If this has already been posted, sorry for the duplication. This whole issue is starting to get traction. More than 200 comments so far. Looks like a good article.
US citizenship = a tax on life online.wsj.com/article/SB1000… Choice for #americansabroad: 1. US citizenship 2: A “high tax” life without #FBAR #FATCA
— U.S. Citizen Abroad (@USCitizenAbroad) May 20, 2012
@bubblebustin.
Truly tragic. What a good headline for a sane article somewhere. Thanks again for boiling it down to the basic.
@JoeSmith
Pfft. The Globe and Mail is grossly inaccurate on several counts. Example: “…an exit tax. 45 per cent on the market value of all your worldly property…”. Nope. It’s 30% on any unrealized capital gains over $600k or more. That’s quite likely a safe harbour for even relatively well off covered expats. (And if you’re over that, well, just sell before leaving and pay the normal 15% rate on realized capital gains.) Grope and Fail, well… fail. then.
One part of the Ex-PATRIOT act overlooked, as far as I can tell, by all the press is that this “30% of future capital gains for the ten years after leaving” thing was in fact part of the pre-2008 expatriation rules. Congress swept it away with HEART in 2008, because (a) the IRS could never effectively enforce it, (b) it violates several tax treaties (not that the US would care particularly about that), (c) it’s likely unconstitutional (but then so is HEART, most likely, so plainly congress doesn’t give a hoot about that either at this point), (d) trusts and partnerships could probably get round it, and (e) even if exposed all you had to do to avoid it was just not sell stuff for ten years. Schumer and his grandstanding pals have, however, no collective memory on this, and thus are doomed to repeat their past errors.
@bubblebustin: Tragic, but unfortunately it is true, unless you have almost unlimited financial resorces which very few have. And even those persons know that it is neither reasonable nor in their interest to keep paying this massive tribute to tax advisers and the IRS in order to carry a US passport. I
am afraid that it with Senator Schumer on the war path it is going to get worse before it gets better, if it ever does.
But I am not giving on trying to open the eyes of the seemingly blind to the realities of the massive damage they have and are still doing to the best interests of the US and its citizens living abroad. They are one in the same.
@ Watcher & Monalisa My MP has a surgery on Friday and I’m going to go along to it. I’ve printed off various application forms fom the major investment houses which now make you declare that you are not a US person before investing with them, and I also found last night that Egg (where I had my savings until fairly recently) has as closed off its savings accounts to US persons – US persons being defined as any US citizen, not just those resident in the US. I’ll let you know how I get on.
@scotgirl: “I also found last night that Egg … has as closed off its savings accounts to US persons…”.
Well, so it has. Terms and Conditions, 14.2. I opened an Egg account a year or two back, and at that time they asked for your SSN if you fell under the definition of ” US person”, but didn’t blank completely. More ammunition for your meeting with your MP. FWIW Egg is probably a leading-edge case. They’re owned by Citibank, so a whopping US connection there. Doesn’t bode well, though, does it? I think it’s time to hold a few MP’s feet to the fire over this. I shall certainly keep hassling mine.
@calgary, thanks. I’ve been told I’m good with the one liners. As a matter of fact I was reflecting on that the other day- I think that it is because I had an older sibling who liked to talk for me when I was a child-I could only express myself when she was breathing in so my lines had to carry impact. I also LOVE metaphors (in case you haven’t noticed 🙂 )
No matter what someone decides — renounce, don’t renounce — I just want to say that it’s Spring for heaven’s sake. We should not have to obsess about senators who are “stuck on stupid” (as Peter, our Rock, stated) or any old, current and future impossible demands on our sanity coming from the IRS. No matter where we are, no matter if it is this particular day or one to come, the sun will shine, birds will sing, flowers will bloom and we should all be in the pursuit of the happiness that this planet provides, not worrying our beautiful and handsome heads about contrived, copious, complex tax regulations designed to stamp culpable on anyone who dares or innocently fails to not comply. I cannot express accurately and certainly not politically correctly how angry I am that the US government has taken it upon itself to torment innocents abroad who deserve even more than the so-called homelanders to be free of its cockamanie, out of control tax system. Wherever you are, whatever you decide to do about your US citizenship, you deserve peace of mind and the freedom to live a normal life in your chosen country of residence.
@Em,
Right on. We have more important use of our time and our lives.
@Em @Calgary411
“Yes we can!”
How do you like Obamaism now?
@Em, I agree with your sentiments about enjoying the spring 😉
@ renounceuscitizenship
I have an opinion regarding Obama but I have no vote. My opinion is that Obamaism is a cruel joke played out upon a nation which desparately tried to escape Bushism … and failed.
P.S. Try not to bait me too much into a PC trap … I’m easy prey. 😉
Obama:
http://www.rall.com/rallblog/2012/05/09/turnabout
I don’t know if this has been mentioned anywhere else, but I see that Laura Saunders has done another post on Renouncing issues. It is titled
New Taxes for ‘Renouncers’?
It was posted on the 25th of May, and I don’t see any comments on it. Guess I will have to post one.
The press reported a few weeks back that some $1.03 billion in unpaid Federal taxes was owed to the IRS by Federal Employees; incluidng emploees of the IRS, Treasury Department and Congressional staffers. These are people who presumably show up for work every day.
The question is why the IRS is not taking action to pick this low-hanging fruit from persons who walk through the front doors of Federal buildings every day rather than Congress dreaming up more ways to destroy the lives of US citizens livng abroad, including vast numbers who are not even aware they are US citrizens? This includes those who, under prior law, were “deprived” of their US citizens when they became naturaloized citizens of Canada and other countries, those born in the US whose mothers came across the northern border to give birth to their baby because they were not close enough to a Canadian hospital to make it on time and those born in Canada, or elsewhere outside of the US, to a US parent but who have never held a US passport, do not have a Social Security number and have never ever visited the US and some of which speak no English.
Most of these don’t have any idea they are US citizens until they are confronted by a US immigration officer when trying to enter the US for a visit with a foreign passport showing their birth place as the US, or accompanying children born abroad who are informed that, because of their parent’s US citizenship they are also US citizens and have a US tax obligation they had better pay up or face serious consequences. This terrorizes them into doing so and, in many cases, results in such massive penalties being levied that their life savings are wiped out.
And to insult to injury, Congress now wants to revoke US passports of citizens allegedly owing $50,000 or more in back taxes.
What about taking action to colect back taxes form Federal employees, includng those who draft our tax laws for their Congressmen and Senator bosses?