Many Americans Renounce Citizenship, Even Before President TrumpPosted: May 6, 2016
Robert W. Wood writes: It seems crazy to call it the ‘New Normal’, but once again, record numbers of Americans are renouncing citizenship. Every three months, the Treasury Department publicly names individuals who renounced. It is surely more about FATCA, the Foreign Account Tax Compliance Act enacted in 2010, than it is about politics. Still, numbers are flying, with one poll saying that 1 in 4 Americans would consider leaving if Trump is elected. Others claim they will leave if Hillary is elected.
“FATCA has been painstakingly implemented worldwide by President Obama’s Treasury Department. It now spans the globe with a network of reporting that is unparalleled in the world. America is requiring foreign banks and governments to hand over secret bank data about depositors.”
Of course, these numbers seem tiny compared to the influx of immigrants. Yet expatriations have historically been much lower, making the uptick worrisome. Moreover, the published list is incomplete, with many not counted. Surprisingly, no one seems to know exactly how big the real number is, even though the IRS and FBI both track Americans who renounce. There is no single explanation, though some renounce because of global tax reporting and FATCA. One law adding to the mix is the IRS power to revoke passports.
The reasons for renouncing can be family, tax and legal complications. Dual citizenship isn’t always possible, as this infographic from MoveHub shows. And leaving can be expensive. Some countries have no fee, but America charges $2,350 to hand in your passport. That is more than twenty times the average of other high-income countries. The U.S. government has collected about $12.6 million in fees since the fall of 2014, after hiking its fee to renounce citizenship by 422%. Some renouncers write why they gave up their U.S. citizenship.
FATCA has been painstakingly implemented worldwide by President Obama’s Treasury Department. It now spans the globe with a network of reporting that is unparalleled in the world. America is requiring foreign banks and governments to hand over secret bank data about depositors. Non-U.S. banks and financial institutions around the world must reveal American account details or risk big penalties.
America’s global income tax compliance and disclosure laws can be a burden, especially for U.S. persons living abroad….(read more)
- The Worst Law Most Americans Have Never Heard Of (financialsurvivalnetwork.com)
- U.S. FATCA Lawsuit Dismissed by District Court (isaacbrocksociety.ca)
- Public registration of asset ownership (intellihub.com)
- Don’t miss foreign account tax-reporting deadline (bankrate.com)