Should You Renounce Your U.S. Citizenship?

[rocketdog]

If you do, Uncle Sam is still going to give you a good tax whacking if you meet certain criteria:

http://finance.yahoo.com/news/should-yo ... 048875.htm

[Ad Orientem]

I am not a fan of citizenship renunciation for economic reasons. If I lived in a communist state I might take a different view. But that's not the case. If I went down that road it would most likely be an act of political conscience.

[notsheigetz]

I doubt that I will ever do this but my wife may have an interesting dilemma on her hands someday. She emigrated from the Philippines and became a U.S. citizen but we have always planned on retiring in the Philippines. After I die (she's 17 years younger than me) she'll have to decide if she wants to keep on filing a U.S. tax return for the rest of her life if she never plans to return to the U.S. I tend to think that might not make much sense but the question will be how much it will cost her to get out from Uncle Sam's thumb. The way I understand it the exit fee amounts to having to pay capital gains tax on all your holdings as though you had liquidated it all.

[D1984]

I am not a fan of citizenship renunciation for economic reasons.

Mind if I ask why not? Not that I plan to renounce my American citizenship, but I don't see it as any morally different than "renouncing" one's employment at one company if another offers you better wages or working conditions.

[Ad Orientem]

I am not a fan of citizenship renunciation for economic reasons.

Mind if I ask why not? Not that I plan to renounce my American citizenship, but I don't see it as any morally different than "renouncing" one's employment at one company if another offers you better wages or working conditions.

If you equate your country with a corporate employer you must live in a pretty crappy country. That said I have some really serious issues with my country's policies on a wide range of issues. But while it may one day come to that, I'm not ready to expatriate myself.

[D1984]

I am not a fan of citizenship renunciation for economic reasons.

Mind if I ask why not? Not that I plan to renounce my American citizenship, but I don't see it as any morally different than "renouncing" one's employment at one company if another offers you better wages or working conditions.

If you equate your country with a corporate employer you must live in a pretty crappy country. That said I have some really serious issues with my country's policies on a wide range of issues. But while it may one day come to that, I'm not ready to expatriate myself.

I live in the US (probably the same for most people on this forum) and it's got some good aspects but some sorry ones as well. I don't see what a corporate employer (or indeed any employer) has to do with some institution or place (in this case a country) being "crappy" or not, though....an employer can be either good or bad; I have worked for employers that treated me well and for employers that treated me-and their other employees- like dirt (I am actually fortunate to have only one really bad employer in my working life and I quasi-quit that job after a few weeks anyway).

If I thought I could benefit personally by expatriation and renunciation I might be well inclined to do so. Screw nationalism and f*ck patriotism; a country is just a set of policies/laws and some ink on a piece of cloth....if you don't like the one you are in, find (if possible) another that suits you better.

[Coffee]

I doubt that I will ever do this but my wife may have an interesting dilemma on her hands someday. She emigrated from the Philippines and became a U.S. citizen but we have always planned on retiring in the Philippines. After I die (she's 17 years younger than me) she'll have to decide if she wants to keep on filing a U.S. tax return for the rest of her life if she never plans to return to the U.S. I tend to think that might not make much sense but the question will be how much it will cost her to get out from Uncle Sam's thumb. The way I understand it the exit fee amounts to having to pay capital gains tax on all your holdings as though you had liquidated it all.

Couldn't she just start up a U.S. corporation, then use her Filipino passport to open a Filip. corporation.  Then have the U.S. corp make a "bad investment" in the Filip. corp and nobody would be any wiser to how she expatriated the money?

[rocketdog]

The way I understand it the exit fee amounts to having to pay capital gains tax on all your holdings as though you had liquidated it all.

According to the article you only owe the tax if you exceed certain thresholds.  But it's worded in a confusing way, so I'm not really sure I understand what the income limits are that trigger the tax liability?

[notsheigetz]

Couldn't she just start up a U.S. corporation, then use her Filipino passport to open a Filip. corporation.  Then have the U.S. corp make a "bad investment" in the Filip. corp and nobody would be any wiser to how she expatriated the money?

I suspect there are a lot of clever ways to get around it. Too soon to start thinking about them although we have been helping the brothers and sisters out here and there in purchasing some land for the family. Also, my stepson, now age 25, immigrated with her but so far hasn't shown much interest in acquiring citizenship. I don't know if he ever will but I can see how it might be to her advantage some day if he doesn't.