Please Note: The US State Department under John Kerry, who served in Viet Nam, is now charging $2350 to receive any CLN whether one has relinquished or renounced. So if you are coming to this only now, you are SOL when it comes to getting a free CLN.
See also Relinquishing your US citizenship in Germany
Those of us who have participated in the Expat Forum have seen that one of the first things that many many newbies say is, “I am going to renounce my US citizenship as soon as I have my Canadian citizenship.” Now, I want to suggest that one should never renounce their citizenship if they can relinquish it instead. Months ago I wrote a post on this subject, which I provide below.
But first, some explanations: Renouncing is one of seven ways to lose your citizenship. It requires swearing an oath in front of an official of the US government and it now has a $450 fee attached to it. Relinquishing does not require a US government official, for it is one of several acts that a US citizen can perform that can result in a loss of citizenship, provided the person intends to lose it. Then, the former citizen must only inform the State Department, not so as to validate the relinquishing act, but to make sure that the US government understands what your intent was when you performed it.
It has become clear that there are several advantages to relinquishing over renouncing:
(1) Relinquishment takes the act of losing your citizenship out of the hands of the US government. This has two benefits. (a) There should be no fee because it doesn’t require a US government official–it doesn’t take place in a US Consulate–you only go to the consulate to inform them of a fait accompli, and it only takes one visit, unlike renunciation which usually take two visits. (b) This saves you $450, or it should, because you are not requiring the services of the Consulate–you are there only to inform them of your intention when you committed a potentially expatriating act such as making a pledge to a foreign power.
(2) Relinquishment is usually a positive act which cannot be confused with an expatriation to avoid taxes. You do it so that you can take part in foreign government or to vote in the country you live in, not so that you can avoid US taxes.
(3) Relinquishment is not a renunciation of your citizenship, so much as a positive act vis-a-vis your new home and country. It is not a repudiation of your country but an acknowledgement that dual citizenship is an unworkable absurdity. Thus, relinquishment comes with less stigma, potentially.
Finally, a caveat is in order. Don’t do one thing and say another. That is don’t relinquish your citizenship then travel on US passport, pay tax in the US, register your children born abroad as US citizens, or take up a residence or a job in the USA, except as one holding a legitimate permit to reside or work in the US as an alien. If a person does any of these things, the State Department may not accept your relinquishment. Those who desire to lose their citizenship but who have done such things after the relinquishing act, may need to renounce their citizenship after all.
So without further ado, here is my original post, “Renunciation of US citizenship: On avoiding the new $450 renunciation fee (update 2), which explains in greater detail, what would constitute a relinquishing act:
Renunciation of US citizenship: On avoiding the new $450 renunciation fee (update 2)
I’ve been pretty upset that it would cost me $450 to renounce my citizenship now that the US consulate in Toronto has instituted a fee. But today I was looking at the various government websites: Consider this website from the US state department and its explanation of how to renounce US citizenship:
Section 349(a) of the Immigration and Nationality Act (8 U.S.C. 1481) governs how a U.S. citizen shall lose U.S. nationality. Section 349(a) states:
A person who is a national of the United States whether, by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality:(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense.
Now perhaps it would interest readers to know that this government website is not telling the whole story: The U.S.C. 1481 lists several other ways that a natural born US citizen may lose their citizenship. Here is the full text (emphasis mine):
§ 1481. Loss of nationality by native-born or naturalized citizen; voluntary action; burden of proof; presumptions
(a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality—
(1) obtaining naturalization in a foreign state upon his own application or upon an application filed by a duly authorized agent, after having attained the age of eighteen years; or(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years; or(3) entering, or serving in, the armed forces of a foreign state if
(A) such armed forces are engaged in hostilities against the United States, or(B) such persons serve as a commissioned or non-commissioned officer; or(4)
(A) 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 if he has or acquires the nationality of such foreign state; or(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(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense; or(7) committing any act of treason against, or attempting by force to overthrow, or bearing arms against, the United States, violating or conspiring to violate any of the provisions of section 2383 of title 18, or willfully performing any act in violation of section 2385 of title 18, or violating section 2384 of title 18 by engaging in a conspiracy to overthrow, put down, or to destroy by force the Government of the United States, or to levy war against them, if and when he is convicted thereof by a court martial or by a court of competent jurisdiction.(b) Whenever the loss of United States nationality is put in issue in any action or proceeding commenced on or after September 26, 1961 under, or by virtue of, the provisions of this chapter or any other Act, the burden shall be upon the person or party claiming that such loss occurred, to establish such claim by a preponderance of the evidence. Any person who commits or performs, or who has committed or performed, any act of expatriation under the provisions of this chapter or any other Act shall be presumed to have done so voluntarily, but such presumption may be rebutted upon a showing, by a preponderance of the evidence, that the act or acts committed or performed were not done voluntarily.
I swear or affirm that I will be faithful and bear true allegiance to her Majesty Queen of Elizabeth the Second, Queen of Canada, Her Heirs and Successors, and that I will faithfully observe the laws of Canada and fulfill my duties a Canadian Citizen.
An individual who has performed any of the acts made potentially expatriating by statute who wishes to lose U.S. citizenship may do so by affirming in writing to a U.S. consular officer that the act was performed with an intent to relinquish U.S. citizenship. Of course, a person always has the option of seeking to formally renounce U.S. citizenship abroad in accordance with Section 349 (a) (5) INA.
Update 2: Today a consular officer called me from the US consulate in Toronto. She confirmed what I’ve said in this post, that relinquishing US citizenship and renouncing US citizenship are two different processes that are treated in a different manner by the consulate (including the fee structure).
Good to know!!!!!!
@LM I understand and respect what you are saying, and while I agree that we have to take this seriously and consider our options, my point is that simply closing people’s accounts based on place of birth (for example) is not going to be as easy as some are making it out to be. First of all, it is going to be a logistical mess and will affect hundreds of thousands of people who would then not be able to pay their bills, their mortgage, etc. causing financial havok. Furthermore, I am aware that there have been some cases of this happening, but Canada does have strong institutions (including the Charter) that make it difficult to discriminate against people based on where they were born. I disagree that banks can simply close people’s accounts based on whatever their policy says. What if banks had a policy that said they would close people’s accounts because they or their parent were born in Iran? in China? because they were black? gay? Imagine a bank sending a letter to a client saying “We suspect you may be black/gay/jewish and if you do not prove that you are not, we will close your account.” Would that be acceptable in Canada? Furthermore, countries can pass legislation making extra-terrirtorial legislation un-enforcable on their territory…remeber the Helms-Burton Act? Again, I’m not saying not to worry about this, just that implementing FATCA isn’t going to be an easy, straightforward process by any means, and will likely be unenforcable, especially once it starts affecting hundreds of thousands of Canadians.
From what I recall, FACTA implementation date is early July 2014 so we will wait and see…..I’m sure it will be interesting to watch what the press and politicians (and banks) say.
By then I will have had my 2nd visit at the consulate and will have sworn my oath of renunciation. If the banks and investment houses I deal with push for citizenship info, I will be free and clear. And glad of it!
I’m a bit confused. Other than the $450 fee, is there an advantage to relinquishing over renouncing? Let me frame the question in a different way. If there wasn’t a $450 fee, is it better to relinquish? Or renounce?
I was born in the U.S.. Lived there for 8 months and moved to Canada. My parents were both born in Canada. I’ve never earned any money in the US and I’ve never lived there. I also don’t own anything there.
Guidance on this would be most appreciated!
@ Bob,
No matter when you apply for your CLN, such as in 2014, your CLN indicates the date you actually terminated your US citizenship.
If you performed one of the relinquishing acts set out in s. 349(a) of the Immigration and Nationality Act, prior to 2004 (I forget the exact date in 2004, but it’s mentioned in at least one of the posts linked below), and your behaviour has been that of a Non-US citizen since you did, you would not have been a US citizen when the current exit tax law came into effect.
This is discussed in the following threads Pre-1995 Relinquishers and the IRS: Three Recent Legal Opinions , If your expatriation date is before 2004 , Did you relinquish before February 6, 1995 Also Tax lawyer Michael J. Miller has written an excellent article on this, which is very clear reading with useful references to legislation and case law as well.
@ Bob,
If you were born dual, you would not have had the need to naturalise in Canada, so could not have performed s. 349(a)(1) – unless you naturalised in a third country. However, s. 349(a)(2) set out the relinquishment act of an oath to a foreign state; also there’s (3) being a non-commissioned or commissioned officer in the military; and (4) working for a foreign government.
@All,
As for s. (2), I’m curious – does anyone here have a CLN which states “s/he thereby expatriated him/her self under the provisions of Section 349(a)(2) of the Immigration and Nationalities Act”?
So does that mean I CANNOT relinquish? I’m sorry I find this incredibly confusing. I have not naturalized in a third country.
I’m sorry Pacifica. Could we try this in plain english?
Sorry. I’ll try to be more clear.
There 7 ways a person can terminate their US citizenship. They are all described in s. 349(a) of the Immigration and Nationality Act.
The most common and well-known way to end US citizenship is renuncation, which is sub-article (5) in section 349.
Of the remaining 6 ways to terminate US citizenship, the most common is under subsection (1), which is naturalising in a foreign country with the intent of simultaneously terminating your US citizenship. So, if you were Canadian all your life, of course that’s not possible.
However, a person who is born a dual citizen can still relinquish under the remaining 5 sub-articles. (sub-articles 6 and 7 aren’t relevant, they’re about stuff like treason and wartime). That leaves sub-articles 2, 3 and 4, which might apply to you.
Hope that’s more clear. Also someone else might describe it more clearly.
Thanks Pacifica,
It still brings me back to my original question though. What is a better option for me? Relinquishing? Or Renouncing?
I’m not worried about the $450 fee. I just want it done right, and in a way that will prevent me from having to file US returns.
If a person’s relinquishing act occurred from 2004 on, the date doesn’t matter for IRS purposes, as in the current law, IRS considers the person as a citizen until the day they notify the US govt of the relinquishing act.
So, if you performed your relinquishing act on March 1, 2009, and signed your CLN application forms on January 20th, 2014, IRS will consider you a citizen until January 20th, 2014.
26 USC 877A(g)(4)
http://www.law.cornell.edu/uscode/text/26/877A
If a person is dual at birth, they will not be charged exit tax, however. The conditions are explained in the instructions for the exit tax form instruction. http://www.irs.gov/pub/irs-pdf/i8854.pdf
According to the Dept of State Foreign Affairs Manual, DOS is supposed to send IRS a copy of each CLN. I’ve no clue if IRS follows up on these CLNs or not, perhaps depends if the fruit is low-hanging or high-hanging, if the person is in the system or not, but I don’t know. Different people make different decisions about what they are going to do based on their own circumstances and risk tolerance — it’s important to read up and think about it and make the decision that you feel most comfortable with. Whether or not the person files with IRS or not, the citizenship itself remains terminated and the CLN remains in effect.
Bob,
You will not be allowed to RELINQUISH as you were born a dual citizen (born in the USA so a US citizen AND born of Canadian parents so also a Canadian citizen), UNLESS, as Pacifica shows, one of the following applies to you:
However, a person who is born a dual citizen can still relinquish under the remaining 5 sub-articles. (sub-articles 6 and 7 aren’t relevant, they’re about stuff like treason and wartime). That leaves sub-articles 2, 3 and 4, which might apply to you.
“(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years; or
(3) entering, or serving in, the armed forces of a foreign state if
(A) such armed forces are engaged in hostilities against the United States, or
(B) such persons serve as a commissioned or non-commissioned officer; or
(4)
(A) 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 if he has or acquires the nationality of such foreign state; or
(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; “
Do any of the above apply to you? If so, you will be allowed to RELINQUISH. Otherwise, because you were born with both Canadian and US citizenship, you will only be allowed to RENOUNCE. (Being born a dual, you will not be subject to the Exit Tax, unless you fail to file Form 8854 the year following your renunciation, certifying that you have fulfilled all IRS filing requirements. Relinquishment, if you meet one of the above definitions, will save you that — if that act of relinquishment you will be claiming occurred BEFORE the specified date in 2004.)
Or, that’s the way I read it. I stand to be corrected. Pacifica has been the person able to quote from the many US regulations regarding renunciation and relinquishment, but none of the advice found here at Isaac Brock should be relied on as legal advice. We hope this site will provide the start to some, yes, confusing information you’ll need to read and access and then, perhaps, get further professional advice to base your decisions on. Every case is different.
@Bob —
By all means talk to a good immigration lawyer — but from what you have said about yourself I don’t think relinquishing is possible. People who relinquish do so on the basis of committing an expatriating act. Example: US adult citizen moves to Canada, 5 years later becomes a Canadian citizen — with the intent to relinquish US citizenship — and has now committed an expatriating act. They can many years later (decades even) apply for a CLN with the date of the expatriating act — and they’ll likely get it, as long as they haven’t done anything (e.g. vote in a US election, get US passport) to exercise US citizenship rights. (My wife, and many others here, did that)
In your case, you were born dual and your Canadian citizenship was already established — as was your U.S. citizenship. Unless there’s something you did that fits one of those expatriating acts that Pacifica has ably laid out, you will likely have to renounce. Not the best news, I know, but that’s how those cretins make the rules work.
But its definitely worth seeking a legal opinion from a good lawyer, because who knows, there might be something there that gives you an opening. The good news is if you try a relinquishment pitch and it isn’t accepted, you can still renounce. Nothing ventured, nothing gained.
Thank you Calgary and Arrow,
That’s what I was looking for. I am getting in touch with an immigration lawyer this week. I don’t believe I will owe any taxes, so it will likely just be my costs of filing my last 5 years taxes (I think). Not an ideal situation, but better than having to file for the rest of my life and getting the WORST of both tax systems!
Thanks very much.
And, thanks to Pacifica. She always answers the hard questions, trying to make simpler the complexity of it all. What a great job she does!
For sure. Thanks again Pacifica. This is so confusing. I really appreciate the fact that you all are on here just trying to help people. All class.
I have to differ on the advice to Bob here. Those relinquishing acts are only used to get a retroactive CLN based on having performed them “before” but from how I am reading the form, he and I CAN relinquish as of now, voluntarily, based on never having used a US Passport and having never voted nor having property or other ties to the US. Having lived in Canada, travelled on a Canadian passport and voted in Canadian elections are all included as “reasons” for wanting to relinquish US citizenship. From what I have read also, you won’t be allowed to renounce without having a US Passport to turn in. Neither Bob nor I have one, therefore we cannot renounce.
GwEvil,
Common sense to me — I hope it will be so. It also would apply to my son and to many, many, many “accidentals” and that is the way it should be!
@ GwEvil,
Common sense to me too and that would be super for a lot of people. Do you have a link for this?
Regarding passports, a person who never had a US passport can renounce. A couple of people have done so, such as Saddened’s son.
@Pacifica
“@All,
As for s. (2), I’m curious – does anyone here have a CLN which states “s/he thereby expatriated him/her self under the provisions of Section 349(a)(2) of the Immigration and Nationalities Act”?”
I tried that. Immigration couldn’t help me with that, saying that the oath/ceremony was for new citizens. My mayor refused to hear the oath, on advice from counsel, as she didn’t have the authority. I finally was able to appear before a Justice of the Peace. She witnessed the oath. Toronto consulate rejected it, saying DC would not accept it. I wish I had fought it, but I caved, and renounced on the spot. With a great deal of anger.
@The Mom,
The oath you’re talking about is the naturalization process, which is the most common expatriating act that gives people back-dated CLNs. I don’t quite understand your story. It sounds like you were already a Canadian Citizen but tried to take a new citizenship oath? When was that?
@GwEvil,
You seem to be confusing the terms.
There are several expatriating acts that relinquish US citizenship. One of them is renouncing it at a consulate. If you did that many years ago (before 2004), you can make a claim that you intended to relinquish your US citizenship at the time and get a back-dated CLN, as long as you did not continue to use US citizens benefits such as using or renewing your a passport. A back-dated CLN is good, because you then do not have to file US taxes for the last 5 years, etc.
There is at least one person here who was a born dual-citizen, but for some reason did the oath-taking naturalization after the age of 18. Perhaps because he didn’t have a certificate of being born abroad? Lucky guy. He can claim that.
Other than naturalizing, the only other successful claim to past relinquishment reported here has been for working for a foreign government (provincial counts; I’m going to try to claim municipal government employment).
None of the things you mentioned will be acceptable to the Department of State as expatriating acts. Voting in a foreign country was on the books until October 10, 1978, but the DoS will not accept prior voting even though it was not stricken retroactively.
You said you can “relinquish as of now, voluntarily, based on…”. What you are describing is renouncing now, which relinquishes your US citizenship. You don’t need those good reasons to renounce (but they might ask): it’s a constitutional right. You do still have to become compliant with IRS filing requirements.
You do not need to have ever had a US passport to renounce.
I also remember someone was explicitly told voting in Canada was not a relinquishing act, and it’s definitely not listed as one of the potentially renunciating acts in the Immigration and Nationalities Act. Really what it goes towards on the 4079 is as a tie to your home country. On the other hand, if a person voted in the US after the claimed date of relinquishment, that voting would carry some serious weight, indicating they believed they were a USC after their claimed date of relinquishment.
“WhatAmI
@The Mom,
The oath you’re talking about is the naturalization process, which is the most common expatriating act that gives people back-dated CLNs. I don’t quite understand your story. It sounds like you were already a Canadian Citizen but tried to take a new citizenship oath? When was that?”
Born dual, infant upon return to Canada, Canadian parents, told in 92 by Toronto consulate by phone not a US citizen, as I’d voted in Canada, not kept residence in US, yada yada. No acts as US citizen (no passport, no voting in US, etc.).
Oath was sworn due to never having served in military, or held a gov’t job, requiring the oath. I took the law for what it said, swore the oath before a JP in Feb. or March of 2013. JP thought the situation absurd, as did Immigration (Jason Kenny’s office).
I am going by what is on the actual relinquishment form (97 something). They ask all the questions and then at the end it asks “do you realize that doing questions 8-19 can result in relinquishment of your US citizenship? 8-19 includes voting in Canada, travelling on a Canadian passport, having property and having lived only in Canada as well as the not having voted or having a US Passport or having property or ties to the US. So that’s what I am going by.
And it doesn’t say you have to do ALL of 8-19. Just ANY