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
But Kabby is in the UK.
How US SS is taxed depends on the US tax treaty with that country, if one exists (and perhaps the totalisation treaty, if one exists).
@placy
Yes, I know, but just saying its not necessarily less favorable to be a cross border pension. It all depends on the tax rate you are paying in your country of residence .
@kabby
From what you have told us, I am not sure of your reasons for keeping US citizenship. Is this only emotional, anxiety, nervousness?
Heidi – “Yes, I know, but just saying its not necessarily less favorable to be a cross border pension. It all depends on the tax rate you are paying in your country of residence .”
Not in Kabby’s case. Whether s/he lives in the US or the UK, s/he’ll get more favourably taxed on the social security that’s paid in the country of residence and less favourably taxed on the cross-border pension,
@plaxy
Agree In kabbys case,UK/US but not in all cases. Just pointing out the situation for other persons.
Mine is actually better in Ch, so not a general rule.
Definitely not a general rule. There is no general rule, since it depends, as I say, on the particular tax treaty (if there is one), and perhaps the totalisation treaty (if there is one).
@plaxy
Your statement
“In a nutshell, whatever country “ sounded like you were quoting a general rule.
Another projection misunderstanding?
Heidi – “Your statement
“In a nutshell, whatever country “ sounded like you were quoting a general rule.
Another projection misunderstanding?”
Another instance of misreading followed by selective (mis)quoting. 🙂
What I actually said:
Gone
@Heidi. You asked me “From what you have told us, I am not sure of your reasons for keeping US citizenship. Is this only emotional, anxiety, nervousness?” Answer- I think all three. I am in a roller coaster and dont know what to think. Appointments at the UK enbassy are now into January 2019 so now into next year which is a shame. Im gong back and forth like a yo yo nerves, emotion and anxiety Heide. It’s awful and is this normal.
@Kabby
For some people it’s purely a transaction: I need a CLN to live my life, so I make the appointment and pay the fee and renounce. Whether I need to deal with taxes or not depends on circumstances, but it’s not required.
For others it’s quite difficult, if their US citizenship was a part of their personal identity, or there are still family connections, then it can be a very emotional decision.
In your case, if you don’t identify as American and face no risks by renouncing – you’re not trying to get away with anything – then there’s really no rational reason to be anxious about it. Indecision about wanting to move back to the US may be a source of uncertainty, in which case don’t renounce until you are certain. Certainly these are not reasons to be nervous.
@kabby
I am sure anxiety is normal for some who perhaps have emotional ties to the US. Some have reported that they left in tears and some could not go through with it but returned later. Mostly these are people who were born in the US and consider that they are losing their birthright but this is not so with you. Perhaps you feel you are leaving part of your life behind? We are perhaps moulded by our experiences and they are a part of whom we are but this is something that a little piece of paper can never take from us. I am not sure of the source of your reluctance but try to ask yourself practically what you would be losing (if anything) versus what you would be gaining. There is nothing shameful in renouncing, it is usually a practical
measure. You must do whatever is best for you in your present situation. Perhaps it is better that appointments now go into next year as it will give you more time to consider. You can of course try for an earler appointment at another embassy if that is your decision.
If it weren’t for CBT and FATCA I would have retained my US citizenship.
However, my recent return to the USA reminded me that I no longer identify with the country of my birth and childhood. I felt very much that I was only a visitor, and the moment the plane touched down at Heathrow I felt I was back home.
@Nonoymous,Heidi,BirdPerson. I guess anxiety in that once you have remounced theres no going back and thinking would it better to return the US to retire or stay in the UK and Europe but the challenges as one gets older with health care costs etc in the US is one determing factor for me even with Medicare but anxious becuase of the process and hoping that nothing trips me up throught this minefield of renouncing and the paperwork after and making sure its all done correctly and your no audited. I am sure others felt the same way however and is normal in a way and leaving a part of your life behind as Heidi mentions. I think howe’ver theres more to be gained than lost and relive oneself of the yearly worry of all the forms to be completed. As BirdPerson says she would not have renounced but for CBT and all the filing.I am wondering if now the renunciations are into next year end of January whether its better to wait towrds the end of next year to renounce ratherr that at the beginning of the year from the final tax filing point of view? I wonder what time of year most people renounce and if there is a better part of the year to do this. If one rennounces in January then presuimably you file ordinary tax forms for this year and then in 2020 you file the final tax forms and 8854 for Jan 1st to day of renouncing where as if you renounce towards the end of the year maybe better? Bird Person you said you only had to wait a month or so so now the lenght of time to get an appointment now has gone over 2 months.
@ Kabby
Could be the waiting period has been extended because of all things Christmas. I know others who renounced in London earlier this year and they also only had a month’s wait.
I can’t comment on the tax side of things as I have no intention of filing a single bit of paperwork. However, if I were you and planning to do final filings, I guess I’d want to be out of the system sooner rather than later.
You couldn’t pay me enough to make me return to live in the USA. Not only do I love the NHS, but I’m glad we have gun control here in the UK. Great Britain is my home now. The country is far from perfect, but I love this small island.
BirdPerson – snap. 🙂
Kabby – “hoping that nothing trips me up throught this minefield of renouncing and the paperwork after and making sure its all done correctly and your no audited.”
One thing at a time. Renouncing isn’t a minefield. It’s very easy, as long as you can pay the fee.
You can shop around the consulates for an earlier appointment if you wish. Paris, Copenhagen, Amsterdam, Reykjavik … You could combine it with your xmas shopping. 🙂
Filing the tax forms isn’t a minefield, though it may be stressful trying to figure out what the hell they want you to do. You won’t get audited if your only US asset is your social security entitlement. There’s nothing for them to audit, if you just fill in the part-year 1040 statement in the same way you always do, then attach it to the (largely blank) 1040NR. They don’t audit people who aren’t US Persons.
Count your blessings – you have freedom to choose. 🙂
Kabby –
“I am wondering if now the renunciations are into next year end of January whether its better to wait towrds the end of next year to renounce ratherr that at the beginning of the year from the final tax filing point of view?“
If you can renounce before 31 Dec, you can be done with the filing by next spring.
If you renounce after 31 Dec, you won’t be finished until the following year.
You are probably too late for this year. Renounce as soon as possible. The less non US income you have to report the better. ( in our case it was 00 so we opted to not file 1040 or 1040nr for the renunciation year.)
That is IF you choose to bother filling anything at all.
kabby
I had a friend renounce in Luxembourg, it’s a little known consulate. They got an appointment in 2 weeks.
Renouncing is EASY, no one will try to trip you up.
There is no minefield, unless your affairs are very complicated, involving large sums of money, businesses or hiding the sort of investments that the US does not like. As you apparently have none of these issues, it should be completely straightforward. There are no “gotcha” risks.
@Heidi, Bird Person,plax, Portland, Nonoymous. Heard from the Lonodn embassy no appointments till the end of January 2019 so that would mean me filing the final tax paperwork not till the following January 2020. Im wondering if I would be better withdrawing my applicatin to renounce now and apply later next year(2019) as the filing date Jan 2020 would be the same as renouncing in end of January 2019 next year or would it be better to get it done and out of the way in January? The problem is you have to them wait a whole year to file the final paperwork. I have been fiiing my 1040’s so cant suddenly stop surely as I want to exit as best as I can. Flying somewhere else isnt really an option for me as commitments at home. I dont know how that would work anyway now I have submitted my papers to the UK embassy. You read all these horror stories on various sites about how people could get audited and its raises a red flag with the IRS and they look more at poeple who renounce than those that dont.
I don’t think it matters one bit whether you renounce in January or December 2019. Either way you’d file your final return in 2020.
Could you please cite and provide links to those “horror stories” you mention? I suspect you are misreading something. We certainly don’t get any such stories here.
The IRS is not going to care which month you renounced. You really need to stop inventing problems that don’t exist – it’s not good for the mental health.
1. Yes, since you intend to do final filings, if you renounce in Jan 2019 you’ll file your usual 1040 for 2018, submitting it during 2019. Then you submit tour 1040NR with attached unsigned 1040 statement during 2020.
2. The London Embassy doesn’t care if you cancel your appointment and then rebook at a later time, there or elsewhere. They don’t care, they’re not bothered.
3. The horror stories are rubbish. The IRS doesn’t and can’t audit people for renouncing.