Wealthy people are renouncing American citizenship • Hacker News Board

Re: Wealthy people are renouncing American citizenship

#531

Post by disabled » Thu, Aug 05, 2021, 6:28 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…

American here living abroad in Croatia, which does not have a tax or social security agreement with the US.

The only reason why I do not renounce my American citizenship is because the very rare disease that I have was discovered on NIH grant funds in the 2000s and ultimately saved my life.

I am not sentimental about being American, except for that.

Re: Wealthy people are renouncing American citizenship

#532

Post by trutannus » Thu, Aug 05, 2021, 6:31 PM UTC

depressedpanda wrote: post #501

trutannus wrote: post #480

Earlier quoted context omitted.

You're correct. And the reasoning behind having not stopped lefty authoritarianism is actually very interesting and complex. At least one American general got ousted from his position after suggesting the USSR be subjugated after the Second World War.

The road to hell is paved with good intentions. I'm not sure subjugation of Communist states by force would have lead to a better outcome, historically. I just find it fascinating and a bit sad that authoritarianism is often seen as somehow better, if it comes from the left. If people truly value democracy and freedom, authoritarianism should be opposed regardless of its underlying political color.

> bit sad that authoritarianism is often seen as somehow better, if it comes from the left

This is exactly the train of thought I had thrown at me by another commenter who was insistent on bringing up the fact that the right wing is "worse" somehow. You're right, it is very disappointing to see.

Re: Wealthy people are renouncing American citizenship

#533

Post by PeterisP » Thu, Aug 05, 2021, 6:31 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.

Residency, at least for overseas tax purposes, generally is presumed to transfer whenever (and wherever) you spend 180 days of a year somewhere, so you by definition can't have multiple residencies (unlike nationalities); you can have residency rights/permits in multiple places, but once you become resident somewhere you cease to be resident at your previous country of residence.

Re: Wealthy people are renouncing American citizenship

#534

Post by splintercell » Thu, Aug 05, 2021, 6:31 PM UTC

JumpCrisscross wrote: post #184

mgbmtl wrote: post #128

Earlier quoted context omitted.

> 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.

> U.S. citizenship carries extraterritorial benefits.

Since we are stepping out of playing world police, we have stopped doing that FYI in the past 15-20 years incrementally so. This ain't the late 20th century anymore.

Re: Wealthy people are renouncing American citizenship

#535

Post by richwater » Thu, Aug 05, 2021, 6:34 PM UTC

sumedh wrote: post #158

the_lonely_road wrote: post #18

Earlier quoted context omitted.

New Zealand it seems. An island country of 5 million with some of the most expensive real estate and highest suicide rates of the developed world.

> highest suicide rates of the developed world. If I am not mistaken most of those suicides are among the Maori people not the white people of NZ.

Yea thanks for clearing that up. The native people don't count.

Re: Wealthy people are renouncing American citizenship

#536

Post by hermannj314 » Thu, Aug 05, 2021, 6:34 PM UTC

tristor wrote: post #462

I was unwilling to renounce and stay abroad, for a variety of reasons, so I returned to the US and decided to stay. But for a good while I lived and traveled outside the US as a digital nomad and the tax implications are immense, especially if you are a member of any corporation or LLC, have any retirement accounts, or own any property. It's an absolute nightmare to correctly file taxes, has an astronomically high au…

I was an American citizen living in Luxembourg for 3 years around 2015.

I agree - many banks did not want to let me open an account, and when BNP Paribas said they work with Americans it was a huge ordeal to open the account.

However, as a salaried employee, I did not struggle with the taxes. The IRS form was very straightforward and after deductions I didnt owe any US taxes (I made just over the equivalent of $100k USD).

IIRC the theory is that you determine your tax liability if you had made all your income in the US and you subtract the liability you incurred by your foreign tax residence. You pay the difference but only after you cross some income threshold. If you are living somewhere that 'pays more in taxes' then you wont owe anything to the US.

I can 100% understand why very wealthy people hate this system, but as a software dev making a modest living it was not onerous or unfair or difficult to manage.

Re: Wealthy people are renouncing American citizenship

#537

Post by [deleted] » Thu, Aug 05, 2021, 6:36 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…

[deleted]

Re: Wealthy people are renouncing American citizenship

#538

Post by ciguy » Thu, Aug 05, 2021, 6:39 PM UTC

aerostable_slug wrote: post #422

marcosdumay wrote: post #399

Earlier quoted context omitted.

Most countries grant those same benefits.

But they don't have a MEU sitting off conflict zones waiting to leap into action. The United States will literally send the Marines to save a citizen. A person from, say, Ecuador probably doesn't enjoy the same amount of risk coverage. https://en.wikipedia.org/wiki/Marine_expeditionary_unit

No, they absolutely will not. I won't go into details but I can tell you from personal experience this is unequivocally false. The USA will in most cases do exactly nothing for their citizens in distress. Even the local US embassies will refuse to get involved in almost all cases.

You know who did get involved in our situation when I was with a group of mixed citizens from USA, UK, EU etc...? The UK and Denmark. France, the USA and Germany all did nothing at all.

This myth that the USA will save citizens from any situation needs to die. It's untrue and dangerous since it encourages Americans to do stupid things because they are convinced the Marines or Seals will come save them.

Re: Wealthy people are renouncing American citizenship

#539

Post by walshemj » Thu, Aug 05, 2021, 6:40 PM UTC

geomark wrote: post #160

Retric wrote: post #137

Earlier quoted context omitted.

That honestly seems quite reasonable. Citizenship comes with all sorts of obligations like getting drafted and serving on juries, taxes are simply the most obvious. On the up side you can apparently still qualify for Social Security benefits.

Yeah, but receiving payments can be an issue because U.S. banks won't deal with you without a U.S. address.

A friend who has a US wife is in the states now to visit family and also most importantly renew her Colorado drivers license for similar reasons.

Re: Wealthy people are renouncing American citizenship

#540

Post by wil421 » Thu, Aug 05, 2021, 6:41 PM UTC

hnthrwy1111 wrote: post #185

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 you…

Why complain? Renounce your citizenship and get over it.