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Would you give up your citizenship or residency in the U. S. to escape the coming high taxes of Obama?

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(Optional) Enter description here.Monday, April 05, 2010
More Americans Give Up Citizenship As IRS Gets Aggressive Overseas

By Martin Vaughan
Dow Jones Newswires
http://www.foxbusiness.com/story/markets/americans-citizenshi...

The number of American citizens and green-card holders severing their ties with the U.S. soared in the latter part of 2009, amid looming U.S. tax increases and a more aggressive posture by the Internal Revenue Service towards Americans living overseas.

According to public records, just over 500 people worldwide renounced U.S. citizenship or permanent residency in the fourth quarter of 2009, the most recent period for which data are available. That is more people than have cut ties with the U.S. during all of 2007, and more than double the total expatriations in 2008.

An Ohio-born entrepreneur, now based in Switzerland, told Dow Jones he is considering turning in his U.S. passport. Mounting U.S. tax and reporting requirements are making potential business partners hesitate to do business with him, he said.

"I still do dearly love the U.S., and renouncing my citizenship is not something I take lightly. But more and more it is seeming like being part of a dysfunctional family," said the businessman, who asked that his name not be used for fear of retribution.

"The tax itself is only a small part of the issue," the Swiss-based entrepreneur said. "It's the overall regulatory environment."

A minority of the recent expatriates are U.S. natives who have started a new life overseas. Most are people with family ties outside the U.S.: foreign professionals who acquired a green card while working in the U.S., or people who have received higher education in the U.S.

"Fifteen or 20 years ago there was a big rush to make sure your kids became U.S. citizens, for access to U.S. schools for example," said Timothy Burns, a tax lawyer at Withers law firm in Hong Kong. "Now we're seeing just the opposite."

Last month, the Treasury Department announced more rigorous requirements for Americans living abroad to report information on foreign bank accounts. The reporting requirement has been in place for years, but only in the most recent couple of years has the IRS gotten tough about enforcing penalties.

The information return must be filed by any U.S. citizen or resident whose balance in all foreign accounts combined exceeds $10,000 at any time during the year. Stiff penalties, up to 50% of the annual account balance, punish failure to file.

Others are giving up their U.S. nationality to avoid tax hikes in the U.S., as the government struggles under huge budget deficits. The top marginal tax rate is set to rise to 39.6% from 35% at the end of this year. A proposal to tax fund manager pay at ordinary income rates, instead of the 15% capital gains rate, is gaining currency in Congress.

"Everybody sees the tax rates are going up. At a certain point, it gets beyond people's pain threshold," said Anthony Tong, a tax partner at accounting firm PricewaterhouseCoopers in Hong Kong.

Unlike most jurisdictions, the U.S. taxes the income of citizens and green-card holders no matter where in the world it is earned.

In order to give up U.S. citizenship, a person must obtain or have citizenship in another country. The person surrenders their passport or green card during an interview with a consular officer in their new home country. He or she must also submit a form, including a list of assets, to the IRS to complete the process.

Chris Kavanagh of the American Institute in Taiwan, which represents U.S. interests in Taiwan, said 43 people gave up their U.S. citizenship in Taiwan in 2009, the highest that figure has been since 2003. He cautioned against drawing conclusions from that data, however.

The IRS says some of the swelling of numbers of expatriations towards the end of 2009 occurred because the agency made a push to notify people that had already surrendered their passport, but had not completed the process by submitting the IRS form. Until that form is received by the IRS, these people are still subject to U.S. tax. "There is some catch-up going on," said IRS spokesman Bruce Friedland.

The stock market plunge of late 2008 and early 2009 may also have played a role in the spike in expatriations. Since 2008, Americans with net worth greater than $2 million have had to pay an exit tax assessed on their assets. With gains reduced or wiped out by the market collapse, those seeking to give up their U.S. citizenship had an opportunity to do so with less exit tax required.

(Andrea Wong contributed to this article)

Copyright © 2009 Dow Jones Newswires

Read More: http://www.foxbusiness.com/story/markets/americans...

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Top Opinion

  • bls 2010/04/14 13:47:48
    Undecided
    bls
    +9
    I would rather see the country seperate before the working people be forced to leave. This is our country first and foremost, but how can we get the welfare lackies that are dragging us down out of here? My vote is secession

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  • Michaelene 2012/02/09 14:26:12
    No, please comment
    Michaelene
    Since I bleed red white and blue, I's never give up. It's not in my nature (stubborn, lol)

    But it is already happening in droves. 2009 was mild compared to 2010 and 2011. There are websites, magazines and even tv shows which espouse the idea of international living, rich expat's are buying homes and setting up residency in other countries en masse.
  • Spizzzo BN-0 2011/07/24 11:29:23
    No, please comment
    Spizzzo BN-0
    This is irrelevant to me, since I make NO WHERE near $250,000 per year.

    However, a minor increase in tax rate would NEVER be a reason to move out of the US. It wouldn't avoid income tax liability, either.
  • Markie 2011/07/22 03:46:22
    No, please comment
    Markie
    I would not but I believe the conservative Republican would give up their passports, residency, for themselves and all of their children, born or not to save $50 on their tax bills.
  • pickelllly 2010/10/12 20:17:19
    No, please comment
    pickelllly
    +1
    I believe that the American people are smart enough to not buy this guys "play ground" bully tactics and he will lose his power this election and his "dictator seat" in 2012. Of course this all hinges on the lazy, no good, give me a break and everything free gang away from the voting booth.
  • steph ♥ 2010/05/29 23:10:10 (edited)
    No, please comment
    steph ♥
    +2
    I am an American and I am dedicated to helping take this country back!!!
    american dedicated helping country
    I don't have dual citizenship or anything, so I wouldn't have a country to join =).
  • Wanda52... steph ♥ 2010/05/31 21:19:39
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +1
    same here.
  • safari 2010/05/28 07:49:43
    Yes, please comment
    safari
    +2
    I refuse to work my ass off for dictators, illegal immigrants, lazy people and have no say about it. Break even day last year was Aug 12 - meaning we all worked on average until that date just to pay for all govt taxes, fees, etc. That is utter bs! We already give them more than half of our money. It is getting so it isn't the wealth that is being redistributed but the poverty. Screw that. I love my country but seriously if we don't turn it around in the next couple of years to save ourselves from total and complete government take overs of every thing and basically being nothing more than a slave to the government then yes, I will leave. I am sad to say it but I won't put up with it. Life is too short.
  • Wanda52... safari 2010/05/31 21:21:42
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    Unfortunately, I think that a lot of countries are doing the same thing that we are doing. So where could you go to escape it.
  • Magus BN-0 2010/05/24 15:15:37
    No, please comment
    Magus BN-0
    What "looming U.S. tax increases"? Taxes have gone DOWN since Obama took office!

    If you righties want to leave over imaginary tax hikes, be my guest.
  • Wanda52... Magus BN-0 2010/05/27 15:04:39
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +1
    Dream on - taxes are going up come the first of the year and this is not counting all the other little taxes being added on every thing that Congress can think of to tax.
  • Magus BN-0 Wanda52... 2010/05/27 20:19:53
    Magus BN-0
    No, your taxes aren't going up, unless you make 250 grand a year or more.
  • safari Wanda52... 2010/05/28 07:51:30
    safari
    +2
    Sometimes I just have to laugh. Do they really believe such tripe or are they propagandists? I can think of a dozen articles I have read and posted on various web sites in the last few days about tax increases. It boggles my mind.
  • Wanda52... safari 2010/05/31 21:23:34
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    Some of them are just plain blind bats where Obama is concerned and the rest of them are being paid to spread his propaganda.
  • Michaelene Magus BN-0 2012/02/09 14:35:49
    Michaelene
    My sales tax, school tax, real estate tax, all went up in the last 6 months.

    The only tax that was reduced was the amount of money that went into my SS/Med account furthering the already underfunded programs, NOW the revenues will be less than the expenses in 2017!
  • xscd 2010/05/16 15:39:23
    Undecided
    xscd
    +1
    It would be nice if hysterical conservatives decided to leave the country to saner minds and in more capable hands than their own.
  • Wanda52... xscd 2010/05/18 16:57:29
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +3
    No, what would be nice is if liberals who want to live in a European, socialist style country would move to Europe and stop trying to change the U. S. instead.
  • xscd Wanda52... 2010/05/18 17:37:34 (edited)
    xscd
    +1
    That's not going to happen. Liberals and progressives love this country and like true patriots are not going to let it be controlled by just one extremist ideological faction for the benefit of just themselves.

    Liberals at least try to address the wellbeing of everyone. Conservatives on the other hand have only their own interests in mind, giving others the choice only to conform or suffer. Selfish, greedy, warmongering and war-profiteering, callous, socially retrogressive conservatives. Leave this country to them? No thanks.
  • steph ♥ xscd 2010/05/29 23:15:38
    steph ♥
    +2
    oops, didn't mean to rave you! I just love the liberal vitriol you are spilling! Love and Peace huh? Apparently that doesn't exist in the world of the far off left!
  • xscd steph ♥ 2010/05/30 00:49:19
    xscd
    +1
    That's OK. Rave accepted.
  • Captain America 2010/05/08 04:41:54 (edited)
  • Wanda52... Captain... 2010/05/18 17:00:33
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +1
    Thanks for commenting.
  • HL 2010/05/07 12:45:12 (edited)
    No, please comment
    HL
    +6
    I received a better refund this year, I am glad to see that the tax cuts for the rich will be going away soon. They make more they should pay more. As far as leaving the US why would I leave the US? We have lower taxes, we have a huge deficit due to no leadership during 2000 thru 2009 with two wars, tax cuts, Katrina, and two recessions did you think we would have money in the bank? Now we have new kind of leadership I am going to wait and see what happens.
  • Wanda52... HL 2010/05/07 13:12:48
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +2
    I hope that you can say the same in a few years because the tax increases to pay for all of Obama's programs have not even begun to kick in yet. Also, I hope that your employer is not one of the rich whose taxes increase - payback would be if he laid you off to pay those extra taxes.
  • HL Wanda52... 2010/05/07 14:06:32
    HL
    +2
    You are talking about futures (may or may not happen)vs past which has happen and WE have recieved the bill. I have been laid off, one month after Bush left.
  • Magus BN-0 Wanda52... 2010/05/24 15:16:30
    Magus BN-0
    Those tax increases haven't begun to kick in because they don't exist.
  • oldcavpilot 2010/05/07 12:03:51
    No, please comment
    oldcavpilot
    +3
    Our tax rates here are lower than most of the rest of the world, and we are virtually alone in not having a VAT. Hong Kong, Gibraltar and the British Virgin Islands don't; everyone else does, and it seems to generally run at the 20% rate, some vary, on top of all other taxes.

    http://www.worldwide-tax.com/

    We've got more and pay less. Why would I leave? When I was working, I was paying @ 40% and I was middle management, not a honcho. I would have had to stay overseas for 2 years to not pay 55% when I worked in the oil fields.

    People here must have some really short memories.
  • Wanda52... oldcavp... 2010/05/07 13:13:52
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +1
    Just wait - They are discussing adding a VAT to pay for all the new entitlement programs being added.
  • Magus BN-0 Wanda52... 2010/05/24 15:16:52
    Magus BN-0
    Who is discussing adding a VAT? Obama has ruled that out.
  • safari Wanda52... 2010/05/28 07:55:34
    safari
    +1
    omg I feel like you are talking to brick walls in here. Where do these people get their news? Oh wait that is right - lame stream propaganda machine. Just wait Wanda IF they have jobs - they will see the increases soon enough. It will almost be fun to watch except we will be paying them too.
  • Wanda52... safari 2010/05/31 21:24:53
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    I know.
  • Jay 2010/05/07 08:10:00
    No, please comment
    Jay
    +2
    Well 1/3 of the stimulus package was in tax cuts, and right now we are paying an all time low in federal taxes, so I'm not complaining. At one time the top tax bracket was 70 percent. What is it now, 35 percent, or half as much? When the Bush tax cuts run out, as Bush planned for them to, it will go up to what, 38 or 39 percent? And that's only on anything that you are making over $373,000. That top tax bracket won't apply to too many of us, but it's still far lower than that 70 percent, that it once was. So I can't imagine why anyone would leave because Bush set a date for his tax cuts to run out. But hey, if you do, don't let the door kick you in your butt on your way out.

    In case anyone's really interested, below are the 2010 tax brackets:

    [Tax Rate Schedule X, Internal Revenue Code section 1(c)]
    Single

    •10% on income between $0 and $8,375

    •15% on the income between $8,375 and $34,000; plus $837.50

    •25% on the income between $34,000 and $82,400; plus $4,681.25

    •28% on the income between $82,400 and $171,850; plus $16,781.25

    •33% on the income between $171,850 and $373,650; plus $41,827.25

    •35% on the income over $373,650; plus $108,421.25

    Married Filing Jointly or Qualifying Widow(er) Filing Status
    [Tax Rate Schedule Y-1, Internal Revenue Code section 1(...






































    Well 1/3 of the stimulus package was in tax cuts, and right now we are paying an all time low in federal taxes, so I'm not complaining. At one time the top tax bracket was 70 percent. What is it now, 35 percent, or half as much? When the Bush tax cuts run out, as Bush planned for them to, it will go up to what, 38 or 39 percent? And that's only on anything that you are making over $373,000. That top tax bracket won't apply to too many of us, but it's still far lower than that 70 percent, that it once was. So I can't imagine why anyone would leave because Bush set a date for his tax cuts to run out. But hey, if you do, don't let the door kick you in your butt on your way out.

    In case anyone's really interested, below are the 2010 tax brackets:

    [Tax Rate Schedule X, Internal Revenue Code section 1(c)]
    Single

    •10% on income between $0 and $8,375

    •15% on the income between $8,375 and $34,000; plus $837.50

    •25% on the income between $34,000 and $82,400; plus $4,681.25

    •28% on the income between $82,400 and $171,850; plus $16,781.25

    •33% on the income between $171,850 and $373,650; plus $41,827.25

    •35% on the income over $373,650; plus $108,421.25

    Married Filing Jointly or Qualifying Widow(er) Filing Status
    [Tax Rate Schedule Y-1, Internal Revenue Code section 1(a)]
    •10% on the income between $0 and $16,750

    •15% on the income between $16,750 and $68,000; plus $1,675

    •25% on the income between $68,000 and $137,300; plus $9,362.50

    •28% on the income between $137,300 and $209,250; plus $26,687.50

    •33% on the income between $209,250 and $373,650; plus $46,833.50

    •35% on the income over $373,650; plus $101,085.50

    Married Filing Separately Filing Status
    [Tax Rate Schedule Y-2, Internal Revenue Code section 1(d)]
    •10% on the income between $0 and $8,375

    •15% on the income between $8,375 and $34,000; plus $837.50

    •25% on the income between $34,000 and $68,650; plus $4,681.25

    •28% on the income between $68,650 and $104,625; plus $13,343.75

    •33% on the income between $104,625 and $186,825; plus $23,416.75

    •35% on the income over $186,825; plus $50,542.75

    Head of Household Filing Status
    [Tax Rate Schedule Z, Internal Revenue Code section 1(b)]
    •10% on the income between $0 and $11,950

    •15% on the income between $11,950 and $45,550; plus $1,195

    •25% on the income between $45,550 and $117,650; plus $6,235

    •28% on the income between $117,650 and $190,550; plus $24,260

    •33% on the income between $190,550 and $373,650; plus $44,672

    •35% on the income over $373,650; plus $105,095
    (more)
  • Wanda52... Jay 2010/05/07 13:17:13
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +2
    Not only are the Bush tax cuts running out but there are tax increases in the Health Care bill as well discussions of adding a VAT to pay for the new entitlements.

    We are not at the tax rates of Europe; but we are well on the way.

    Sorry, but I don't care to be Greece where they riot in the streets because the government has to cut entitlements to keep from going bankrupt. What kind of entitlements do they expect from a bankrupt government.
  • Jay Wanda52... 2010/05/07 20:51:27
    Jay
    Why don't we actually wait and see exactly if and what taxes go up, and how much they go up, before whining about something that hasn't happened yet. So far, since President Obama took office are taxes have gone down, other than the tobacco tax.
  • Murph 2010/05/05 23:09:26 (edited)
    No, please comment
    Murph
    +1
    There's nowhere else to go.

    http://www.reagan.utexas.edu/...
    Not too long ago, two friends of mine were talking to a Cuban refugee, a businessman who had escaped from Castro, and in the midst of his story one of my friends turned to the other and said, "We don't know how lucky we are." And the Cuban stopped and said, "How lucky you are? I had someplace to escape to." And in that sentence he told us the entire story. If we lose freedom here, there's no place to escape to. This is the last stand on earth.

    Ronald Reagan, Republican National Convention, October 27, 1964.
  • Wanda52... Murph 2010/05/07 13:19:26
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    +1
    I know and the Progressives don't seem to care what damage they are doing to our form of government. Why can they not look at Greece to see what happens when you promise things that you cannot possibly afford to provide.
  • USKA4Life 2010/04/20 18:42:28
    No, please comment
    USKA4Life
    +2
    Good or bad I will and always will love the United States of America. I don't care if I'm 24th or 3rd in the best countries I will always stay here. What we NEED is a reformation of politics, neither side seems to support the American Idea anymore and we need change!
  • Wanda52... USKA4Life 2010/04/20 20:18:26
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    We need to go back to the Constitution. Congress is making up the rules as they go along and you even have congressmen on the record admitting this as well as the fact that they disregard the Constitution when it does not agree with the laws that they are trying to pass.

    We have rules set up by the Constitution and when those rules are followed, we have a much better and more stable country.
  • USKA4Life Wanda52... 2010/04/21 19:16:40
    USKA4Life
    +1
    Agreed. The constitution IS the government! We need them to realize this and then we can get back on track! agreed constitution government realize track
  • TruBluTopaz 2010/04/19 00:41:39
    No, please comment
    TruBluTopaz
    +2
    No, because here we (sort of) still have the power to change things. And that will happen in November.
  • Wanda52... TruBluT... 2010/04/20 20:18:49
    Wanda5245 - Citizen Activist Who Wants Spunkysmum Back On SH
    I hope so.

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