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Facebook Co-Founder Gives Up U.S. Citizenship

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Re: Facebook Co-Founder Gives Up U.S. Citizenship

#61

Post by bilbo0s »

Immigrant who only sought US citizenship for financial gain, renounces US citizenship for financial gain. This is not terribly surprising.

There is a subset of Immigrants that move to the US, not because they believe in its ideals, but because it is financially advantageous for them to do so. Sometimes it works for the benefit of the US... as in this case. Other times... not so much.

On balance, I believe we generally gain more than we lose. Though I have no data to back up that assertion.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#62

Post by blahedo »

muyuu wrote: post #14
Matt_Mickiewicz wrote: post #6

It's common for UK citizens to give up citizenship, prior to an exit in their business and move to Monte-Carlo or Gilbraltar for a few years to avoid capital gains tax. If Facebook blows up on the IPO and the stock value increases 50% or 100% he could easily be saving $500m - $1b in taxes. It's a no-brainer...

It's more of a no-brainer when he isn't even American. He "became" an American citizen in record time - arrived in the US in 1992 and was a citizen by 1998. I'd say citizenship was given a tad too lightly.

He's 30 now, right? So he arrived at age 10 and was a citizen sometime before 16. The rules are (as they should be) a little different for minors.

Edit: dumb math error.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#63

Post by georgieporgie »

planetguy wrote: post #9

US citizenship is a nasty trap from which it is extremely difficult to escape. The US is one of a very small number of countries which will happily tax its citizens on income earned overseas, thus causing them to pay double taxes on everything they earn. This has seriously bad consequences for US competitiveness, in particular: 1. It discourages competent foreign citizens from seeking US citizenship (a greencard is s…

Go to any interntional company's office in Singapore, Shanghai, Kuala Lumpur and note that it's filled with Brits, Australians, New Zealanders with very few Americans; this is why.

Americans are exempt from the double-tax up to $91,400. Since I imagine most expat workers are earning under this level, I don't imagine that taxation is what's keeping Americans at home. Personally, I've found it difficult to even be considered for work abroad, usually due to visa issues. Other countries seem to have reciprocal working holiday visas for young people, and I imagine that this allows people to develop the specialized skills that justify the visa sponsorship or permanent resident status necessary to continue working abroad.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#64

Post by ashconnor »

apendleton wrote: post #37
ashconnor wrote: post #20

30 years old. He'll have to do his National Service in the Singaporean army. Edit: Correction. His children would be eligible. Also, Singapore doesn't allow dual-citizenship, so he'll have to give up his Brazilian citizenship (if he had it).

The article doesn't say he's establishing citizenship in Singapore; just residency. He presumably will remain a citizen of Brazil.

That makes more sense.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#65

Post by stevenwei »

steve-howard wrote: post #47
tallanvor wrote: post #44

Earlier quoted context omitted.

It does not discourage US workers from spending some of their careers overseas. Most workers, even if working overseas, don't make enough that they have to pay taxes on foreign earned income. --Between the deduction for money earned overseas, deductions for housing, and other standard deductions, if you earn enough that you're going to get taxed by the US, you earn enough that you might as well pay an accountant to h…

It looks like you have to make over $150k/year to have to pay worldwide taxes: http://www.irs.gov/businesses/small/international/article/0,... It's not cool on principle, I suppose, but most people find it hard to sympathize with the problems you face when you make more than $150k/year.

Just to clarify, your link refers to the income limits that qualify someone for the exit tax (i.e. the tax that you have to pay the IRS upon giving up your citizenship).

If you remain a U.S. citizen but choose to live abroad (i.e. pay taxes in another country), you also have to pay income tax to the IRS, but you can exclude the first $95,100 of your income from being taxed.

Source: www.irs.gov/businesses/small/international/article/0,,id=97130,00.html

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#66

Post by alain94040 »

planetguy wrote: post #58
clueless123 wrote: post #11

Earlier quoted context omitted.

That is a joke right? (I really hope so)

Personally I'm in favour of a system where it's done both ways. Most countries have a bicameral legislature in which one branch is a bit of a joke. My idea is that there should be a "House of Representatives" and a "House of Taxpayers", both of whom need to sign off on any bill. In the election for the House of Representatives, everyone gets an equal vote. In the election for the House of Taxpayers, everyone gets a v…

Why single-out the taxpayers? Do you also need a house for the poor (they surely are impacted by laws)? What about minorities? Etc.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#67

Post by ajross »

grandalf wrote: post #41
ajross wrote: post #35

Earlier quoted context omitted.

What does any of this have to do with the linked article? Savarin clearly wasn't trapped, he "escaped". He wasn't paying significant tax on overseas income, his wealth was generated inside the USA. Point #1 seems to be belied by simple observation. My US-based career has been filled with international professionals, virtually all of whom planned on spending their careers here, and almost all of whom have/had or were…

If you read the article he still has to pay the exit tax.

I read the article. You mean the exit tax that "trapped" him in the USA, from which he just expatriated? I must have missed that part.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#68

Post by idan »

planetguy wrote: post #9

US citizenship is a nasty trap from which it is extremely difficult to escape. The US is one of a very small number of countries which will happily tax its citizens on income earned overseas, thus causing them to pay double taxes on everything they earn. This has seriously bad consequences for US competitiveness, in particular: 1. It discourages competent foreign citizens from seeking US citizenship (a greencard is s…

You're missing a key aspect here:

Social Security.

While the US does indeed have tax treaties with many countries, it doesn't have treaties with everyone regarding social security.

I live in Israel, which does have an income tax treaty with the US. Still, for many types of employment and contracting scenarios, I must pay social security "twice"—once for each country. That's a hefty amount of double taxation.

Regardless, the cost of compliance is a real burden. I'm still filing my 2010 taxes. I have accountants on both sides. Figuring out how to correctly pay my taxes, how much to pay, and how to operate in order to minimize my tax profile is a gigantic pain in the ass.

FYI.

Re: Facebook Co-Founder Gives Up U.S. Citizenship

#69

Post by lbrdn »

The lack of social responsibility is what erks me the most about Saverin's decision. Saverin takes full advantage of the investments and sacrifices made by countless Americans and then when the country asks for him to uphold his obligation as a citizen, he leaves to save a few percentage points. This is a tactic for small thinkers.
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