To bring the subject of one of Eric’s posts back to the forefront, State Department to hike renunciation fees to US$2,350; says “no public benefit” in respecting human right to change nationality, I add another article, today, from the U.S. — Wall Street Journal, Laura Saunders, August 30th: U.S. Fee to Drop Citizenship Is Raised Fivefold. Commenting is open and comments have started.
Advocates for U.S. expatriates reacted angrily to news of the increase. “I’m so disappointed and insulted by the continuing punitive actions of the U.S. in trying to prevent persons and companies from leaving,”
Also from the U.S., which complements the articles on higher fees for renunciation, one from the U.S. Chamber of Commerce, highlighted this morning by badger: Exit Strategy: FATCA Tax Law Keeps Pushing Americans To Give Up Citizenship. Growth opportunity — the HIRE Act continues to give.
Here’s a hot tip for accountants and tax attorneys: now is a good time to develop specialized expertise in advising clients who may be seeking to expatriate from the United States. That demographic looks more and more like a real growth opportunity.
Some firms have already figured this out!
The fee increase is a win-win for the US. The US government has wanted to paint renouncers as being wealthy. With the new fee increase you *have* to be wealthy to renounce.
I think we have all missed another valid relinquishing opportunity. I have, because I remained focused that serving as a Commissioned or Non-Commissioned Officer in a “foreign” military was relinquishing.
My mind and I assume others instantly thought, joining the military and serving as a “Private” was not relinquishing.
But alas that is wrong, I believe that would also qualify under 8 USC 4(B);
Why do I say this? It is an office, it is a post and its employment under the government of a foreign state and it in most countries requires a fresh oath of allegience. With respect to that Oath on joining the military it does in fact, under US State Dept FAM, change your relationship with that state.
B) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years for which office, post, or employment an oath, affirmation, or declaration of allegiance is required; or
Little do they know that it’s more like a leg hold trap, dax, where you’ll chew your own leg off to escape.
@dax, not necessarily. Plenty of stories will begin to emerge of people selling their car or using money they were trying to save for house or even retirement savings to liberate themselves. The higher the fee – the more stories.
And though they have tried to paint us all with one brush, they are beginning to lose hold of that narrative. Real facts are coming to light.
Facts that will be compared to Soviet Union exit tax extortion and other less than great media for the US comparisons.
Considering that the bulk of the renunciations are Canadian, UK and Swiss, the US is clearly trying to slow things down for a bit and make a quick buck or million to boot.
But it can’t last. There is just a finite number of us.
People who haven’t gotten the memo will soon, and the registration of births at US consulates will stop – because without that the odds of ferreting out a foreign born USP aren’t great.
People who have yet to get their citizenship will know to take it with intent so they can relinquish and eventually the back-dating relinquishers will have all made it through the process.
Who is going to be left after that?
To change their own rules on relinquishing, the USG would need the cooperation of Congress, which isn’t likely because it’s Congress and because this falls under immigration and no one down there wants to touch immigration with a ten foot pole at the moment (illegal immigration is our friend right now).
The fee hike is desperation. Desperation makes people dangerous to be sure but it also makes them stupid and stupid people makes mistakes and this is their first big public one.
They are scared. We should just keep doing what we are doing. Getting our stories out, pressing with the legal action and giving people factual advice about options. It’s a slow process but it’s working.
Why don’t we take our inspiration from something in an email I saw this morning:
“As Martin Luther King and Gandhi instructed: Use the weight of their stupidity [instead of inhumanity] against them at every turn so they cannot escape themselves.”
Always, Bubblebustin, you pare it all down to reality — and make cynical old me laugh in the process.
It may be worse than you think!
…”1. IRS Form 8854 – US Expatriation Statement has no provisions for people expatriating in 2014. This is validated via IRS Form 8854 Instructions. THAT IS MESSED UP!!!!!
2. A Certificate of Loss of Nationality is a necessary component of filing IRS Form 8857. There is a LOT of chatter in the blog-sphere that the State Department via the White House has been instructed to not issue this certificate until 2015 to ANY 2014 applicants. The State Department denied this when I called and asked. Point of fact though I am quite active on line and not a single tax practitioner engaged has successfully processed any IRS Form 8854 in 2014.”…
With all due respect, that tax blogger seems like an idiot. Lots of CLNs have been reported received in 2014, and 8554 for 2014 expatriates cannot be filed until 2015; hence the lack of a form or instructions.
Nevertheless, your statement “It may be worse than you think!” may certainly prove true!
@Bubblebustin, I read this article earlier today, but couldn’t get it to fit the facts.
On point 1, 2014 renunciants won’t (can’t) file their 8854 until April 2015 or so; it goes in as part of the usual — and in this case final — 1040 package. So there being no 2014 version of the form available yet isn’t an issue. Perhaps the author is recalling the pre-HEART days where an ‘initial’ 8854 was due directly after renouncing, and until that was filed one was still fully liable for US tax even as a non-citizen, non-greencard holding, non-resident alien(!). HEART swept all that away (though one could argue that the cure was worse than the disease).
And on point 2, I don’t think so. While a few folk have sent copies of their CLN along with 8854, there’s certainly no requirement to have it in hand before 8854 time (which in any case is still some months away, see point 1 above).
I think the author is muddled on a few facts. Of course, no disagreement with the basic sentiment — messed up indeed.
He talks about form 8857. That form ( Request for innocent spouse relief) has very little to do with anything. Another example of a blogger who is not at all helpful,
“Point of fact though I am quite active on line and not a single tax practitioner engaged has successfully processed any IRS Form 8854 in 2014.”
WTF? Does that mean that the clients of the “brilliant” tax practitioners have been getting “do over” demands from the IRS all throughout 2014? I thought nobody really knows when a 8854 is “successful” because nobody gets a “mission accomplished” letter from the IRS. You send it, keep your mail track receipt and then wait out the SOL. Isn’t that how the dysfunctional system works?
Which blogger is that, KalC? Me or the blog I referenced?
…or read over his mistake of 8854?
Will the 8854 form for those who expatriated in 2014 not be available until the end of 2014 as has been the case in every other year (I think!)?
Is the author saying that no CLNs have been sent to / received by any persons who expatriated in 2014?
“Is the author saying that no CLNs have been sent to / received by any persons who expatriated in 2014?”
That’s how I read it, and of course we all know that that is not true. Sounds like a rumourmonger to me.
Bubble. I meant the guy you referenced. I thought I was being wonderfully restrained!
Maybe some if you experts should set this guy straight, before he does some harm…
Does anyone know if the new fee will apply to dual citizens born abroad also? Up till this time,(at least that is what I always understood) there was no fee charged to dual citizens that wanted to renounce citizenship.
Since I am not yet 5 years tax filing compliant, I will be hit with the new cost of getting rid of US citizenship, as I was born and lived there for 20 years.
Sorry, not true, Marge — those “born dual” do not get any discounts or freebies. You may be confused with the “Exit Tax” which those “born dual” will not be subject to no matter their Net Worth — IF they file Form 8854 on time. If that is not filed and on time, you become a Covered Expatriate. You do NOT want to be deemed a U.S. Covered Expatriate.
Also, you do NOT have to be tax compliant before your expatriation. That has nothing to do with your expatriation, under the Department of State. See comments from “James” and to “James” here earlier today: http://isaacbrocksociety.ca/renunciation/comment-page-141/#comment-2902205.
My apologies: I forgot to say “Welcome to Isaac Brock, Marge.” You will find good people and some good information here for you to make the decisions you need for both yourself and any family.
Thank God I live in a capital city with not a lot of Americans and have plenty of appointment slots available. I already had my first meeting months ago knowing I would have to make a decision soon as banking has been impossible for me. I spent 40 days in Hong Kong trying to get an account and not a single bank would let me open an account for my Hong Kong company, because I was a U.S. citizen. Was kicked out of my Belize bank earlier this year. I have had it. I will be expatriating on the last day prior to the $2350 fee going into effect, ironically 9-11. Who knows if the US will even let citizens expatriate in the future if they have to jack up fees so much without even waiting for written comment period. Good riddance to my US passport.
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