64 thoughts on “ACA Global Foundation Video: 21st Century Taxation of Americans Abroad: CBT vs. RBT Toronto May 2, 2014”

1. @Calgary 411
   The trouble with any return of the US passport by the State Dept after the person has taken the oath of renunciation (so that this person can travel into the US) muddies up the whole process again. If he/she crosses into the US on that US passport, won’t that seem like a repudiation of what renunciation work one has done? Just like the USC who became a Cdn back in the 1970s but was, at some point, told they needed to use a US passport to enter the US (so they, following orders, got another US passport and then, in 2015 are seen , because of that act, to have “revived citizenship”. CATCH 22. Seems like it could be used as a trap for the USGov to say “see, you really didn’t mean it when you said you were renouncing – – so now file all those forms and pay all your fines and taxes. Does that make sense to you?

2. This topic about keeping the US passport after renouncing until the golden ticket arrives was discussed in the American Expatriates group on FB. What I said is that when I renounced, they required you to bring both a US passport and a valid passport for another country. They took the US passport knowing you can still travel on the non-US passport. They wanted the US passport to cancel it (it is canceled by punching holes in it). They mailed back the passport with the golden ticket.

3. My friend in Hong Kong was talking about this issue. Since she was born in Hong Kong, she is thinking of taking up Chinese citizenship with a Hong Kong passport. China doesn’t allow dual citizenship, and requires proof of renunciation before the final step of issuing the Hong Kong passport. Yet there is no clear guidance as to how long the “stateless” period will last, between waiting months for the certificate of renunciation to arrive, followed by up to three months for the China passport to be issued. Seems rather confusing.

   And to think that someone would feel freer by becoming a citizen of communist China rather than retaining US citizenship. Chew on that, American exceptionalists!

4. @Barbara: HK immigration department will issue a stateless person’s travel document (Document of Identity for Visa Purposes) in the mean time while you’re waiting for your proof of renunciation from your old country. Once you have the renunciation certificate, they issue the naturalisation certificate, then a passport application takes about a week. Definitely not three months. (Might be longer if they make you replace your identity card again after naturalisation. Some folks I know had to do this, others didn’t bother.)

   Also, the freedom to leave and the free movement of capital are both guaranteed in the Hong Kong Basic Law. So I can’t vote for the mayor but if he screws up the place too much I can always vote with my feet.

5. @LM

   I caught myself almost saying “C’mon, even the US isn’t THAT evil”, but it would be another way to extract that evil $2,350 renunciation fee, wouldn’t it? Without comments on their part, one can never be too sure what their motives are, can we?

   If you must travel to the US during this twilight zone, maybe the best thing to do is to present your Canadian passport, and if they deny you entry, pull our your US one. For visa countries, apply for a visitors visa and see what happens.

6. @Eric: Are you saying you know people who have specifically renounced US citizenship to take up Hong Kong Chinese citizenship? Are these mainly Chinese people simply reclaiming their birthright in Hong Kong, or are there non-Chinese involved? I’m rather curious, because in countries such as Canada and anywhere in the EU, it seems a no-brainer to apply for local citizenship, but to ditch the US passport for a Chinese one seems such a drastic, unthinkable step, considering how Xi Jinping is rushing China headlong backwards into the Cultural Revolution (“art must serve the party” etc.), and working hard to take Hong Kong with it. Does anyone have any idea how many people who are not born in HK or China, and not ethnic Chinese, have ditched US citizenship in favour of HK Chinese citizenship? It would certainly help reassure my friend that she wouldn’t be alone if she takes this step.

7. @Barbara: Are you saying you know people who have specifically renounced US citizenship to take up Hong Kong Chinese citizenship?

   My case officer told me it was uncommon, but I certainly wasn’t the first non-ethnic-Chinese American whose application she’d handled. The majority of applicants are of non-Chinese background. Mostly Indians and Pakistanis. I met a Ghanaian in the waiting area before my first interview. Two famous ex-Americans here: a banker and an aspiring Olympian.
   https://en.wikipedia.org/wiki/Marshall_Nicholson
   https://en.wikipedia.org/wiki/Jennifer_Lee_%28equestrian%29

   I’m rather curious, because in countries such as Canada and anywhere in the EU, it seems a no-brainer to apply for local citizenship, but to ditch the US passport for a Chinese one seems such a drastic, unthinkable step

   Lots of HK natives have a backup plan — somewhere else they can go and land on their feet if they really need to leave. Just another one of the quiet facts of life here, to which us immigrants have also adapted. The Americans I know (ethnic Chinese or otherwise) who gave up US citizenship in favour of HK Chinese citizenship mostly have a secure claim to residence in another first-world country (e.g. spouse with a VWP passport, ancestry visa, employer getting ready to transfer them, etc.).

   In my case, my wife says that unless they’re shooting people on the streets here there’s no way we’re moving back to her country (she hates it there and our future kids would have to serve in the army). So my personal backup plan is kinda shabby (location-independent career + ancestry visa for a third-world country), but it’s enough for our peace of mind for now. Sorry, don’t know if that will be particularly reassuring to your friend, just my thoughts on the matter.

8. @Eric: Thanks for being so forthcoming. Very interesting. I’m grappling with similar issues, since I’m a long-term permanent resident of another Asian country that has practically no Caucasian citizens, and with plenty of hoops toward citizenship. So my husband and I blow hot and cold about renouncing and taking up local citizenship. Though we feel settled here after 20+ years, and are likely even to retire here, I also don’t have those deep feelings of belonging, and the thought of naturalizing makes me feel trapped. Neither of us qualifies for any other 1st world (or, for that matter, 3rd world) passports, other than purchasable ones, all out of our price range, like Antigua, and we’re too old to qualify even for residence in a lovely place like New Zealand. So once we take the plunge, there is no other way out. I think my HK-based friend feels the same. It makes me so angry (at the USA) that I often can’t sleep.

9. Now also on the Prof. Caron site:
   http://taxprof.typepad.com/taxprof_blog/2015/03/kirsch-schneider-debate-.html#more

10. The comments Prof. Caron makes to accompany the video are worthy of a post of their own.

11. Thanks for the link, badger. Once again, my thanks for all you find and especially all you SAY so well.

    My reply is waiting for moderation and approval:

    Thanks, ExUS, for so eloquently pointing out *what is missing from the video – and which would have provided balance and real life perspective, are the many informed and informative comments and questions from the audience who attended the day long event*. As the cost of travel to Toronto was prohibitive for me, I was unable to attend the ACA Global Foundation forum and have waited for the promised video, now disappointed that it was so edited. I know there were attendees (you?) there who asked these pertinent questions on my family’s behalf. You so well explained the immoral absurd dilemma and real-life consequences for those entrapped into the costs of yearly compliance — because without *requisite mental capacity*, they are unable to renounce the US-defined US citizenship they automatically acquired, a US citizenship never acknowledged by the parent(s) and never of any benefit to the person living and benefiting in the country of his or her residence. On top of that is the inconceivable fact that a parent, a guardian or a trustee does not have the right to act on such a person’s behalf, even with a court order.

    So, my and many other families will wait for the answer to the question you ask:

    On what ethical, just, legitimate or logical basis then are children and disabled dependents outside the US being punitively and extraterritorially taxed by the US on their NON-US savings, benefits and grants provided by NON-US families, NON-US sources and NON-US taxpayers?

    Will anyone in the US government come forward with the answer?

    My deep appreciation for your comment!

    Posted by: calgary411 | Wednesday, March 25, 2015 at 03:50 PM

12. I stand corrected. Calgary is right to note that the excellent comment comes from ExUS.

13. Are you referring to the comment shown there from *ExUS* (rather than Prof. Caron as part of his post, just a brief introduction to the video), Shovel.

    That comment certainly SHOULD BE part of the ACTUAL POST by Professor Caron!

14. @ Shovel
    The way the TaxProf piece is laid out, the excellent ExUS comment appears to be coming straight from Paul Caron. It will be great when calgary411’s supporting comment gets posted. Perhaps Prof. Caron will even post a reply to both of them. That would be very much appreciated. You know ACA Global could have released video of the more interesting part of that forum but they went with the Kirsch-Schneider part instead. That says something about ACA Global which I’ll leave to you and others to imagine.