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Why are Americans giving up their citizenship?

bbc.co.uk

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Re: Why are Americans giving up their citizenship?

#21

Post by bsullivan01 »

sipior wrote: post #6
eschnou wrote: post #2

"Unlike other countries, Americans are taxed not only as residents of the US but also as citizens, wherever they live." Huh?? Just because you are a US citizen, you have to pay taxes to the US wherever you live? Is any other country in the world having such policies?

Yes, although there is a high deductible (~$80k, as I recall). It's never been something I needed to worry about, but FATCA most definitely will be. I don't know the answer to your last question, but I've never personally heard of another nation with similar policies.

Do you still have to file US taxes though? Say you make $60K in Germany, well under the deductible, and do not file US taxes for 10 years.

Is there a penalty just for not filing? penalties can cripple you.

Re: Why are Americans giving up their citizenship?

#22

Post by Aloisius »

UnoriginalGuy wrote: post #13
Aloisius wrote: post #7

This doesn't make sense to me. If you give up your citizenship, then presumably you have citizenship elsewhere, so why not just open a bank account under your foreign citizenship? How is the bank to know? The only thing I can think of is that maybe people are avoiding taxes in the US and their adopted country as well. After all, many countries Americans move to have such high tax rates that after deductions, their US…

Replying before reading the article just wastes everyone's time. PS - The answers to all of these questions is contained within the article.

I read the article. It talks about Facta and then tries to link it to people complaining about how expensive it is to file tax returns, but the two aren't linked unless you weren't reporting your real income. Americans have always had to file taxes while living abroad. The tax laws have been extremely complicated for decades. Facta isn't changing that.

FTA:

"Fatca provisions impose no new obligations on US citizens living abroad... US taxpayers, including US citizens living abroad, are required to comply with US tax laws," he says​.

No, this sounds more like people who might have fudged some numbers now worrying that the IRS is going to find out and realizing that their citizenship isn't worth the yearly bill.

Re: Why are Americans giving up their citizenship?

#23

Post by cromwellian »

If you want to live abroad and pay no US taxes, shouldn't one also give up rights to any entitlement services from the US government during that period? Otherwise, US tax payers are subsidizing free riders. If I'm a US citizen, but spend my whole life working in another country, should I be entitled to draw social security checks from the US? This would seem to create a moral hazard, as if you could find a tax shelter jurisdiction, you could work there, pay little to no taxes, and still cost the US government to support you.

Re: Why are Americans giving up their citizenship?

#24

Post by Frozenlock »

pekk wrote: post #16
ekianjo wrote: post #4

Earlier quoted context omitted.

France was also trying to do that recently, since the government there spends way more than they can hope to "steal" from their citizens. They thought it was a good idea to try to tax citizens living abroad (on top of the taxes paid abroad). If they ever did that, I can tell you a number of French citizens living abroad would just drop their French passport without hesitation.

Taxation is not theft, it is lawful. The developed world is founded on taxes.

And war isn't murdering people?

Just because something has the backing of a government doesn't change the definition of words.

You can argue who is the owner of the money being taxed, but you can't say something is or isn't because it's lawful.

Re: Why are Americans giving up their citizenship?

#25

Post by Lewisham »

brudgers wrote: post #9
eschnou wrote: post #2

"Unlike other countries, Americans are taxed not only as residents of the US but also as citizens, wherever they live." Huh?? Just because you are a US citizen, you have to pay taxes to the US wherever you live? Is any other country in the world having such policies?

US citizens living abroad are able to avail themselves of services through embassies and consulates for ordinary problems and call upon the USMC etc. for assistance with extraordinary ones.

Are you trying to say that US citizens abroad are paying for the services of their embassy? That's crazy. Every expat citizen from any country is offered help from their home country's embassy, and they do it without citizen-based taxation.

I could walk into the British consulate in San Francisco tomorrow and expect help, and I haven't paid taxes in the UK for 5 years now.

Re: Why are Americans giving up their citizenship?

#26

Post by bsullivan01 »

Aloisius wrote: post #7

This doesn't make sense to me. If you give up your citizenship, then presumably you have citizenship elsewhere, so why not just open a bank account under your foreign citizenship? How is the bank to know? The only thing I can think of is that maybe people are avoiding taxes in the US and their adopted country as well. After all, many countries Americans move to have such high tax rates that after deductions, their US…

This doesn't make sense to me. If you give up your citizenship, then presumably you have citizenship elsewhere, so why not just open a bank account under your foreign citizenship? How is the bank to know?

Yeah, just open a secret Swiss account, who will know.

Re: Why are Americans giving up their citizenship?

#27

Post by pixelcort »

jandrewrogers wrote: post #5

This has been the case for some time and has been getting worse year after year. It is pretty shameful the extent to which the US tries to attach itself to the income and wealth of people who are not even living in the country solely because they are American citizens. In some cases, compliance with US tax laws (even though not in the US) are in direct conflict with laws in jurisdictions where people actually reside.…

Do you have any examples of specific laws that are in direct conflict with laws other places?

Re: Why are Americans giving up their citizenship?

#28

Post by foobarbazqux »

alexmat wrote: post #19
pekk wrote: post #12

Earlier quoted context omitted.

Payment of one's taxes is not the same as, or equivalent to, indentured servitude. Or slavery.

Not equivalent to, but certainly shares similar characteristics through coerced surrender of the fruits of one's labor.

Living inside the state, you wouldn't have those fruits if it weren't for the state. Living outside of the state, tribute of fruits is the fee for belonging to the state. If someone were truly being forced to pay US taxes, they wouldn't be able to renounce their citizenship while living outside of the state. And inside the state, it's like complaining that your parents insist you buy your brother a present with your allowance, or better yet, the money you earned mowing the front lawn. The reason the US economy is so deep and liquid is because the US state is so powerful, and to stay powerful it needs to collect taxes.

Re: Why are Americans giving up their citizenship?

#29

Post by Lewisham »

Aloisius wrote: post #22
UnoriginalGuy wrote: post #13

Earlier quoted context omitted.

Replying before reading the article just wastes everyone's time. PS - The answers to all of these questions is contained within the article.

I read the article. It talks about Facta and then tries to link it to people complaining about how expensive it is to file tax returns, but the two aren't linked unless you weren't reporting your real income. Americans have always had to file taxes while living abroad. The tax laws have been extremely complicated for decades. Facta isn't changing that. FTA: "Fatca provisions impose no new obligations on US citizens l…

It said that people were not so worried about making sure their tax return was exactly correct. Now they are, so you need to hire better tax lawyers than you did before.

I take exception to your characterization of "fudging numbers". We all fudge the numbers of our tax returns, even when filing in the US. How many people really do anything but use TurboTax and hope for the best? I know I do. I can't possibly know everything about US tax law. I hope TurboTax does, but I have no guarantee, and it's my ass on the line if it screws up. I see no difference between that and the expats mentioned in the article, except the help they have to buy in is far more expensive.

Re: Why are Americans giving up their citizenship?

#30

Post by auctiontheory »

Aloisius wrote: post #22
UnoriginalGuy wrote: post #13

Earlier quoted context omitted.

Replying before reading the article just wastes everyone's time. PS - The answers to all of these questions is contained within the article.

I read the article. It talks about Facta and then tries to link it to people complaining about how expensive it is to file tax returns, but the two aren't linked unless you weren't reporting your real income. Americans have always had to file taxes while living abroad. The tax laws have been extremely complicated for decades. Facta isn't changing that. FTA: "Fatca provisions impose no new obligations on US citizens l…

It became so complicated to do her tax return that she turned to professionals, at an annual cost of nearly $2,000 (£1,250), with the prospect of Fatca raising the price to $5,000. Also, fewer tax lawyers were taking on American clients, she says, and some banks were even turning away American money.

I don't see any mention of tax-dodging in the paragraph above. Which part of paying $2000 (and maybe soon $5000) to file taxes, and banks turning away American customers, don't you understand?

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