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Wealthy people are renouncing American citizenship

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Re: Wealthy people are renouncing American citizenship

#691

Post by abroadsaver »

cortesoft wrote: post #435
Dracophoenix wrote: post #427

Earlier quoted context omitted.

What benefits does one have when living in a foreign country as a US citizen? There is no legal representation. There is no access to US government services. What exactly would an overseas US citizen be paying for?

If there are no benefits to being a US citizen while living abroad, there should be no issue with renouncing their citizenship. Why do they want to maintain their citizenship if it doesn’t give them anything?

We are still culturally American, and we still have family in the US. And if we visit, we pay taxes on everything while we’re there. There are taxes on the flight in, on the fuel we use, on the stuff we buy. And maybe we’d like to move back.

So why conflate being American with federal taxes and bureaucracy?

Maybe America should think about the benefits we expats provide to it while living and representing our culture and values abroad. We usually make a good impression on our country’s behalf, but everyone abroad is shocked to hear about the potential draconian penalties and compliance headaches our government forces on us.

Re: Wealthy people are renouncing American citizenship

#692

Post by larkost »

jarl-ragnar wrote: post #548
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.…

There’s an irony in there somewhere given the original motivation for the “Boston Tea Party”. No taxation without representation.

You are mistaken about the cause of the the Boston Tea Party. It was not about taxation without representation; it was about lack of taxation on tea from the East India corporation (which the King and his friends had a financial interest in). Many of the people protesting were owners in the local tea companies who's product was suddenly undercut because the King did not want to lose money on teas that were not selling in England.

The "no taxation without representation" was a slogan applied after the fact.

Re: Wealthy people are renouncing American citizenship

#693

Post by danmaz74 »

Leherenn wrote: post #395
danmaz74 wrote: post #144

Earlier quoted context omitted.

If you're Italian and living abroad, you can vote to elect one of the few members of parliament which actually represent migrated Italians. This way they can still have a bit of representation, but without the same amount of influence as if they were living in the country.

Is the ratio of electors/MP different for expats vs those living in the country? I can certainly understand the anger of the GP, apparently roughly 25% of the Croatian citizens do not live in the country. As an expat myself, having a say in how my home country is run is nice, but I feel it's a bit "easy", because I mostly do not have to live with the consequence of my choices.

Yes, I don't remember the actual ratios but it's much fewer representatives per person for citizens living abroad.

Re: Wealthy people are renouncing American citizenship

#694

Post by wait_a_minute »

whymauri wrote: post #600
jandrese wrote: post #403

Earlier quoted context omitted.

It's even more expensive than that since they don't refund you the money you paid into Social Security when you renounce.

lol, as Gen Z I've more-or-less accepted that my Social Security is just setting my money on fire and dancing in a circle.

Why? It doesn’t have to be that way. Social Security has been successfully bolstered in the past and can be again. I don’t see why it can’t remain solvent for the foreseeable future…

Re: Wealthy people are renouncing American citizenship

#695

Post by kevinh »

whymauri wrote: post #600
jandrese wrote: post #403

Earlier quoted context omitted.

It's even more expensive than that since they don't refund you the money you paid into Social Security when you renounce.

lol, as Gen Z I've more-or-less accepted that my Social Security is just setting my money on fire and dancing in a circle.

My boomer parents felt the same way and yet they're receiving it right now. 65+ year old people are one of the most powerful voting blocs.

Re: Wealthy people are renouncing American citizenship

#696

Post by spoonjim »

yawaworht1978 wrote: post #502
fmajid wrote: post #193

Earlier quoted context omitted.

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 ad…

Boris Johnson is a Ted Cruz who knew the appeal of a Donald Trump.

Re: Wealthy people are renouncing American citizenship

#697

Post by Izikiel43 »

obmelvin wrote: post #580
dghlsakjg wrote: post #571

Earlier quoted context omitted.

The TFSA is not something that can be abused by a high income individual. It has a $6,000 yearly contribution limit. Canada, if anything, has an investment tax scheme which favours middle class investors. For someone making millions of dollars Capital gains tax is tied to your income tax bracket in Canada so it is very likely that you would end up paying higher taxes. Canada also has a tax and income information shar…

> It has a $6,000 yearly contribution limit. I haven't looked into the exact details of Peter Thiel's IRA, but those have a contribution limit too, and look at all the press recently about him "abusing" [0] that. [0] I can't claim to know enough of his specific situation and the exact regulations to have an opinion on whether that's a fair characterization.

He bought paypal stock privately when it was almost worthless, which the roth ira allowed, then the stock exploded. I mean, sure, if you can tell the future you can do what Peter did.

Re: Wealthy people are renouncing American citizenship

#698

Post by ithinkso »

paulddraper wrote: post #623
mellavora wrote: post #621

Earlier quoted context omitted.

I think you misunderstood. Most (EU) pension systems also payout worldwide. It is the 'putting in' part which depends on residency.

They have one criterion for putting in and a different one for paying out? That would seem.....unfair.

What do you mean? You pay in the country you live/work in. You get back your pension wherever you are, from every country you've worked for in your life. Sounds pretty fair to me

Re: Wealthy people are renouncing American citizenship

#699

Post by abroadsaver »

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.

The US can’t be bothered to help its citizens living abroad with vaccinations even though it has expiring doses. Other countries have done so, AND without the tax compliance demands.

So let’s drop this extraterritorial benefits stuff. No benefit the US has provided has been worth the worry, anger, and tedium of trying to be tax compliant in a situation where it’s impossible to be truly compliant (thanks to how irreconcilable foreign arrangements often are to US tax law).

https://americanexpatfinance.com/news/item/782-state-dept-re...

Re: Wealthy people are renouncing American citizenship

#700

Post by ipaddr »

dzhiurgis wrote: post #679
PeterisP wrote: post #533

Earlier quoted context omitted.

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.

Can you live without residence? Say I'm sailing around the world. My home country could be thousands of miles away, pretty much unreachable in a practical way. Should that still count as my residence?

In some countries Canada for example if you don't take a new residence they will treat your last residence as your residence.

India is the opposite. You can work on a boat get paid in India and owe no taxes.

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