Number of U.S. expatriations reaches record high In 2013

[CaseyJones]

http://www.cnbc.com/id/101195604


Apparently for some U.S. citizens it's true—you can't go home again!

The Treasury Department published the names of 560 Americans who renounced their citizenship or are long-term residents who gave back their green cards during the third quarter of 2013, The Wall Street Journal reported. According to tax lawyer Andrew Mitchel who tracks the data, these expatriations reached a record high of 2,369 for the year. The prior highest number of published expatriates was in 2011, said Mitchel.

How's this for a parting gift? Taxpayers who renounce their citizenship or turn in their green card can be subject to an exit tax. People who renounced last year might have avoided higher taxes on income and estates—including those on long-term capital gains—which took effect in 2013.

"The reality is that the U.S. tax system gives dual citizens a good reason to walk away from their U.S. citizenship or permanent-resident status," said Jeffrey Neiman, a former federal prosecutor now in private practice in Fort Lauderdale, Fla. "It's a painful process but easier than staying in compliance with the law."

[Zippyjuan]

Meanwhile, a much larger number of wealthy people moved here.2,369 out of 300 million. The number includes those who had green cards and decided to return to their native countries so only a small percent of that figure were people who actually gave up US citizenship.

Renouncing citizenship (which must be done outside the USA) requires turning in your passport at a US Embassay. Unless that country grants you travel papers, you are unable to go anywhere else. It does not relieve one of any tax obilgations.

http://travel.state.gov/law/citizenship/citizenship_776.html

A person wishing to renounce his or her U.S. citizenship must voluntarily and with intent to relinquish U.S. citizenship:

1.appear in person before a U.S. consular or diplomatic officer,
2.in a foreign country (normally at a U.S. Embassy or Consulate); and
3.sign an oath of renunciation

Renunciations that do not meet the conditions described above have no legal effect. Because of the provisions of Section 349(a)(5), U.S. citizens cannot effectively renounce their citizenship by mail, through an agent, or while in the United States. In fact, U.S. courts have held certain attempts to renounce U.S. citizenship to be ineffective on a variety of grounds, as discussed below.

C. REQUIREMENT - RENOUNCE ALL RIGHTS AND PRIVILEGES

A person seeking to renounce U.S. citizenship must renounce all the rights and privileges associated with such citizenships. In the case of Colon v. U.S. Department of State , 2 F.Supp.2d 43 (1998), the U.S. District Court for the District of Columbia rejected Colon’s petition for a writ of mandamus directing the Secretary of State to approve a Certificate of Loss of Nationality in the case because he wanted to retain the right to live in the United States while claiming he was not a U.S. citizen.

D. DUAL NATIONALITY / STATELESSNESS

Persons intending to renounce U.S. citizenship should be aware that, unless they already possess a foreign nationality, they may be rendered stateless and, thus, lack the protection of any government. They may also have difficulty traveling as they may not be entitled to a passport from any country. Even if not stateless, former U.S. citizens would still be required to obtain a visa to travel to the United States, or show that they are eligible for admission pursuant to the terms of the Visa Waiver Pilot Program (VWPP). Nonetheless, renunciation of U.S. citizenship may not prevent a foreign country from deporting that individual to the United States in some non-citizen status.

E. TAX & MILITARY OBLIGATIONS /NO ESCAPE FROM PROSECUTION

Persons who wish to renounce U.S. citizenship should be aware of the fact that renunciation of U.S. citizenship may have no affect whatsoever on his or her U.S. tax or military service obligations (contact the Internal Revenue Service or U.S. Selective Service for more information). In addition, the act of renouncing U.S. citizenship does not allow persons to avoid possible prosecution for crimes which they may have committed in the United States, or escape the repayment of financial obligations previously incurred in the United States or incurred as United States citizens abroad.

F. RENUNCIATION FOR MINOR CHILDREN/INCOMPETENTS

Citizenship is a status that is personal to the U.S. citizen. Therefore, parents may not renounce the citizenship of their minor children. Similarly, parents/legal guardians may not renounce the citizenship of individuals who are mentally incompetent. Minors seeking to renounce their U.S. citizenship must demonstrate to a consular officer that they are acting voluntarily and that they fully understand the implications/consequences attendant to the renunciation of U.S. citizenship.

G. IRREVOCABILITY OF RENUNCIATION

Finally, those contemplating a renunciation of U.S. citizenship should understand that the act is irrevocable, except as provided in section 351 of the INA (8 U.S.C. 1483), and cannot be canceled or set aside absent successful administrative or judicial appeal. (Section 351(b) of the INA provides that an applicant who renounced his or her U.S. citizenship before the age of eighteen can have that citizenship reinstated if he or she makes that desire known to the Department of State within six months after attaining the age of eighteen. See also Title 22, Code of Federal Regulations, section 50.20).

Renunciation is the most unequivocal way in which a person can manifest an intention to relinquish U.S. citizenship. Please consider the effects of renouncing U.S. citizenship, described above, before taking this serious and irrevocable action. If you have any further questions regarding this matter, please contact:

[acptulsa]

Like rats off a sinking ship.

[Acala]

Like rats off a sinking ship.

Like passengers off a sinking ship that has been overrun with rats.

[Acala]

It does not relieve one of any tax obilgations.


Actually I believe it does in many cases. The U.S. is one of the few countries that taxes the income of US citizens earned outside the country. Renouncing your citizenship relieves you of that tax.

[Sonny Tufts]

Actually I believe it does in many cases. The U.S. is one of the few countries that taxes the income of US citizens earned outside the country. Renouncing your citizenship relieves you of that tax.

It doesn't for the very wealthy. A person is subject to U.S. income tax for 10 years after renouncing one's citizenship if either (a) his net worth was at least $2 million, (b) he had an average annual income tax of at least $155,000 for the 5-year period preceding expatriation, or (c) he fails to certify he has complied with federal tax law for the 5-year period.

[Acala]

It doesn't for the very wealthy. A person is subject to U.S. income tax for 10 years after renouncing one's citizenship if either (a) his net worth was at least $2 million, (b) he had an average annual income tax of at least $155,000 for the 5-year period preceding expatriation, or (c) he fails to certify he has complied with federal tax law for the 5-year period.

Wow. That sucks.

[69360]

It doesn't for the very wealthy. A person is subject to U.S. income tax for 10 years after renouncing one's citizenship if either (a) his net worth was at least $2 million, (b) he had an average annual income tax of at least $155,000 for the 5-year period preceding expatriation, or (c) he fails to certify he has complied with federal tax law for the 5-year period.

Only if they move to a country that extradites it's citizens to the US. You could go to Russia, France or various south american countries with your wealth and thumb your nose at the US tax laws.

[DFF]

The U.S. is one of the few countries that taxes the income of US citizens earned outside the country. Renouncing your citizenship relieves you of that tax.

Correct.

And outside of being relieved of the burden of US taxation, if one moves to a tax-haven country like Andorra, or St. Kitts, one doesn't have to pay capital gains taxes or income tax.

[DFF]

Like rats off a sinking ship.

Jim Rogers lives in Singapore, and Peter Schiff incorporated his new business in the Bahamas.

Shedding oneself of the US isn't cowardly, it's smart.

[Tod]

reminds me of this tidbit of wisdom from the forum namesake:


http://www.youtube.com/watch?v=esp-ruhkZqQ

[Pericles]

including Tina Turner:

http://www.washingtonpost.com/blogs/in-the-loop/wp/2013/11/12/tina-turner-formally-relinquishes-u-s-citizenship/

This item just in via an “activity” report from the U.S. Embassy in Bern, Switzerland, headlined “Soul Legend Relinquishes U.S. Citizenship.”


“Long-time Swiss resident Tina Turner was in the embassy Oct. 24 to sign her “Statement of Voluntary Relinquishment of U.S. Citizenship under Section 349 (a)(1) of the INA” — the Immigration and Naturalization Act.