# READ THIS before moving to the US



## jimmyjam (Jan 9, 2012)

Anyone planning to move to the USA should be aware of the recent changes in fiscal legislation that will have an impact on you and your family if you work or live in the USA for more than 4 months.

Thousands and thousands of US citizens are queuing up at embassies around the world to renounce their citizenship and this is for a reason.

If you or your family have any assets, investments, retirement savings (even real estate), etc., by moving to the USA you will be bringing all of your savings into the jurisdiction of the US tax authorities.

US tax legislation is one of the most complicated in the world, you should be prepared to spend 1000$ or more per year on professional help for filling in your tax return.

If you do not report correctly any assets that remain in your home country, like for example a bank account or retirement account you may have back home, this is considered a criminal offense and also one that costs a minimum of 10,000$ and a maximum of 3x your total assets in penalties.

All of your assets will be taxed and any assets that remain outside of the US will be subject to high scrutiny and high taxation.

Coming 2012 there is a very high chance your home country bank will kick you out if you have a US address.

You will not be able to go back and live in your home country again, without going through a complicated, intimidating and costly expatriation process, and the USA will confiscate 15% of your capital gains (if they are above a certain limit) when you go back.

Anyone who has any savings, retirement, real estate investments, funds, etc. should take legal advice before moving to the USA.

If you are starting out in life, you have no money, and/or if you plan to cut all ties with your home country and never go back, perhaps the US move is right for you.


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## nyclon (Apr 3, 2011)

> Thousands and thousands of US citizens are queuing up at embassies around the world to renounce their citizenship and this is for a reason.


Really? Can you provide a valid source for this information? You'd think "thousands and thousands of people queuing" in the first 10 days of the new year would spark some press interest considering that fewer than 1000 people renounce their citizenship in a year, and yet I've found nothing.


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## hutais (Jul 2, 2010)

Ummm???


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## twostep (Apr 3, 2008)

Unless you can post official links as foundation for this - please consider this is an open forum for those wanting to ask questions and share factual information about the US and US immigration.


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## Bevdeforges (Nov 16, 2007)

Just for information, the OP is referring to the FBAR and FATCA legislation that is currently under discussion in the Tax section of the Canadian forum here on Expatforum.

I have to say that the OPs interpretation of some of this is a bit, oh, shall we say "open to question." I won't go through it point by point - but basically, when you are subject to US taxation (i.e. once you are considered "resident" in the US), you will be expected to disclose your foreign financial assets, with a view toward identifying any foreign source income you are failing to report on your US income tax returns.

A couple of clarifications: the US does NOT tax assets, other than the transfer of assets (as on the death of a taxpayer subject to the estate tax). The FBAR and FATCA that everyone is moaning about in the Canada forum is legislation requiring disclosure only - there is no tax assessed on the assets you are reporting.

Actually, the biggest issues are for those US citizens living abroad and still subject to US taxation. There has been an increase in those looking to renounce their US citizenship "for tax reasons" (normally not a good idea) - but in general, if you're not hiding income producing assets overseas, the new reporting requirements are more a big PITA than a real threat to your financial or physical well-being. 

The focus of the new requirements is actually more on US residents with large and complex foreign (i.e. non-US) financial holdings designed to obscure ownership and thus evade US taxation. Overseas Americans are more or less "collateral damage" in this whole thing, and it remains to be seen exactly how the IRS plans to identify, audit and penalize non-US-residents in violation of these new requirements.

A couple of points to consider for those looking to move to the US:

If you have children while living in the US, they will have US citizenship and (unless the laws change) will be subject to filing US tax returns for the rest of their lives no matter where in the world they live.

And yes, it seems that very few US taxpayers do their own tax returns themselves these days - but depending on your financial situation, it is possible to get tax preparation assistance for free, or to make use of fairly easy to use tax assistance software costing anywhere from about $20 a year to a couple hundred $ a year. "Human" tax assistance starts at about $50 and can run into the thousands, depending on how complicated your finances are.

If you want to get your knickers in a twist over this, just check out the Expat Tax section of Expatforum for any threads dealing with FBAR, FATCA or "renunciation."
Cheers,
Bev


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## jimmyjam (Jan 9, 2012)

*Don't take my word, here's proof.*



nyclon said:


> Really? Can you provide a valid source for this information? You'd think "thousands and thousands of people queuing" in the first 10 days of the new year would spark some press interest considering that fewer than 1000 people renounce their citizenship in a year, and yet I've found nothing.


Deary Nyclon I understand how surprised many people are and how few people actually realize this.

For starters you can have look at 

Americans in Canada driven to divorce from their country - The Globe and Mail

Although this article talks only about Canada, this is in fact a world wide problem and any person who lived and worked in the USA and then moves back abroad to almost any country will be facing this problem.

Indeed it is complex because it is the alliance of 3 or 4 things that made this happen: (1) US citizenship based taxation that taxes you worldwide wherever you live and no matter how long you have been away from the USA until you formally renounce (and now applies exit tax and formalities) + (2) Outrageous reporting penalties applying to people who do not owe tax but just didn't file the forms (3) the tax treaties signed by countries in 2007 with the USA which provide for information sharing and (4) new FATCA which requires every single bank in the world to seek out all US persons in their client base and report details of these people directly to the IRS.

Please note also that many articles refer to "tax cheats" and "tax havens" but the reality is that the IRS has no tolerance anymore for US citizens having bank accounts anywhere but in the USA. Assets abroad are subject to onerous reporting requirements and high penalties. If you keep a bank account in your home country, or if you move back to your home country without formally expatriating, you will be considered a tax cheat along with the rest of law abiding dual citizens who are being caught up right now.

In order to get a good introduction and overview you can go on the site of the American Citizens Abroad organization, much of their site is geared to informing and protecting US citizens who fell into this trap, and trying to raise public awareness in the hopes of changing legislation.

The radio interviews are particularly good for getting a basic overview of the situation.
They also have a page with extensive links to articles in the media from the WSJ to the NY times.

ACA American Citizens Abroad

Once you get a good understanding of the basics, have a look on the expat tax category on this forum site you can read many testimonials and you will realize that this is touching a lot of people.

The issue is so huge that they had to set up a whole new category in this forum called "expat tax" you can have a look yourself on 

Expat Tax - Expat Forum For Expats, For Moving Overseas And For Jobs Abroad

It is wrongly classified under "Canada" forum, but it affects every single US citizen living abroad.

Within that forum you will find a thread that lists extensive media articles on the subject:

http://www.expatforum.com/expats/expat-tax/96699-media-articles-issue-7.html#post688522

See also 

Opinio Juris » Peter Spiro

Reaction to US Tax Law: European Banks Stop Serving American Customers - SPIEGEL ONLINE - News - International

The Fatca Menace! - James Fallows - International - The Atlantic

Expats in US pay high price|World|chinadaily.com.cn


There are also many industry specific conferences addressing the FATCA issue alone, it comes up at every banking seminar such as SIBOS, withholding tax conferences, etc. one of the next ones is in Dubai: 

FATCA 2012 - Home

I think I will stop here, this should be enough valid sources, or do you need more?


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## jimmyjam (Jan 9, 2012)

*important for people moving to the US to know*



Bevdeforges said:


> Just for information, the OP is referring to the FBAR and FATCA legislation that is currently under discussion in the Tax section of the Canadian forum here on Expatforum.
> 
> A couple of clarifications: the US does NOT tax assets, other than the transfer of assets (as on the death of a taxpayer subject to the estate tax). The FBAR and FATCA that everyone is moaning about in the Canada forum is legislation requiring disclosure only - there is no tax assessed on the assets you are reporting.
> ....
> ...


I think it is important for anyone moving to the US from abroad, to realize what they are getting into in order to avoid costly mistakes:

- Any of their assets in their home country MUST be reported to US tax authorities on 2 separate forms.

- Bev is right, you are not taxed on your assets BUT if you did not know about or forgot to fill in these forms, you can be faced with criminal charges, penalties from 10,000$ per account per year to 300% of the maximum value of the bank account

- In order to leave the US and go home to your country of origin you will have to go through a formal renunciation process and possibly pay an exit tax (even if you just want to stop holding your green card).​
Secondly, Bev says this is mainly a problem for US citizens living abroad... I don't agree.

*The first people who are going to be targeted and penalized by these measures are people in the USA who have jobs, a house, investments and assets there, but who also had some investments abroad.* Who are those people? The exact people who should be looking at this post, foreigners who are thinking of emigrating to the USA for marriage, jobs or education.

I'm not saying you should stay away from the USA because of this, I'm just saying you should be aware of it. Depending on your situation it may be dissuasive or not.


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## twostep (Apr 3, 2008)

I asked for official links not newspaper clippings. You may want to move your concerns to the tax forum. Thank you.


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## jimmyjam (Jan 9, 2012)

*what is an official link*



twostep said:


> I asked for official links not newspaper clippings. You may want to move your concerns to the tax forum. Thank you.


Please forgive me I don't understand what a "official link" would be.

Perhaps one article is not "official" but dozens of them conferring on the same topic? Is that not convincing?

Do you not think that the information provided on the American Citizens Abroad website would be reliable and useful for people thinking about becoming American Citizens? It is an official organization and they are doing their best to help Americans who are today caught in a trap.

I have clearly explained why it is important for people wanting to move to the US to be aware of this, it is indeed a tax issue but it is extremely important and should be considered when someone is considering moving to the USA which is why I put the posting here.


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## jimmyjam (Jan 9, 2012)

*attempting an "official link"*



twostep said:


> I asked for official links not newspaper clippings. You may want to move your concerns to the tax forum. Thank you.


Here is a publication from the Luxemburg bankers association - it is not a newspaper clipping - would that qualify as a valid source?

FATCA: Turning US persons into toxic liabilities | ABBL

Do you not agree that before they move to the USA, people should know that they are going to be considered "toxic liabilities" in their own countries?


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## siobhanwf (Mar 20, 2009)

Hi there Jimmyjam. Just a thought but what are your credentials? Your information states that you are originally from the US but expat in the UK however resident in Sweden.


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## nyclon (Apr 3, 2011)

Still not seeing any evidence to back up the statement that "thousands and thousands are queuing" to renounce US citizenship. So this is gross exaggeration as the only evidence you have provided is 1 guy who lives in Canada.


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## jimmyjam (Jan 9, 2012)

*Official links proving US treatment of international individuals*



twostep said:


> I asked for official links not newspaper clippings. You may want to move your concerns to the tax forum. Thank you.


This is not an issue that should be hidden away in the tax forum.

This is an US immigration issue, because informing people of the consequences of holding US citizenship is, I believe, necessary and relevant to anyone planning a move to the US.

If you read through the "tax forum" on this website you will see is essentially composed of testimonials, questions and responses of people who were UNAWARE OF THE IMPLICATIONS OF HOLDING US CITIZENSHIP and who are now facing life changing penalties, legal fees, anxiety, marital discord, etc. due to their US citizenship.


In my 2nd post I listed multiple press clippings, international nonprofit organizations such as American Citizens abroad (www.aca.ch),a link to the hundreds of testimonials on the (incorrectly categorized) Canada Expat Tax forum , links to banking associations and trade conferences were not enough, here are some more links that will perhaps qualify as "official".

The "official" problem is very complex so you will find extremely technical links below to tax legislation and treaties that are hard to comprehend and require you to read between the lines. 


Like many countries the US taxes everyone who lives there on their WORLDWIDE income. Which means you have to report to the IRS your WORLDWIDE assets. The difference between the USA and other countries is the draconian measures they have applied to anyone with international investments. First of all not reporting your foreign assets is a CRIMINAL offense and they have been contacting people, such as Indian immigrants working in the USA who have kept bank accounts back in India, with threats of criminal prosecution for not declaring the. You must fill in two forms and the penalties for simply not knowing about the form is 10,000$ a year or up to 50% of the highest balance of the account per year going back 6 years (300% of the account).

Unlike any other country, the US also taxes citizens and green card holders who DO NOT LIVE IN THE US anymore. If you move back to your country of origin you will continue to be taxed and penalized even if you no longer even travel to the US, until you go through the onerous expatriation procedures.

Links supporting these assertion:

Report of Foreign Bank and Financial Accounts (FBAR)

Read especially the penalty section. "Non willful" means that you honestly and innocently did not know you had to file this form, even if no taxes are due, penalty = 10,000$ per account.

Note: the IRS does not say "We are the only country in the world to tax green card holders who have moved back home". They do say that anyone must pay taxes and fill in these forms who is a US citizen OR resident (read between the lines - citizen even if you do not live there).​
http://www.ey.com/Publication/vwLUAssets/2011_global_executive_guide/$FILE/2011_global_executive_guide.pdf

The above is an Ernst and Young publication explaining tax legislation around the world. It is not a press clipping, it is a professional publication from these highly competent tax advisors. On page 1283 you will find the chapter on the USA including the statement about the taxation of worldwide income even for nonresidents.​
Do I need to file Form 8938, ?Statement of Specified Foreign Financial Assets??
Form 8938, Statement of Foreign Financial Assets

This is another and more complicated form requiring people with assets in foreign countries to report everything they have to the IRS or be subject to draconian penalties. 
US citizens who have no holdings outside of the US do not have to report their total assets to the IRS, but any person with international ties does.
Anyone who is a US citizen or green card holder must fill in this report even if they have moved back to their home country for as long as they have not formally renounced or expatriated and terminated their green card.​

http://www.irs.gov/pub/irs-pdf/f8854.pdf

This form is the "expatriation form" which US citizens and green card holders must complete if they wish to move away from the USA and be free from the scrutiny, penalties and threats concerning their business in their home country. You will see that you must declare your entire net worth and (if you are wealthy enough) you will be required to pay an exit tax.​
http://www.treasury.gov/resource-center/tax-policy/treaties/Documents/uktreaty.pdf
United States Income Tax Treaties - A to Z

The US has signed treaties with most developed countries to avoid double taxation. However if you are a US citizen or green card holder these treaties do not apply to you, the US specifically states it can continue double-taxing you even if you are no longer a US resident. For solid proof see paragraph 25 article 4, the "non discrimination" clause in the 2001 US - UK tax treat, but every tax treaty includes this clause you just have to do a search for it

In addition in many of these treaties you will see the clause that states that if you wish to move back to your country of origin and renounce citizenship or give up your green card, and tax avoidance is one of your motivations, the US reserves the right to continue to tax you for 10 years​
UNDERSTANDING TAX TREATIES

The above link does a good job of explaining the tax treaty issue, especially see paragraph 3​
Treasury and IRS Issue Guidance Outlining Phased Implementation of FATCA Beginning in 2013

The above IRS publication talks about the new US imperialistic initiative to force foreign banks to report on every US account holder directly to the IRS. What they don't say is that, as a result, banks are kicking out their US account holders, especially any person that has a US address. The do not publish this information on "official links", you must look at the myriad of press articles, financial industry publications, consultancy firm pubications, etc. on this topic, many of which I provided before.​

Read Jim Flaherty’s letter on Americans in Canada | News | Financial Post

Above is a link to the letter that Jim Flaherty, Canadian Finance Minister, sent to the US on the subject. It appears in a newspaper so perhaps you will count it as a "press clipping", but you can find it in many different sources so I believe nobody could discount it as non-factual​

As for proof of the thousands of people renouncing, the only "official" information that we will have is the Federal Register which lists the names of people who renounced, and yes up until 2011 this was about 1000 a year, BUT the federal register only lists those people who have net worth above 2 million dollars and are "covered" expatriates.

What I can list as official proof of this is my own experience:

- waiting times for renunciation visits going up exponentially at the embassies where I have enquired, sometimes as long as 6 months wait

- time to receive the CLN (certificate of loss of nationality) has gone up from 6 weeks in 2010 to around 6 months to a year (announced by embassies currently)

- my tax lawyer, a small one-man operation, dealt with over 100 renunciation processes last year and he is just a very small entity, the huge tax firms have told me they are overwhelmed by requests

- Toronto holding a mass-renunciation meeting in October 2011 which was something virtually unheard of until now

- recent visits to the embassy where I was witness to a number of renunciations (something that was quite rare before FATCA)


I hope these references will convince you that I am basing all of my post on pure facts and not imagination, and that it is essential for anyone planning a move to the us to take into account these aspects in addition to immigration, quality of life, health care, schools, career opportunities, etc.


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## jimmyjam (Jan 9, 2012)

*absolutely not 1 guy in Canada*



nyclon said:


> Still not seeing any evidence to back up the statement that "thousands and thousands are queuing" to renounce US citizenship. So this is gross exaggeration as the only evidence you have provided is 1 guy who lives in Canada.


I will try my best to come up with even more material on the renunciation issue.

I can ensure you it is absolutely NOT just "one guy who lives in Canada".

If Jim Flaherty, the Canadian finance minister, has been forced into speeches and writing official letters to the USA on this subject, you can be sure it is not just "one guy".

Have you had a look at the testimonials on the renunciation thread in the expat tax forum under Canada? Are all these people making it up?


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## jimmyjam (Jan 9, 2012)

*credentials*



siobhanwf said:


> Hi there Jimmyjam. Just a thought but what are your credentials? Your information states that you are originally from the US but expat in the UK however resident in Sweden.


I am a US citizen living abroad who has been struggling with the issue of holding a US passport for the past 7 years.

If I had realized the implications of being an international US citizen abroad long ago I would have either moved back to the US or renounced.

I have had extensive immigration, legal and fiscal help from lawyers like many of the people you can read about in the canada forum, expat tax section.

I have been following this issue with professional help for a number of years.

May I ask any of you sceptics, have you taken the time to read ANY of the links to material that I have painstakingly published to support my case?


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## Bevdeforges (Nov 16, 2007)

jimmyjam said:


> - Any of their assets in their home country MUST be reported to US tax authorities on 2 separate forms.​




Not unusual - especially for countries with a wealth tax. The US has no wealth tax, but is hardly the only country to require legal residents to declare their foreign assets.



> - Bev is right, you are not taxed on your assets BUT if you did not know about or forgot to fill in these forms, you can be faced with criminal charges, penalties from 10,000$ per account per year to 300% of the maximum value of the bank account


I have yet to hear of anyone being assessed a criminal charge or the max penalty for failure to file unless their unreported assets amount to FAR more than the minimum - and point to significant amounts of unreported income.



> - In order to leave the US and go home to your country of origin you will have to go through a formal renunciation process and possibly pay an exit tax (even if you just want to stop holding your green card).





> ONLY if you have taken US citizenship and wish to renounce that. The exit tax only kicks in if you have $2million or more in assets. If you wish to leave the US for good after many years of residence there, you should file a "sailing permit" which is just a document asserting that you are giving up your permanent residence and are up to date on your income tax filings before you leave.
> 
> 
> 
> ...


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## jimmyjam (Jan 9, 2012)

*"official link" to the number of renunciations*



Bevdeforges said:


> The people who will be targeted are those who are resident in the US and who have financial assets abroad *on which they have not been reporting the income, as required by the US tax laws.* This is no different from any other country that requires reporting of "worldwide income" for residents subject to taxation.
> 
> Bev


Bev Thanks for intervening and bringing some objective views to this.

You are quite knowledgable on the subject, I have seen your numerous posts over the months. In these forums you have interacted with numerous international people who either renounced US citizenship, are planning to renounce, or want to renounce but can't due to regularization barriers.

Would you therefore agree with me that the number of people renouncing their US citizenship is on the rise and there are many indicators out there to support this?

Do you not also have insight that we are seeing and going to see unprecedented numbers of renunciations this year?

Of course the embassies don't publish the number of renunciation interviews nor the wait times for obtaining an interview, the state department does not publish the number of CLN's issued nor the historical trend; the IRS does not publish the number of 8854's filed and even if they did, these filings only come in a year or more after the renunciation takes place.

The only "official" link would be to the Federal Register which is incomplete, I know because a close relation renounced in 2009, I have seen his CLN, and he is not on the list. I can also add some references to blogs written by lawyers and professors about how the Federal Register is composed and why it is incomplete.


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## jimmyjam (Jan 9, 2012)

*Obtaining US passport or renewing from abroad - IMPORTANT info*

For anyone who has been living outside of the US for a number of years and is thinking about renewing their US passport or obtaining a US passport for the first time, there is some important information you should know.

If, for example, you are a US citizen by virtue of your parents, but you have never yet held a US passport or travelled to the US, this information applies to you.

When you file for obtaining or renewing your US passport, your personal information will be transferred to the department of Treasury to verify if you have been complying with US tax law during the period you have been living outside of the USA

http://www.state.gov/documents/organization/79955.pdf?

See top of page 4 which says: Section 6039E of the Internal Revenue Code (26 USC 6039E) requires you to provide your Social Security Number (SSN), if you have one, when you apply for a U.S. passport or renewal of a U.S. passport. If you have not been issued a SSN, enter zeros in box #5 of this form. If you are residing abroad, you must also provide the name of the foreign country in which you are residing. The Department of State must provide your SSN and foreign residence information to the Department of Treasury. If you fail to provide the information, you are subject to a $500 penalty enforced by the IRS. All questions on this matter should be directed to the nearest IRS office.​
According to US law all Americans must fully comply with all US tax legislation whether they live, work or travel to the states or not.

If you are obtaining your passport for the first time and you have never filed US income taxes or reports of your "foreign" assets, you will be requested to do so.

If you have assets over 10,000$ and if you owe US back taxes you will be liable for very high penalties and fines. You will also, in many cases, have to hire a tax professional to get your file in order going back 6 years. This will probably cost for most people between 500$ to 1000$ per year of back filing unless your case is extremely simple (or more if you have sophisticated investments like retirement funds and - god forbid - trusts)

This is applicable even if you are paying taxes in the country where you live.

FINALLY AND MOST IMPORTANTLY

The IRS does give some leniency to people who were born outside the country and who were dual nationals at birth (this is your case if you got US citizenship through your parents but have never been back yet).

However, IF you fill in a passport request, you are giving up any possibility to resort to that leniency and you will become a fully taxed US citizen, with full reporting requirements and subject to taxes and penalties, even if your tax home is still abroad.

If you have any assets, investments or savings, I highly recommend you look into this situation, give a call to an experienced tax professional, check around and inform yourself before filling in that passport request.


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## Bevdeforges (Nov 16, 2007)

jimmyjam said:


> Bev Thanks for intervening and bringing some objective views to this.
> 
> You are quite knowledgable on the subject, I have seen your numerous posts over the months. In these forums you have interacted with numerous international people who either renounced US citizenship, are planning to renounce, or want to renounce but can't due to regularization barriers.
> 
> ...


Let me say that *I have heard* that the number of renunciations is increasing in reaction to these FBAR and FATCA rumors that are spreading amongst the expat communities. I have no direct knowledge of this, "other than what I read in the papers" as they say.

But renunciation is a LONG ways off for those just considering immigrating to the US - you need to take US nationality before you can even start to consider renouncing it. I really wonder whether it's a relevant topic for the "Expats Living in America" part of the forum. 
Cheers,
Bev


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## Bevdeforges (Nov 16, 2007)

> According to US law all Americans must fully comply with all US tax legislation whether they live, work or travel to the states or not.


Yeah, but the enforcement ability of any agency of US government is pretty feeble outside the US. The main "weapon" they have is the ability to compare your US tax return to your local income tax return - though they only seem to do that at death (where there is a sizable estate that needs to be cleared) or in case of some fairly blatant discrepancy that comes to the attention of the IRS.



> If you are obtaining your passport for the first time and you have never filed US income taxes or reports of your "foreign" assets, you will be requested to do so.


I would be curious to know which US consulates are doing this. My experience here in Paris is that as long as you have a SS number to give them, they don't fuss about whether or not you've filed your tax returns recently. (I renewed my US passport the year after I didn't file - because I had insufficient income to have to do so - and never heard a word about it.)



> If you have assets over 10,000$ and if you owe US back taxes you will be liable for very high penalties and fines. You will also, in many cases, have to hire a tax professional to get your file in order going back 6 years. This will probably cost for most people between 500$ to 1000$ per year of back filing unless your case is extremely simple (or more if you have sophisticated investments like retirement funds and - god forbid - trusts)
> 
> This is applicable even if you are paying taxes in the country where you live.


This is rubbish. First of all, you only have to report *financial (i.e. investment) assets overseas *if they total $10,000 or more. Depending on your circumstances, even with this level of financial assets, you may not owe any back taxes and you can "clear your name" merely by filing a few years of back returns that demonstrates this. In part, the fact that you are paying taxes in the country where you live may result in more than sufficient tax credits to offset any amounts you might have had due to the IRS.

Lots of people panic and think they have to hire expensive tax help to file back taxes. A few years ago, lots of people believed that you couldn't get a visa for the US unless you had an expensive immigration lawyer. Unless you have complex financial arrangements of the type they are looking for (polite way of saying, "unless you're rich and setting up tax shelters overseas") the tax returns aren't that difficult to file - and there is no one "correct" way of filing anything. It's mostly a matter of declaring all sources of income and offsetting any tax liabilities with the appropriate deduction, exclusion or tax credits. 



> If you have any assets, investments or savings, I highly recommend you look into this situation, give a call to an experienced tax professional, check around and inform yourself before filling in that passport request.


There are any number of free online tax preparation programs where you can get a look at the forms and start to evaluate for yourself where you stand as far as US tax reporting is concerned. Or, you can buy a tax preparation program online for a reasonable amount that will allow you to prepare all but the most complicated returns without forking over big $$$ to a tax accountant or attorney. (And just for the record, I AM an accountant by trade - and I suppose I could profit by all this panic and confusion by charging people to fill out their tax returns, but I don't.)
Cheers,
Bev


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## nyclon (Apr 3, 2011)

> I can ensure you it is absolutely NOT just "one guy who lives in Canada".


Apparently, you can't.

I've seen no news stories about the thousands and thousands lining up at US Embassies around the world and you haven't provided any. Whether or not it's easy or hard to find out information about renunciations, I'm sure more than a few news agencies would have picked up on "thousands and thousands queuing" at US Embassies and asked a few questions.

Until you can give some concrete back up on this, it's just gross exaggeration.


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## jimmyjam (Jan 9, 2012)

*Yes, news agencies have picked up on it!*



nyclon said:


> Apparently, you can't.
> 
> I've seen no news stories about the thousands and thousands lining up at US Embassies around the world and you haven't provided any. Whether or not it's easy or hard to find out information about renunciations, I'm sure more than a few news agencies would have picked up on "thousands and thousands queuing" at US Embassies and asked a few questions.
> 
> Until you can give some concrete back up on this, it's just gross exaggeration.


Dear Nycon, like everyone on these forums I am just trying to provide assistance and help people avoid the pitfalls and troubles I have experienced.

I really do not understand your comments and borderline rude refusal to believe me, if you read prior posts I explain what in my personal experience has led to my statement and why it is hard to find "official data" (coming from a government source).

I needed a few minutes to compile the list for you which you will find below.

Obviously, people are not lining up in the streets.

The embassies make you take an appointment. The waiting list is there, but it is not visible. 

-------------------------

McGurn: Washington's Assault on American Expats - WSJ.com

Vancouver Consulate Backlog for Expatriation | Hodgen Law Group, PC | Hodgen Law Group, PC

?Swearing out? for U.S. citizens held in Toronto - Bill Mann's Canada - MarketWatch

Americans in Canada driven to divorce from their country - The Globe and Mail

Opinio Juris » Blog Archive » FATCA Fallout: Mass Renunciations?

FATCA Isn t Just for Fat Cats

US International Tax Penalties, FBAR Lawyer Briefing Note

This is an old article but the situation has gotten much worse since 2006 with the introduction of FATCA:

Tax Leads Americans Abroad to Renounce U.S. - New York Times

http://www.procopio.com/userfiles/f...rmanent-residents-living-overseas-2--1424.pdf


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## jojo (Sep 20, 2007)

I think whats being said here Jimmyjam is that its a tad alarmist for a forum which deals with expats moving TO the US

Jo xxx


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## jimmyjam (Jan 9, 2012)

*print out of article*



nyclon said:


> Apparently, you can't.
> 
> I've seen no news stories about the thousands and thousands lining up at US Embassies around the world and you haven't provided any. Whether or not it's easy or hard to find out information about renunciations, I'm sure more than a few news agencies would have picked up on "thousands and thousands queuing" at US Embassies and asked a few questions.
> 
> Until you can give some concrete back up on this, it's just gross exaggeration.


Printout of article in case the link didn't work or you didn't have time to click it:

Vancouver Consulate Backlog for Expatriation | Hodgen Law Group, PC | Hodgen Law Group, PC


Vancouver Consulate Backlog for Expatriation
November 8, 2011
A client has a pending application to cancel his U.S. citizenship at the Vancouver Consulate. Today he received the following email from the Consulate:

From: “Vancouver, ACS Department” <[email protected]>
Date: November 8, 2011 7:47:00 AM PST
To: FirstName LastName
Subject: RE: CLN forms – FirstName LastName

There is currently a back-log in respect of Loss of Nationality cases. Cases are responded to by turn. We request your patience.

U.S. Consulate General
American Citizen Services
Vancouver, BC, CANADA

Privacy/PII|
This email is UNCLASSIFIED.

DO NOT EXPATRIATE BY MAIL

If you want to terminate your U.S. citizenship before the end of the year:

Make an in-person appointment at an Embassy or Consulate.

Do not mail in your application to terminate citizenship. Do it in person.

If I could put twinkle stars surrounded by rainbows to draw your attention to those two sentences, I would. I’m just not that good at HTML.

You can go to any Consulate or Embassy in the world. It is worth buying a cheap ticket to fly somewhere to do this. Make it a vacation — go to Singapore or Bangkok or Frankfurt or somewhere else.

There is no guarantee that you will have your application processed before year-end. When you mail the documents to the Embassy or Consulate you do not know whether they arrived in good shape. By setting an in-person appointment, you will know for a fact that you terminated your citizenship on a particular day.

Even if your documents arrive by mail, and the Consulate acknowledges receipt, you face a second risk. If your documents were mailed and were incomplete, they will be rejected and you will have to start over. If you made a mistake on your paperwork, you can fix it on the spot if you are sitting in front of the Consular official.

COMMENTARY — KEEP AN OPEN MIND

I get the feeling that the number of people terminating U.S. citizenship has jumped dramatically. I wonder whether the U.S. government publishes statistics on this. Yes, I know that there are quarterly statistics for people expatriating under Section 877A, but I question whether those are complete and accurate.

Regular people who do not live in my world (international taxation) are flabbergasted when I tell them that U.S. citizens are turning in their passports right and left. It is simply inconceivable that someone would do such a thing. Sometimes the reaction turns to an implicit character assassination of the person relinquishing citizenship: they must be a bad person in some way. Tax dodger. Non-patriot. Someone unwilling to support his country.

Meh.

It is more interesting to me to watch the outbound flow of intellectual (and financial) capital in a semi-scientific way and formulate a hypothesis. Why are these people choosing to terminate citizenship of the most powerful country in the world? Keep an open mind. Formulate a testable hypothesis. Adjust it when the data indicate the hypothesis fails.

Me? I know what they tell me. Multiple anecdotes don’t create a data set. But I hear them again and again report:

The current jack-boot tax enforcement attitude of the IRS scares them. Many of the people we help expatriate settle in countries with higher tax rates than the U.S. It is not the rate of tax that matters. It is something else. Can you guess, Mr. Shulman?
The estate tax. The funny (as in “it is a monument to towering stupidity”) thing about expatriation is that people who do so cannot allow their capital to return to the United States after death because of the exit tax rules — Section 2801. So the U.S. government drives capital out of the United States and then creates economic disincentives for that capital to return. Makes sense. We don’t need investment capital in the United States. We have too much real estate already. We don’t need investors. Or jobs. We have plenty of jobs already in the United States. Go away with your silly investment capital. Our banks are fine.
The hassle of pointless paperwork. Unlike other countries, the United States imposes income tax on its citizens no matter where they live. Even if there is no tax imposed (because, for instance, the host country has a higher tax rate than the USA) there is a paperwork burden and the opportunity for screwing things up accidentally. And then, please cross-reference my first point re: jack-boots. Oh. And look at the constant threat that Congress will do away with the foreign earned income exclusion. Yet more Towers of Stupidity from our friends in Congress.
They’ve put down roots (or have roots) in another country. Non-tax reasons exist. After living abroad for decades, people finally decide that the United States is no longer home. Or they came to the United States from another country and find the United States no longer hospitable, and prefer the home country to the USA. My parents are immigrants, and they decided that their home countries are no longer home–the United States is home. The reverse happens, too. Especially with Canada, in my experience.
CANARY, MEET COAL MINE

At the moment the number of people leaving might be small, and their actions dismissed in a hand-wavy fashion. But they should not be dismissed. Their actions are an indicator of something gone awry.

The United States has been built on immigration. Out-migration tells us something isn’t working. (Hah. Tell that to the State of California. “Oh, no. Everything is fine!” Same thought.) When people vote with their feet — and are willing to pay a staggering tax to do so — they are sending a message.

I don’t think anyone is listening. And this, unfortunately, is to the greater harm of the United States.

Posted in Expatriation | 35 Comments - Leave a comment


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## xabiaxica (Jun 23, 2009)

jojo said:


> I think whats being said here Jimmyjam is that its a tad alarmist for a forum which deals with expats moving TO the US
> 
> Jo xxx


more to the point it's hardly relevant as far as I can see - people thinking of moving to the US are a long way from being 'citizens' - if they _*ever*_ become such - who knows what law changes could happen by the time they might even consider it :confused2:


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## jojo (Sep 20, 2007)

xabiachica said:


> more to the point it's hardly relevant as far as I can see - people thinking of moving to the US are a long way from being 'citizens' - if they _*ever*_ become such - who knows what law changes could happen by the time they might even consider it :confused2:


I'm going to close this thread as it has little bearing on the subject of expats moving to the US

Jo xxx


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## twostep (Apr 3, 2008)

You have brought your concerns to the table and those interested in more detail can either use Google or PM you. Should you feel the need to post more of your internet research please do so on the appropriate forum here. Thank you.


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