Greencard vs. US citizenship

[Time Traveller]

Just now, chiang mai said:

 

I don't see that as breaking the law, the person would be a Thai citizen hence legally entitled. What else he may or may not be is irrelevant.

Well good for you. The IRS thinks differently.

 

 

[skatewash]

2 minutes ago, chiang mai said:

 

I don't see that as breaking the law, the person would be a Thai citizen hence legally entitled. What else he may or may not be is irrelevant.

Wrong.  In this case the person was a dual Thai-US citizen.  As a US citizen (regardless of how many other countries the person may have citizenship in) the person is required under FATCA/FBAR to identify as a US citizen and comply with the laws regarding accounts held outside the US.  If caught the IRS would be penalizing the person as a US citizen, not a Thai citizen.

[skatewash]

To put it even more simply, being a Thai citizen does not eliminate any responsibilities, liabilities, or other obligations you may have being a US citizen.

[bubba]

17 minutes ago, Time Traveller said:

To answer the OP's question: Does he intend to live in the US in his future life? If the answer is no, then citizenship is not worth it.

 

Oh, you'll hear these people scream (all of them Americans) on about the travel benefits of a US passport. But for me (i have a greencard and weighed up the pros and cons) if it's only about the passport then why bother to apply? 

 

Permanent residents have basically most of the same rights as citizens if he's living in the US.  But if he does't want to live in the US, a lifetime of applying for visas is much better than a lifetime of filing US taxes as an expat. Remember it was that SOB Obama that signed FATCA into law. The complexities of this law is so extreme that US Citizenship is akin to a ball and chain around your life forever. Perhaps Trump and the republicans will overwrite this law and simplify the tax code, but until then he will always live with the risk that a simple mistake in his tax filing and foreign acct reporting responsibilities could bankrupt him through IRS fines.

 

And besides foreigners (non-resident aliens) who've given up their green card can still get the SS retirement benefits paid to almost any country if they've worked in the US for 10 years or more. 

These are the main considerations but there as some lesser know situations that may affect some individuals - such as land ownership rights and specific tax laws concerning inheritance taxes come to mind.

 

Unfortunately for Thais who are US permanent residents, Thailand is not on the list of countries where Social Security benefits can be paid out. 

 

Also, if someone really does not want to keep up with their green card residency obligations or annual re-entry permits, they can go into US Immigration here in BKK, surrender their green card and they will be given a ten year multiple entry visitor's visa. This was the case with one of my staff last year.

[mduras01]

The freedom to travel is alone a great reason.


Sent from my iPhone using Thaivisa Connect

[Time Traveller]

15 minutes ago, bubba said:

 

Unfortunately for Thais who are US permanent residents, Thailand is not on the list of countries where Social Security benefits can be paid out. 

 

Also, if someone really does not want to keep up with their green card residency obligations or annual re-entry permits, they can go into US Immigration here in BKK, surrender their green card and they will be given a ten year multiple entry visitor's visa. This was the case with one of my staff last year.

Maybe you're confused by my comment. So to clarify, any Thai citizen who has worked in the US and paid into the SS system for a minimum of 40 quarters, is eligible to receiver SS Retirement benefits even if they give up their green card and move back to thailand - the key words being Worked and Retirement.

I have have no idea about other SS benefits like widows, orphans, disabled payments (maybe that's what you're talking about). But SS retirement is paid to non citizens - although there is a withholding tax that is 30% (unless paid under Tax treaty) 

Edited December 5, 2016 by Time Traveller

[mania]

24 minutes ago, Time Traveller said:

Well good for you. The IRS thinks differently.

 

 

 

Kind of a storm in a tea cup because believe me...the Thai's who leave the US as  US citizens to move back

to Thailand as my wife & I did ...have very little if any chance to need to worry about breaking the allowed exclusion

of income before needing to pay any taxes from income gained in Thailand

[Time Traveller]

Just now, mania said:

 

Kind of a storm in a tea cup because believe me...the Thai's who leave the US as  US citizens to move back

to Thailand as my wife & I did ...have very little if any chance to need to worry about breaking the allowed exclusion

of income before needing to pay any taxes from income gained in Thailand

It's account reporting....not the same as Income declaration. If you don't know that, then you'd better read about about FATCA/FBAR and the penalties

[mania]

1 hour ago, IMA_FARANG said:

A Greencard is for those non U.S. citizens who reside in the U.S. for a reletively short period and are NOT residing there permanently.
 

 

Not really

The second green card you get is a 10 year card

Some folks spend their whole loves in the US on a green card

[mania]

1 minute ago, Time Traveller said:

It's account reporting....not the same as Income declaration. If you don't know that, then you'd better read about about FATCA/FBAR and the penalties

 

555 you better read

FBAR is treasury not IRS

 

Your the one who said

" Well good for you. The IRS thinks differently. "

 

Edited December 5, 2016 by mania

[skatewash]

19 minutes ago, mania said:

 

555 you better read

FBAR is treasury not IRS

 

Your the one who said

" Well good for you. The IRS thinks differently. "

 

When a US-Thai dual citizen loses 50% of her Thai bank account balance in penalties because she didn't file an FBAR (technically a Financial Crime Enforcement Network FCEN Report 114) when she was required to do so as a US citizen, I'm sure she'll appreciate knowing the fine distinction between the Internal Revenue Service and the US Treasury Department of which the IRS is a bureau ;-)

[Time Traveller]

31 minutes ago, mania said:

 

555 you better read

FBAR is treasury not IRS

 

Your the one who said

" Well good for you. The IRS thinks differently. "

 

Actually you do need to report your foreign accounts twice - once to Treasury on FBAR, and then seperately on Form 8938 with your tax return to the IRS. (and BTW the foreign earned income exclusion only applies if you file for it, it's not automatic). 

Anyway, you could be right, I thought IRS was part of the Treasury department. In any case, as skatewash pointed out. The penalties still stand. 

[chiang mai]

1 hour ago, Time Traveller said:

Well good for you. The IRS thinks differently.

 

 

 

1 hour ago, skatewash said:

Wrong.  In this case the person was a dual Thai-US citizen.  As a US citizen (regardless of how many other countries the person may have citizenship in) the person is required under FATCA/FBAR to identify as a US citizen and comply with the laws regarding accounts held outside the US.  If caught the IRS would be penalizing the person as a US citizen, not a Thai citizen.

 

Before everyone gets too righteous about my opinion, it was just an opinion!

 

And frankly, if I was a Thai/American who had chosen to live in Thailand rather than in the US and consequently regarded myself as more Thai than American, I'm pretty sure I wouldn't hesitate to open a bank account in Thailand using my Thai ID card etc, safe in the knowledge that my fellow Thai's would be most unlikely to ask any further questions. In fact I think in that situation I might feel a little indignant that the US government was trying to dictate to me what I could and couldn't do in my own country.

 

Now if and when it came time to receive SSc payments where, that would be a bridge to cross at the time perhaps.

Edited December 5, 2016 by chiang mai

[skatewash]

1 minute ago, Time Traveller said:

Actually you do need to report your foreign accounts twice - once to Treasury on FBAR, and then seperately on Form 8938 with your tax return to the IRS. (and BTW the foreign earned income exclusion only applies if you file for it, it's not automatic). 

Anyway, you could be right, I thought IRS was part of the Treasury department. In any case, as skatewash pointed out. The penalties still stand. 

 

The IRS is a bureau under the Treasury Department.  It is worth noting that the FBAR filing is done separately from the filing of one's income tax return.  I can even imagine a situation in which a person would be required to make an FBAR filing, but would not have to file an income tax return due to falling below the minimum filing threshold requirements.  You do need to file to get the foreign earned income exclusion.  Sometimes it is a good idea to file a tax return even if not required to do so.  Filing a tax return at least starts the clock on the statute of limitations.

[skatewash]

7 minutes ago, chiang mai said:

And frankly, if I was a Thai/American who had chosen to live in Thailand rather than in the US and consequently regarded myself as more Thai than American, I'm pretty sure I wouldn't hesitate to open a bank account in Thailand using my Thai ID card etc, safe in the knowledge that my fellow Thai's would be most unlikely to ask any further questions. In fact I think in that situation I might feel a little indignant that the US government was trying to dictate to me what I could and couldn't do in my own country.

I personally would feel more than a little indignant about that ;-)  In fact, even many US citizens would agree it's not appropriate for them to do this.  However, the fact remains that the US has a citizenship-based taxation system (not resident-based like the rest of the world) and a US citizen is bound by laws such as FATCA/FBAR whether they are in the US or not, whether they have dual citizenship or not.  It goes with having the US passport.

[avvocato]

On 12/4/2016 at 4:32 AM, mania said:

 

The abandonment of green card status rule is only during the first 2year card

Which is why that card is called the Temporary Residence

 

But after the 2 year card he gets a 10 year card called the permanent residence

& that card does not have that rule afaik

This is mis-information. See the second item from the USCIS website. One needs to tread carefully. It is after all Premanent "Resident" Status:

Abandoning Permanent Resident Status

You may also lose your permanent resident status by intentionally abandoning it. You may be found to have abandoned your status if you:

• Move to another country, intending to live there permanently.
• Remain outside of the United States for an extended period of time, unless you intended this to be a temporary absence, as shown by:
  • The reason for your trip;
  • How long you intended to be absent from the United States;
  • Any other circumstances of your absence; and
  • Any events that may have prolonged your absence.
  • Note: Obtaining a re-entry permit from USCIS before you leave, or a returning resident visa (SB-1) from a U.S. consulate while abroad, may assist you in showing that you intended only a temporary absence.
• Fail to file income tax returns while living outside of the United States for any period.
• Declare yourself a “nonimmigrant” on your U.S. tax returns.

[mania]

Poor OP this topic has drifted so far from his simple question I think he left

 

For what it is worth we know all about FBAR & FACTA having filed for all the years we lived in Thailand

 

I stand by my previous post IRS Is not Treasury BUT

 

Yes you need to file FBAR if at anytime during the calendar year your total of any & all account you have

cumulatively outside of the USA exceeded $10,000 even for a day you must file a simple online form

 

FACTA yes if fir instance your married & filing jointly AND made over 300K

(congrats on making this 10+ million Baht in Thailand) then yes file

 

 

As I said in one of my previous posts lucky if you exceed the exclusions of Income 116k outside of US

regarding IRS or the 300K for FACTA

 

To the rest it is all so far off topic & basic fear mongering as it is a given we as US expats know & follow the laws

The OP asked a simple question

from there some mentioned taxation that US citizens pay no matter where they live

That is how we got on this crooked off topic road

 

Fact is IRS taxation is not a big deal if you make less than 116K USD (the foreign income exclusion allowed) per year outside of the USA

.........living in Thailand? 4.1 million baht a year???

 

FBAR yes if you have a bank account opened under your US passport & it exceeded 10K during the year file the simple form online easy

 

FACTA if you need to file this congrats you made a BIG pile of dough in Thailand

 

 

Lastly I agree with Chiang Mai's opinion

If I were a dual citizen & Thailand was my 1st citizenship I would of course open account in Thailand as a Thai

As such no reporting period

 

 

 

 

Edited December 5, 2016 by mania

[mania]

53 minutes ago, avvocato said:

This is mis-information. See the second item from the USCIS website. One needs to tread carefully. It is after all Premanent "Resident" Status:

 

Read back & see we agreed awhile back about all of that yes?

Edited December 5, 2016 by mania

[skatewash]

44 minutes ago, mania said:

Poor OP this topic has drifted so far from his simple question I think he left

 

For what it is worth we know all about FBAR & FACTA having filed for all the years we lived in Thailand

 

I stand by my previous post IRS Is not Treasury BUT

 

Yes you need to file FBAR if at anytime during the calendar year your total of any & all account you have

cumulatively outside of the USA exceeded $10,000 even for a day you must file a simple online form

 

FACTA yes if fir instance your married & filing jointly AND made over 300K

(congrats on making this 10+ million Baht in Thailand) then yes file

 

 

As I said in one of my previous posts lucky if you exceed the exclusions of Income 116k outside of US

regarding IRS or the 300K for FACTA

 

To the rest it is all so far off topic & basic fear mongering as it is a given we as US expats know & follow the laws

The OP asked a simple question

from there some mentioned taxation that US citizens pay no matter where they live

That is how we got on this crooked off topic road

 

Fact is IRS taxation is not a big deal if you make less than 116K USD (the foreign income exclusion allowed) per year outside of the USA

.........living in Thailand? 4.1 million baht a year???

 

FBAR yes if you have a bank account opened under your US passport & it exceeded 10K during the year file the simple form online easy

 

FACTA if you need to file this congrats you made a BIG pile of dough in Thailand

 

 

Lastly I agree with Chiang Mai's opinion

If I were a dual citizen & Thailand was my 1st citizenship I would of course open account in Thailand as a Thai

As such no reporting period

 

 

 

 

The relationship between the IRS, FinCEN and the Treasury Department isn't a mystery.  Both the IRS and FinCEN (where the FBAR is sent) are both bureaus of the same US Treasury Department:  https://www.treasury.gov/about/organizational-structure/bureaus/Pages/default.aspx

 

US laws, including FATCA/FBAR, apply to all US citizens, including people who happen to have citizenship in other countries as well, including Thailand.  It matters not if a dual US-Thai citizen opens an account in Thailand as a Thai (presumably using their Thai ID card), if they also have US citizenship they are liable to report the account (if they meet the required threshold of $10,000 balance) on an FBAR filing just like every other US citizen in the world.  The law as written doesn't include a Thai citizen escape hatch.  It doesn't say you have to report all foreign accounts except those accounts you opened with a Thai bank and forgot to mention to the Thai bank that you were also a US citizen.  If they are found out, they will have to deal with US tax officials, it's really as simple as that.

[vaultdweller0013]

Back to the original question (and please remember, this is for a 17 year old who needs to make a decision that could affect his life in the future):

 

He will qualify for federal student aid as a green card holder. He will need to fill out a FAFSA to qualify for anything federal -- both grants or loans.

 

Note that even as a permanent resident he still needs to register for selective service once he turns 18 (and will not be able to receive any financial aid until he registers).

 

The biggest advantage of citizenship will be flexibility in the future. As was noted above, a green card can be involuntary revoked, specifically if he spends too much time outside of the US; citizenship can only be taken if explicitly renounced (or if obtained through providing false information). So, for example, as a citizen, he could chose work in Thailand (or any other country) after graduation, but still be able to have the right to live and work in the US 5, 10, or 20 years in the future. It will also be easier for him to travel to other countries outside of ASEAN (especially for business, if that is something he wants to do as part of his career).

 

Outside of this, he would have the right to vote, could hold public office, serve on a jury, and have jobs that require higher security clearance (although he may need to give up his Thai citizenship in this case). 

 

As a green card holder he will have almost the same bureaucratic burden (taxes, FBAR, FACTA) as a US citizen. The main advantage would be that it is easier to give up your green card than it is to renounce your citizenship. However, unless he becomes very wealthy the only real cost of this bureaucracy is time; there will be no or very little financial cost.

 

I'm a little idealistic in this regard, another question for him is whether he views himself as American. So, a question he should ask himself is does he think of himself as Thai AND American or as a Thai living in America? 

 

[craigt3365]

1 hour ago, vaultdweller0013 said:

Back to the original question (and please remember, this is for a 17 year old who needs to make a decision that could affect his life in the future):

 

He will qualify for federal student aid as a green card holder. He will need to fill out a FAFSA to qualify for anything federal -- both grants or loans.

 

Note that even as a permanent resident he still needs to register for selective service once he turns 18 (and will not be able to receive any financial aid until he registers).

 

The biggest advantage of citizenship will be flexibility in the future. As was noted above, a green card can be involuntary revoked, specifically if he spends too much time outside of the US; citizenship can only be taken if explicitly renounced (or if obtained through providing false information). So, for example, as a citizen, he could chose work in Thailand (or any other country) after graduation, but still be able to have the right to live and work in the US 5, 10, or 20 years in the future. It will also be easier for him to travel to other countries outside of ASEAN (especially for business, if that is something he wants to do as part of his career).

 

Outside of this, he would have the right to vote, could hold public office, serve on a jury, and have jobs that require higher security clearance (although he may need to give up his Thai citizenship in this case). 

 

As a green card holder he will have almost the same bureaucratic burden (taxes, FBAR, FACTA) as a US citizen. The main advantage would be that it is easier to give up your green card than it is to renounce your citizenship. However, unless he becomes very wealthy the only real cost of this bureaucracy is time; there will be no or very little financial cost.

 

I'm a little idealistic in this regard, another question for him is whether he views himself as American. So, a question he should ask himself is does he think of himself as Thai AND American or as a Thai living in America? 

 

My wife has a US passport.  We did this for 2 main reasons.  One, travel is infinitely easier with a US passport vs. a green card.  No comparison.  If you travel extensively, like we do, it's a no brainer.  Two, she'll be entitled to SS survivor payments when I pass.  Not a lot, but still a fair amount as I'm entitled to the max amount.

 

My wife thinks of herself as a Thai with a US passport.  We live here in Thailand.

[Mr0Yallow]

On 12/4/2016 at 3:34 PM, radiochaser said:

I returned to the United States from Thailand about 45-49 days ago.  

At immigration check point, a green card holder was questioned about his long stay outside of the United States.  He was told he could lose his green card status by staying outside the United States so long.  He was questioned for several minutes about his stay, why he was gone, etc.  

He was outside the United States for only 7 months.  

Unless there has been a change,  a green card holder cannot receive Social Security payments outside of the United States.  No matter how long you have worked and payed into the system.  You will only be eligible to draw them inside the United States.  

My Thai ex-wife came to Thailand when she first got her green card, her mother had died. she returned a couple of weeks later via Myanmar, (her Aunt works at the Thai Consulate there) She was interrogated for over an hour by ICE because I did not accompany her, (Damn, it sucked having to work for a living).

From what I have read on the Social Security website Social Security RETIREMENT benefits can be received in most foreign nations by qualified recipients, however SSD, (Social Security Disability) recipients are not supposed to leave the US for more than a short period, not sure if 30 or 60 days.

[avvocato]

21 hours ago, mania said:

Read back & see we agreed awhile back about all of that yes?

Yes. Before she became a citizen, my wife got flagged in SF Airport (under her PRA green card) for being out of the country a lot. They didn't try to do anything but they flagged her in the computers.

[hoosierhiver]

 Thanks everyone for the responses. My son is identifying more and more as an "American", he is losing his Thai language skills and has not shown much desire to go back to Thailand to live or even to visit.

  Does anyone have insights regarding military service? I know as a Thai citizen, he has to participate in the Thai military lottery. If he were chosen, I don't know what good he would be to them since he is losing his language skills. I wonder if he could be exempt because of this.

[Dustdevil]

On 12/3/2016 at 3:01 AM, skatewash said:

 

Really?  The US has citizenship-based taxation rather than residence-based taxation.  The only country in the world to do so (except for Eritrea, which is a complicated situation).  Therefore, if he obtains and keeps US citizenship or keeps his Green Card status he will be liable for filing and paying US taxes for the rest of his life, not just when he is residing in the US.  As a US citizen he will also be responsible under FATCA for annually reporting any financial accounts located outside the US to the US government (under very Draconian penalties for failing to do so).  A Green Card holder who is a tax resident of a country outside the US would not necessarily have to report these accounts.  Finally, should he wish to do so, it is becoming more difficult to renounce US citizenship, more difficult than simply to give up Green Card status.  So there are some negative consequences of being a US citizen or green card holder.  Whether they would negatively affect the OP's son depends on what he wants or plans to do.

 

People always say Oh, he'll have to pay US taxes. NO, he WON'T for the first $96,000 he earns outside the U.S.  After that figure you start from zero . So if you make $100,000 overseas, you owe taxes on $4000. Since $4K is poverty level, you still won't pay any taxes until you start earning a bit more, like $124,000....and then only on the $28K that is in excess of $96K.

[Dustdevil]

10 hours ago, hoosierhiver said:

 Thanks everyone for the responses. My son is identifying more and more as an "American", he is losing his Thai language skills and has not shown much desire to go back to Thailand to live or even to visit.

  Does anyone have insights regarding military service? I know as a Thai citizen, he has to participate in the Thai military lottery. If he were chosen, I don't know what good he would be to them since he is losing his language skills. I wonder if he could be exempt because of this.

There is no military draft, not since Vietnam. But if he joins up for three years, like my son did, he gets a free ride through universisty, including rent. That's what my kid is doing now--going to college for free including rent. And not just the lowest-cost state colleges. BTW, most people don't get deployed to the nasty places. He spent his 3 years divided between S. Korea and Germany.

Edited January 7, 2017 by Dustdevil

[skatewash]

19 minutes ago, Dustdevil said:

There is no military draft, not since Vietnam. But if he joins up for three years, like my son did, he gets a free ride through universisty, including rent. That's what my kid is doing now--going to college for free including rent. And not just the lowest-cost state colleges. BTW, most people don't get deployed to the nasty places. He spent his 3 years divided between S. Korea and Germany.

I think the OP is concerned about the Thai draft lottery rather than military service in the US which is voluntary rather than mandatory.

[CaptHaddock]

33 minutes ago, Dustdevil said:

People always say Oh, he'll have to pay US taxes. NO, he WON'T for the first $96,000 he earns outside the U.S.  After that figure you start from zero . So if you make $100,000 overseas, you owe taxes on $4000. Since $4K is poverty level, you still won't pay any taxes until you start earning a bit more, like $124,000....and then only on the $28K that is in excess of $96K.

 

Actually, it is more complicated than you realize.  It's true that the Foreign Earned Income Exclusion does exempt the first $102,100 of earned income from US income tax.  An expat working abroad for a non-US company is not liable for payroll tax, i.e. Social Security and Medicare contributions, since the employer is not paying into the SS system.  The payroll tax rate for an employee is 7.65% while the employer pays another 7.65%.  However, if the expat is working for a US company then the payroll tax does apply to both the employer and the employee.  The surprise for many expats is that if he were to be self-employed he would indeed be working for a US employer, i.e. himself.  So, as an American employer and employee, he would be liable for the entire 15.30% payroll tax.  And unlike the income tax, there is not foreign exclusion for the payroll tax.  So, he would have to pay 15.3% payroll tax on top of his Thai income tax on all his income up to the $127,000 cutoff for the payroll tax.

 

As to the OP's original question, if his son plans to stay in the US, he should avoid the Thai military draft by giving up his Thai citizenship, which would seem to have little value to him.  If he were to consider settling in Thailand, maintaining US citizenship is a mixed bag.  The US passport is an advantage, but there are tax liabilities to consider.

 

Also, income over the FEIE is taxed by the IRS not at the lowest income bracket, as you incorrectly assert, but at the appriopriate bracket if all the foreign income were taxable.

 

Edited January 7, 2017 by CaptHaddock

[bitcoinforever]

does your son want to return to Thailand , and work and stay? does he want to live and stay in the u.s.? it only works to his advantage to get u.s. citizenship. he becomes available for the Thai draft soon. if his does not register for it has to avoid Thailand till he is over 30. do not worry about any of these tax problems till you are making over 100,000 usd. education ,and job opportunities better in the u.s. nothing for a young man in Thailand to build a financial future, unless he wants to work at a overworked underpaid job---- go for it

Edited January 7, 2017 by bitcoinforever

[Mansell]

One advantage to your son with U.S. passport and paying taxes in the U.S. When he is older he would qualify for Social Security and Disability if something happened to him. I may be wrong on this, but my understanding is your son even if a Thai citizen will have to register for Selective Service. This is in the event there needs to be a draft in the event of a future war. Then there will be a database of everybody registered and they can expedite the process. If I am wrong I am sure somebody will say so. America is one of the few countries that used to draft people into the military even if they only resided in the country and were not a citizen. Back in the sixties there was a British boxer Terry Downs, who had been I believe world middleweight champion, and he got drafted and served as a marine for a number of years. I suppose he could have avoided it by leaving the country.