No matter how you slice it, immigration into the US is a hot button topic for a myriad of reasons. But just as there is a long line of people waiting to get into the “land of opportunity,” there is an increasingly growing number of people eager to get beyond what they view as Uncle Sam’s greedy fingers.
Why would anyone in their right mind willingly leave the US? The most common reasons are tax laws.
Let’s face it: few countries can compete with the US when it comes to the notion that the last person entitled to your hard earned money is you. The US government has it down to a science.
People are wising up and checking out. During the first three months of 2015, 1,335 US citizens renounced their citizenship. At first blush, that may not seem like a lot of people. It is, however, the highest number ever recorded for one quarter.
One of the things the US excels at is policy. As a country, we do love our paperwork. Renouncing your citizenship is a bit more complicated than ripping up your passport.
According to US law, you must complete a lot of paperwork, participate in interviews and fork over a bit of money. You can’t do it by mail, email, phone calls or through a third party while in the US.
Get this: In an odd bit of irony, the US Department of State has seen the increase of citizens wanting to revoke their citizenship and, rather than try to talk them out of it, they’ve identified it as another source of revenue. They’ve recently raised the fee for renunciation from $450 to $2,350. In addition, some high-income citizens may be subject to an “exit tax.”
Before you start packing your bags and brushing up on your Spanish, you should carefully consider what you’ll be forfeiting by getting the heck out of Dodge.
You’ll no longer:
- Be able to vote in US elections;
- Have access to government protection and assistance while traveling overseas;
- Be able for your children to have automatic citizenship if they’re born outside the US;
- Have access to federal jobs;
- Enjoy unrestricted travel into and out of the US.
Another HUGE reason to think long and hard before renouncing your citizenship is that the decision itself is irrevocable. There’s no second chance when you make the decision to move.
It’s About Fairness
Of the reasons given for renouncing US citizenship, tax laws are at the top of the list. Those choosing to leave aren’t necessarily doing so because of the money itself. Rather, it’s the tax compliance and disclosure laws they consider to be heavy and unfair.
Newer tax laws like the Foreign Account Tax Compliance Act (FATCA) contribute to the notion of double taxation. The US is peculiar in that her citizens are taxed regardless of where they live and where their income is earned. Higher-income earners often end up paying taxes in the US and abroad.
Expatriates-to-be may see leaving the US as an end to being subject to the complicated US tax reporting responsibilities.
We Don’t Blame You
At the end of the day, it’s your life, and you’ve got to do what’s right by you.
If you’ve already decided to renounce your citizenship or are seriously thinking about it, do the smart thing and let us help you. We know all the ins and outs, and can make sure that when your ship sails, you’ll have calm seas.
Get in touch and let us start working for you. Contact Eric Stuhler at email@example.com.