Record Number of U.S. Citizens, Green-Card Holders Cut Ties With U.S. in 2015Posted: February 6, 2016 | |
Increase attributed to recent enforcement campaign against U.S. taxpayers with undeclared offshore accounts.
“An increasing number of Americans appear to believe that having a U.S. passport or long-term residency isn’t worth the hassle and cost of complying with U.S. tax laws.”
— Andrew Mitchel, an international lawyer in Centerbrook, Conn., who tallies and tracks renunciation data
Last year was the third year in a row for record renunciations, according to Andrew Mitchel, an international lawyer in Centerbrook, Conn., who tallies and tracks renunciation data. The Treasury Department renunciation list for the fourth quarter, which contained 1,058 names, was released on Friday.
“An increasing number of Americans appear to believe that having a U.S. passport or long-term residency isn’t worth the hassle and cost of complying with U.S. tax laws,” Mr. Mitchel said.
Experts say the growing number of renunciations by citizens and long-term holders of green cards is related to an enforcement campaign by U.S. officials against undeclared offshore accounts. It intensified in 2009, after Swiss banking giant UBS AG admitted that it encouraged U.S. taxpayers to hide money abroad.
Since then, the U.S. has collected more than $13.5 billion from individuals and foreign financial firms in taxes and penalties due on such accounts. This week, Swiss bank Julius Baer Group AG admitted it encouraged U.S. taxpayers to hide money abroad and agreed to pay $547 million to settle potential charges.
However, the campaign by U.S. officials also has complicated the financial lives of an estimated 7 million or more Americans living abroad, leading growing numbers to sever their U.S. ties.
Unlike many countries, the U.S. taxes nonresident citizens on income they earn abroad. According to Philip Hodgen, an international tax lawyer who practices in Pasadena, Calif., the law provides only partial offsets for …(read more)
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