Americans Abandoning Citizenship In Record Numbers Due To Government Tax/Fine Harrassment

[Jingthing]

As many know, the U.S. government demands a lot more of her expats that any other country in regard to tax reporting, bank account reporting, and it is getting worse. The fines for non-compliance are HORRENDOUS.

So now this news. Americans in record numbers are abandoning U.S. citizenship to REALLY escape from America. Because physically leaving America isn't enough.

This was on Fox News and it certainly belongs on expat forums!

http://www.cuencahighlife.com/post/2012/04/16/Complaining-of-what-they-consider-an-over-bearing-taxes-some-US-citizens-living-abroad-renounce-their-citizenship.aspx

As American expats in Thailand very few of us are on a path towards Thai citizenship. Giving up citizenship is one thing, but you do need citizenship SOMEWHERE.

[flying]

Yes there was a big story about it a couple of years ago.

Problem is as you stated.....you can check out anytime but you may never leave their reach until you have another citizenship.

You cannot be a man without a country.

So of course for the wealthy this does not pose such a large problem as they can buy citizenship in quite a few spots.

But even then they are not home free as they must even then pay an exit tax....If your net worth is over 2 million USD

Not surprising eh?

You qualify for the covered expatriate and the related exit tax, if you meet any of the following criteria:

• you have a net worth of US$ 2 million or more;
  
• you have an average net U.S. income tax liability of greater than US$ 139,000 (thereafter indexed for inflation; $145,000 for people expatriating in 2009) for the five year period prior to expatriation; or
  
• you fail to certify that you have complied with all U.S. federal tax obligations for the preceding five years.
  

http://www.isla-offs...xpats-exit-tax/

Edited April 17, 2012 by flying

[Soutpeel]

Jing, me old fruit....you boys wouldnt have this problem now if you had stayed a colony, you would have only been paying tax on the tea...

[necronx99]

Jing, me old fruit....you boys wouldnt have this problem now if you had stayed a colony, you would have only been paying tax on the tea...

Yes....bit of God Save the Queen and a few Yes M'Lords and they wouldn't be in this situation. Problem is, as already stated they have to have citizenship somewhere and who'd have them? Maybe Nauru or some other pacific shithole hard up for a few dollars...

Edited April 17, 2012 by necronx99

[Naam]

But even then they are not home free as they must even then pay an exit tax... If your net worth is over 2 million USD

no American in his right mind will still have assets in the U.S. of A. at the time of his announcement "me no like IRS too mutt."

i'm going even further and claim that nobody in his right mind keeps assets in a jurisdiction which can be frozen or confiscated without involving a proper procedure in a court of law.

[flying]

Problem is, as already stated they have to have citizenship somewhere and who'd have them? Maybe Nauru or some other pacific shithole hard up for a few dollars...

Goodnight you had me laughing so hard....Thanks

[theblether]

Just a bunch of tax dodgers playing to form. Welcome to the good ole USA

[samran]

Jing, me old fruit....you boys wouldnt have this problem now if you had stayed a colony, you would have only been paying tax on the tea...

yeah, but they'd be too good at cricket and they'd monopolise the commonwealth games. Couldn't have that.

[jalansanitwong]

Didnt GE make a 2 billion dollar profit a year back and pay ZERO tax on the dollar. Must of been the great leadership of Jack Welch.

Do any of the richest 100 American families in New England states pay taxes or is all their money tied up in trusts? Those families make tens of millions every day in dividends ,stock market tip offs and futures, rents and royalties on consumer goods.

Mitt Romney and Obama are basically the same so who are the Americans on main street going to vote for ? Clint Eastwood ?? maybe

[AZBill]

Jing, me old fruit....you boys wouldnt have this problem now if you had stayed a colony, you would have only been paying tax on the tea...

yeah, but they'd be too good at cricket and they'd monopolise the commonwealth games. Couldn't have that.

Not to mention anything else we put our mind to trying - Old Boys!!!

[Jingthing]

Didnt GE make a 2 billion dollar profit a year back and pay ZERO tax on the dollar. Must of been the great leadership of Jack Welch.

Do any of the richest 100 American families in New England states pay taxes or is all their money tied up in trusts? Those families make tens of millions every day in dividends ,stock market tip offs and futures, rents and royalties on consumer goods.

Mitt Romney and Obama are basically the same so who are the Americans on main street going to vote for ? Clint Eastwood ?? maybe

That's easy. Most Americans don't vote. We're not Australians!

[Time Traveller]

But even then they are not home free as they must even then pay an exit tax... If your net worth is over 2 million USD

no American in his right mind will still have assets in the U.S. of A. at the time of his announcement "me no like IRS too mutt."

i'm going even further and claim that nobody in his right mind keeps assets in a jurisdiction which can be frozen or confiscated without involving a proper procedure in a court of law.

I think they mean you are liable if your global net assets are worth more 2million. Doesn't matter to the IRS what country your assets are in.

[dekestone]

As I mentioned in an earlier thread about the new taxation laws, this is the part that most concerns me:

The tax compliance act — the newer law — asks foreign financial institutions such as banks, hedge funds, and private equity funds to provide the IRS with information on U.S. clients.

I just wonder if the Thai banks, in order to avoid the excessive paperwork and cost this would entail, simply close all accounts held by Americans, as apparently other banks around the world are doing. This would be a big problem for both the retired guys and those of us who have our salaries deposited directly in the local bank.

I'm not ready to renounce my citizenship but geez, there's got to be an easier way to stop tax evasion and money laundering.

(I think this part of the law won't come into affect until 2013 or later, so hopefully a more reasonable approach will prevail.)

[Soutpeel]

As I mentioned in an earlier thread about the new taxation laws, this is the part that most concerns me:

The tax compliance act — the newer law — asks foreign financial institutions such as banks, hedge funds, and private equity funds to provide the IRS with information on U.S. clients.

I just wonder if the Thai banks, in order to avoid the excessive paperwork and cost this would entail, simply close all accounts held by Americans, as apparently other banks around the world are doing. This would be a big problem for both the retired guys and those of us who have our salaries deposited directly in the local bank.

I'm not ready to renounce my citizenship but geez, there's got to be an easier way to stop tax evasion and money laundering.

(I think this part of the law won't come into affect until 2013 or later, so hopefully a more reasonable approach will prevail.)

I think you will find parts of this are already in place....As an American go and try an open an offshore account with a major bank in Singapore...first question...are you a US citizen ?...you reply yes and some banks will politely decline your business...they dont want the hassle of dealing with your beloved IRS

[55Jay]

Good article, thanks JingThing. Read about his a couple years ago as I considered it. Element of emotional "voting with our feet" in protest, but the article laid out a few scenarios I hadn't considered, the common unpinning being money, taxes and overbearing govt interferece in our lives. Started out fair enough, virtuous War on Terror and all that, then leeched into broader powers to other agencies. We've been warned, so we need another McCarthy-like commission to haul up American expats with foreign bank accounts and accuse them of being tax dodging unpatriotic souls. That sort of public "name and shame" will never happen.

I do resent paying taxes (even with the FE Income Exclusion) to assist in operating the infrastructure of a country I don't live in, probably never will again, but do visit for a few weeks every few years or so. Mind less paying Social Security and Medicare monthlies, rationalizing that I might actually avail those accrual type services (chuckle) at some point in the future, and try to keep my head in the sand on the argument they may not be around by the time I get to eligibility age and further, my current contributions support a percentage "on the dole" who are defrauding the system. On the other hand, Mom/Dad are still around and collect monthly SS benefits, so I rationalize I'm helping them. A lovely, warm feeling, sorta like pissing down one's leg in winter, in the snow.

Oh, and to the lads who droned on above with the predictable "shoulda remained a colony" pokes, I actually agree, only as far as favorable expat taxes status goes. Yes, it would be grand.

However for the rest of it, and setting aside that you drive on the wrong side of the road, I am shocked and confused why you didn't relay the colonist comment to me in either Urdu, Farsi or Hindi, which makes complete sense to me as Z BBC told me all good English sur-names these days end in I or "Zed". Further, at least for now, where I'm located, can still go to "my" Embassy for a quick, new passport, not Germany, as I've heard a few of my UK allies and best mates lament about recently.

I do, however, say this descending into a barely audible, embarrassed murmur (as should you) as, where I'm at, the American Service Timing is 2 days weekly on the comical order of like 0900-0905. I arrive in the car park at 0830, compensating for the fact it requires 10 minutes to explain why I'm there to a host national (jobs programme), empty my pockets to get frisked by an Asian security guard paid slightly better than slave wages (jobs programme), then eventually I'm escorted by another Asian security guard into the Consular office where I am interviewed in front of a bullet proof window by a non-American (jobs programme). Shell out the required fees, reverse to check out with the Asian security guard and host national, who crosses me off the visitor's list.

I can visit my Embassy and save for other unfotunate souls like me, never see another American.

In'Shallah, to be fair again, you should actually relay your colonist break away barbs to us Americans on this forum in Spanish which, after all, is our official, national language.

Allah Akbhar, Humdullah, peace be upon you, best mate. Happy taxes to the rest of us.

J

[bangkokrick]

It's ironic that you Americans are complaining about the very thing that brought about your the Independence from Britain. That was all about paying British taxes for work done in the USA. Maybe you should form a new state and fight for independence from the USA?

[smiling mantis]

I think you can buy a Cambodian passport for $50K.

[dekestone]

As I mentioned in an earlier thread about the new taxation laws, this is the part that most concerns me:

The tax compliance act — the newer law — asks foreign financial institutions such as banks, hedge funds, and private equity funds to provide the IRS with information on U.S. clients.

I just wonder if the Thai banks, in order to avoid the excessive paperwork and cost this would entail, simply close all accounts held by Americans, as apparently other banks around the world are doing. This would be a big problem for both the retired guys and those of us who have our salaries deposited directly in the local bank.

I'm not ready to renounce my citizenship but geez, there's got to be an easier way to stop tax evasion and money laundering.

(I think this part of the law won't come into affect until 2013 or later, so hopefully a more reasonable approach will prevail.)

I think you will find parts of this are already in place....As an American go and try an open an offshore account with a major bank in Singapore...first question...are you a US citizen ?...you reply yes and some banks will politely decline your business...they dont want the hassle of dealing with your beloved IRS

So Americans working in Singapore cannot have their salaries deposited in local banks? I just wonder how they're managing it.

[Jingthing]

It's ironic that you Americans are complaining about the very thing that brought about your the Independence from Britain. That was all about paying British taxes for work done in the USA. Maybe you should form a new state and fight for independence from the USA?

It would be ironic if it were TRUE. Sad to hear the British education system is so poor. Tsk tsk.

http://www.historynet.com/debunking-boston-tea-party-myths.htm

[Soutpeel]

As I mentioned in an earlier thread about the new taxation laws, this is the part that most concerns me:

The tax compliance act — the newer law — asks foreign financial institutions such as banks, hedge funds, and private equity funds to provide the IRS with information on U.S. clients.

I just wonder if the Thai banks, in order to avoid the excessive paperwork and cost this would entail, simply close all accounts held by Americans, as apparently other banks around the world are doing. This would be a big problem for both the retired guys and those of us who have our salaries deposited directly in the local bank.

I'm not ready to renounce my citizenship but geez, there's got to be an easier way to stop tax evasion and money laundering.

(I think this part of the law won't come into affect until 2013 or later, so hopefully a more reasonable approach will prevail.)

I think you will find parts of this are already in place....As an American go and try an open an offshore account with a major bank in Singapore...first question...are you a US citizen ?...you reply yes and some banks will politely decline your business...they dont want the hassle of dealing with your beloved IRS

So Americans working in Singapore cannot have their salaries deposited in local banks? I just wonder how they're managing it.

Of course they can I was talking about an "offshore account", American's working in Singapore would be paying Singapore tax and they can prove to the Singapore bank.

And before you say I am making this up about US citizens and "offshore" accounts, a collegue of mine, who is an American and working in Thailand tried to open an offshore account with Citibank in Singapore and was politely declined and "hassles" with the IRS was the reason cited...

[Soutpeel]

Good article, thanks JingThing. Read about his a couple years ago as I considered it. Element of emotional "voting with our feet" in protest, but the article laid out a few scenarios I hadn't considered, the common unpinning being money, taxes and overbearing govt interferece in our lives. Started out fair enough, virtuous War on Terror and all that, then leeched into broader powers to other agencies. We've been warned, so we need another McCarthy-like commission to haul up American expats with foreign bank accounts and accuse them of being tax dodging unpatriotic souls. That sort of public "name and shame" will never happen.

I do resent paying taxes (even with the FE Income Exclusion) to assist in operating the infrastructure of a country I don't live in, probably never will again, but do visit for a few weeks every few years or so. Mind less paying Social Security and Medicare monthlies, rationalizing that I might actually avail those accrual type services (chuckle) at some point in the future, and try to keep my head in the sand on the argument they may not be around by the time I get to eligibility age and further, my current contributions support a percentage "on the dole" who are defrauding the system. On the other hand, Mom/Dad are still around and collect monthly SS benefits, so I rationalize I'm helping them. A lovely, warm feeling, sorta like pissing down one's leg in winter, in the snow.

Oh, and to the lads who droned on above with the predictable "shoulda remained a colony" pokes, I actually agree, only as far as favorable expat taxes status goes. Yes, it would be grand.

However for the rest of it, and setting aside that you drive on the wrong side of the road, I am shocked and confused why you didn't relay the colonist comment to me in either Urdu, Farsi or Hindi, which makes complete sense to me as Z BBC told me all good English sur-names these days end in I or "Zed". Further, at least for now, where I'm located, can still go to "my" Embassy for a quick, new passport, not Germany, as I've heard a few of my UK allies and best mates lament about recently.

I do, however, say this descending into a barely audible, embarrassed murmur (as should you) as, where I'm at, the American Service Timing is 2 days weekly on the comical order of like 0900-0905. I arrive in the car park at 0830, compensating for the fact it requires 10 minutes to explain why I'm there to a host national (jobs programme), empty my pockets to get frisked by an Asian security guard paid slightly better than slave wages (jobs programme), then eventually I'm escorted by another Asian security guard into the Consular office where I am interviewed in front of a bullet proof window by a non-American (jobs programme). Shell out the required fees, reverse to check out with the Asian security guard and host national, who crosses me off the visitor's list.

I can visit my Embassy and save for other unfotunate souls like me, never see another American.

In'Shallah, to be fair again, you should actually relay your colonist break away barbs to us Americans on this forum in Spanish which, after all, is our official, national language.

Allah Akbhar, Humdullah, peace be upon you, best mate. Happy taxes to the rest of us.

J

See it didnt take long for the rabid anti-British and Anti-german bile to raise its ugly head

Edited April 18, 2012 by Soutpeel

[Naam]

In'Shallah, to be fair again, you should actually relay your colonist break away barbs to us Americans on this forum in Spanish which, after all, is our official, national language.

Allah Akbhar, Humdullah, peace be upon you, best mate. Happy taxes to the rest of us.

J

to be fair again... congratulations on "achieving" half a dozen mistakes by latinising three arabic expressions.

[bangkokrick]

It's ironic that you Americans are complaining about the very thing that brought about your the Independence from Britain. That was all about paying British taxes for work done in the USA. Maybe you should form a new state and fight for independence from the USA?

It would be ironic if it were TRUE. Sad to hear the British education system is so poor. Tsk tsk.

http://www.historyne...party-myths.htm

I think not oh learned one.

'Events like the Boston 'Massacre' of 1770, when British troops fired on a mob that had attacked a British sentry outside Boston's State House, and the Boston 'tea-party' of 1773, when British-taxed tea was thrown into the harbour'.

[Naam]

As I mentioned in an earlier thread about the new taxation laws, this is the part that most concerns me:

The tax compliance act — the newer law — asks foreign financial institutions such as banks, hedge funds, and private equity funds to provide the IRS with information on U.S. clients.

I just wonder if the Thai banks, in order to avoid the excessive paperwork and cost this would entail, simply close all accounts held by Americans, as apparently other banks around the world are doing. This would be a big problem for both the retired guys and those of us who have our salaries deposited directly in the local bank.

I'm not ready to renounce my citizenship but geez, there's got to be an easier way to stop tax evasion and money laundering.

(I think this part of the law won't come into affect until 2013 or later, so hopefully a more reasonable approach will prevail.)

I think you will find parts of this are already in place....As an American go and try an open an offshore account with a major bank in Singapore...first question...are you a US citizen ?...you reply yes and some banks will politely decline your business...they dont want the hassle of dealing with your beloved IRS

So Americans working in Singapore cannot have their salaries deposited in local banks? I just wonder how they're managing it.

Of course they can I was talking about an "offshore account", American's working in Singapore would be paying Singapore tax and they can prove to the Singapore bank.

And before you say I am making this up about US citizens and "offshore" accounts, a collegue of mine, who is an American and working in Thailand tried to open an offshore account with Citibank in Singapore and was politely declined and "hassles" with the IRS was the reason cited...

American banks are polite, most other banks would have said "get lost!"

[Naam]

I think you can buy a Cambodian passport for $50K.

offers are floating around for €UR 20k. but if the Cambodian passport says e.g.

name: Bubba or Hank or Joe

place of birth: Tulsa, Oklahoma or Boise, Idaho

the banker will smile and shake his head.

[dekestone]

Of course they can I was talking about an "offshore account", American's working in Singapore would be paying Singapore tax and they can prove to the Singapore bank.

You could very well be right Soutpeel but in everything I've read the IRS makes no such distinction. I understand it as the IRS wanting foreign banks to inform them of any Americans who have accounts with them. That's part of the problem of course, the law is so poorly written and vague that even long-term expatriate tax experts are pulling their hair out.

Edited April 18, 2012 by dekestone

[Naam]

But even then they are not home free as they must even then pay an exit tax... If your net worth is over 2 million USD

no American in his right mind will still have assets in the U.S. of A. at the time of his announcement "me no like IRS too mutt."

i'm going even further and claim that nobody in his right mind keeps assets in a jurisdiction which can be frozen or confiscated without involving a proper procedure in a court of law.

I think they mean you are liable if your global net assets are worth more 2million. Doesn't matter to the IRS what country your assets are in.

of course it does not matter because if you have some grey cells working the IRS knows <deleted> in what country/jurisdiction and in what way you hold your assets.

[Naam]

Of course they can I was talking about an "offshore account", American's working in Singapore would be paying Singapore tax and they can prove to the Singapore bank.

You could very well be right Soutpeel but in everything I've read the IRS makes no such distinction. I understand it as the IRS wanting foreign banks to inform them of any Americans who have accounts with them. That's part of the problem of course, the law is so poorly written and vague that even long-term expatriate tax experts are pulling their hair out.

the law is indeed very clear but the point Soutpeel was trying to make is a different one. banks in offshore jurisdictions will open without big hassle a current account (e.g. for salary transfers) even for Americans. but not an account which can also be used as a trading and portfolio account.

reason: for a current account the administrative procedures demanded by the IRS are neither costly nor difficult for the bank (one "1099" at the end of the year). for a portfolio account with a lot of transactions the bank's workload is 'abominable' (a "1099" for each transaction). in 2004, when i was still a U.S. taxpayer, my bank told me that two employees in the back-office worked for several days to prepare the necessary paperwork.

[wdr]

Just read:

The Passport Book "The Complete Guide to Offshore Residency, Dual Citizenship and second Passports"

Send me a PM and I return you the book as PDF file.

[chops]

Well, if you have a wife/husband you can just have them do your banking for you. Assuming you trust them..