Americans who are unhappy with the nation’s tax policies are increasingly turning in their passports and renouncing their U.S. citizenship. Though the numbers of Americans seeking to become citizens of foreign nations is on the rise, the overall quantities remain relatively low. However, as many groups of immigrants, who are currently in the country illegally, continue to fight for the rights of citizenship, ironically an increasing number of Americans are looking to relinquish theirs.
In the first quarter of 2014 the number of Americans looking to relinquish their U.S. citizenship jumped 47%. Between January and March 2014, 1001 Americans gave up their nationalities, compared with 679 Americans who renounced their citizenship in the first quarter of 2013. Of the total number of Americans who are turning in their passports, most do so for tax reasons. The United States is one of the few countries in the world which requires its citizens to report and pay taxes on income earned while living overseas. This tax burden can cause not only a financial strain, but logistical strain as well, as American citizens seek to calculate and pay taxes in two different countries.
Additionally, United States has moved in recent years to rein in off shore banking by its citizens, which is often used to hide foreign assets. The United States government has recently made it increasingly difficult for foreign banks to access the U.S. financial systems if they do not agree to share information on accounts held by Americans. Many banks have simply decided that they don’t want Americans business in an effort to avoid the problem altogether.
Americans turning in their passports is happening at increasing levels, but still represents a very small percentage of the overall U.S. population. But, with baby boomers continuing to retire at historic rates, and many of them looking to move out of the country for a change of pace and in order to enjoy a lower cost of living, it will be interesting to see how the country’s tax policies may change in response to growing numbers of Americans living abroad.
The Austin based immigration attorney at Lyttle Law Firm are here to help you and your loved ones with any immigration needs you may have. Whether it be obtaining a visa, fighting a deportation, or applying for residency or citizenship, we can help. Call us today at 512-215-5225.