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Wealthy people are renouncing American citizenship

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Re: Wealthy people are renouncing American citizenship

#501

Earlier quoted context omitted.

> Both kill just as many people Let's be honest here, lefty authoritarianism has historically killed way more people in total. Fortunately, righty authoritarianism was stopped; unfortunately lefty authoritarianism wasn't.

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.

Re: Wealthy people are renouncing American citizenship

#502
post #193

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.…

Some are "accidental Americans" like UK Prime Minister Boris Johnson, born in the US, who discovered as a US citizen he had to pay capital gains taxes when he sold his London apartment. Australia requires its parliamentarians to have only Australian citizenship and some discovered for the same reason they were not eligible. Furthermore, the burden of FATCA is sufficiently onerous that many banks etc. just refuse to d…

Alexander Boris de Pfeffel Johnson aka Boris Johnson is not as clumsy as his haircut makes him look to be. The guy keeps fit, doesn't look like Rambo but he is fit with a bit a sticky build. He is intelligent, he survived the muddy waters of politics, affairs and is prime minister. Of course he always knew he is American dual citizen, a person like him does not handle an apartment sale himself, he has handlers and advisors. And he was in a very high income bracket for a while and it's safe to say he fell into a us taxable segment before that sale. He is a showman and this was just the event where the tax bill was too high and he said "no more".

Re: Wealthy people are renouncing American citizenship

#503

Earlier quoted context omitted.

As a former American who lived abroad for about 11 years before renouncing, “cartoonishly cruel” is a pretty accurate description of the system. It’s even worse an American entrepreneur abroad because that makes things even more complicated. I gave up jumping through the hoops in 2018 and the self-torture and renounced. I shared my story in case anyone is interested: https://larrysalibra.com/goodbye-usa/

This was a good read. It's interesting that you decided to stay in HK after the protests/hostile takeover in 2020. My partner and friends all left HK for the UK, Australia, and Canada.

> By funding and participating in the system, we give the system legitimacy and only make the system stronger and the problems worse. Exiting is the high leverage and most effective option.

Very interesting indeed.

Re: Wealthy people are renouncing American citizenship

#504

Being a Canadian, I started a tax-free savings account "TFSA" (similar to a US Roth IRA but with way less restrictions)when I turned 18 and was investing heavily in it. A few years later I would get a green card and move to the US and didn't touch the account afterwards except make a few rebalances here and there. My brokerage asked me to update my information and asked me if I was a "US" person to which I answered y…

its clear how your situation could be abused. i am not suggesting that you have done this, but that it creates an interesting loophole for the wealthy by harboring investements into other countries capital.

Lets say you are a 0.1%er who happens to live in canada. Invest everything on canadas terms, then move to the USA. receive foodstamps, welfare checks and the likes for XX years. Go back to canadian citizenship and cash out. Darn, looks like tax payers supported the ultra wealthy while they just got richer eh?

Re: Wealthy people are renouncing American citizenship

#505
post #418

Earlier quoted context omitted.

According to another post you do not owe tax on income below $108k so that’s probably not going to affect most filers, though I’m sure an anomalously high number of HN users are earning six-figure salaries.

As multiple people have explained, preparing the required paperwork each year is a major expense and hassle, even if you do not owe any tax. Also, if you are technical enough to frequent this web site and you think $108K is a lot of money, you are being underpaid.

Googling, just the first one that comes up, suggests that median income for "software developer" in USA is $86,523. Meaning half make less, half make more. $100K is the 75th percentile, meaning 75% make less. (https://www.ziprecruiter.com/Salaries/Software-Developer-Sal...)

Some people that work in especially high-paid sub-industries have a mistaken idea of what typical "technical enough to frequent this web site" (?!) people make.

And even if most software developers did make over $100K, it could still be a lot of money? The median income in USA as a whole looks to be about $52K, with $100K being about 83rd percentile (83% of USA makes less than $100K).

Re: Wealthy people are renouncing American citizenship

#506

Earlier quoted context omitted.

According to another post you do not owe tax on income below $108k so that’s probably not going to affect most filers, though I’m sure an anomalously high number of HN users are earning six-figure salaries.

That is only applies to so-called earned income , you still owe taxes on all of your other income. And many people earn considerably more than $108k. Furthermore, even under tax treaties, it is not uncommon for some part of your income to be double taxed due to differences in recognition and classification of income and foreign taxes paid. Americans often have to pay more taxes than if they only had to pay taxes in e…

Many people earn a lot more than that. I agree. Where I disagree is that I don't see what's unjust about asking them to pay tax for a system they benefit from.

Re: Wealthy people are renouncing American citizenship

#507

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…

Kept all what benefits? People who fled the US are now living under some other country's benefits, and pay taxes there instead.

Don't citizens of (almost) every other country in the world have the ability to go live abroad and keep all their benefits, whatever they are? I'm not following where Americans can actually get away with anything special.

Re: Wealthy people are renouncing American citizenship

#508

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…

Could it be because you're eligible for social security even if you don't reside in the US? I'm not sure about medicare or unemployment benefits.

Re: Wealthy people are renouncing American citizenship

#509

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…

Your representation is a bit exaggerated. The law simplistically simplifies to: if your income is above $X, then if your foreign tax payment $Y is less than the theoretical amount of tax you would have paid doing the same work under American Tax laws $Z, then please remit the difference ($Z-$Y) to the American government. I've personally filled out the forms several times, for multiple periods (full and partial). How…

Some years are fine, just subtract the earned income exemption and move on. Others are nightmares.

Unlike in America, where there are accountants lurking around every corner, the tax code here is very "simple" (the vast majority of people probably never fill out a tax return in their lives). This means accountants charge like you're some sort of multi-millionaire business owner (since that's who their clients typically are). My last quote to get US & domestic taxes filed here when I was a grad student was $6,000 on a total income of I just did my best to file on my own. I probably got something wrong since it's crazy confusing. Prizes are tax-free here, but taxable in the US and not typically "earned income" but are maybe covered by the foreign income exemption or a dual taxation agreement (since I did have to report it to the taxman here, the tax rate was just zero). I literally couldn't afford to figure out how much tax I owed and to who - nevermind the taxes themselves!

Hopefully the IRS doesn't care enough to seize me the next time I visit my family. I tried my best, but that doesn't necessarily mean much in court. I think a lot of the problem is with the American tax code in general, but American accountants know nothing about the tax code here so I can't just ring up H&R Block and ask them to file over zoom (I've tried). Meanwhile, the only accountants who know about American taxes over here are specialist catering to the millionaire expat market. An hour of their time costs more than I earn in a week.

Re: Wealthy people are renouncing American citizenship

#510

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.

“Off the back” sounds like the wealthy took advantage of folks when, in fact, they entered voluntary contracts in a win-win scenario. Creating a company is not exploitative but rather collaborative and mutually beneficial (with workers).

so the current distribution of wealth in america is ok and not anyones fault?
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