Total Pageviews Pageviews all time history 13,800

Why Americans Working Abroad Are Ditching Their U.S. Citizenships |

Why Americans Working Abroad Are Ditching Their U.S. Citizenships |

In addition to the burden of double taxation, expats must deal with a myriad of increasingly complex and confusing IRS rules, like the Report of Foreign Bank and Financial Accounts, which requires expatriates to report all foreign accounts exceeding $10,000, including those held jointly with their non-American spouses. Stiff financial penalties are imposed for noncompliance.
While filling out this form, Genette Eysselinck, a North Carolina native who lives in France, included the details of her accounts held jointly with her Belgian husband, as required by the IRS. “When I realized how distressed he was over my breach of confidence, I decided the only recourse left was to renounce my nationality,” she says. Eysselinck gave up her American citizenship last year.
Another law that affects expatriates is the Foreign Account Tax Compliance Act (FATCA), which will go into effect in July and require all foreign banks to report to the IRS information about accounts held by Americans. While this new regulation aims to prevent tax evasion, it also makes life difficult for millions of law-abiding expats.
“FATCA is the straw that broke the camel’s back,” says Jackie Bugnon, director of American Citizens Abroad (ACA), a Geneva-based expatriate advocacy group. Because this legislation forces local banks to invest in expensive new infrastructure in order to comply with the IRS rules, “access to foreign financial institutions is being shut off and Americans abroad are treated like criminals,” she adds.
Switzerland-based Amy Webster experienced the bias firsthand when she and her Swiss husband encountered difficulties getting a mortgage because of her U.S. citizenship. “This was infuriating and humiliating,” she says. “These unfair regulations imposed by the U.S. government are having adverse effects on the lives and well-being of U.S. citizens living in this country.”
Webster notes that while she understands “the political motivation of the current Administration to chase tax evaders and punish banks that contributed to such transactions, I am outraged that these regulations have impacted honest and hardworking citizens.”
One way to stave off the surge in renunciations, ACA’s Bugnon points out, is to tax expatriates on the same basis as nonresident aliens, who maintain a tax home in a foreign country and benefit from the same tax laws as American citizens within U.S. territory. That’s the proposal the ACA will push during the Overseas Americans Week, to be held in Washington, D.C., the week of Feb. 11.
Unless this change happens soon, disgruntled expats will continue to turn their backs on America, perhaps singing Tina Turner’s old hit, aptly titled, “Goodbye, So Long.”

Read more:

No comments:

Post a Comment