Renunciation and Relinquishment of United States Citizenship: Discussion thread (Ask your questions) Part Two
Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
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NB: This discussion is a continuation of an older discussion that became too large for our software to handle well. See Renunciation and Relinquishment of United States Citizenship: Discussion thread (Ask your questions) Part One
PS
Merrick
If you have never applied for an ESTA, they now ask you if you have EVER had any other citizenship. Obviously you would have to say yes, USA, at that stage you would know if they regarded you as a US citizen, and you would have to make the decision whether to travel on a US passport and then renounce at a later date.
Also I would not be overly worried about renewing the US passport if you are choosing to be non-compliant on taxes. One day the IRS might attempt to connect passport renewals to tax status, but there’s no evidence yet that they are willing or able to do anything with that data. Currently they make no attempt to contact citizens who renew passports from abroad but who do not file tax returns – it could be perfectly legitimate that a citizen who did not work would not meet the minimum thresholds for tax filing or FBARs.
Another thought I had is does the embassy ever advise you on whether or not you are likely to be turned down for relinquishment (once of course I’ve presented my case and all possible proof?)…..
@Nonomynous – I am determined to use my UK passport for the same reason I have exclusively used it since 2005, because I live my life as, vote as, pay taxes as a EU citizen. To me, using a USA passport is completely misrepresenting myself – EVEN having renewed it, (which I did NOT want to do, I only felt I had no choice at that time because the advice I’d gotten was poor – contrary to Westcoaster’s comment, I didn’t see myself as American then, one bit – in fact I halfway expected the US would reply with a “nope” letter and not give me a passport since I’d gone there as British just years earlier! (Yes, I was this naive, and when I DID actually get one, I just wish with all my heart I’d known then what I know now and taken action).
For this same reason, the idea that I even if I am forced to renounce I would have to file stupid FBARS seems ludicrous – why? Ignoring the fact that it’s for an account that I opened before these rules even existed, that I opened as a UK citizen, it still has never exceeded 10K for a balance in ALL these years. It doesn’t even meet the filing threshold.
On the other hand, if I have to renounce, I’d think I’d have to file tax returns even if they are ZEROS – I have more than the “minimum” required to file, but not enough to have a USA tax liability. I pay taxes here, and always have, and it sounds like this “covered expatriate” stuff can come back to haunt people…and yet, I read about people who never bother because on paper, they’re worth nothing anyway, at least in any taxable sense.
What bothers me the most at this point is there’s a second burden I bear right now, Brexit – which has brought it’s own set of concerns for us. So on top of this circus, I am actively working towards citizenship of the country I’m in NOW, (which permits duals, so I can keep my UK citizenship) -and this just feels like a completely unwarranted and unnecessary burden, not to mention I can’t imagine any country wants me to have a THIRD citizenship?!
Much less one that – short of one stupid, naive and paranoid act out of a desire to see my parents that ultimately came to nowt – have never once acknowledged since 2005.
@Heidi – did the ESTA exist in 2005? I cannot remember if I had to apply for it then, to be honest. This was Sept. 2005 if it helps.
I really appreciate everyone’s comments.
I was about to comment that you might want to hang onto that US citizenship until you see how Brexit shakes out. Worst case, you might be better off than with a UK passport.
“To me, using a USA passport is completely misrepresenting myself”
Look, if you want to get all ethical about which passport you use, fine, but the US government likely still considers you a citizen, so it’s up to you whether you want to potentially cause yourself unnecessary grief on a matter of principle. Do as you see fit but don’t moan if it goes badly, you now know the risks. See what happens on the ESTA application.
I still use my Canadian passport going to the US (I’m dual and have not renounced) but I keep my US passport close by in case the Federales ask questions. I do this as a public service – I want to see if the US becomes more vigilant about enforcing its passport law, so that I can report back and inform others.
Don’t beat yourself up about the 2010 passport renewal – I expect it will have zero impact on your situation.
No sense complaining here about the stupidity of filing a bunch of zero returns after renunciation – you’re preaching to the choir.
@Merrick
I believe ESTA started in 2009. It lasts two years, you can take a look at it online. It has become more intrusive lately, apart from the usual inane questions, it asks other citizenships held and past citizenships. You will need it to enter the USA on any European passport now.
If you decide to go the renunciation route and decide to exit cleanly, then you are asked on the 8854 to confirm 5 yrs of tax compliancy, there is no mention of Fbars, you say that you are below the limit for filing, so this is not relevant to you anyway.
It seems to me that you would really like to be completely free of this American taint, so perhaps the best idea would be to renounce then file along with the 8854 before you build up any real assets.
Only you can chose a path where you are comfortable.
PS Merrick
Even if you haven’t had problems with your bank yet, you may experience a problem if/when you apply for any new financial product, ie a mortgage.
@Nononymous – re: “all ethical” – I did smile wryly at that. For better or worse that is how I am. It’s why the passport renewal bothered me so much, it’s why wanted to relinquish, not renounce, etc. But I also know that being a massive dork about such things is perhaps not best serving me at the moment, so there’s that.
@Heidi – I really would like to be free of it, not in anger so much as just…it’s irrelevant to me. It’s not my life, it hasn’t been for a long time, and the news over there these days makes me ever more grateful that it’s the case. But – I have nobody to blame but myself for not being aware of all these intricacies sooner….I get that. Even if my circumstances would have made it rather impossible to find out those things easily, reality doesn’t give a damn, right?
And that makes sense, re: the VISA and the 2009 date – in fact, thinking of it now, ‘m almost positive that had added to my “2009 freak-out” event that caused me to renew it in the first place….
I definitely want to be free of this, yes. At a time in my life when my extra time and energy should be spent on learning this language, HERE, living my life, HERE – a whole “old world” just seems to have come back to haunt me in ways that I could not have imagined back in 2001, when I left it!
So looking clinically at all this – I am self-employed and am WELL under the the threshold, and I do pay tax here, and always have. I have no retirement plans, just my basic account and a small savings, and in even since this FBAR stuff started, I haven’t ever had more than maybe 8K in it, max. Never over 10K for SURE.
And as such, on the issue of renouncing – I just had a good look at the forms I’d need to fill out and I actually feel quite comfortable with everything. I used to do the EZ versions in 2001-2004 (resident in UK but still waiting to get UK passport). and if I understand right, FACTA isn’t an issue for me, apparently, I’m nowhere near a point of triggering that apparently. And I don’t meet the FBAR thresholds (and will happily tell them so in a letter), and so that leaves just those 2555s, (I know I can’t use EZ because I’m self-employed). Otherwise, since I have no assets to speak of,and my situation is “a bunch of zeros” – maybe I am best off simply renouncing, filling those 5 years as such, and the 8854.
In short – a clean break in 2017 is perhaps better than risking a messy one from 2005, even if it’s not indicative of reality as I know it.
It’s given me a lot to think about and I’ll keep checking back – again, everyone, thank you.
Merrick
The embassy will tell you at the interview that they will either recommend a relinquishment or not.
The decision is made by the State Dept. There are some reports of the embassy not recommending , but the State has OK it after insistence by the relinquisher that it be submitted. I believe you will still have to pay the fee before the interview.
Hi Heidi,
I had read the fee would be do either way, so that’s okay – while I am ready to pay it, it’s true that risking it being rejected and having to pay AGAIN would be unnecessarily hard on us, budget-wise.
As long as the embassy is willing to tell me “well, that’s not likely to fly, you have to renounce”, then honestly, I’m tempted to just say “fine, do it” – one of the things that worried me about the 2005 situation is that it sounds like the 2004-2008 renunciants have an even MORE confusing situation – I’m still not sure if, for instance, relinquishment means I need to file 8854 as a 2017 document – or a 2005 document, if the date of notification = the backdated CLN date, OR the date I GOT the backdated CLN, etc…
Is there anyone who has successfully received a CLN based on prior relinquishment who renewed a passport after that relinquishment? I thought the Department of State were treating passport renewal as overwhelming evidence that there was no intent to relinquish (even when the renewal is years later than the relinquishing act and has no bearing on intent at the time of reqlinquishment). Not saying DoS is right here. But my sense is that they don’t understand the idea of “preponderance of evidence” – they will focus on that single act of passport renewal.
Another consideration is that, prior to 2004 there was no need to get a CLN to exit the US tax system. My inclination would be to assert the relinquishment without the CLN, and only pay the $2350 extortion if ESTA is denied. Of course, you need to choose the path that helps you sleep easiest at night.
@Karen – wow, if that’s true, then there’s truly no need for me to even try to relinquish, though I’ll let the Embassy confirm that for sure. Assuming the DoS isn’t particularly interested in nuance in these matters, I guess that would be the logical outcome, “doesn’t matter, you still did it”.
Prior to 2004 – I had briefly hoped I fell into that category! When I found out about all this, I ran down to our storage room to dig up my UK citizenship ceremony papers. I had been given permanent leave to remain in 2003 and was hoping beyond hope that I’d finished in that time – but no. I literally got my UK passport a few months later than that. I missed it by “that much”.
When I started the process, I was still going in my head by the rules as they’d existed under that “old” system, and living up in the Highlands, we didn’t even have ‘net for awhile. I had no clue whatsoever that an 8854 even existed, or that I had to do more than I did at the time to be “non” US.
@ merrick
I hope being self-employed doesn’t complicate things too much. This article confuses me but others might be able to suss it out for you.
http://ustaxhelp.com/2015/07/do-us-expats-have-to-pay-social-security-tax/
Hi EmBee – thanks for this- I had a look…at a glance, I don’t *think* so? Reason being that since 2001, I have lived in countries that both fall under these agreements re: social security, etc.
“(1) you have a “closer connection to a foreign country,” and (2) you pay into that country’s Social Security system.”
Both of those qualify for me, for sure. Closer connection is not an issue – I pay taxes here, I haven’t spent a day in the USA since 2005, I have a social security/healthcare identity here, and my taxes pay into our social security – and on TOP of that, I have to pay a “mandatory” pension for the self-employed for myself as a top-up to the “baseline” pension that I can expect as a taxpayer (if I went back to being a non-working spouse, for instance, that is still something I can count on, then anything I paid into my own self-pension adds a bit to that).
In essence, I live in a Nordic country – about the farthest thing from a Tax haven one could think of! I pay more here than I would have there. But I don’t mind. I feel like I get something back for it, and that’s worth the world to me.
@Karen and Merrick
Yes, I remember reading a couple of reports of backdated relinquishments being approved when passports were renewed after the act. I believe the mitigating factor was coercion by an overzealous immigration officer. I don’t think Merrick could argue that.
I am not sure that Embassies do curbside consults without paying upfront, they will then advise relinquishment or renunciation.
Passport use is iffy. Some people who have used a US passport, or applied for their first US passport after their relinquishing act, due to bullying or misinformation/misunderstanding, have received CLNs based on their relinquishing act, but some haven’t.
They seem to have gotten stricter on the passport factor in recent years (albeit, we have very few reports to base this perception on). It isn’t, and never was, a slam dunk – even in some of the cases which went smoothly, there was consultation between the consulate and Washington (either at the time of their consulate meeting or during the weeks prior to it) before the person proceeded with their application.
At any rate, we got reports from the following people who used/renewed/got a passport after their relinquishing act.
2012 Halifax
Baird
Got passport because border agent told him he had to.
CLN received 2 months
2012 Vancouver
David: Submitted on 2012/12/20 at 10:41 pm
http://isaacbrocksociety.ca/2012/03/14/pdf-compilation-of-relinquishment-and-renunciation-data-as-reported-on-isaac-brock/comment-page-32/#comment-118836
Used passport to enter US, thought he had to.
CLN received 3 months
2013 Jerusalem
BenPloni
Renewed/used passport.
After lengthy back and forth (a couple of months) between person, consulate and DC, person was told could only renounce.
Renounced
2013 Consulate in Western Hemisphere, but not in Canada.
Anonymous
Had been given a very hard time in secondary entering the US on non-US passport, so got a US passport.
CLN received 3 months
2013 Toronto
AtticusInCanada: Submitted on 2013/09/26 at 10:48 pm
http://isaacbrocksociety.ca/relinquishment/comment-page-10/#comment-554746
Used passport.
CLN received 13 months
2014 Toronto
Anonymous
Used passport until it expired. Did not renew.
Was told could only renounce.
Became self-documented relinquisher
2014 Vancouver.
BC_Doc Submitted on 2014/05/16 at 6:39 pm
http://isaacbrocksociety.ca/consulate2/comment-page-23/#comment-1769004
Renewed (used?) passport.
Was told could only renounce.
Became self-documented relinquisher
2014 Vancouver
Ghost66 Submitted on 2014/04/20 at 11:56 pm
http://isaacbrocksociety.ca/consulate2/comment-page-22/#comment-1501567
Used passport.
Was told could only renounce.
Renounced
2014 Amsterdam
Murdo Douglas: Submitted on 2014/12/03
http://isaacbrocksociety.ca/2014/10/27/cheryls-claim-for-relinquishment-based-on-ina-1952-350-the-case-of-a-dual-citizen-at-birth/comment-page-8/#comment-4614351
Renewed/used passport.
Relinquishment claim sent by embassy to DC but rejected 2 months
2014 Melbourne
Anonymous
Renewed/used passport.
Reliinquishment claim sent by embassy to DC but rejected 14 months
Renounced.
@ merrick
I was hoping you’d be exempted from SS tax. Good!
@Pacifica
Thanks for that info.
It was always worth a try back then when relinquishment was free.
@Merrick it’s not just the banks you need to think about.
As I have posted elsewhere on this website with almost no response, *airlines* also could create challenges for individuals with a US place of birth but no CLN.
I recently (~6 weeks ago) booked a flight to the USA on Virgin Atlantic (departing from the UK).
After (!) paying for the ticket, while hunting for the place to provide Advanced Passenger Information, I was concerned to find a link within the Virgin website to the following misleading and unclear text:
“Born in the US but hold a non-US passport? A change in US government policy now means that anyone born in the United States is considered to be a US citizen. As a result, if you were born in the US but don?t hold a US passport, you’ll need a ‘loss of nationality letter’ to enter the country. Please note that we are not able to carry passengers in these circumstances unless they have this letter, which can be obtained from the US embassy.”
This seemed to me to mean that Virgin will not carry any passenger with a US place of birth but without a ‘loss of nationality letter’. Virgin suggest disingenuously that this “can be obtained from the US embassy.”
We all know that a ‘loss of nationality letter’ is *never* “obtained from the US embassy”. A Certificate of Loss of Nationality is not a *letter*. And it comes from the *US State Department*.
I took this whole matter up with Virgin, mainly in the hope that they would change this dangerous wording to more correct and clear text (and make this text available before the customer hits the ‘Pay Now’ button). After several rounds, all I got from them was:
(1) “I can confirm that the Loss of Nationality Letter is the same as the CLN.”
(2) “We have recently changed the way we collect our customer’s API (advanced passenger information). You can continue to access and amend your booking online at virginatlantic.com at any time, however you will now be asked to provide passport details when checking in for the flight.”
(3) “I am sorry for any confusion caused on our website with regards to a change in US government policy.”
(4) “With regards to our check in staff, they would adhere to the current policies implemented by the higher authorities with regards to visa requirements. I’m afraid that we are not able to advise on visa or immigration issues and in this respect we can only advise you contact the US Embassy directly.”
Strike 1.
I next tried getting clarity regarding the confusing wording on the Virgin website by emailing the US State Department directly, and all I received was:
“You have contacted the Bureau of Public Affairs. Your query reaches beyond our purview.”
Strike 2.
Finally, I checked with the Passport & Citizenship Unit at the London Embassy, who wrote:
(1) “At the port of entry U.S. Customs and Border Protection officers will determine your eligibility to enter the United States. We recommend you carry a copy of your Certificate of Loss of Nationality and check your eligibility to obtain ESTA or U.S. visa before making travel plans.”
(2) “Customs and Border Protection (CBP) officer has a discretion to ask for any additional information/ documents and will make determination whether you are eligible to enter the United States at the port of entry. Any further questions regarding your travel to the United States should be addressed to the Department of Homeland Security: http://www.cbp.gov.”
Strike 3.
I conclude from all of this that anyone with a US place of birth who does not already possess *both* a CLN *and* current valid ESTA clearance must carefully consider all of the above before booking any flights to the USA.
(Whether it indicates the need for care regarding travel into the USA via any other means, I could not say.)
If I remember correctly, about ten years ago Boris Johnson was kept off a US-bound flight by airline staff because he had a U.K. passport with US birthplace. He moaned about it in the papers later.
Probably happened because he annoyed someone at check-in…
@Merrick
I was in very similar circumstances to you that the only thing I did after becoming a UK citizen was renew a US passport which in the end was never used. Also renewed for the same reason that you explained, reading somewhere that one needs to enter the US on a US passport. this was pre-Fatca days and there was no real discussion about consequences of this. the only conversation was which passport to use at which gate.
I debated the relinquishment and renunciation question. I also debated the staying under the radar option. In the end, I decided to take the safe exit out, renounce, file my 5 years back taxes (didn’t owe anything) and get my freedom while I still could. I don’t classify as a person with no assets. but thankfully below the exit tax in 2016. I got my CLN relatively quickly and I just filed all my final paperwork and have never regretted my decision or looked back.
As far as filing the 5 years returns, I did get burned quite a bit with accountancy fees and if I had to do that part again, I would have tried to file myself.
If others can stay under the radar easily that is a good option but I don’t think I qualified for that. there were changes happening in my company where I worked that would have made it problematic for me to remain a US citizen plus I had signage over accountants.
@Merrick
@Embee
Merrick, the part you quote from that article (“(1) you have a ‘closer connection to a foreign country,’ and (2) you pay into that country’s Social Security system.”) doesn’t apply to you, it applies to those who work for a US company in their country of residence (the paragraph begins “If you work for a US company…”)
The paragraph that does seem to apply to you (you stated that you are self-employed) is “If you are self-employed, you are subject to Self-Employment Tax (Social Security and Medicare Tax) and must report income and expenses on Schedule C (Form 1040).”
I don’t know if that is always true or not, but it does look like you ought to dig into this stuff a little deeper so you don’t find out the hard way later.
The existence of a totalization agreement DOES NOT mean that you have no worries. The totalization agreement sets forth how your specific situation is to be treated.
In my case, the totalization agreement for my country of residence specifies that I (I am self-employed, too) MUST pay social security taxes to the US and not to my country of residence (because I am a US citizen and not a citizen of my country of residence; in the latter case I would have a choice of which system to pay into). If your totalization agreements (for the countries you have lived in) state something similar, it seems like you MAY have been paying social security to the wrong country. Except perhaps for the UK when you were a UK citizen. I am NOT an expert in this stuff, so don’t freak out; instead, dig into the totalization agreements and find out first-hand what they say.
If worst comes to worst, I would think long and hard before opening up a can of worms of this magnitude. Doing your US tax returns “correctly” may very well entail requesting a refund of social security from your country of residence and paying social security to the US for past years. The US will want much more than you get back from your country of residence, guaranteed (penalties, interest). I would definitely try to find an alternative path. Hopefully I’m wrong. Good luck.
The summaries of the totalization agreements the US has with the UK and Canada say that if your employer isn’t US, then as an employee or a self-employed US person outside the US you pay only into the UK or Canadian system. For a short time I was self-employed and chose to pay into both US and Canadian to boost retirement income but could I think have just paid the Canadian.
@Merrick, I will either be pouring petrol on burning embers or provide laser precision clarity.
You renewed a US Passport with the US Embassy London. You signed the renewal form under Penalty of Perjury which is a criminal offense.
The renewal form CLEARLY asks if you have performed any acts as listed on another page.
I assume you naturalised under section 6(1) of the British Nationality Act based on five years residence.
An honest application to renew a US Passport would have disclosed that you naturalised. This would have then generated an enquiry and another form asking if you had intended to relinquish your US Citizenship. This is the trap that BC_Doc fell into.and he was HONEST.
IF you renewed your US Passport after you naturalised and stated on the requisite form that you naturalised with the intent to retain USC then a relinquishment is out of the question.
IF you renewed your US Passport after you naturalised and decided to keep hush about your naturalsiation then you have committed perjury!!
To be totally honest, the advice to stay far far away from any part of the USG is likely sound advice. Otherwise you are likely to be asked questions about your renewal application and do you really really want to test the patience of the USG having possibly committed perjury which is a separate federal crime?
Note, I relinquished but do not have a CLN. A very recent ESTA was approved with full disclosure. Plus you can always enter via pre-clearance in selected locations.
In regards to Virgin, it is the policy that UK Passports list place of birth and not country.
Again sorry to say but I think you are now exhiled from the USA and want nothing to do with it. IF banking is a problem, you can self document with a statutory declaration before a solicitor.
@merrick, one thing I will suggest – make a note of the details of your US passport, even though you haven’t used it, and keep it somewhere safe. The passport number and the dates that it was valid from/to will be required for any future ESTA application. ESTA applications require that info if you have ever have been a US citizen. If you do decide to renounce you can use that date as the date the US passport’s validity ended, assuming it hasn’t expired first of course. I did this for my ESTA last September and had no problems in getting clearance. My US passport was due for renewal in May this year, while I renounced in March 2013 so I put the 2013 date down as when it finished because after that I was no longer a US citizen and the passport invalid after that date.
I looked into that last night and it should be fine. The country I am in has residence-based SS and I have been in it since I had an incone again and I have to pay into it via taxes. That article is not especially clear on the matter but the US’ own Soc. Sec. Site says that if I am self-employed in this country, I generally will be covered and taxed only by the country where you reside….which seems to mirror my expectations. I just have to provide the coverage note from our local institution, which I can do.