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Why expat Americans are giving up their passports

bbc.com

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Re: Why expat Americans are giving up their passports

#81

Post by letitleak »

"The US Treasury worked tirelessly to address many of these problems, and most have been resolved. If there are still problems with the law, then I believe Congress should hold hearings to see how it can be improved."

I bet they are wondering how to stay motivated on this one. Well a minor update to the legal system should fix the problem:

Welcome to Congress, we have now designated you a "US Congress Person" for filing purposes.

Being or having been a Members of Congress will require you to file all forms that could be requested of any "US Person".

In cases like FATCA you will also be required to disclose all accounts in your country of residence to meet our test of equivalence for "US Persons" abroad. Banks in the US will now be required to follow all procedures for FATCA for the special case of "US Congress Persons" or face 30% penalties. If Banks are unable to establish whether account holders are "US Congress Persons" they shall pay 30% penalties on all US sourced income.

The penalties for failure to file any form as a "US Congress Person" shall be no less than the highest established for other "US Persons".

Being convicted of some crimes and failures to file may limit your time in office but does not change your status and obligations as a "US Congress Person". If (Ex-)Congresspeople would like to renounce their citizenship they will automatically face the maximum 10 years of continued filing with the IRS as provided by the current regulations. "US Congress Person" like "US Person" can not be renounced separately.

Children of US Congress Persons shall inherit all filing birthrights of being a "US Congress Person".

(edit- fix mis-attribution of renunciation/IRS filing issue to FATCA)

Re: Why expat Americans are giving up their passports

#82

Post by zrail »

crdoconnor wrote: post #52
lokedhs wrote: post #25

Earlier quoted context omitted.

It can be a huge hassle for normal US citizens living outside the US. Most banks won't deal with them because of the risks involved. As a US citizen abroad, just getting a regular bank account can be next to impossible. I live in Singapore and when I was signing up for a stock trading account I asked what would have happened if I had to answer yes in the box that asked if I was liable to pay income tax in the US. The…

I lived in Singapore for 3 years and managed without a stock trading account. It's one of the easiest places to open a bank account, actually.

This is a recent development. How long ago were you in Singapore?

Re: Why expat Americans are giving up their passports

#83

Post by maxerize »

mbesto wrote: post #48
jacquesm wrote: post #12

Earlier quoted context omitted.

What premium is that over say being the holder of passport from the UK, NL, DE, FR, ES, IT, CH, SE, DK, NO, FI, BE or any one of a host of other countries that don't have such crazy tax rules?

The US economy and quality of life commands that premium. Note - My fiancee is British and I've lived for 4 years overseas in the EU (UK 3 years, DE for 1). As the tax code as an American begins to squeeze more and more, I've become more reluctant to "pay" that premium, but there are indeed aspects of American life and opportunity that don't currently exist in the EU.

I constantly have to remind myself that people who browse HN learn strongly libertarian and are mostly well-off white males. Otherwise, saying that the US quality of life exceeds that of the UK, Germany or Switzerland is just blatantly false.

Re: Why expat Americans are giving up their passports

#84

Post by paulsutter »

madaxe_again wrote: post #17

So, I know a us born billionaire who rescinded his citizenship last year to avoid fatca. He has successfully evaded both the US and UK tax authorities to the tune of half a billion or so, he tells me. The guy gives crazy amounts to philanthropic causes instead. He doesn't want his hard earned wealth pissed away by clueless bureaucrats. So. Anyone who tells you fatca has been a success is full of it. It penalises "nor…

He had to pay an exit tax on all his unrealized gains at the moment of rescinding citizenship, so it's almost certain that his taxes were much higher if he did so last year.

Details please, or it didn't happen.

Just for your own information: tax avoidance is legal and expected. Tax evasion is criminal and can result in prison. The distinction is that tax evasion is when you misrepresent the facts in your tax filings.

Re: Why expat Americans are giving up their passports

#85

Post by sklivvz1971 »

madaxe_again wrote: post #17

So, I know a us born billionaire who rescinded his citizenship last year to avoid fatca. He has successfully evaded both the US and UK tax authorities to the tune of half a billion or so, he tells me. The guy gives crazy amounts to philanthropic causes instead. He doesn't want his hard earned wealth pissed away by clueless bureaucrats. So. Anyone who tells you fatca has been a success is full of it. It penalises "nor…

Billions are never "hard earned". Do the math :-)

Re: Why expat Americans are giving up their passports

#86

Post by ta250x »

karlcoelho1 wrote: post #2

Scared to turning my permanent residency into citizenship now.

This is why I think getting a Green Card and relocating to the US is a bad idea. The idea that I'd have to keep paying crazy amounts of taxes even if I decide to move on with my life five or ten years from now and relocate to Japan or Germany is nuts.

In my opinion working remotely from a nice and affordable country is the best bet for skilled tech workers. Right now the US market is good but maybe in the future the money will be in China. You can work for the same startups from your bungalow in a tropical country instead of having to live over there. Maybe you can rationalize moving there today because of high salaries but that will inevitably change and when that happens you might regret committing to the US.

Re: Why expat Americans are giving up their passports

#87

Post by DyslexicAtheist »

I just noticed that this year if you open a bank account in most EU places they all ask you if you are a US citizen or have a green-card for the US to tick a box on the account opening forms.

I'd really hate it if my own country would force all the banks in the world to report back to the "mothership" and hence track my every move around the world for what? The IRS? Sure there are also other implications such as total control over the movements of a citizen. Can see why people renounce their citizenship. This isn't freedom any more.

Re: Why expat Americans are giving up their passports

#88

Post by personlurking »

> "The United States is one of only two countries in the world that has citizenship-based taxation (the other is Eritrea)."

I very recently read that Brazil does this too - that no matter where you currently live or work, as a Brazilian citizen, you have to pay taxes on it to Brazil (someone correct me if I'm wrong)

Re: Why expat Americans are giving up their passports

#89

Post by Ovid »

crdoconnor wrote: post #43
ascorbic wrote: post #34

Earlier quoted context omitted.

" Jane has lived and worked in France for 30 years drawing what she calls a "humble" salary. She has filed a tax return every year even though she earns significantly less than $106,000 a year." Hardly the 1%

She isn't the reason this article appeared in the BBC (it's effectively a reprinted press release, cf. Paul Graham's submarine). She also earns a good salary and is dropping citizenship basically in order not to have to fill out a form once a year. Either that or she's expecting a pay raise from her "humble" salary and will have to start paying a small amount of US tax. Either way, my sympathy dial isn't moving.

You are completely wrong and people with your attitude are part of the reason we expats are suffering.

Studies repeatedly show that that that majority of almost 8 million Americans living abroad moved to look for work, to find love, explore the world, do volunteer work, teach, and so on. We're largely middle class, just like most Americans back home. We're not rich (many of us teaching or volunteering are dirt poor), but we're putting up with a tax horror that Americans back home would revolt over if they had to endure it.

Re: Why expat Americans are giving up their passports

#90

Post by arto »

morgante wrote: post #78
arto wrote: post #26

For those looking to renounce their U.S. citizenship, Mike Gogulski has chronicled and documented the whole paperwork-heavy process on his blog: http://www.nostate.com/about/ In his case, after submitting the paperwork and burning his passport on YouTube, he chose to not get another citizenship, which means he's now stateless.

> which means he's now stateless Knowing some people who are involuntarily stateless, I can't imagine why someone would ever voluntarily give up their citizenship. It makes traveling, financing, and generally living incredibly citizenship.

You don't have to imagine, it's all chronicled on his blog. Gogulski's life is an open book.
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