be exempt from paying U.S. taxes? Also, shouldn’t foreign financial institutions be exempt from reporting to the U.S. about financial activities of U.S. citizens when they are outside the U.S.? I think the answer to both questions ought to be yes. EDIT: I’m aware of the rules regarding income taxes for Americans based…

[deleted]

Re: Wealthy people are renouncing American citizenship

#190

Post by fourthwaveska » Thu, Aug 05, 2021, 1:53 PM UTC

zarkov99 wrote: post #52

Of course they are. When the dominant narrative is that America is a racist hellscape, built on oppression and plunder then things like patriotism and civic spirit seem absurd, quaint notions, ripe for ridicule.

Patriotism? What exactly is that word to you? To me it is merey loyalty to mud.