from the breaking-up-is-hard-to-do dept.
The USA has been making life difficult for Americans residing abroad; FATCA causes plenty of problems; but so does citizenship-based taxation. The IRS and Treasury department have made the reporting and taxation more onerous, and stepped up their collection efforts.
The result should be a surprise to no one: more and more Americans are handing in their US citizenship. Total numbers are unavailable (the lists published by the government include only a portion of the total), but undisputed is the fact that the numbers are increasing rapidly.
Having lots of citizens want to leave is...embarrassing. One solution could be to review the policies leading to people to hand in their citizenship. Another would be to make the fee unaffordable, especially for people living on second- or third-world incomes. It's obvious, of course, which route the USA has chosen: It now costs $2350 to hand in your US passport; more than 20 times the international average.
Ummm... (Score:1, Insightful)
Total numbers are unavailable (the lists published by the government include only a portion of the total), but undisputed is the fact that the numbers are increasing rapidly.
If there are no accurate figures how exactly can that claim be "undisputed"? I heavily dispute it unless you can prove otherwise. I'm sorry but I don't just take your word for it.
Re:Ummm... (Score:5, Interesting)
I heavily dispute it unless you can prove otherwise.
In the past if you wanted/needed to renounce it was a same day operation, more or less. Now the demand is so high that some consulates in Canada are booked for many months into the future. Go ahead, call the Toronto consulate and try to schedule a renunciation...
You can also look at a .gov provided graph of the fake data and see its going up pretty fast.
If you're a Canadian "for real" and an accidental American then you pretty much can't visit the USA anymore unless you file back taxes and massive punishment payments, and then spend a lot of time and money renouncing. Getting all freaked out about thousands of dollars is not a big deal, considering the IRS probably wants $500K or more for the income you earned as a lifelong Canadian citizen working in Canada, and you're going to have to take time off work and travel to Toronto, etc.
Its a really huge problem... go talk to some Canadians. Your crime is having a dad originally from Oregon, and next thing you know you're arrested when you visit the USA on vacation. Or your bank closes your account because you're a money laundering terrorist. "everyone has heard a story".
You probably won't be extradited, but you'll never be able to visit the USA (legally) unless you pay up.
The primary real world effect is if you're a retired Canadian old dude with a USA parent, you can go on vacation, as the foreigner you are, to the USA for the first time in your life, if you pay $50K, or you can say F the USA and go on vacation in .mx or ireland or whatever. Or just travel the USA illegally which has all kinds of interesting implications if you get caught.
Parent
Re:Ummm... (Score:4, Funny)
It still can be, if you think outside the box. Book travel to some random ISIS occupied hell hole in Syria or Iraq and CC Senator Ted Cruz [time.com] your travel plans. Make your (soon to be ex-) government work for you, just for once!
There's a downside to everything though, right? :p
UNIX? They're not even circumcised! Savages!
Parent
Weird US tax system (Score:0)
It is weird that US ex-pats have to file a tax report. A friend who is living outside US has to decide whether her new baby should get US citizenship - it is not an obvious choice. Condemn said child to file US tax reports forever... but get advantage of easier immigration, etc.
Re:Weird US tax system (Score:5, Insightful)
Since no one would voluntarily live under such a system, especially an American citizen, they must be living under duress I think. Rather than tax them, the US gov't should invade and rescue them.
Seriously, though, there are tax treaties between most so-called "welfare states" and the US. Taxes paid in your local country do count as a deduction against taxes the US claims against you. In simple cases, you will never owe the US government anything. However the costs from the added complication of trying to stay in compliance with US tax law are burdensome. As another poster said, you owe the US $0, but your tax accountant $4000. It's a huge scam. Besides being a bizarre interpretation of constitutional law (the US income tax claim on citizens abroad), the real reason this is becoming a big issue is that the US government is broke and they are desperate to find cash anywhere. And news stories of rich people "hiding" their income overseas has really got public opinion onboard, sadly. Most Americans at home have little concept of the nuances of situations of many of citizens living abroad.
My neighbor was born in the US, and has always been proud of her US heritage and citizenship. Recently though as retirement approached, she realized that when they sell their home and farm land (which is their retirement savings essentially), Uncle Sam would hold out its hand for half of her share of the money. Sounds fair. Except that by taking that money that leaves her with half her retirement money. Now she's followed Canadian tax law her whole adult life, and everything is onboard with Canada, and its capital gains exceptions. After some difficult soul-searching, she decided to become a Canadian citizen and renounce her US citizenship. She never had plans to live in the US (all her grandkids are here), but she would have kept her citizenship, as it was part of her identity, had it not been for the increasing difficulty of complying with US tax laws. This story gets repeated across Canada.
One recent story that illustrates the ridiculousness this US money grab has reached, the CBC reported on the plight of a disabled man who by weird quirks in American law has US citizenship. In short, the US gov't is after his bank account. But he can't renounce because the US does not see him as fit to understand what renouncing means. So he's in a quite literal catch-22.
http://www.cbc.ca/news/canada/u-s-fatca-tax-law-catches-unsuspecting-canadians-in-its-crosshairs-1.2493864 [www.cbc.ca]
Parent
In the old days... (Score:3, Insightful)
In the old days they used to build walls and put up barriers to keep citizens from leaving.
Vote Sanders for US President. [berniesanders.com]
10 turns around
Big Brother (Score:1)
This whole thing is creepy. I get that the US taxes based on citizenship, and it isn't really that onerous--you just fill out your normal tax form and then an additional form declaring your foreign income. If that income is less than a certain amount (I think around $100,000 currently) then your tax liability is zero. But I don't get why the US government thinks that it needs to know about your bank accounts in the country in which you reside. In my case, I have joint accounts with a foreign national (AKA my wife) who has no ties to the US at all, but our bank is now compelled to report that account to the US government because of my citizenship. The stupidest part is that they don't seem to care about my American bank accounts... at least I haven't seen a box on a tax form asking me to disclose how much I have in my USD checking account that I left open when I moved abroad.
I mean, we're not millionaires flying around the world to our various vacation homes, stashing money in Swiss bank accounts to dodge taxes. We're just a regular family do regular family stuff. And there are plenty of people who just happened to have dual citizenship--like my kids--but who have no other ties to the US. Those people will now also have their bank information disclosed to the US government unless they want to pay $2350 to renounce their citizenship, but even that process involves an audit to make sure you don't have any outstanding tax liability, including the tax of forfeiting your citizenship.
Why stop people from leaving? (Score:2)
I don't agree with the submitter that having a lot of citizens want to leave is embarrassing. TFA doesn't really go into the reasons for the departures, other than an offhand mention of one billionaire who left for tax reasons.
If you're a US citizen and you feel that the benefits you receive from the Bill of Rights and all the government services, not to mention membership in American society, are not worth the costs you pay in taxes, regulatory compliance, and other legal obligations, to the point where you want to opt out of our particular social contract, then I wish you the best of luck in your new homeland.
If people were leaving in large numbers because they can obtain a better standard of living elsewhere, that would be slightly more embarrassing. I happen to believe several other countries offer comparable or better living conditions than the US, but the choice is so complicated and multi-faceted it depends heavily on your personal situation and values.
What would be much more embarrassing than someone wanting to leave would the Federal government trying to interfere with and penalize that person. It would be almost as if the government didn't regard US citizenship as a good thing.
Though I would point out that TFA does not attribute that motive to the fee increase. All it says is:
No preventative or punitive motive is attributed by TFA to the fee increase. Submitter seems to have introduced that without showing evidence. But hey, this is Soylent, why worry about unbiased summaries when we can create another opportunity to bitch about the US government?
[Sir Garlon] is the marvellest knight that is now living, for he destroyeth many good knights, for he goeth invisible.
Re:Why stop people from leaving? (Score:4, Insightful)
The Current US Federal Bill of Rights:
1: You have the right to say anything you want as long as we agree with it. Otherwise, you may be deprived of your life without trial or any form of recourse (Al Awlaki).
...
4: You have the right to privacy and the right to be free from unreasonable searches or seizures. Note however that anything the Federal Government wants is de facto reasonable and lawful irrespective of your appearance of or actual innocence, and all of your motions, communications, and private information (like medical records) is subject to Federal monitoring. Also, if Federal Law Enforcement agencies need extra money, they can seize your property through civil forfeiture for no reason whatsoever and that too is reasonable and lawful.
5: Before being punished, you have a right to a fair trial. A "fair trial" means that the Feds can bully and bulldoze you beyond your ability to actually pay for that trial, and further, that a fair trial can mean a secret trial in which you are not told of the offense, not given an opportunity to defend yourself, and indeed, not even told that the trial is happening, from which there is no appeal, and once completed you will be immediately drone bombed.
6: You have the right to a speedy and public impartial trial, to confront the witnesses against you, to be informed of the crime you are charged with, and to have assistance of counsel. A speedy and public trial comporting with the 6th amendment, as that phrase is defined by the US Federal Government, means a secret trial in which you are not appraised of the charges against you, the evidence against you, are not allowed any representation, and you are not even informed of the fact of the trial.
7: You have the right to a jury trial. The US Federal Government reserves the right to hand select the jury, in secret, during secret trials.
8: Excessive bail and fines are prohibited. It is defined as not excessive if a Federal LEO needs extra money in which case all of your property is subject to civil forfeiture without reason.
9: Enumerating these rights does not mean you don't have other rights. Remember however, that the rights of Federal agencies trumps all other rights.
10: The powers not specifically delegated to the Federal Government belong to the states. Just as the Federal government defines "imminent" to mean "perhaps, some time off in the future", in this instance, the word "states" is defined as "Federal Government."
Parent
The average is broken - 20x is an understatement (Score:3, Informative)
For example: If the USA charged $991, and 9 other countries charged $1 for renunciation, then the "average" would be 1000/10 = $100. So the US would only be 10 times the average. However, it's clear that the US is 110 times more expensive than they ought to be. A geometric mean of the non-zero data would be $2, giving a ratio of 445x, which seems to represent more closely how most people would view the disparity.
In the real world case, in the top table only, the arithmetic mean is given as $197. Treating the $0 as $1, the geometric mean is only $57. Across both tables, the geometric mean falls to $43.
Arithmetic means almost never give you a meaningful answer when there are highly-skewed distributions. Geometric often does, but some might say that chosing that was just as arbitrary as chosing the arithmetic mean. Fortunately, there's a way out - the most average of all averages is actually the median - its pretty-much immune from skewing by one rogue datum. The median across both tables appears to be $47.
Making a public pledge to no longer contribute to that other place, whatever it was called
Re-bill the State Department (Score:2, Funny)
So the State Dept. are claiming...
Fantastic! My advice to anyone thinking of renouncing but maybe hesitating due to the high cost is to invoice them in return for the extra demand on your time and all the extra workload you rack up to provide them with the data they intend to process. Just enclose a copy of the invoice with any requested documentation, they can't claim they didn't receive it if they have everything else you sent them. Once they have received your invoice take a very discrete vacation so that your home is empty during the inevitable drone strike.
Cons: You'll probably need a new home.
Pros: Because they'll know no better, the State Dept. will consider you dead and call off the debt collectors.