[HN Gopher] Wealthy people are renouncing American citizenship
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Wealthy people are renouncing American citizenship
Author : SirLJ
Score : 383 points
Date : 2021-08-05 12:28 UTC (10 hours ago)
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(TXT) w3m dump (www.axios.com)
| amcoastal wrote:
| Its really a great system we have here --- get insanely wealthy
| off the backs of Americans who pay tons more for basic services
| and then when it's time to pay back run off and keep your change.
| No wonder America is doing so well.
| cblconfederate wrote:
| The rest of the world suffers much worse than that. Not only
| are the rich finding it easier to go to tax havens (because
| there's no taxation of foreign income), but they are also
| bleeding their best and most educated (education that they paid
| for) human capital to the richest cities western europe & us
|
| (also americans overall are rich compared to the rest of the
| world at this time)
| DennisP wrote:
| > get insanely wealthy off the backs of Americans
|
| I find it a bit startling to see this sentiment on HN, a site
| that used to be mostly full of people building startups,
| attempting to get wealthy by building something useful that
| people are happy to pay for.
| [deleted]
| PaulDavisThe1st wrote:
| A couple of days ago, I learned about an audio processing
| plugin that apparently (I haven't verified it yet) earned its
| creator US$1M in 4 months. This is a little blob of code that
| you load into your DAW and it makes or changes the sounds,
| and you tweak knobs till it's doing what you want.
|
| If you don't see the difference between that and, say,
| Amazon, then I don't know what to say.
|
| The fact that you can trace a line between a scrappy startup
| in a converted garage somewhere and a behemoth doesn't mean
| that they are both the same thing.
| rob_c wrote:
| not just America, the 0.01% around the world are all learning
| this lesson...
| djKianoosh wrote:
| so where are they all going?
| betaby wrote:
| Some to Singapore https://www.forbes.com/sites/danielmitche
| ll/2012/05/11/faceb...
| papito wrote:
| According to the Bible, nowhere good.
| jkepler wrote:
| What biblical reference are you alluding to? I'm not sure
| how its relevant to the question of where the rich who
| leave the USA go?
| Thiez wrote:
| It's all terribly off-topic, but presumably they are
| talking about Matthew 19:24, which says (ymmv based on
| your exact translation):
|
| "Again I tell you, it is easier for a camel to go through
| the eye of a needle than for someone who is rich to enter
| the kingdom of God."
| koonsolo wrote:
| Seems like the top of the Catholic Church will not go to
| heaven then ;)
| jkepler wrote:
| Thanks. Yes, off-topic. Particularly considering that
| according to Genesis 13:2, Abraham (key for Paul's
| argument in Romans 4 for justification by faith) was
| "very rich in gold, silver, and cattle", and that in 1
| Timothy 6, Paul warns Timothy not against riches per se,
| but against " the love of money".
|
| Biblically speaking, its not whether one is rich or not,
| but whether one loves (or worships) riches and the
| associated power, or whether one _uses_ his or her riches
| to serve God and love one 's neighbor. Thus Paul wrote of
| learning to be content in plenty or in want, and James
| warns of not showing favoritism to the rich (echoing
| perhaps the Old Testament command to not pervert justice
| in favor of the poor or of the rich).
|
| Trying to tie this thread back into the topic.... I guess
| it was good that when Abram emigrated from Ur in his home
| country, the Chaldeans Revenue Service didn't have the
| steep exit tax that the US imposes on rich emigrants.
| ttyprintk wrote:
| James 5 1-6 came to mind.
| papito wrote:
| I should have specified, the New Testament is
| particularly anti-wealth and pro helping the
| disadvantaged. The Old Testament is like the internet -
| you can always find horrible examples to reinforce your
| beliefs.
| bovermyer wrote:
| The UAE sees a lot of wealthy expats from various countries
| move in.
| the_lonely_road wrote:
| New Zealand it seems. An island country of 5 million with
| some of the most expensive real estate and highest suicide
| rates of the developed world.
| sumedh wrote:
| > highest suicide rates of the developed world.
|
| If I am not mistaken most of those suicides are among the
| Maori people not the white people of NZ.
| richwater wrote:
| Yea thanks for clearing that up. The native people don't
| count.
| mkl wrote:
| Where did you get that statistic? According to https://en
| .wikipedia.org/wiki/List_of_countries_by_suicide_r...,
| the USA's suicide rate is ~40% higher than NZ's.
| anovikov wrote:
| UAE for effectively zero taxes.
|
| New Zealand as it is rumoured although i don't believe it -
| for someone not rich enough to own a private jet where you
| can properly sleep, it is TOO far away from... just about
| anywhere.
|
| Singapore. Some of the Southern and Eastern Europe for
| those not rich enough.
| Fidelix wrote:
| Pay back? You mean get robbed a bit more?
| janeroe wrote:
| It's our cow and we're to milk it!
| 734129837261 wrote:
| Most people would, if they could, avoid taxes legally to the
| maximum of their ability.
|
| You US folks have created this monstrosity yourselves, too. You
| let lobbyists (who work for the companies that the richest own)
| influence politicians, you allow companies to have personhood
| and other such nonsense.
|
| Even the politicians you get to vote on are placed there by
| said lobbyists and thus the companies that pay for them.
|
| Institutionalised, legal, and widely stimulated and motivated
| corruption is what causes all of this to happen. The rich make
| the rules, you not liking it can't be fixed because the rich
| decide what "fixes" are available for you to vote on.
| ninja3925 wrote:
| "Off the back" sounds like the wealthy took advantage of folks
| when, in fact, they entered voluntary contracts in a win-win
| scenario. Creating a company is not exploitative but rather
| collaborative and mutually beneficial (with workers).
| amilios wrote:
| This is a fantasy. Voluntary contracts imply that workers
| have the option of not working for starvation wages, which in
| many cases is simply not true. If your options are to work a
| dead-end minwage job or, well, die on the street, is it
| really a voluntary contract that you're entering? I would say
| not.
| ninja3925 wrote:
| Of course! You can choose: - Not to work - Move to a
| city/state with better opportunities - Take classes to
| specialize - Work hard and get promoted - Start your
| business
|
| Aren't these valid options? No "cigar smoking fat cat"
| force workers to sign the contract under duress.
| opheliate wrote:
| For many people these are not valid options, no. If you
| grew up in a low-income household and entered a low-wage
| job, the likelihood of having sufficient savings to
| choose not to work, take time off to improve your skills,
| or move is very low.
| KittenInABox wrote:
| How do you have the money to move, take classes, or start
| a business (business licenses cost $$$) if you are
| choosing between abusive/dead-end work and homelessness?
| koonsolo wrote:
| There is only 1 company you can work for, and no way to
| work independently or start a company? Seems strange to me.
| amilios wrote:
| If all the companies that are willing to hire you equally
| treat you like crap, you aren't really given much choice.
| In terms of entrepreneurship, it carries a ton of risk.
| People living paycheck-to-paycheck typically aren't able
| to carry such a risk with no safety net (family, etc.).
| koonsolo wrote:
| Price is set by supply and demand, not by either seller
| or buyer.
|
| In a market with multiple suppliers and buyers, the price
| will sort itself out.
|
| That you don't like that price has nothing to do with
| either side being "evil".
| bestcoder69 wrote:
| Sure except one side gets a much larger benefit and the other
| side must enter into this style of contract with _someone_,
| or starve to death (in the typical case). Just to sidestep
| the debate over differing dictionary definitions of
| exploitation (to show my hand a bit though, I prefer the ones
| that are useful in describing how things have become the way
| they are, rather than the libertarian ones).
| i_d_rather_read wrote:
| > Creating a company is not exploitative but rather
| collaborative and mutually beneficial (with workers).
|
| If it's collaborative can we vote a new CEO?
| sparrish wrote:
| Yes, you go to work for a different company that has the
| CEO you want. Vote with your feet.
| PaulDavisThe1st wrote:
| But wait, I thought building the company was
| collaborative? If I collaborated in building the company
| I work for, why would I want to leave it just to work for
| a different CEO? If all the workers agree that we need a
| different CEO, why can't we vote for it? After all, it's
| supposed to be a _collaboration_ ....
| stale2002 wrote:
| It is collaborative.
|
| Collaboration doesn't mean forcing others to work with
| you.
|
| Instead, collaborative is about voluntary choice.
|
| If you want to work somewhere else, under different
| rules, that would be your choice. Forcing others to do
| what you want isn't collaboration.
|
| > why can't we vote for it
|
| Co-ops exist. If that is what you prefer then go work for
| a co-op.
| igorkraw wrote:
| I feel like you'd have to give some evidence for the claims
| you are making (voluntary, win-win, creating a company being
| collaborative...) as long as the US doesn't have free health
| care,free housing and/or some form of UBI. "Take job where
| you have to pee in bottles or live in squalor" doesn't seem
| that voluntary to me
| engineer_22 wrote:
| There are many places in the United States that have free
| healthcare, free or reduced price housing, and assistance
| payments for the poor and sick or injured. These things are
| paid for with public money through government programs.
|
| Personally I think everyone deserves a certain level of
| dignity, especially when they're going through hard times.
| But I've also seen plenty of examples of people who "work
| the system", which makes it harder to get funding for
| social welfare programs.
| azth wrote:
| The onus is on the person making the claim to provide the
| evidence. Forming a company (that doesn't work in immoral
| areas) is a perfectly ethical and legal way of making
| money.
|
| UBI is not the only solution. Islamic countries have for
| over 1400 years had the Zakat system, which provides for
| the poor and needy.
| libbroscrubber wrote:
| Wealth inequality is _proof_ of exploitation. Look at CEO
| to worker pay. The capitalists have the system rigged.
| psychlops wrote:
| It's simpler and more emotionally appealing to explain things
| from an exploitative marxist point of view.
| oo0shiny wrote:
| Not if the wealthy campaigned to keep the minimum wage below
| a living wage for the sake of a higher profit, while also
| subsidizing the welfare system so the taxpayers pick up the
| bill instead of the company owners.
|
| Creating a company _should_ be collaborative, but our current
| capitalist system has actually become more exploitative.
| mrow84 wrote:
| Consider two scenarios:
|
| a) Undeveloped land is freely available, and anyone who wants
| to can go and cultivate it independently from anyone else,
| making a life entirely for themselves.
|
| b) All land is already owned, and making a living must be
| achieved by exchanging (typically labour) with others.
|
| Do you believe that people starting without capital in
| scenario b) will enter into contracts as freely as those
| starting without capital in scenario a)?
| goodpoint wrote:
| Furthermore:
|
| a) 100% of the world population can relocate globally
| without any need for visa so they can access the global job
| market and pick the best location
|
| b) 1% of the world population has access to enough
| education to become highly skilled and be able to relocate
| legally. Everybody else has limited choice.
|
| Another example:
|
| a) Everybody has access to UBI and can freely choose to
| work or study or do volunteering, art etc
|
| b) Unemployed people go hungry, homeless, get sick, get
| imprisoned
| qwertox wrote:
| That is a very naive way to look at it. It is capitalism, and
| capitalism is brutal. So even if your view applies to some
| cases, it certainly does not to all.
|
| Take Jeff Bezos' commentary after his ride into space for
| example:
|
| > I want to thank every Amazon employee and every Amazon
| customer because you guys paid for all this. So, to every
| Amazon customer out there and every Amazon employee thank you
| from the bottom of my heart.
|
| https://twitter.com/EoinHiggins_/status/1417515577275453440
|
| I get it that we, the consumers paid for this trip. But his
| employees? What do they have to do with this? Isn't it
| supposed to be a "collaborative and mutually beneficial"
| relationship, which would imply that Bezos is not making
| money _from_ his employees, but exclusively _through_ them,
| and paying them what they deserve? Yet he claims that they
| paid for it, which implies that he is not paying them what
| they deserve, since it is the customer who is supposed to pay
| his salary, not the exploitation of his employees.
| srswtf123 wrote:
| It isn't voluntary when its the only game in town. My
| personal experience tells me the nature of work in the US is
| exploitative. Of course, experiences will vary, but I've
| never felt _alone_ in this; on the contrary, in the Midwest
| "Living the Dream" is essentially shorthand for "I hate my
| job and everything about it". We're all _living the dream_ ,
| and boy does it suck.
| the_cat_kittles wrote:
| so the current distribution of wealth in america is ok and
| not anyones fault?
| yardie wrote:
| Wage theft is the #1 fraud[0] in the US. So while the
| voluntary contract can be a win-win for a quite a few
| Americans it is still exploitative.
|
| [0] https://www.epi.org/publication/employers-steal-billions-
| fro...
| ninja3925 wrote:
| While true and something that needs fixing immediately,
| this is uncommon and therefore, cannot be used to describe
| the relationship as "exploitative".
| revolvingocelot wrote:
| If you read the link, you'd learn that in the 10 most
| populous US states, 2.4 million minimum wage workers are
| victims of wage theft annually. This loss averages $3,300
| per (full time, year round) worker per year, and just
| under $8 billion in total per year.
|
| And that's _only_ minimum wage workers, in a subset of
| the US.
|
| Was there a particular reason you were under the
| impression that wage theft was uncommon?
| [deleted]
| Aunche wrote:
| America has one of the most progressive tax system of any
| country.
|
| https://taxfoundation.org/summary-of-the-latest-federal-inco...
|
| >The top 1 percent paid a greater share of individual income
| taxes (38.5 percent) than the bottom 90 percent combined (29.9
| percent).
|
| IMO, this is one of this is why the American government seems
| so bad at spending money. It's not their money, so there's
| little incentive to care if it's misappropriated.
| trainsplanes wrote:
| What percent of wealth does the top 1% possess vs the bottom
| 90 percent combined?
|
| Wikipedia says the top 1% possesses precisely 38.5% of the
| country's wealth, so it's more than reasonable that they
| shoulder at least 38.5% of the taxes. [1] This stat is also
| from 2016. That divide has grown immensely these past few
| years.
|
| The stat the Tax Foundation presents is made to make us
| sympathetic towards people who control basically the entire
| nation's wealth and pay, frankly, very little. There's a
| reason they're not putting their wealth in the EU or
| developed Asian countries--they'd be paying more.
|
| [1] https://en.wikipedia.org/wiki/Wealth_inequality_in_the_Un
| ite...
| Aunche wrote:
| Income and this income taxes are first derivatives of
| wealth. It doesn't make sense to directly compare the two.
| The wealthy spend relatively little of their wealth on
| discretionary spending.
| sobellian wrote:
| Ordinary income is not the first derivative of wealth,
| capital gains also contribute.
| tech_tuna wrote:
| If I had the means to do so, I would do it just to avoid the
| politics of the US.
|
| Better cuisine is a big driver for me too - hello Italy or
| France.
| Dma54rhs wrote:
| American wealth is built upon globalized workforce, you're the
| next on the ladder that is throat cutting capitalist for the
| next class.
| tehjoker wrote:
| Pretty cool that the guys the US government bends over to service
| and on whose behalf the army fights to open new markets basically
| see themselves as above the other Americans.
| [deleted]
| ggggtez wrote:
| I've heard that technically renouncing us citizenship to dodge
| taxes is illegal. But as with most things, that's only if you get
| caught.
| tristor wrote:
| I was unwilling to renounce and stay abroad, for a variety of
| reasons, so I returned to the US and decided to stay. But for a
| good while I lived and traveled outside the US as a digital nomad
| and the tax implications are immense, especially if you are a
| member of any corporation or LLC, have any retirement accounts,
| or own any property. It's an absolute nightmare to correctly file
| taxes, has an astronomically high audit risk (you basically
| /will/ be audited), and is very expensive to hire accountants
| that have understanding of multiple national tax laws to cover
| things correctly.
|
| FATCA made this even worse. Now many companies and financial
| institutions abroad will refuse to do business with you if you
| hold US citizenship /even/ if you are a dual citizen and primary
| resident of the country they are based in. It's absolutely absurd
| how the US government treats American expats, and is in stark
| contrast to how British, Australian, and German expats are
| treated (of which there are many all over the world).
| hermannj314 wrote:
| I was an American citizen living in Luxembourg for 3 years
| around 2015.
|
| I agree - many banks did not want to let me open an account,
| and when BNP Paribas said they work with Americans it was a
| huge ordeal to open the account.
|
| However, as a salaried employee, I did not struggle with the
| taxes. The IRS form was very straightforward and after
| deductions I didnt owe any US taxes (I made just over the
| equivalent of $100k USD).
|
| IIRC the theory is that you determine your tax liability if you
| had made all your income in the US and you subtract the
| liability you incurred by your foreign tax residence. You pay
| the difference but only after you cross some income threshold.
| If you are living somewhere that 'pays more in taxes' then you
| wont owe anything to the US.
|
| I can 100% understand why very wealthy people hate this system,
| but as a software dev making a modest living it was not onerous
| or unfair or difficult to manage.
| tristor wrote:
| > I can 100% understand why very wealthy people hate this
| system, but as a software dev making a modest living it was
| not onerous or unfair or difficult to manage.
|
| Okay, now apply your experience with this system but instead
| of being a salaried employee you run a <5 person LLC that is
| incorporated in the US that does the same work but on
| contract and has a small leased office. It goes from being
| one form and a simple exercise into a massive nightmare, even
| though the dollar amounts you are actually making in income
| aren't any higher (at the time I think my AGI was like $126K
| USD).
|
| Anything off the path of salaried employee stationary in a
| foreign tax residence exponentially increases the complexity
| involved and therefore the expense to file. Most years, my
| accountancy bill was actually higher than the taxes owed, and
| it would have saved everyone quite a lot of trouble for
| little gain to just do away with this archaic and pointless
| rule which no other civilized nation has.
|
| This is not just a problem for the very wealthy, it's a
| problem for anyone who does not fall in a very narrow bucket
| but happens to reside abroad while having US citizenship.
| Even in your case, where you found the process simple, you
| must admit it made it difficult to secure accounts and form
| business relationships abroad because of the tax implications
| and reporting implications for your possible business
| partners.
| junar wrote:
| Did you file Form 2555 or Form 1116?
|
| Were you also required to file FBAR or Form 8938?
|
| About how much time did you spend on tax preparation
| yourself? If you used a paid preparer, how much did that cost
| you?
| fukmbas wrote:
| Goodbye! Don't let the door hit you in the ass. You pay no taxes
| and drain our economy. BYE
| nyghtly wrote:
| "The big picture: Only the U.S. and Eritrea tax people based on
| citizenship rather than residency. For most countries, if you are
| a citizen but don't reside there, you aren't taxed in that
| country."
|
| Sounds like we need to start taxing based on residency.
| ninja3925 wrote:
| It is good that we have such process for people to push back
| against their government greed. Usually, the citizenry is at the
| mercy of it and can't do anything about it.
|
| You don't like it? Fine. You have a choice and can get out.
|
| Good safety valve. It keeps the populist governments in check.
| PaulDavisThe1st wrote:
| Except that the government has a _process_ for "getting out",
| and that process is totally wedged right now. You don't just
| publish a notice in a newspaper or on FB ... you have to submit
| paperwork, pay fees, and have an exit interview. The government
| controls who gets out, and at what rate.
| engineer_22 wrote:
| They're not leaving, they're just giving up their civic rights
| (and duties).
| jjoonathan wrote:
| Ah, yes, those greedy populist governments. They set up and
| facilitate extreme winner-take-all systems on the promise that
| they are better for everyone. How dare they ask the winners to
| make good on the "better for everyone" part! Such greed.
| risaacs99 wrote:
| This is classic libertarian thinking, and I used to subscribe
| to it, at least to some extent. The more you think about it,
| though, the more it doesn't hold up.
|
| It's just undeniably true that individual freedoms exist only
| to the extent that society allows them to. To think that you
| can opt out of society is fantasy.
|
| It's in everybody's best interest to make sure society works
| well for everyone, and that kind of thinking pushes you back to
| the political center.
| roenxi wrote:
| The observation that it is in everyone's interest for society
| to function is a core plank of libertarian thinking. If
| everyone was going to opt out then libertarianism would not
| work.
|
| The core argument is that the government doesn't need to step
| in to fix society, because the incentives are so strong that
| society will sort itself out through people realising that if
| the ship sinks they will drown so they have to keep the water
| outside the boat of their own initiative.
|
| Given that it is already in everyone's interest that the ship
| floats, the people loudly claiming "our enemies are trying to
| sink the ship!" are probably lying and should not be put in
| charge. However, such people _infest_ government.
| opheliate wrote:
| IMO the ship "sinking/floating" analogy is far too
| simplistic for this discussion. Everyone has a different
| idea of what the ship "floating" looks like: If you're
| someone with a lot of wealth, the current state of things
| might look completely reasonable. If you're very poor, the
| fact that 0.1% of people control 25% of the world's wealth
| might look a lot less like society is functioning
| correctly. Society could easily "sort itself out" into a
| stable state which happily oppresses a great many people,
| just based on individual incentives.
| roenxi wrote:
| If you're worried about people being oppressed, moving
| away from basic principles of freedom and liberty is
| probably not the path you want to take.
|
| If libertarianism would result in a great many oppressed
| people, any sort of centralisation of power will result
| in _even more_ oppressed people. Beefing up government
| power is no solution to oppression; the worst oppressors
| are invariably governments. The worst of the great
| catastrophes and oppression of the last century were
| perpetrated by strong centralised governments.
| opheliate wrote:
| > The worst of the great catastrophes and oppression of
| the last century were perpetrated by strong centralised
| governments.
|
| Absolutely. It's a good thing I'm not calling for
| massively beefing up government then, I'm just advocating
| that tax laws exist & are enforced, so as to redistribute
| wealth, which I don't view as oppressive.
|
| > If libertarianism would result in a great many
| oppressed people, any sort of centralisation of power
| will result in even more oppressed people.
|
| I disagree with the implied premise that there is not a
| "centralisation of power" under libertarianism. While
| there isn't a state to have a monopoly on violence, there
| can certainly be a centralisation of _economic_ power.
| And when we rely on money to pay rent, afford food, pay
| for healthcare etc, economic power is functionally
| equivalent to power in general.
|
| > the worst oppressors are invariably governments
|
| I wouldn't say invariably. Consider the United Fruit
| Company for example, or the current prevalence of child
| labour in tech company supply chains (e.g: Glencore,
| Zhejiang Huayou Cobalt).
| ninja3925 wrote:
| > I'm just advocating that tax laws exist & are enforced,
| so as to redistribute wealth, which I don't view as
| oppressive
|
| Laws are strongly enforced in this country (USA).
|
| Where is the bar for "oppressive"? I come from a country
| that thought that 70%+ taxation was acceptable. In the
| USA, we are now at 60%+ (across federal, state, local).
| It sure sounds oppressive to me and one way out is to
| give the choice to people to opt out.
| PaulDavisThe1st wrote:
| That 60% tax number is false.
|
| What country ever taxes at 70% overall? The US used to
| have federal income upper marginal rates in the 90%
| range, but that doesn't mean that you pay 90% of your
| income as tax.
| opheliate wrote:
| Do you have a source for the 60%+ number?
|
| I think paying 60% tax or higher on income _above a
| certain threshold_ (e.g: $300,000, just throwing a number
| out there, so you 'd pay 60% tax on $1 if you were
| earning $300,001, and a lower tax rate for the lower
| portion) is reasonable.
|
| Regardless, sure, one way is to give the choice to opt
| out, another is just to lower taxes if it's generally
| agreed they're too high.
| ytNumbers wrote:
| > To think that you can opt out of society is fantasy.
|
| It seems to me that the wealthy who leave the country and
| renounce their citizenship are effectively opting out of
| society. It's not a fantasy for the wealthy. We live in a
| competitive world where people have freedom of movement. The
| wealthy will tend to go where they are treated best. I think
| society works well for everyone when the government keeps the
| tax rates reasonable. Over time, a government kleptocracy
| causes horrific suffering for the vast majority of people.
| goodpoint wrote:
| > are effectively opting out of society
|
| No: they get to choose which society to live in and which
| legal system gives them less trouble.
|
| Everybody else has little choice.
| cmrdporcupine wrote:
| Many of the comments here are preposterous. I am a socialist by
| conviction, my whole life, and strongly believe the wealthy
| should pay their fair share.
|
| _But_ being a Canadian and knowing many Americans who have come
| here to work -- making prosperous but not insane professional
| class incomes -- and still having to file with the IRS, often
| having to pay into the IRS (without receiving services back in
| the US) and having their Canadian retirement funds messed with by
| the IRS, I find this whole thing baffling. No other western
| nation does this, and it 's unjust. why would this forum -- full
| of people in the tech industry making a good living -- try to
| justify this?
|
| Put this another way: should you cross the border into Canada and
| take up residency here (for a job, or because your spouse lives
| here, or because you like it here) you will now be effectively
| double-taxed for the rest of your time here.
|
| This from a country that supposedly started its war of
| independence over the issue of taxation without representation?
|
| Like I said, preposterous. Glad my mother and myself never
| applied for the dual citizenship we could in theory be entitled
| to. What a _curse_ that would be.
|
| Yes, make the seriously wealthy pay their share. But most of the
| people suffering from this situation (and often _trying_ to
| renounce their citizenships in many cases not able to) _are your
| peers in your industry_.
| xtracto wrote:
| Right. Back when i was living in Germany we were part of a very
| international community. I learned about the USA taxes craze
| when our poor American friend had to file his US taxes.
| Everyone in the group was like WHAT? My opinion is that it's a
| quite abusive practice.
|
| However I've heard some people say it is worth the hassle so
| that you can save your passport everywhere saying "I'm American
| " and getting some sort of special treatment. Or that your
| embassy saves you from some crazy scenario you could get into
| as an expat.
| dzhiurgis wrote:
| > Only the U.S. and Eritrea tax people based on citizenship
| rather than residency. For most countries, if you are a citizen
| but don't reside there, you aren't taxed in that country.
|
| Funny thing is if you are living nomad life you are still
| required to pay tax somewhere, which I'm not sure makes much
| sense. My country surely not going to pay my medical expenses
| abroad, so why should I contribute?
| gertrunde wrote:
| A couple of sources from another perspective:
|
| https://www.bloomberg.com/opinion/articles/2020-08-31/why-th...
|
| https://theconversation.com/americans-are-renouncing-us-citi...
|
| And one fun quote:
|
| "Still, all American expats - even those who've lived abroad for
| decades, earn no income in the U.S., and hold no U.S. assets -
| must submit an annual tax return to the Internal Revenue Service.
| Now, ever since Congress strengthened anti-money laundering and
| counter-terrorism financial reporting requirements, many have had
| to hire costly international accounting firms to do their taxes.
|
| The consequences of noncompliance are severe: forfeiting up to
| 50% of all undeclared assets held overseas."
|
| There may be some "ultra-wealthy" people doing this, but I
| suspect that they are not the bulk of it by a long way.
| nickthemagicman wrote:
| I would be happy to pay taxes if I thought that my tax money was
| being used well.
|
| I wonder if these mega rich are leaving to avoid paying taxes to
| a what they view as a mismanaged governmental system because they
| think they can do a better job of distributing their money and
| making the world a better place.
| anigbrowl wrote:
| Worth noting that this story gets run every year around this time
| (because that's when the annual #s are released) and is always
| about last year.
| dblohm7 wrote:
| This can backfire horribly no matter which citizenship you are
| renouncing. Conrad Black renounced his Canadian citizenship so
| that he could take a seat in the British House of Lords. Then he
| was convicted of fraud charges in the USA.
|
| He had a hell of a time getting back into Canada after that!
| say_it_as_it_is wrote:
| .. and soon local mafia may ransom their families without
| worrying about American government protecting its elite. It'll be
| a good day for organized crime. Wealthy people have the most that
| they can afford to lose.
| rory wrote:
| Without getting into the moral debate of taxing US Citizens
| globally... how could the US government stop this from happening?
| Surely these ex-citizens hold a lot of assets in the US, and most
| probably spend a lot of time in the country. Could the gov't
| effectively banish them or ban them from holding assets in US
| assets? What would be the side effects of such a law?
| papito wrote:
| They could impose a citizenship "exit tax", if you are worth
| more than X amount of dollars, I reckon.
| CodesInChaos wrote:
| I believe the US already has an "exit tax" where you're taxed
| on unrealized capital gains when you give up citizenship,
| similar to how you'd be taxed if you realized the gains by
| selling.
| magpi3 wrote:
| Perhaps a tax could be introduced for those who renounce their
| citizenship and which could work somewhat like the estate tax.
| Meaning it would only affect people who have considerable
| wealth.
| toomuchtodo wrote:
| This exists. It's called an exit tax. Applies if you have
| assets over $2 million, or you haven't been meeting your tax
| obligations over the past five years.
| engineer_22 wrote:
| There's no reason to stop it. Their assets are still paying
| taxes.
| rory wrote:
| I'm asking simply as a thought experiment.
|
| And the reason to stop it is obvious-- to procure other taxes
| from those people. For example, many jurisdictions don't have
| an inheritance tax, and the US Gov't would likely want that
| cut upon the (ex?)-citizen's death.
| s1artibartfast wrote:
| >how could the US government stop this from happening.
|
| Lots of simple solutions if we look at other countries that
| restrict emigration. USSR and North Korea had models that
| worked pretty well. High boarder security, labor camps,
| family punishment, and asset seizure.
|
| These could all keep people working and generating tax
| revenue in the US when they want to leave.
|
| On a practical level, I think the idea of coercing people
| to stay in the USA would be unpopular, especially when
| contrasted with the current wealth tax on exit.
| mytailorisrich wrote:
| > _how could the US government stop this from happening?_
|
| By taxing based on residency, not citizenship, like pretty much
| all other countries on Earth.
|
| People have the right to lower their tax liability within the
| law, they have the right to move, and they have the right to
| renounce citizenship (if they have another one). We're not
| going to prevent any of that from happening. The only thing the
| US can do is to remove the incentive to renounce citizenship if
| they think that this is a problem.
| jkepler wrote:
| Do you have a citation where US (federal) law requires one to
| have a foreign citizenship in order to renounce US
| citizenship?
|
| Or, would it be possible to renounce US citizenship without
| foreign citizenship, perhaps while maintaining citizenship in
| one's state of origin in one of the seven states--Alaska,
| Florida, Nevada, South Dakota, Texas, Washington, and Wyoming
| --which levy no state income tax, or in one of the two
| others, New Hampshire and Tennessee, which don't tax earned
| wages? In other words, could one reside overseas but maintain
| a tie with a particular state _within_ the USA without any
| relationship to the federal government?
| mytailorisrich wrote:
| Ah, well according to Google the US are one of the few
| countries that does _not_ require another citizenship in
| order to let you renounce citizenship.
|
| So, indeed you could renounce US citizenship without having
| any other one... But that would make you stateless, without
| passport, etc. which does not sound like a good idea.
| rory wrote:
| Wouldn't you not have a passport in that case? So
| presumably you would never be able to get back to the state
| you have a tie to, right? Seems like a tenuous
| circumstance.
| compsciphd wrote:
| it's not just about taxes. US Citizens who live overseas can't
| invest in what are effectively foreign mutual funds (PFIC in IRS
| parlance). While retirement plans are generally exempted if
| there's a tax treaty, that doesn't help other forms of money one
| might get.
|
| Your local government gives your child a grant of money each
| month to be invested in a choice of funds? You're a US citizen?
| sorry, you're out of luck, this makes doing taxes effectively
| very very difficult.
| pedrosorio wrote:
| Conversely, you can't buy US funds as a European resident due
| to PRIIPs requirements: https://www.justetf.com/ch/news/etf/us-
| domiciled-etfs.html
| papito wrote:
| From the bottom of my heart, _fuck off_. If you get blackmailed,
| abducted, squeezed or raided in any way, the U.S. will have the
| privilege of not caring.
|
| These tools accumulated massive wealth by corrupting the U.S.
| political system, gutting the IRS, and bringing their effective
| tax rate lower than most other citizens' - and it is _still_ not
| enough.
|
| I guess it's a tall order to ask to keep your grubby paws away
| and not pump more dark money into U.S. politics.
| ceejayoz wrote:
| > and it is still not enough
|
| It never will be.
|
| I don't think you can psychologically become a billionaire if
| you have the mindset that permits leaving a penny on the table.
| fourthwaveska wrote:
| > From the bottom of my heart, fuck off. If you get
| blackmailed, abducted, squeezed or raided in any way, the U.S.
| will have the privilege of not caring.
|
| Guess you have never lived abroad? If you think the US doesnt
| care about you when you're in country, you dont even exist when
| you're out of it.
|
| Imagine being in the middle of a coup, calling up your
| consulate for guidance only to find out that they all left the
| country or are hiding in their bunkers. Been through that
| before.
| geomark wrote:
| Imagine being an expat in the middle of a pandemic, the U.S.
| donating millions of vaccine dosages to the country you live
| in, vaccines that your tax dollars helped pay for, and you
| can't get vaccinated because the U.S. won't stipulate that
| some of those millions of doses should go to the
| approximately 30,000 U.S. expats in the country .
| fourthwaveska wrote:
| Yeah that kind of pissed me off too. Luckily most countries
| treated everybody the same and we got out jabs with our age
| groups without a fuss.
| ceejayoz wrote:
| > Imagine being in the middle of a coup, calling up your
| consulate for guidance only to find out that they all left
| the country or are hiding in their bunkers. Been through that
| before.
|
| What, exactly, was your expectation? That they'd send out
| Navy SEALs to rescue you?
| fourthwaveska wrote:
| Oh no. I understand that america's military exists mosty to
| force christianity on the world and to maintain high oil
| prices, not to protect little old me.
|
| I just expected them to, you know, pick up the phone or
| have a hotline with a recording of suggestions.
|
| I left the usa a long time ago, and the only interaction I
| need with them is a new passport every 2 years when I run
| out of pages for stamps.
| enriquec wrote:
| Where was that?
| engineer_22 wrote:
| These are people with a few million in assets. Enough to retire
| comfortably. These are not the "Power Elite". At least, there
| is no evidence that these people are "Ultra-Wealthy", only that
| they have reached a certain threshold that the US Govt keeps
| track of them. And it's peaked at around 7,000 persons per
| year. Hardly a tidal wave of capital flight.
|
| Have you considered that this story was titled in such a way to
| elicit an emotional response?
| papito wrote:
| I forgot I was on HN. Before we start discussing white papers
| on how emotionally gullible consumers of information can be,
| let's look at the article, shall we?
|
| "There are probably 20,000 or 30,000 people who want to do
| this, but they can't get the appointment".
|
| And
|
| "A lot of people who take this drastic step are tech
| zillionaires: Eric Schmidt, the former Alphabet CEO, has
| applied to become a citizen of Cyprus."
| luffapi wrote:
| Eric Schmidt is _definitely_ ultra-wealthy.
| k__ wrote:
| I read, some German citizens travel all the time without paying
| taxes, because of some loop hole that only requires you to pay
| income tax when you stay longer than three months in a country.
| woopwoop wrote:
| All-in-all, the United States is a great place. But it's an awful
| look for a country to make it hard to leave. I think shutting the
| borders to people coming in is bad, but shutting them to people
| going out is so much worse.
| bacan wrote:
| So what like 7k people? 2 Million is not even a big figure.
| Sounds like the site is making a mountain out a pin prick.
|
| Also if you notice the number spiked in 2016, meaning that it was
| more to do with Trump than anything else.
| surajs wrote:
| Once when young, I used to dream of living and working in the US,
| how naive I was!
| engineer_22 wrote:
| Where are you now? What do taxes cost you?
| moss2 wrote:
| Not related, but I pay about 40% income tax plus a 25% value-
| added tax (VAT) on every purchase.
|
| It's at a good level but my political belief is that this
| should be higher.
| not_throw_away wrote:
| That's not an uncommon belief - feel free to write an extra
| check to your tax department and they will happily accept
| it. Normally tax departments have a whole system set up to
| accept voluntary additional tax payments for anyone who
| feels inclined to top up their contribution to the
| wellbeing of the state.
| moss2 wrote:
| Very clever, but my tax agency does not allow for
| donations.
| djbebs wrote:
| Somehow I doubt that. What country are you in?
| alephnan wrote:
| This title would be less click-baity if it was
|
| 'People renouncing their citizenship are wealthy'
|
| because I don't think poor people can afford to. That says
| nothing about whether poor people are more or less interested in
| doing so.
| throwaway5372 wrote:
| I was feeling the same.
|
| I live abroad and I'm not rich. I sometimes debate renouncing
| my US citizenship, but working remote in the US makes me well
| off here. If I had a local job making piles of money I might be
| more inclined to. My only complaint is that when I go to visit
| mom, I get endless grief from the immigration officials.
| madengr wrote:
| Ah, the same tech liberals who voted for this shithead are now
| fleeing his proposed tax policy.
| alephnan wrote:
| Being upset about this is like feeling Roth accounts are unfair.
| libbroscrubber wrote:
| Are you talking about the Peter Theil thing? I think it's fair
| that people who don't like watching billionaires exploit the
| rest of us would be equally pissed about Eric Schmidt dodging
| taxes.
| mrtweetyhack wrote:
| Leaving a sinking ship is wise
| Gunax wrote:
| It's completely corrupt. I don't know why we cannot change it.
|
| Remember that you need not ever even have been to America to be a
| citizen. Second, America can decide who is a citizen according to
| their own laws, which is a bit of a conflict of interest.
|
| So currently children of Americans are American, but there's no
| reason they couldn't arbitrarily decide that grand children, or
| great grandchildren are as well. Or if you want to be really
| silly, in theory they could grant citizenship to anyone if they
| amended the laws to do so.
|
| So ive been given a status at birth by a foreign country that I
| have no wish for. They then grant me the privilege of paying them
| to renounce the status that they declared me to have!
|
| Why thank you land of the free!
| space_rock wrote:
| This does happen. People get unwanted US citizenship have to
| renounce. Rediculous to tax someone for that
| BrianOnHN wrote:
| Good riddance. "Wealthy" people contribute capital. The
| government can print more money to replace them at the expense of
| the same "wealthy" people who most likely got "wealthy" from
| exploitative practices opposed to conscious capitalism.
| luffapi wrote:
| They will continue to cash in from the systems of exploration
| they've already created.
| BrianOnHN wrote:
| I'm pretty sure generational wealth has the most to lose from
| printing money. So they can try to continue being
| exploitative. But the government should print money to fund
| competition.
| [deleted]
| zapataband1 wrote:
| Soo, could a senior engineer that's lived here since he was three
| and pays absurd amount of taxes every year get a green card
| yet???
| tartoran wrote:
| I surely hope so. I was wondering too about non citizens who
| pay taxes, should they become ones?
| Yizahi wrote:
| Not surprised. Rich people have disproportionally many crooks who
| have both desire and capabilities to avoid paying taxes.
| globular-toast wrote:
| Remember when they declared independence and chucked all that tea
| off the boat because they were paying taxes to England? How
| ironic.
| jacquesm wrote:
| Lots of not so wealthy people doing it as well, simply to get rid
| of the hassle and to be able to do regular banking abroad. Plenty
| of banks simply refuse to do business with American passport
| holders.
| ma2rten wrote:
| _A lot of people who take this drastic step are tech
| zillionaires: Eric Schmidt, the former Alphabet CEO, has applied
| to become a citizen of Cyprus._
|
| This is such lazy reporting. Is there any data showing the
| connection to tech? Is there any indication that Eric Schmidt
| would renounce his American citizenship if he becomes Cypriot?
| What is a zillionaires?
| ne0flex wrote:
| Being a Canadian, I started a tax-free savings account "TFSA"
| (similar to a US Roth IRA but with way less restrictions)when I
| turned 18 and was investing heavily in it. A few years later I
| would get a green card and move to the US and didn't touch the
| account afterwards except make a few rebalances here and there.
| My brokerage asked me to update my information and asked me if I
| was a "US" person to which I answered yes because of my
| greencard. A little while later I get a notification that I owe
| US taxes... on an account that I opened before I had anything to
| do with the US and that is considered a tax-free account in
| Canada.
| clarkbw wrote:
| Yes, most people in this situation liquidate them. Dual US /
| Canadian citizen here living in Canada.
|
| While you can keep a TFSA around you'll end up paying taxes on
| the gains back to the states as well you need to file
| additional paperwork come tax time. If your TFSA gains exceed
| the filing requirements it might still be worth keeping.
| Historically you needed to file a TFSA as a foreign trust
| however recently the IRS has deemed them a foreign disregarded
| entity which reduces the filing requirements thus making it
| cheaper.
|
| In your situation you could open up a US based fund with that
| money and Canada won't care so that's likely your best option.
| digianarchist wrote:
| The general advice is to liquidate your TFSA, ISA etc. before
| moving to the US.
| whoomp12342 wrote:
| its clear how your situation could be abused. i am not
| suggesting that you have done this, but that it creates an
| interesting loophole for the wealthy by harboring investements
| into other countries capital.
|
| Lets say you are a 0.1%er who happens to live in canada. Invest
| everything on canadas terms, then move to the USA. receive
| foodstamps, welfare checks and the likes for XX years. Go back
| to canadian citizenship and cash out. Darn, looks like tax
| payers supported the ultra wealthy while they just got richer
| eh?
| dghlsakjg wrote:
| The TFSA is not something that can be abused by a high income
| individual.
|
| It has a $6,000 yearly contribution limit.
|
| Canada, if anything, has an investment tax scheme which
| favours middle class investors. For someone making millions
| of dollars Capital gains tax is tied to your income tax
| bracket in Canada so it is very likely that you would end up
| paying higher taxes.
|
| Canada also has a tax and income information sharing with the
| USA, so someone making big bucks in investments in Canada
| could not benefit from means tested programs in the US.
|
| The scenario you proposed is entirely impossible.
| obmelvin wrote:
| > It has a $6,000 yearly contribution limit.
|
| I haven't looked into the exact details of Peter Thiel's
| IRA, but those have a contribution limit too, and look at
| all the press recently about him "abusing" [0] that.
|
| [0] I can't claim to know enough of his specific situation
| and the exact regulations to have an opinion on whether
| that's a fair characterization.
| Izikiel43 wrote:
| He bought paypal stock privately when it was almost
| worthless, which the roth ira allowed, then the stock
| exploded. I mean, sure, if you can tell the future you
| can do what Peter did.
| pedrosorio wrote:
| > you are a 0.1%er
|
| > move to the USA. receive foodstamps, welfare checks and the
| likes for XX years
|
| Does this seem like a good use of your time, as a 0.1%er?
| Collecting foodstamps?
| Gustomaximus wrote:
| Pretty crazy with people like Eric Schmitt applying for Cyrus
| citizenship. The guy is worth $20+ billion. You'd think at that
| point you hate tax like the rest of us but recognise it makes
| zero difference to your own quality of life and this is what
| funds great nations.
|
| US and other countries need to come down hard on wealth movement
| in general. Biden's global tax minimums are a good start but
| government will need to start limiting physical, financial and
| business access bloc nations to make this effective.
| 0x0nyandesu wrote:
| The irony is I've seen so many eastern Europeans who gain
| American citizenship and then continue to not pay taxes on any of
| their income since it's all off the books to the IRS. This is
| especially common with the semi rich (5-20 million net worth).
| TheGigaChad wrote:
| Good, the cocksucking statists in the comments should get cancer
| an die.
| lalos wrote:
| This also affects long term US residents (green card). See more
| at https://www.expatriationattorneys.com/green-card-u-s-exit-
| ta...
| penguin_booze wrote:
| > For most countries, if you are a citizen but don't reside
| there, you aren't taxed in that country.
|
| Is it true? To my knowledge, if one's home and the resident
| country have double taxation avoidance agreement, the citizen end
| up paying the maximum of the tax rate amongst the two.
|
| Is it the case that the US doesn't have DTAA at all, or do US
| citizens always get taxed twice?
| ttyprintk wrote:
| USA does have DTAA with maybe 60 countries. Those mutual
| agreements are based on income from personal services. I think
| a lot of the comments in this thread are drawing conclusions
| about specific sources of income:
|
| - there's an exit tax, might be millions $ for the top-tier.
| You might give your money to family members or a trust before
| planning to pay it.
|
| - there's capital gains tax. This means your income is not from
| personal services and instead from just being wealthy. Looks to
| me like a lot of the comments here are defending the rights of
| people with that lifestyle. Those people do not need DTAA.
|
| - reported income from personal services (labor) is what you're
| talking about. The bad experiences in this thread are real, but
| DTAA is meant to make life easier for professors and touring
| musicians, etc.
|
| - unreported income is indistinguishable from money laundering.
| The underworld is a very libertarian place, a sore spot for
| some in this thread.
| noja wrote:
| Terrible title! "Wealthy people" - all of them? Two of them? Half
| of them? Most of them?
| [deleted]
| cletus wrote:
| It's obviously a burden on the not-so-wealthy to be a US citizen
| living overseas. There's the annual requirement to file a tax
| return (most countries don't do this) but also the implications
| for opening accounts thanks to FATCA. The IRS requirement in
| particular needs to be addressed.
|
| Fun fact: the US is becoming a haven for tax avoidance and
| privacy simply because they're forcing all this disclosure
| information on other countries and are completely unwilling to
| reciprocate.
|
| A lot of people concentrate on the super-wealthy renouncing US
| citizenship. I mean that's going to happen. For people who don't
| know you get taxed on your holdings at current market rates when
| you do this. Obviously people still do this because they realize
| it's going to be cheaper in the long run. I don't really care
| about that.
|
| What I do care about is removing the political influence of
| former citizens. They are technically foreigners now and there
| are restrictions on foreign influence on US elections. So we
| should be:
|
| - Stopping former citizens from contributing to political
| campaigns, PACs and politically active charities;
|
| - Companies they control or directly control should likewise be
| prohibited from contributing; and
|
| - Any such organization that contributed to political candidates
| directly or indirectly should be forbidden from accepting foreign
| money or having such foreigners in any leadership or executive
| position.
|
| We should probably do something about holding US real estate too
| but that's a whole other discussion.
| matttrotter wrote:
| It's funny how the IRS publishes a "shame list" of people who
| renounced.
| worik wrote:
| FACTA
|
| Rouge state that is using its economic might (and implied brute
| force) to bend foreign banks to their nefarious will
|
| For one thing they are cornering the market on industrial scale
| money laundering. Making American states the last place standing
| where unattributable companies can be formed.
|
| End of empire - a dangerous time.
| novok wrote:
| Thousands in a country of hundreds of millions. This is a drop in
| a drop of a bucket. Wake me up when it breaches %0.01 of the
| population.
| academia_hack wrote:
| It's so irritating to be an American that has moved overseas.
| Basically the only country in the world that charges taxes on
| money you make and spend somewhere else, just because of where
| you were born. Thanks to IRS regulations, 90% of investment firms
| will just reject me outright rather than deal with the paperwork.
| Getting someone to help file my inordinately complex taxes costs
| thousands of dollars more than I actually pay in tax. I can't
| have a proper retirement account here since America doesn't
| recognize the local pension providers, so my government mandated
| pension is deducted from my salary here and then also taxed as
| income in the USA. If I ever want to leave, the IRS charges a
| small fortune for the privilege of not being a citizen too.
|
| I'm sure there's a small number of rich people gaming the system,
| but for the vast majority of expats the citizenship-based
| taxation system is almost cartoonishly cruel.
| ekster wrote:
| I am renouncing for these exact reasons. I am lucky enough not
| to be rich enough for the exit tax, though.
| yardie wrote:
| > 90% of investment firms
|
| These must be very small meat and potatoes investment firms
| then. They might not have a compliance department and might not
| be able to justify the salary of having someone tackle FATCA
| requirements. I, as an American abroad primarily used the big
| banks (HSBC, BNP, Barkleys) because its built in to the
| service.
| beagle3 wrote:
| In Israel (9m pop), non of the banks available to the general
| public (Poalim, Leumi, Discount, Iggud/Mizrahi) will let you
| do anything other than a checking account and a saving
| account. Perhaps a loan but definitely no holdings; and
| similarly no broker will either. They are not small. It just
| isn't worth it to them financially so they don't. There are
| est. 300k US tax payers in Israel, but while the profit is
| per-person, the compliance costs are huge and mostly
| constant.
|
| HSBC in Israel, last I Heard, had a $2M account minimum.
| robjan wrote:
| HSBC Hong Kong does not accept US citizens or green card
| holders to open an investment account.
| tazjin wrote:
| > Basically the only country in the world that charges taxes on
| money you make and spend somewhere else
|
| I believe Eritrea does this, too. They don't have as much
| political power as the US though, so they resort to torturing
| your remaining family members in the country to get you to
| comply.
| fmajid wrote:
| And it's not as if Eritrean migrants or refugees are welcomed
| with open arms anywhere in the world, so there aren't that
| many in that position in the first place.
| EE84M3i wrote:
| Hmm, I seem to recall hearing Australians also have
| complicated rules about being an "Australian resident for tax
| purposes" that is not the same as an Australian resident for
| other purposes, especially when you don't have Permanent
| Residence/Green Card and are on a time-limited visa (even if
| it's years long). So they don't technically fall into the
| "America and Eritrea" bad list, but still tax many
| Australians abroad. I forget the exact details though.
| mythz wrote:
| This is untrue, if you're a citizen of Australia who is a
| non-resident you don't have to report or pay taxes on world
| wide income made outside of Australia.
| BelenusMordred wrote:
| The laws recently changed last month. If you spend more
| than 45 days in the country or tick two of the following
| dot points you are now considered a tax resident and need
| to pay income tax:
|
| * the right to reside permanently in Australia
|
| * Australian accommodation
|
| * Australian family
|
| * Australian economic interests.
|
| https://www.lexology.com/library/detail.aspx?g=a9c5000f-b
| de6...
| Izikiel43 wrote:
| So, just by being australian and having family there you
| check box #1 and #3 automatically?
| mythz wrote:
| This sounds like proposed changes, I'm not seeing these
| rules reflected on ATO's guidance:
|
| https://www.ato.gov.au/Individuals/coming-to-australia-
| or-go...
|
| This suggests it wont come into effect until 2022:
|
| > Since draft legislation is not yet available, the rules
| likely will not apply before 1 July 2022.
|
| https://www.taxathand.com/article/17653/Australia/2021/Ne
| w-t...
|
| > If you spend more than 45 days in the country or tick
| two of the following dot points
|
| The proposed secondary rules only applies after spending
| 45+ days in a FY, not OR. Which is important because this
| new criteria basically applies to most people born in
| Australia, so it basically reduces the 183 day test to
| 45.
| EE84M3i wrote:
| There is an example[1] on their official site of an
| Australian living abroad in Japan and being a "resident
| for tax purposes" and thus being taxed, but not being a
| resident for other purposes.
|
| [1]: https://www.ato.gov.au/Individuals/coming-to-
| australia-or-go...
| mythz wrote:
| Right they're still classified as a resident since
| they're on a temporary contract who intended on returning
| after their contract has expired.
|
| If they had permanent residence in a different country
| they wouldn't need to.
| EE84M3i wrote:
| As far as I know, in most countries, acquiring permanent
| residence requires living in the country for years first
| and then applying, so you will be on time-limited visas
| until then. That is the way it is in Japan, and it is 10
| years to get PR, in the general case.
|
| Anyway, I'm not an expert on Australian tax law by any
| means, I just wanted to note that it's not always so
| clear cut as "do other countries tax citizens living
| abroad".
| mythz wrote:
| > As far as I know, in most countries, acquiring
| permanent residence requires living in the country for
| years first and then applying, so you will be on time-
| limited visas until then.
|
| I joined a US-based Company who organized my Green Card
| without me having ever been there.
|
| As long as your intention is to migrate to a different
| country you're regarded as a non-resident in which case
| you wont have to pay taxes on worldwide income, unlike in
| the US.
| tazjin wrote:
| This confusion is common amongst people who haven't lived
| in abroad. Visa status, work permits, future intentions,
| work contracts and citizenships are all separate things
| and most countries weigh more than one factor to
| determine tax-residency.
|
| In this example, the operative bit is this:
|
| > She has a one-year contract, after which she plans to
| tour China, [...]
|
| This time-boxes her _intentions_ for living abroad. It 's
| distinct from having an unlimited work contract with a
| temporary visa that requires renewals, which indicates
| intent to stay abroad (and potentially a basis for the
| visa renewals).
|
| Other countries use things like a point system (UK),
| definitions of "centre of life" (Russia, where I live
| atm) and so on. Either way, Australia doesn't do the
| thing that the US & Eritrea do (tax applicability solely
| based on citizenship).
| dbetteridge wrote:
| Not too bad really for us overseas Australians.
|
| If you took out a HECS (0% interest, indexed to inflation)
| loan for university study you still need to file taxes when
| resident overseas and continue making payments if you earn
| over the threshold.
|
| If you are resident in Australia more then 6mths of the
| year you must complete an Australian tax return, but for
| most people that involves logging in around september and
| checking that all the auto-fills match up with what they
| expected.
| queuebert wrote:
| That sounds nice. The tax preparation lobby in the US has
| so far prevented the IRS from pre-filling our tax
| returns.
| BelenusMordred wrote:
| They only just changed the laws a month ago to make it so
| opaque and vague about who qualifies as a tax-resident or
| not. It's basically a "if we want we will tax you"
| situation. The 183 day rule means little if you have even
| something as innocuous as a bank account back home now.
| It's a ridiculously stricter change that is entirely open
| to interpretation by the ATO.
|
| https://www.mondaq.com/australia/income-tax/1070880/tax-
| resi...
| vkou wrote:
| What you are describing is a pretty common requirement.
| Canada has a similar requirement, and while a passive
| bank account would in itself not be considered 'ties' to
| the country, an active one that sees use might.
| dbetteridge wrote:
| Ugh, thats a headache of a read.
|
| Sounds like they're just 'recommended' for now but won't
| take effect till next tax year at least.
|
| Also sounds like its intended to catch people working 0%
| tax contracts in the middle east or digital nomading
| around east-asia till they need medical care. (still not
| a good reason to complicate things)
| vertis wrote:
| You have to be able to prove you're a resident somewhere
| overseas though, and that you've broken your ties to
| Australia.
|
| It's more complicated for digital nomads that don't
| really have a permanent place overseas.
|
| Other than that though, agreed. AU taxation filing is not
| complicated.
| peteretep wrote:
| Many countries do, and losing your tax residency in a
| country of which you're a citizen and have been recently
| resident is a pain -- check out the UK statutory residency
| tests for example.
|
| That said, it _is_ possible to lose your tax residency in
| these countries, where American citizens are simply fucked.
| trutannus wrote:
| > They don't have as much political power
|
| They're basically the North Korea of Africa. This is a
| massive understatement.
| arwhatever wrote:
| _INTERNATIONAL_ political power
| cjaybo wrote:
| So they have as much political power as the US?
| trutannus wrote:
| I know you're being facetious, but still, even as a joke
| this comparison is deeply wrong. There's nothing even
| remotely comparable between the two nations. You won't
| have your family interned in a concentration camp for
| moving to Italy for example.
| [deleted]
| berinateni wrote:
| Eric Schmidt renounced his US citizenship even though he owns 2
| California homes and one in Massachusetts.
| DamnYuppie wrote:
| You don't have to be a US citizen to purchase property in the
| country. This is the same for many of the European,
| Central/South American and South East Asian countries. Is it
| as straightforward as being a citizen no, but it can usually
| be done without much extra effort.
| estebank wrote:
| Also, given the exit tax, he'll have to pay taxes on them
| _as if_ he had sold the properties, despite the properties
| not having been sold.
| rejectedandsad wrote:
| He did not renounce his citizenship, where are you getting
| this information?
| bmitc wrote:
| Edit: My question wasn't clear, but it's not important.
| dathinab wrote:
| > [..] this taxation is in place effectively due to rich
| people in the first place hiding money in accounts
| overseas.[..]
|
| I think that was the original intent but:
|
| 1. It affects everyone including many people not paying taxes
| in a amount where it matters.
|
| 2. I'm not sure if it works, the really rich people (i.e. the
| ones you would want to be "captured" by this law the most)
| have way to many ways to avoid paying taxes and reduce the
| amount they "in person" have to pay.
|
| It might be reasonable to have a cut blow which you you don't
| have to bother with this.
|
| I also have frequently considered if it would make sense for
| the country I live in to have such a law.
|
| But in the end I realized that this is probably not what I
| would want.
|
| In the end the problem is much more countries which
| intentionally create tax gaps to benefit from it but directly
| hurting other countries with that and even potentially
| undermining their governments independence.
|
| Through without question even if that is solved there is
| still the fact that even wrt. countries which do not do so
| their can be huge differences in taxation, but "somehow"
| "disabling" tax havens would be a much bigger step in the
| right direction then this regulation IMHO.
| IG_Semmelweiss wrote:
| The US is the top tax haven in the world.
|
| You read that right.
|
| The US is the top place to hide your money if you are a
| foreigner
|
| Yet foreign countries are not rushing to change their laws to
| tax their citizens living abroad. There is no urgency to tax
| their expats who havent worked or lived back on foreign home
| for years, even decades.
|
| So if nost countries have reason to complain about us helping
| hide stuff, they dont seem interested in enforcing anything
| dathinab wrote:
| > they dont seem interested in enforcing anything
|
| Or are not able to. Weather it's because of risking more
| people with money fleeing before changes take into effect,
| to much influence of wealthy people in politics or being
| forced by external forced, e.g. in context of not-so-public
| trade agreements.
| jjcm wrote:
| The worst part for me is not the taxes themselves, but it's
| that I feel like I have no representation while overseas. When
| I was living in Australia, my representatives were for the
| state of Oregon. Not once did one of my assigned
| representatives nor senators propose legislation meant to help
| expats overseas, they understandably represented their voter
| base in Oregon.
|
| It essentially creates a system of taxation without
| representation; ironically something the country has a deep
| history fighting against. The number of US expats is enormous,
| and if they were a state of their own they'd be the 11th most
| populated state (just ahead of New Jersey). If we're going to
| tax expats overseas, at the very least they should be provided
| with senators that are dedicated to fighting for their cause.
| Causality1 wrote:
| _expats the citizenship-based taxation system is almost
| cartoonishly cruel._
|
| If the concept of citizenship has no meaning to you beyond
| personal convenience, sure. If citizenship and the
| responsibilities inherent in it is something you take
| seriously, it makes a little more sense. Why should an expat
| who's not interested in living in and participating in the
| future of their former nation even be allowed to remain a
| citizen at all?
| tinyhouse wrote:
| What about the benefits? You get social security wherever you
| live. Most countries don't pay social security to their
| citizens living abroad.
| azinman2 wrote:
| The US has a lot of tax treaties with many countries to prevent
| double taxation. Does your country not have one?
| beezle wrote:
| "Basically the only country in the world that charges taxes on
| money you make and spend somewhere else, just because of where
| you were born."
|
| It is not about where you are born, it is about where you have
| citizenship (and possibly also residency).
|
| As long as you maintain your US citizenship you are morally
| obligated to contribute to the well being of the country, the
| biggest and easiest to understand of course is national
| defense.
|
| Likewise, if you own a property in another state that you only
| use a portion of the year you are not off the hook for paying
| taxes that contribute to, for example, road maintenance and
| local schools.
|
| Where I do have sympathy is that they make it extremely
| difficult for expats to file as well as maintain investment
| accounts.
| masklinn wrote:
| >and possibly also residency
|
| Not that is the issue. Residency is the norm, the US is both
| residency and citizenship.
| moneywoes wrote:
| In Canada and not being able to open a tax free savings account
| is a major blow
| matttproud wrote:
| In case anyone is interested, the taxation on Americans abroad
| isn't new but has its roots in the 1860s with the U.S. Civil
| War: https://www.bloomberg.com/opinion/articles/2015-04-24/end-
| th....
|
| FATCA is annoying. I don't mind taxes. I want the process to be
| fair, predictable, and not exceptional. It's a travesty the
| United States has been most of my adult life a failed state,
| which makes the tax treatment insult to injury.
|
| - American Abroad (on the pathway to naturalization in a new
| home)
| djyaz1200 wrote:
| That is a bummer but on the plus side the USA will send the
| Navy Seals to get you if someone kidnaps you. That's worth
| something.
| https://en.wikipedia.org/wiki/Rescue_of_Jessica_Buchanan_and...
| lordnacho wrote:
| Deleted
| bmitc wrote:
| They do not.
| RufusJacksons wrote:
| Couldn't agree more, sounds like you're in Australia too - I've
| been here 9 years and am yet to file tax... Interested how bad
| they will fuck me when I do...
| mmmeff wrote:
| Fake your death while you still can
| jjgreen wrote:
| A practical guide: https://en.wikipedia.org/wiki/The_Fall_a
| nd_Rise_of_Reginald_...
| disabled wrote:
| American here living abroad in Croatia, which does not have a
| tax or social security agreement with the US.
|
| The only reason why I do not renounce my American citizenship
| is because the very rare disease that I have was discovered on
| NIH grant funds in the 2000s and ultimately saved my life.
|
| I am not sentimental about being American, except for that.
| Izikiel43 wrote:
| What disease if you don't mind me asking?
| disabled wrote:
| Autoimmune autonomic ganglionopathy: https://rarediseases.i
| nfo.nih.gov/diseases/11917/autoimmune-...
|
| It's immune-mediated autonomic neuropathy and causes
| autonomic nervous system failure. I am in pharmaceutical
| remission now.
| kaboomman wrote:
| This. Living (even partially) overseas as someone who was born
| in the U.S. has so many disadvantages. The U.S. is the only
| country in the world that imposes global tax. Not only that,
| taxes are really complex and cost a fortune to file if you have
| overseas assets. Now, add to that that I cannot sign up for
| many bank accounts or other financial institutions because they
| don't accept U.S. customers - they don't want to deal with IRS
| filings either. It's not about tax evasion. It's just a huge
| pain being an American that owns property and spends a lot of
| time overseas.
|
| At some point, depending on how much time you spent overseas
| and how many assets you own, the benefits of giving up US
| citizenship start to outweigh the cons. And it's better to do
| this soon than later because exit tax is a thing.
| sokoloff wrote:
| Eritrea imposes a global tax as well.
| Izikiel43 wrote:
| Sure, I mean Eritrea and the US have the same power
| globally to enforce stuff right? It's not like one is ~25%
| of the world's economy.
| AdrianB1 wrote:
| How is this relevant, is Eritrea one of the great countries
| on this planet?
| sokoloff wrote:
| It corrects the erroneous statement "The U.S. is the only
| country in the world that imposes global tax."
| pacman2 wrote:
| NK too
| cortesoft wrote:
| On the other hand, is it right to be able to leave the country
| indefinitely, not contribute to the country at all, but still
| expect to have all the benefits of citizenship forever?
| Dracophoenix wrote:
| What benefits does one have when living in a foreign country
| as a US citizen? There is no legal representation. There is
| no access to US government services. What exactly would an
| overseas US citizen be paying for?
| cortesoft wrote:
| If there are no benefits to being a US citizen while living
| abroad, there should be no issue with renouncing their
| citizenship.
|
| Why do they want to maintain their citizenship if it
| doesn't give them anything?
| BenjiWiebe wrote:
| To keep the option open of coming back, and _then_ using
| government services /paying taxes.
| abroadsaver wrote:
| We are still culturally American, and we still have
| family in the US. And if we visit, we pay taxes on
| everything while we're there. There are taxes on the
| flight in, on the fuel we use, on the stuff we buy. And
| maybe we'd like to move back.
|
| So why conflate being American with federal taxes and
| bureaucracy?
|
| Maybe America should think about the benefits we expats
| provide to it while living and representing our culture
| and values abroad. We usually make a good impression on
| our country's behalf, but everyone abroad is shocked to
| hear about the potential draconian penalties and
| compliance headaches our government forces on us.
| amanaplanacanal wrote:
| I would suggest that the major benefit would be that if
| things go to shit wherever you are, you can flee back to
| the US. There are probably other countries you could
| choose for that instead, though.
|
| Also, if you give up your citizenship, does that have any
| implications for traveling back to the US? You might very
| well have friends and family you would like to visit
| occasionally.
| mjevans wrote:
| All of the benefits that taxes provide. I don't even know
| them all offhand, let alone have enough space to enumerate
| them fully.
|
| Some of the major benefits that come to mind: Protect by a
| world superpower military and diplomacy, welfare and social
| security, a stable place to return to in the case of
| trouble, a country that ensures development of vaccines and
| provides them for it's population in the case of pandemics.
|
| I would really like us to add to that list: medicare (or
| similar) for all as well as some other social benefits that
| make sense to enable more risk free pursuit of happiness
| and simplify employment.
| Dracophoenix wrote:
| >>Protect by a world superpower military and diplomacy,
|
| That's the argument the British crown once made for
| taxation without representation. It wasn't very well-
| received.
|
| A country is obligated to protect its own borders and
| demand commensurate payment. I don't see a reason to pay
| for American military expansionism if I'm kept safe
| enough by my country of residence. Anything beyond that
| is wasted tax dollars or adventurism with the US
| government's own motives in mind. I shouldn't have to
| subsidize either one.
|
| >>welfare and social security,
|
| EBT, food stamps, COBRA, etc. aren't recognized outside
| of the United States. Social security is not a benefit.
| It's a Ponzi-scheme with a gun to your head taking money
| that was already earned and delaying it until you have
| strong chance of dying from a heart attack.
|
| >>a stable place to return to in the case of trouble,
|
| That's an argument that can be made for most overseas
| citizen of many countries. Yet these other countries have
| not fallen to shambles on the basis of lacking global
| taxation. There's no reason for me to pay for a
| "stability" I'm not in a longitude and latitude to
| benefit from.
|
| On the contrary, there is a case to be made that United
| States is quite unstable itself as it has failed to
| contain a disease within its own borders and has also
| chosen to violate property rights under its
| unconstitutional eviction moratorium without providing
| just compensation. Even pre-COVID, some areas like
| Chicago and Los Angeles have had crime ratings high
| enough to compete with entire countries.
|
| >>a country that ensures development of vaccines and
| provides them for it's population in the case of
| pandemics.
|
| So can India, China, Britain, France, Italy, Germany,
| Australia, etc. Why should I pay the United States if I
| received my vaccine from these countries' labs and and
| medical resources instead?
|
| >>medicare (or similar) for all as well as some other
| social benefits that make sense to enable more risk free
| pursuit of happiness and simplify employment.
|
| An American citizen can't use medicare in a foreign
| country. Just like how a British citizen can't use NHS
| services in the United States. The pursuit of happiness
| is a negative right, not a subsidized one.
| mjevans wrote:
| >>>>Protect by a world superpower military and diplomacy,
|
| >>That's the argument the British crown once made for
| taxation without representation. ...
|
| IIRC Those living outside of the US still have the right
| to cast votes for President, and are not compelled to pay
| non-federal taxes. An argument might be made for non-
| state citizens to at least have a single representative
| and senator they can vote for.
|
| >>>> (social programs)
|
| >> ... Ponzi-scheme ...
|
| I agree about the problems with the funding and
| fulfillment structure. However the reality still exists
| even if the current implementation is unfair for those of
| us not yet seeing the benefits. If you're also a US
| citizen, please vote to get this fixed.
|
| -- The next set of points contradict my historically long
| viewed claim of stability. Generally both viewpoints are
| correct; though I would like to compare the current
| issues with the virus and unrest in the US to the latest
| 6 WEEKS lockdown in portions of Australia. Stability is
| __relative__.
|
| -- The last point was my hopeful view for benefits I'd
| prefer all US taxpayers to receive in the future. If your
| opinion differs from mine, you could share what other
| befits you'd like to see instead.
| leppr wrote:
| _> If you 're also a US citizen, please vote to get this
| fixed._
|
| Where/how can US citizens vote to modify the social
| security system?
| jleyank wrote:
| I thought US expats could vote where they last lived in
| the US in Federal elections... President, Senate and
| House.
| leppr wrote:
| Is there a way to, even approximately, target the "social
| security system" issue with your vote? Or do you have to
| chose between 2 or 3 bundles of pre-chosen policies, the
| composition of which you had no say in?
| MandieD wrote:
| Legally: yes, federal law says that you have to be
| allowed to vote for the federal offices from wherever you
| last lived in the US (or your American parent, if you
| were born abroad but never lived in the US)
|
| Reality: some states make it easy and will even let you
| vote in state and local elections, others make it
| inconvenient if you're not with the military (have to
| request ballots every year, have to diligently watch for
| registration purges), and some make it practically
| impossible for non-military.
|
| If you're an American abroad having trouble registering
| and/or getting your ballots, your local Democrats Abroad
| chapter has someone who will help you out. Even if you're
| a Republican ;)
|
| I want as many US citizens abroad as possible to vote on
| a regular basis, even if they're voting differently from
| me: our representatives will pay more attention to us if
| they see that we vote in larger numbers.
| mtnGoat wrote:
| I used to live internationally and the taxes weren't that much
| more complex. It really shouldn't cost thousands, it's just two
| extra forms if I recall correctly.
|
| If you Are living in high tax regimes like Switzerland you
| don't have double tax on the first $xx,xxx in income, it used
| to be close to 90k.
| a4a4a4a4 wrote:
| Switzerland is not a high tax regime (outside of some French
| speaking Kantons).
| Chris2048 wrote:
| What's unfair isn't this practise per-say, but the fact that
| it's not equal.
|
| I think keeping hold of foreign citizenship represents an
| unfair advantage to some degree, as a kind of "fallback" - e.g.
| if things go to shit you always have the option of returning
| home.
|
| _but_ other nationalities generally don 't need to pay to
| remain citizens while they are abroad, so Americans are treated
| unusually.
| Dracophoenix wrote:
| How is it unfair to have fallback option? Is it unfair to
| California when someone decides to move Texas for lower
| taxes?
| PragmaticPulp wrote:
| > It's so irritating to be an American that has moved overseas.
| Basically the only country in the world that charges taxes on
| money you make and spend somewhere else, just because of where
| you were born.
|
| This is exactly why these people are renouncing US citizenship:
| They're living overseas as citizens of another country and,
| like anyone rich or poor, don't want to be paying taxes to a
| country they aren't living in.
|
| It's not exactly unfair or nefarious. If they're no longer
| living in the US and they are citizens and residents of another
| country, surrendering US citizenship is a logical choice.
|
| Renouncing US citizenship is a common move for this exact
| reason. This article just happens to have drawn an arbitrary
| line in the wealth of people who renounce US citizenship and
| made a headline out of the wealthier subset. The wealthy are
| also more like to have dual-citizenship but relocate to another
| country, so they'd be over represented in this set.
| mgbmtl wrote:
| > surrendering US citizenship is a logical choice
|
| Only because of US laws. I have two citizenships, but one
| residency. In most Western countries, being a resident is
| associated with healthcare and pension, so having one
| residency is logical.
| paulddraper wrote:
| > In most Western countries, being a resident is associated
| with healthcare and pension
|
| Then that's the difference.
|
| American citizens can collect Social Security while
| residing in foreign countries. Same with VA benefits.
| mellavora wrote:
| I think you misunderstood. Most (EU) pension systems also
| payout worldwide.
|
| It is the 'putting in' part which depends on residency.
| paulddraper wrote:
| They have one criterion for putting in and a different
| one for paying out?
|
| That would seem.....unfair.
| ithinkso wrote:
| What do you mean? You pay in the country you live/work
| in. You get back your pension wherever you are, from
| every country you've worked for in your life. Sounds
| pretty fair to me
| PeterisP wrote:
| Residency, at least for overseas tax purposes, generally is
| presumed to transfer whenever (and wherever) you spend 180
| days of a year somewhere, so you by definition can't have
| multiple residencies (unlike nationalities); you can have
| residency rights/permits in multiple places, but once you
| become resident somewhere you cease to be resident at your
| previous country of residence.
| dzhiurgis wrote:
| Can you live without residence? Say I'm sailing around
| the world. My home country could be thousands of miles
| away, pretty much unreachable in a practical way. Should
| that still count as my residence?
| ipaddr wrote:
| In some countries Canada for example if you don't take a
| new residence they will treat your last residence as your
| residence.
|
| India is the opposite. You can work on a boat get paid in
| India and owe no taxes.
| JumpCrisscross wrote:
| > _Only because of US laws. I have two citizenships, but
| one residency._
|
| U.S. citizenship carries extraterritorial benefits. For
| example, we're pretty good at getting our people out of
| thorny situations, even at great national expense. If
| someone isn't paying to support that, it makes sense to
| force a revocation decision.
| mxfh wrote:
| That's nothing unique american and quite standard for
| western democracies. Way more important than military
| force is legal support and diplomatic weight, to get you
| extradited, if you end up in your host countries legal
| system for whatever reason, which is the way more likely
| thing to happen.
|
| It's not unheard of, that dual citizens renounce their
| more or less vaguely authoritarian citizenship when it's
| too dangerous to live or visit there with a dual one.
| Since then the other state has no obligation to intervene
| and is even blocked from reigning into the affairs of
| another nation.
| abroadsaver wrote:
| The US can't be bothered to help its citizens living
| abroad with vaccinations even though it has expiring
| doses. Other countries have done so, AND without the tax
| compliance demands.
|
| So let's drop this extraterritorial benefits stuff. No
| benefit the US has provided has been worth the worry,
| anger, and tedium of trying to be tax compliant in a
| situation where it's impossible to be truly compliant
| (thanks to how irreconcilable foreign arrangements often
| are to US tax law).
|
| https://americanexpatfinance.com/news/item/782-state-
| dept-re...
| leoedin wrote:
| Most Western countries have some level of
| extraterritorial benefits. At least in the UK they're
| nominally "paid for" by the cost of the passport. If
| you're a dual citizen with another country you have no
| obligation to get a passport - but shouldn't expect help
| without one.
| vagrantJin wrote:
| I needed to laugh really hard at this because it
| encapulates the US citizen's mind so perfectly. Partly
| because the US lives in my head rent free.
|
| Is it because every single US diplomatic relation is in
| one way or other tied to the military?
|
| If a jibali captures an operator then fair enough. The US
| is very preachy about their soldiers. But for a civilian
| to think about that as a benefit is just wild.
| dylan604 wrote:
| "civis romanus sum"
|
| It's not like the US made this up. The Roman citizens had
| this protection too as they wandered the globe.
| MangoCoffee wrote:
| >we're pretty good at getting our people out of thorny
| situations, even at great national expense. If someone
| isn't paying to support that, it makes sense to force a
| revocation decision.
|
| how many American get into that kind of shit storm? it
| seem like this benefit isn't worth the taxes that you pay
| rs999gti wrote:
| The US may or may not have paid $2M to get Warmbier our
| of North Korea
|
| https://www.washingtonpost.com/world/asia_pacific/north-
| kore...
| petre wrote:
| He died, so it didn't do much help.
| emodendroket wrote:
| What difference does that make? Is the ambulance
| worthless because not everybody it picks up lives?
| stickfigure wrote:
| The value I assign to "my government will ensure
| repatriation of my corpse" is $0.
| emodendroket wrote:
| Which is not what happened, given that he died after he
| got home. Again, not seeing how this is different than
| blaming the ambulance because you died in the ER.
| imwillofficial wrote:
| Too little too late makes all the difference in the
| world.
| emodendroket wrote:
| How many Americans actually end up with real tax
| liability from a foreign country? Probably need to answer
| that before we determine whether it's "worth it" because
| my understanding is most people don't.
| simonh wrote:
| Well there are a handful right here on this comment
| section. I'm a Brit and have known maybe half a dozen US
| citizens reasonably well here in London over the years,
| at least two of which renounced US citizenship for tax
| reasons while I knew them. It's definitely a thing.
| emodendroket wrote:
| According to another post you do not owe tax on income
| below $108k so that's probably not going to affect most
| filers, though I'm sure an anomalously high number of HN
| users are earning six-figure salaries.
| simonh wrote:
| Oh well, that's alright then. As long as it's only
| successful people getting screwed I suppose we're good.
| emodendroket wrote:
| I mean, am I supposed to feel sorry for high-income
| people because they have to pay tax to continue to
| benefit from US citizenship and US embassies? I don't
| really, nor do I consider it getting "screwed." I think
| it is only fair that well-to-do expats should pay into
| the system like everybody else. If they don't want to, I
| welcome them to take the article's lead and give up their
| citizenship.
| fantod wrote:
| The thing is, many of these expats aren't even "paying
| into the system" anyway. I have to file US taxes but can
| deduct what I pay in taxes in my country of residency,
| which is higher than I'd pay in the US; as a result, I
| don't actually owe any US taxes. But, like another
| commenter said, I have to pay thousands to someone to
| figure out how to even file all this stuff. In other
| words, some local accountant is making bank, not the IRS.
| emodendroket wrote:
| I could probably be convinced to get on board with an
| initiative to make filing easier, but this is a different
| argument than I was responding to.
| ElFitz wrote:
| From what I've read, the US is possibly one of the worst
| countries to have to file taxes with, paperwork-wise.
|
| And that's for the simple scenario of someone actually
| living in the US.
|
| But is also is another issue altogether. How US citizens
| can bear with this and the lobbying that spawned it is
| beyond me.
| emodendroket wrote:
| The people who have complicated taxes also usually have
| complex income sources and generally higher incomes. If
| you just get your wage the tax forms are relatively
| straightforward. Being international complicates things
| but you'll notice people are talking about the headaches
| associated with running their businesses, capital gains,
| etc.
| skatkartoffel wrote:
| It doesn't take much for an American residing abroad to
| have complicated taxes. I work a salaried job and am
| trying to save for retirement and that puts me into the
| complicated bracket because of the rules on pension
| taxation in my country of residence vs the US. Our
| options for investment are very limited, compared to
| every other resident of the country. My local brewery was
| doing a grassroots investment campaign and I couldn't
| even buy PS20 worth of shares to support them because as
| a US person that was forbidden.
| ghaff wrote:
| Yeah, while you could argue that the IRS should do pre-
| filled electronic returns, the reality is that if you
| have a W2 and a couple 1099s, doing your taxes is pretty
| straightfoward.
|
| As you say, it's more complex income sources and
| potentially deductions that lead to big accountant bills.
| mellavora wrote:
| Or simply the fact of living overseas.
|
| And you mention 1099s, i.e. self employed. Well, if you
| run a sole proprietorship as an expat, you still have to
| file US self-employment tax forms, and there are also
| QUARTERLY filing requirements with penalties for non-
| filing.
|
| Or you need to get the paper certifying that your country
| has a totalization agreement with the US (not all do).
|
| And since 1099 isn't a thing in EU, you have to file the
| US 'small business' tax form, which is actually 3-5
| forms.
|
| so as an expat, even what should be very straight forward
| turns into a massive mess.
| ghaff wrote:
| Sure. Yes, I was assuming a US citizen/resident working
| for an employer who has income from a few basic sources
| and is taking standard deduction--which actually
| describes a lot of people. (And I was mentioning 1099s
| mostly in the context of a brokerage account.)
| ElFitz wrote:
| Well, I am glad to stand corrected.
|
| Most of my knowledge of it comes from all the threads
| about Intuit's and H&R Block's lobbying regarding what
| IRS could and could not do to simplify tax filling.
|
| If you don't me asking. If it is as straightforward, what
| actually is the point in said lobbying?
| emodendroket wrote:
| Many people don't realize it's straightforward to fill
| out a 1040 form and assume they need to buy specialty
| software or go to a tax preparation place like H&R Block.
| Naturally they're not going to tell them otherwise.
| skatkartoffel wrote:
| Serious question, what benefits do you think US
| citizenship and US embassies provide over and beyond what
| pretty much every other western country provides to their
| citizens?
| simonh wrote:
| If it was just getting taxed up to a point I think you'd
| have a reasonable argument, but looking at the torturous
| nonsense they have to go through to the point where even
| US banks think the costs of having them as clients isn't
| worth the hassle, it's clearly way beyond that. Also,
| many of these people don't actually owe any tax at all,
| or relatively small amounts, but it's ridiculously
| difficult and costly to prove it.
|
| I mean what is the objective? Raise tax revenue from ex-
| pats, or drive them out of US citizenship? What's
| actually happening seems to be the latter, not so much
| the former. Surely that's a serious policy failure.
| 2xpress wrote:
| Perhaps you are being sarcastic in the parent comment,
| but United States "screwing" its successful people and
| forcing them out means that these successful people will
| no longer contribute to United States, but to their new
| home country instead.
|
| Without their contributions the Unites States will be
| less successful, thereby "screwing" everybody in it.
|
| This trend within United States is especially ironic and
| alarming considering that United States gained its
| success specifically by giving home to persecuted people
| from other countries with capacity for success.
| Conversely, other countries, some obvious examples being
| Nazi Germany and USSR, were not successful specifically
| because they forced out their successful people.
| jrochkind1 wrote:
| Well, wehther it's alright or not, whether it is
| accurately characterized as 'getting screwed' or not, at
| least it's only the ones who can most afford it.
| mixmastamyk wrote:
| No, this hits the upper to middle professional class the
| hardest. One percenters are handled by a staff with white
| gloves as always.
| emodendroket wrote:
| Strange that we're all commenting on an article
| concerning specifically the ultra wealthy renouncing
| citizenship to reduce tax liability then
| nraynaud wrote:
| I'm self employed, and had a green card, I paid the
| accountant 700EUR to file the US tax form and paid a
| couple thousands dollars in taxes because I hit the
| minimum tax rate.
| w0mbat wrote:
| As multiple people have explained, preparing the required
| paperwork each year is a major expense and hassle, even
| if you do not owe any tax. Also, if you are technical
| enough to frequent this web site and you think $108K is a
| lot of money, you are being underpaid.
| AnIdiotOnTheNet wrote:
| > Also, if you are technical enough to frequent this web
| site and you think $108K is a lot of money, you are being
| underpaid.
|
| Sorry, what? Exactly how much technical ability does it
| take to frequent a website? You have the strangest
| delusion I've seen on HN and that's saying something.
| Talanes wrote:
| To further illustrate that point: I'm a barista.
| tacocataco wrote:
| I work food service.
| emodendroket wrote:
| I just ran a search and found the median US personal
| income is around $35k. $108k may be low for a tech job
| but most people don't have high paying tech jobs.
| ElFitz wrote:
| > Also, if you are technical enough to frequent this web
| site and you think $108K is a lot of money, you are being
| underpaid.
|
| Most software engineers in Europe, aside from
| freelancers, and probably the _world_ , don't make
| anywhere _near_ $108k.
| jrochkind1 wrote:
| Googling, just the first one that comes up, suggests that
| median income for "software developer" in USA is $86,523.
| Meaning half make less, half make more. $100K is the 75th
| percentile, meaning 75% make less.
| (https://www.ziprecruiter.com/Salaries/Software-
| Developer-Sal...)
|
| Some people that work in especially high-paid sub-
| industries have a mistaken idea of what typical
| "technical enough to frequent this web site" (?!) people
| make.
|
| And even if most software developers did make over $100K,
| it could still be a lot of money? The median income in
| USA as a whole looks to be about $52K, with $100K being
| about 83rd percentile (83% of USA makes less than $100K).
| jandrewrogers wrote:
| That is only applies to so-called _earned income_ , you
| still owe taxes on all of your other income. And many
| people earn considerably more than $108k.
|
| Furthermore, even under tax treaties, it is not uncommon
| for some part of your income to be double taxed due to
| differences in recognition and classification of income
| and foreign taxes paid. Americans often have to pay more
| taxes than if they only had to pay taxes in either
| country separately.
|
| And this is on top of the onerous reporting overhead and
| other difficulties.
| emodendroket wrote:
| Many people earn a lot more than that. I agree. Where I
| disagree is that I don't see what's unjust about asking
| them to pay tax for a system they benefit from.
| bmn__ wrote:
| Faulty assumption; Americans who live abroad do not
| benefit from the US system: social
| security/disability/retirement, health programs,
| military, public infrastructure etc. pp. is provided by
| the country where they live.
| emodendroket wrote:
| Does the country where they live run the embassy too and
| I just never knew about it?
| AdrianB1 wrote:
| They should not pay taxes in full to get 1% of the
| benefits.
| emodendroket wrote:
| Why not? I could just as well say that someone making
| $50k in Arkansas shouldn't have to subsidize consular
| services for someone making a quarter million a year
| abroad. They're not really paying "full price" either
| given the large exemption.
| abroadsaver wrote:
| The US has an interest in maintaining embassies and
| consulates independent of its expat population. And we
| often pay for whatever services we get there, so you
| aren't subsidizing us.
|
| Additionally a government should think about practicality
| and fairness before it implements policy. It is
| impractical and excessively burdensome to try and tax
| residents of countries that aren't the US. Despite your
| stated beliefs elsewhere, it does not take very much
| income or bizarre situations to wander into dicey tax
| situations that are frightening for the expat. A small
| business (which is taxable in the US if you net more than
| about $430) can mean difficult filing in the US. I don't
| earn all that much, and I've spent a lot of this summer
| working on my US taxes for no purpose other than to have
| them piled up somewhere, unless some IRS agent decides to
| make my life much more difficult.
| Symbiote wrote:
| Most people use their country's embassy approximately
| never.
|
| Where they do need to use it (such as registering a
| birth) it's usually replacing use of a different
| government office, had they not lived abroad.
| kingosticks wrote:
| What's the embassy doing for me as an American citizen
| living abroad who uses none of their services (except
| passport renewal but that's only because of the other
| ridiculous rule that US citizens must travel there on a
| US passport). Why am I paying for it?
| emodendroket wrote:
| What's the fire department doing for me, a citizen of my
| town who has not experienced any fires? Why am I paying
| for it?
| [deleted]
| gricardo99 wrote:
| At least from those expats posting here, the issue isn't
| the actual real tax liability, but the burden of having
| to show the IRS every year that you don't think you have
| a tax liability.
| emodendroket wrote:
| That's a hassle but it seems hyperbolic to call it
| absurdly cruel and the other things people here are
| saying.
| dantheman wrote:
| It is awful - I'm glad you never had to deal with. It
| provides little revenue and causes a huge amount of
| hassle and makes living overseas way more difficult.
| emodendroket wrote:
| Perhaps the revenue is not very great but if there were a
| blanket exception I think you'd suddenly find a lot more
| people gaming then system to not technically be US
| residents and thereby escape large amounts of liability.
| ElFitz wrote:
| Most countries don't tax citizens living abroad on
| foreign revenue, and just forget about them once they
| become residents elsewhere (unless they still have income
| from their country of origin).
| [deleted]
| robin_reala wrote:
| And by most here, you mean every single country in the
| world apart from the US, Eritrea, Myanmar and Hungary.
| randomchars wrote:
| Hungary does not tax it's citizens living abroad.
| robin_reala wrote:
| I was going by the table at https://en.wikipedia.org/wiki
| /International_taxation#Individ... but it's entirely
| possible that it's incorrect.
| naniwaduni wrote:
| It looks like Hungary technically taxes nonresident
| citizens except in almost every case where it would
| matter.
| simonh wrote:
| That's pretty easily dealt with through residency
| thresholds. We do this in the UK, counting people
| resident for tax purposes if they spend more than so many
| days in the UK in a given year. I would be very surprised
| if the US doesn't already do this to determine non-
| citizens tax status.
| ricksunny wrote:
| American expat here - agreed with the other expats - it's
| the filing that really, really sucks. Like really.
| Breaking the difficulty down in terms of priority.
|
| 1 - just trying to work through what all might possibly
| be owed and not owed to US as well as the country(ies)
| one operates in.
|
| 2 - Identifying through which paperwork to declare it,
| while also ensuring income / business reporting is
| copacetic with the tax regime of the country that same is
| actually earned in. As a business owner, (many operating
| overseas are looking after a business) I have to complete
| corporate accounts (which costs $$$$ and takes forever)
| before I can file American income tax for the same
| accounting year.
|
| 3 - the value of the tax liability itself is a _distant_
| third in terms of hassle than any of the above. (I'll
| include in this bucket the fact that Americans are taxed
| on income earned abroad, putting us at enormous
| disadvantage for work opportunities vis--a-vis peer
| expats who come from other countries)
| 1024core wrote:
| Why doesn't the US reduce it to a flat tax? Say,
| $1000/year to send you your election ballot, and evacuate
| you in case something goes horribly wrong.
| javert wrote:
| The US government doesn't work like that. There isn't
| some logical person making logical decisions.
|
| For this change to occur, many senators and
| representatives would have to be directly and personally
| incentivized to make the change.
|
| They aren't.
| kingosticks wrote:
| And how about they make this service opt-in. I was born
| in the US but I have had nothing to do with the place for
| 95% of my life and I don't want their help. Why must I
| fill out their paperwork every year or pay them money to
| opt-out (which I can't even do anymore because of the
| current backlog).
| BeetleB wrote:
| If you are not allowed to open financial accounts for
| investments in the country you are living in because they
| do not want to have information sent to the IRS, you'll
| think differently.
|
| I know at least one country that will not let you even
| open a bank account if you have a green card or US
| citizenship. Actually, even if you're a foreigner living
| in the US (student, H-1, etc), that country will not let
| you open a bank account - even _if you are a citizen of
| that country_. The rule is simple: If you have ties to
| the US that could require you reporting your bank account
| to the IRS, then you cannot open a bank account.
| emodendroket wrote:
| Which country is this?
| BeetleB wrote:
| I'm aware of restrictions in France and Pakistan from
| coworkers on H-1 visas from those countries. Note that
| both probably do provide a way to open it if you go
| through some lengthy "exceptions" process, but it wasn't
| worth the hassle.
|
| Basically, ever since the IRS required you to report
| foreign accounts (2007 or 2008), some countries have made
| it harder for people based in the US to get accounts.
| They see it as an indirect means to collect intelligence
| by the US.
| pacomerh wrote:
| I don't understand how the IRS can know what you do in
| foreign banks
| ElFitz wrote:
| Because they apparently require foreign banks to report
| it.
|
| Now, how do they actually _enforce_ that supposed
| "obligation"? I do not know.
|
| But it doesn't surprise me. The US has already enforced
| it's laws on foreign companies' dealing abroad merely
| because they had used dollars in their transactions.
| abroadsaver wrote:
| They haven't enforced it yet (for the banks, for non-
| compliant Americans, they have). But they've signed
| treaties with many governments to allow this, and they
| threaten foreign banks with fines related to any US
| dealings.
| mixmastamyk wrote:
| It generally doesn't, but the law says you have to tell
| it or face prison time.
|
| And there are some instances of information sharing via
| tax treaty, but I haven't seen exact details on how it
| works.
| BeetleB wrote:
| The IRS requires you to report all bank accounts you have
| in foreign countries when you file taxes:
|
| https://en.wikipedia.org/wiki/Foreign_Account_Tax_Complia
| nce...
|
| > FATCA also requires such persons to report their
| non-U.S. financial assets annually to the Internal
| Revenue Service (IRS) on form 8938, which is in addition
| to the older and further redundant requirement to report
| them annually to the Financial Crimes Enforcement Network
| (FinCEN) on form 114 (also known as 'FBAR')
|
| What's ridiculous is that it also "requires" foreign
| banks to report details of accounts by US holders - even
| if the bank has no relation to the US.
| walshemj wrote:
| And the fact that most UK finace institutions wont deal
| with you makes opening ISA's etc v difficult
| marcosdumay wrote:
| Most countries grant those same benefits.
| aerostable_slug wrote:
| But they don't have a MEU sitting off conflict zones
| waiting to leap into action. The United States will
| literally send the Marines to save a citizen. A person
| from, say, Ecuador probably doesn't enjoy the same amount
| of risk coverage.
|
| https://en.wikipedia.org/wiki/Marine_expeditionary_unit
| 1024core wrote:
| You've been watching too many movies, I'm afraid. The
| reality is (and it happened in Yemen recently) that the
| US will just shrug and tell you to go ask some other
| country for help. No MEUs set foot in Yemen when things
| went south there.
| aerostable_slug wrote:
| The last I heard, the Houthis let the Americans go.
|
| Navy SEALs from the Navy SMU parachuted into Africa in
| the dead of night to save a missionary kidnapped from a
| known conflict zone, killing 6 of 7 combatants (one
| wonders if they let the last guy go to spread Fear
| amongst his fellows). Perhaps some of you had different
| experiences (and/or perhaps the State Department really,
| really wanted you to leave), but that doesn't erase the
| rescue of Americans such as this man:
|
| https://en.wikipedia.org/wiki/2020_Nigeria_hostage_rescue
|
| We sent the best of the best in to save him. Not the JV
| team, the varsity. Before you whine, ask yourselves if
| perhaps there was some motive to telling you that nobody
| would help you if you didn't leave. Maybe they were
| trying to manage their risk.
| 1024core wrote:
| > to save a missionary
|
| That could have been just Trump pandering to his base.
|
| You're telling me that the US will do that for every Tom,
| Dick and Harry who gets caught by some $EVILDOER anywhere
| on this planet? Fat chance!
|
| > The last I heard, the Houthis let the Americans go.
|
| But how did they get out? Who picked them up?
| aerostable_slug wrote:
| >That could have been just Trump pandering to his base.
|
| That's pretty weak, you have to admit. Wouldn't Obama
| send the same men in to save a citizen? I think he would.
| This is undeniably what our military is for, what those
| special mission units are for, and what those operators
| live for. They went in to do God's Work, and luckily this
| time it worked with no Good Guy casualties. Why would you
| doubt this?
|
| > How come no SEALs have parachuted to rescue Jeffery
| yet, huh? Reinforces my theory that it was just election-
| time pandering by Trump.
|
| Maybe because they don't have actionable intel to find
| and fix him? Maybe because the Bad Guys weren't so stupid
| as to use something that would show up on our various
| SIGINT collection platforms? It's not always a great big
| Trumpian conspiracy.
|
| > But how did they get out? Who picked them up?
|
| The Omani military, our allies. I suspect more than one
| person on that flight didn't have an Omani passport.
| AdamN wrote:
| I remember being in Kenya before the election that
| followed post-election violence previously (scores dead).
| Ambassador said point blank, "You need to take care of
| yourselves. We only have a handful of marines and they'll
| be spending their time protecting or destroying
| classified documents."
| aerostable_slug wrote:
| Perhaps that was their way of trying to get you to leave
| so they didn't have to send anyone after you.
| ciguy wrote:
| Exactly. This myth that the USA bails its citizens out of
| sketchy situations needs to die.
| ciguy wrote:
| No, they absolutely will not. I won't go into details but
| I can tell you from personal experience this is
| unequivocally false. The USA will in most cases do
| exactly nothing for their citizens in distress. Even the
| local US embassies will refuse to get involved in almost
| all cases.
|
| You know who did get involved in our situation when I was
| with a group of mixed citizens from USA, UK, EU etc...?
| The UK and Denmark. France, the USA and Germany all did
| nothing at all.
|
| This myth that the USA will save citizens from any
| situation needs to die. It's untrue and dangerous since
| it encourages Americans to do stupid things because they
| are convinced the Marines or Seals will come save them.
| aerostable_slug wrote:
| Except the Marines and/or SEALs do come to save people.
| Perhaps there are political complications you aren't
| mentioning. Perhaps you got into trouble in a nation with
| a halfway-functioning government (so diplomacy trumps men
| with rifles).
|
| It is provably true the US does send armed forces in to
| save citizens, and it is obviously true that many other
| countries simply lack the ability to do so. That isn't a
| license to be stupid, but it is a differentiator between
| countries with true power projection capabilities and
| those who don't have the same.
| not-so wrote:
| What circumstances are those? There are a ton of homeless
| Americans where I live and the embassy doesn't do
| anything until they commit a crime as far as I know.
| JumpCrisscross wrote:
| > _What circumstances are those?_
|
| If there is an act of war or natural disaster, the U.S.
| is good at extracting its citizens. There is also a
| decent precedent of negotiating to release people taken
| hostage or held prisoner by unfriendly regimes. (Or
| causing a fuss when Americans are harmed in a friendly
| country.) That, in turn, has a deterrent effect.
|
| For Americans with access to legal counsel and the State
| Department, the benefits expand. Rich, overseas Americans
| thus present a unique free-rider problem.
| EVa5I7bHFq9mnYK wrote:
| For example, Israel goes to extremely great lengths
| extracting its citizens in trouble (search Operation
| Entebbe), and no, they don't charge you any taxes if you
| reside permanently abroad.
| adolph wrote:
| https://en.wikipedia.org/wiki/Operation_Entebbe
|
| Such a gruesome story: _Kenyan sources supported Israel,
| and in the aftermath of the operation, Idi Amin issued
| orders to retaliate and slaughter several hundred Kenyans
| then present in Uganda. There were 245 Kenyans in Uganda
| killed and 3,000 fled._
|
| https://en.wikipedia.org/wiki/Idi_Amin
|
| _Amin first escaped to Libya, where he stayed until
| 1980, and ultimately settled in Saudi Arabia, where the
| Saudi royal family allowed him sanctuary and paid him a
| generous subsidy in return for staying out of
| politics.[18] Amin lived for a number of years on the top
| two floors of the Novotel Hotel on Palestine Road in
| Jeddah._
|
| https://www.imdb.com/title/tt0455590/
|
| Movie The Last King of Scotland is _Based on the events
| of the brutal Ugandan dictator Idi Amin 's regime as seen
| by his personal physician during the 1970s._
| mljoe wrote:
| You don't have to go that far back. See the recent
| Surfside tragedy. Israel sent an elite rescue team and
| set up relief centers to assist displaced persons,
| regardless if they were Israeli or not.
| robocat wrote:
| "Casualties have been disproportionately Jewish because
| about a third of Surfside residents are Jewish."
| janeroe wrote:
| > For example, we're pretty good at getting our people
| out of thorny situations
|
| How thorny a situation has to be? Because I'm aware of a
| case when an American couldn't bring his own children to
| the states because his ex wife didn't consent to issue
| them American passports. Petitions, letters to the
| embassy and his congressman, nothing helped. A 3rd world
| country his ex wife's a citizen of had no issue with
| consents, it just issued passports allowing her to get
| the kids and leave the country they were residing in.
| splintercell wrote:
| > U.S. citizenship carries extraterritorial benefits.
|
| Since we are stepping out of playing world police, we
| have stopped doing that FYI in the past 15-20 years
| incrementally so. This ain't the late 20th century
| anymore.
| e12e wrote:
| Since the US has preformed drone strikes on its own
| citizens, I think it's pretty clear that "some citizens
| are more equal than others" ?
| dlisboa wrote:
| That's only relevant to a tiny percentage of American
| immigrants who travel/work in conflict zones and
| unfriendly countries.
|
| It could even be said Americans are more at risk in those
| countries for being American and no other reason. So for
| people outside of that there won't be any benefit.
| JumpCrisscross wrote:
| > _only relevant to a tiny percentage of American
| immigrants who travel /work in conflict zones and
| unfriendly countries_
|
| I know a (thankfully small) handful of cases in which
| Americans' kids were arrested in a friendly country. The
| State Department provided invaluable support.
| (Recommendations on legal counsel, prudent next steps,
| relevant authorities' phone numbers...nothing nefarious,
| just context and support.)
|
| I am under no illusion that I, with my resources, would
| get that sort of access. But it exists, and probably
| benefits U.S. international business concerns. Since this
| article concerns itself with rich overseas Americans, I
| think it's relevant.
| goodpoint wrote:
| > Since this article concerns itself with rich overseas
| Americans, I think it's relevant
|
| Not many millionaires are getting arrested in general,
| due to the availability of lawyers and so on.
|
| The US support might be very relevant for a war reported
| captured by ISIS.
|
| But most millionaires are not going to be in those
| locations and/or able to afford good private security.
| emodendroket wrote:
| Ok, but they're also not very sympathetic. I don't feel
| sorry for anybody who can afford private security that he
| has to pay if he wants to hang on to the benefits of US
| citizenship.
| goodpoint wrote:
| So?
| emodendroket wrote:
| So "so?" is my reaction to wailing about their being
| taxed.
| tylersmith wrote:
| They're not wailing, they're leaving for better service
| elsewhere.
| emodendroket wrote:
| Great, then everybody's happy. What's the problem?
| dlisboa wrote:
| I think you're under the impression this doesn't happen
| with other countries too. That's the job of embassies.
| Obviously the State Department has more funding and
| resources, but that's really only relevant to how big of
| a trouble you got yourself into.
|
| One thing the US has is more bargaining power to force
| early release of some people accused of crimes (like
| Liangelo Ball in China, Anne Sacoolas in UK). That's
| significant leverage, but again: most people will never
| find themselves in that situation. But even then it's not
| like other countries will not imprison you if you're
| American.
| ska wrote:
| > U.S. citizenship carries extraterritorial benefits.
|
| Many citizenship's include extraterritorial benefits, but
| few of them are as aggressive with foreign income.
|
| It's a fair question which countries approaches are the
| most effective, but this is hardly unique.
| consumer451 wrote:
| > U.S. citizenship carries extraterritorial benefits. For
| example, we're pretty good at getting our people out of
| thorny situations, even at great national expense.
|
| Are we? I've been told to use my other passport if ever
| in a situation like that. Are there any stats that
| support either case?
| SerLava wrote:
| Just a warning: this isn't necessarily true. They'll only
| do it if there is a political benefit. Otherwise there is
| no duty to assist you.
| janeroe wrote:
| > They'll only do it if there is a political benefit.
|
| This is also how it works with other countries (e.g.,
| Russia). They'll help if they get something out of it, or
| won't give a damn otherwise.
| bnralt wrote:
| Many Americans seem to believe that, but it doesn't
| actually seem to be the case. For instance, when Yemen
| was falling apart, countries like China, India, Pakistan,
| Russia, and Indonesia all worked hard to evacuate their
| citizens, many using their military to do so[1]. The U.S.
| response was to tell American citizens they were on their
| own[2]. The U.S. embassy even recommended that Americans
| seek assistance from India if they needed to evacuate[3].
|
| So if anything, I'd say America is worse than other
| countries at getting citizens out of bad situations. But
| there seems to be a tendency for people to not look at
| what other countries actually do and just assume that
| America is the best.
|
| [1] https://www.bbc.com/news/world-middle-east-32162364
| [2] https://foreignpolicy.com/2015/04/21/washington-to-
| americans... [3]
| https://twitter.com/SMedia4/status/585286801968893954
| matttproud wrote:
| Don't forget the poor responses at home to disasters
| natural and unnatural. Katrina was only 15 years ago, and
| that was before mainstream myths of omnipotence were
| broken. Such a travesty. Such a failed social contract --
| esp. for common security, welfare, and wellbeing.
| madengr wrote:
| As a US citizen, you are less likely to be tortured in a
| foreign prison. This book is a good read:
|
| https://en.m.wikipedia.org/wiki/Operation_Acid_Gambit
| ljf wrote:
| (you seem to have been shadow banned, might be working
| asking dang why - I couldn't see anything in your history
| from a mod)
| maxerickson wrote:
| https://news.ycombinator.com/item?id=23559004
| beezle wrote:
| The US is also very good at issuing travel warnings that
| are very explicit about the risks [1] I am not aware of
| the DoS ever going from 'its all ok' to 'see ya, y'all on
| your own now!' Anyone that was in Yemen prior to 2/15 had
| (or should have) a very good idea of where things were
| going.
|
| [1] https://travel.state.gov/content/travel/en/traveladvi
| sories/...
| [deleted]
| JumpCrisscross wrote:
| > _I 'd say America is worse than other countries at
| getting citizens out of bad situations_
|
| I last saw data through the UNDP about ten years ago.
| It's very possible that the situation has degraded. And
| no country has 100% coverage, far from it. At the time,
| however, the U.S. government was exceedingly good at
| exfiltrating citizens from disaster zones. Granted, it
| has had more experience doing this because, well, empire.
|
| The situation was starker for low-level assistance, in
| which many diplomatic missions will not get involved.
| bnralt wrote:
| If you come across the data please share it, it would be
| worthwhile seeing what exactly they're talking about and
| if the data matches your memory of it. I didn't come
| across it in my (very limited) search, but I did find
| this analysis that suggests U.S. citizens fare worse than
| citizens of many other countries[1]:
|
| > According to a database compiled by New America from
| public sources, since 2001, American hostages taken
| captive by terrorist, militant, and pirate groups have
| been more than twice as likely to remain in captivity,
| die in captivity, or be murdered by their captors as the
| average Western hostage. Forty-three percent of American
| hostages died, remain in captivity, or remain unaccounted
| for, compared to an average of 19 percent for all
| Westerners.
|
| [1] https://www.newamerica.org/international-
| security/policy-pap...
| qwytw wrote:
| It's because USA has a policy of not paying any ransoms
| or making concessions to the hostage takers (unlike most
| other western countries). I'd assume this might also
| result in Americans being targeted less often than people
| from other countries (I haven't see any data on this).
| tshaddox wrote:
| So what about American citizens who legally don't pay any
| federal taxes? Like, say, children? Should they receive
| "extraterritorial benefits"?
| dustinmoris wrote:
| > U.S. citizenship carries extraterritorial benefits.
|
| Not sure about actual benefits. The US passports is one
| of the worst when it comes to travel. Many countries have
| stricter entry rules only for US citizen, or require at
| least a higher Visa fee in comparison to other Western
| nations or outright don't allow US citizens entry at all.
| I found my Austrian passport to be actually extremely
| beneficial. Most powerful passport is still from
| Singapore when it comes to extraterritorial benefits.
|
| In terms of getting people out of thorny situations,
| countries which don't have citizenship based tax laws are
| also pretty good at that, if not even better, because the
| US has in fact a lot of scarred relations with other
| nations whereas other Western nations have it easier to
| get a country pull some strings in order to get their
| people out.
| emodendroket wrote:
| "One of the worst" maybe if you're comparing to the EU,
| but definitely not in a wider global sense.
| ElFitz wrote:
| > "One of the worst" maybe if you're comparing to the EU,
| but definitely not in a wider global sense.
|
| Definitely. But comparing the benefits of US citizenship
| to that of, say, Venezuela or Tchad would be pointless,
| now, wouldn't it?
| emodendroket wrote:
| Why would that be pointless?
| ElFitz wrote:
| Mostly because the gap in international political reach
| and leverage, respective economic situations and means
| are too huge for there to be a point.
|
| Also because I suspect the population here to likely be
| mostly from Western countries. Cf dang's comment[1]
| stating that 50% of the userbase is from the US
|
| [1]: https://news.ycombinator.com/item?id=25787770
| emodendroket wrote:
| Will I think it is relevant because the fact that the
| passport holder benefits from all that makes it one of
| the best by any reasonable standard, unless you
| arbitrarily ignore all the worse ones and then say it's
| the "worst of the best," so to speak.
| ElFitz wrote:
| And I would argue that it's like comparing professional
| Formula 1 drivers' performance to that of professional
| kart racers. Or a five stars hotel to a motel by the
| highway.
|
| But I see your point, and we'll probably have to settle
| on agreeing to disagree.
| bluedevil2k wrote:
| > The US passports is one of the worst when it comes to
| travel
|
| 100% wrong! US passport is ranked 7th best in the world.
| You need very few visas and get waved through customs
| faster than visitors from most other countries.
|
| * https://www.usatoday.com/story/travel/2021/07/07/where-
| does-...
|
| *
| https://www.thenationalnews.com/business/2021/07/07/the-
| worl...
| fmajid wrote:
| Some are "accidental Americans" like UK Prime Minister Boris
| Johnson, born in the US, who discovered as a US citizen he
| had to pay capital gains taxes when he sold his London
| apartment. Australia requires its parliamentarians to have
| only Australian citizenship and some discovered for the same
| reason they were not eligible.
|
| Furthermore, the burden of FATCA is sufficiently onerous that
| many banks etc. just refuse to deal with it and close the
| accounts of US persons. A number of long-time expat
| Americans, e.g. in Germany, have renounced their citizenship
| because they are unable to function due to this.
| yawaworht1978 wrote:
| Alexander Boris de Pfeffel Johnson aka Boris Johnson is not
| as clumsy as his haircut makes him look to be. The guy
| keeps fit, doesn't look like Rambo but he is fit with a bit
| a sticky build. He is intelligent, he survived the muddy
| waters of politics, affairs and is prime minister. Of
| course he always knew he is American dual citizen, a person
| like him does not handle an apartment sale himself, he has
| handlers and advisors. And he was in a very high income
| bracket for a while and it's safe to say he fell into a us
| taxable segment before that sale. He is a showman and this
| was just the event where the tax bill was too high and he
| said "no more".
| didntknowya wrote:
| hah yes this. the buffoon act really makes people
| underestimate- and if i dare say, sympathize with him.
| but he's much more competent (at getting what he wants)
| than people give him credit for.
| spoonjim wrote:
| Boris Johnson is a Ted Cruz who knew the appeal of a
| Donald Trump.
| aarchi wrote:
| Well Germany also requires that you surrender other
| citizenships when you get a German citizenship, unless you
| are a German dual citizen through ancestry.
| disabled wrote:
| Or your other citizenships are solely from the European
| Union. (You can be a dual/tri/quad EU|German citizen)
| eduardo_f wrote:
| This is incorrect.
| rsstack wrote:
| Imprecise but not incorrect: https://en.wikipedia.org/wik
| i/German_nationality_law#Dual_(o...
| anticristi wrote:
| I heard rumours that this law is basically to put a thorn
| in the eye of Turkish immigrants minus what the EU does
| not allow. Is there any truth in this?
| rolleiflex wrote:
| Yes, and Turkey moved to nullify this by creating a
| system in which if you are otherwise a valid Turkish
| citizen that has to give up because of a requirement from
| a foreign country like this, you can get on a special
| status in which you cannot vote, but have all the other
| privileges of Turkish citizenship. That status is not
| citizenship in theory, but practically you have
| everything as usual, and can participate in the Turkish
| social security, retirement, health system and all else.
| It's called the blue card.
| bakuninsbart wrote:
| It got really awkward when the large minority of turkish
| Germans living in Germany with turkish citizenry
| overwhelmingly voted for Erdogan in the last elections.
| I'd really wish Germany was able to adopt an immigrant
| culture similar to the US, but the current situation is a
| semi-failure, but neither side of the political spectrum
| seems to be able to implement good policies to solve the
| issues.
| markdown wrote:
| > the current situation is a semi-failure
|
| WOuld you care to expand on that? I'm curious what in
| particular about the US immigrant culture you would like
| to see adopted, and what about the current German system
| prevents that culture from developing.
| skeeter2020 wrote:
| Doesn't the Netherlands do this as well? As a Canadian I
| think not allowing dual citizenship might solve a lot of
| issues with both the very rich and the very poor.
| Muromec wrote:
| Unless you marry a citizen or get citizenship by option ,
| you have to surrender previous one.
| mistrial9 wrote:
| unless you have special wealth status?
| mywittyname wrote:
| Is it possible to operate using a business account in other
| countries? It's pretty cheap and easy to do in the USA.
| mellavora wrote:
| I assume you mean a business bank account for the
| banking?
|
| Challenging, and potentially criminal.
|
| If you have any management authority over the bank
| accounts owned by the business, then those accounts fall
| under FACTA.
|
| Hell, if you are even just an employee, but can sign on
| the bank account, then you have to report it to the US
| authorities.
|
| So a 'business account' doesn't get you out of the US
| required reporting.
|
| Also, the implication is that you'd use this for 'day to
| day' banking. Using a business's funds (a business bank
| account) to cover personal spending is typically criminal
| (embezzlement).
|
| So not a solution.
|
| And this doesn't solve the other problems, like pension
| savings or other financial products.
| erikw wrote:
| Unfortunately if you have equity in the business, you'll
| get taxed. However, if you are only an employee, you get
| an exemption on something like $150,000 of income,
| housing, and other expenses. So as a US citizen, you can
| avoid taxes only by living outside the US, and being an
| employee of a non-US company. If anyone knows otherwise,
| please correct me as I'd greatly benefit!
| Maursault wrote:
| Not to correct, but to affirm. [0]
|
| [0] https://en.wikipedia.org/wiki/Foreign_earned_income_e
| xclusio...
| mellavora wrote:
| nitpicking. You don't get out of taxes, you get out of
| paying US taxes (on earned income, you still have to pay
| capital gains).
|
| But you still have to file US taxes. As an expat, you
| have more forms to fill out.
|
| AND the bigger challenges are banking. You still have to
| find a bank willing to open an account for you, and good
| luck getting more complex financial services.
| noodlesUK wrote:
| Yeah, it is in theory, but even small businesses
| incorporated abroad with US persons involved in them put
| _huge_ reporting burdens on the US person. Form 5471 and
| friends make this stuff look straightforward. Most of the
| time I find my frustration isn't about how much money I
| am paying in taxes, but just how much dull and confusing
| paperwork I have to understand. Even trained
| professionals who spend their whole lives doing this get
| confused by US tax compliance for people who have
| international lives. The US needs to realise how
| important the a positive reputation in its expat
| community would be for its soft power.
| jontas wrote:
| The article is not drawing an arbitrary line:
|
| > The IRS publishes a quarterly list of the names of people
| who have renounced their citizenship or given up their green
| cards, but it only includes people with global assets over $2
| million
|
| It may be an arbitrary line, but if so, it's the IRS drawing
| it.
| andruby wrote:
| Why does the IRS publish the list of people renouncing
| citizenship? And why does it filter for people with global
| assets over $2M? I feel like I am missing something for
| this to make sense.
| kogepathic wrote:
| > The IRS publishes a quarterly list of the names of people
| who have renounced their citizenship or given up their
| green cards, but it only includes people with global assets
| over $2 million
|
| This claim is total crap. The list includes _all_ US
| citizens who renounce their citizenship, regardless of
| their net worth. [1]
|
| You also cannot renounce your citizenship for tax dodging
| [2]:
|
| _> Persons who wish to renounce U.S. citizenship should be
| aware of the fact that renunciation of U.S. citizenship may
| have no effect on their U.S. tax or military service
| obligations (contact the Internal Revenue Service or U.S.
| Selective Service for more information)._
|
| So plan to become rich after renouncing (and without the
| IRS noticing).
|
| [1] https://www.federalregister.gov/quarterly-publication-
| of-ind...
|
| [2]
| https://travel.state.gov/content/travel/en/legal/travel-
| lega...
| claytongulick wrote:
| From [2]:
|
| E. TAX & MILITARY OBLIGATIONS /NO ESCAPE FROM PROSECUTION
|
| Persons who wish to renounce U.S. citizenship should be
| aware of the fact that renunciation of U.S. citizenship
| may have no effect on their U.S. tax or military service
| obligations (contact the Internal Revenue Service or U.S.
| Selective Service for more information). In addition, the
| act of renouncing U.S. citizenship does not allow persons
| to avoid possible prosecution for crimes which they may
| have committed or may commit in the future which violate
| United States law, or escape the repayment of financial
| obligations, including child support payments, previously
| incurred in the United States or incurred as United
| States citizens abroad.
|
| I read that as saying "If you owe the IRS money already,
| renouncing your citizenship isn't going to get you out of
| paying it".
|
| >So plan to become rich after renouncing (and without the
| IRS noticing).
|
| Do you have any other sources that corroborate this? I've
| certainly never heard of the IRS coming after someone for
| money they've earned after renouncing citizenship, except
| perhaps in complex cases involving international
| companies.
| robocat wrote:
| > You also cannot renounce your citizenship for tax
| dodging
|
| You just pay an exit tax, which is a percentage of your
| total wealth. The exit tax only applies if your total
| wealth is over 2 million (or less than that if you
| haven't been filing properly).
|
| https://americansoverseas.org/en/knowledge-centre/us-
| taxes-a...
| f38zf5vdt wrote:
| It seems like no one actually knows what the list
| represents.
|
| > Gibbons expected that the list would include only "a
| handful of the wealthiest of the wealthy" motivated solely
| by taxes; however, the people named in the list turned out
| to have a wide variety of motivations for emigrating from
| the U.S. and later giving up citizenship, and few were
| publicly known to be wealthy.[7]
|
| > ...In contrast, Andrew Mitchel, a Connecticut tax lawyer
| interviewed by The Wall Street Journal for its reports on
| Americans giving up citizenship, states that the list is
| required to include all former citizens. [15]
|
| https://en.wikipedia.org/wiki/Quarterly_Publication_of_Indi
| v...
| ConSeannery wrote:
| It's not quite arbitrary, it relates to having to pay an
| exit tax if your global net worth meets or exceeds 2
| million.
|
| You are correct in that the IRS chose this number.
| steve76 wrote:
| >It's not exactly unfair or nefarious.
|
| >Eric Schmidt, the former Alphabet CEO, has applied to become
| a citizen of Cyprus.
|
| The rich jerk who needed free trillions or otherwise the
| world would end left us high and dry. Wow imagine that. And I
| wonder how this is going to end. Not like it's too difficult
| today to spread word through Turkish prisons that it's open
| season on rich Americans in Cypress.
|
| Public outrage? Likely you'll get complementary cigarettes
| sent to you in the mail.
| jarl-ragnar wrote:
| There's an irony in there somewhere given the original
| motivation for the "Boston Tea Party".
|
| No taxation without representation.
| larkost wrote:
| You are mistaken about the cause of the the Boston Tea
| Party. It was not about taxation without representation; it
| was about lack of taxation on tea from the East India
| corporation (which the King and his friends had a financial
| interest in). Many of the people protesting were owners in
| the local tea companies who's product was suddenly undercut
| because the King did not want to lose money on teas that
| were not selling in England.
|
| The "no taxation without representation" was a slogan
| applied after the fact.
| rejectedandsad wrote:
| Americans can vote overseas though
| masklinn wrote:
| "No taxation without representation" does not imply "no
| representation without taxation".
| jarl-ragnar wrote:
| I know. I was referring to the comment about not feeling
| represented.
| skatkartoffel wrote:
| Not all of them and even if you are eligible to vote,
| some states make it nearly impossible to request a
| ballot. I've been removed from the registry multiple
| times and had to fill out an emergency ballot which
| didn't even get counted in the 2016 election.
| greyhair wrote:
| Commonly called "click bait"
| andi999 wrote:
| One should actually be a bit careful to state such intent.
| https://en.m.wikipedia.org/wiki/Reed_Amendment_(immigration)
| pmoriarty wrote:
| A pertinent example of the kinds of people this amendment
| was apparently intended to bar from entry to the US:
|
| _" One example discussed was Kenneth Dart of Dart
| Container, who had become a citizen of Belize and then
| attempted to obtain a diplomatic visa to serve as Belize's
| new consul in Sarasota, Florida."_
| bee_rider wrote:
| From that article:
|
| "The wording of the statute is embarrassing. How can an
| alien renounce U.S. citizenship? In what capacity would
| said alien do so officially? One assumes that a court of
| law would find the language incoherent and unenforceable
| ... This is the way we legislate at 5 o'clock in the
| morning 4 days before adjournment."
|
| Nice to see lawmakers falling to the specter of trying to
| get that commit in for the next release, along with the
| rest of us.
| anticristi wrote:
| One could actually say they push code, although "code" in
| this context means law.
| aarchi wrote:
| Still seems relatively safe:
|
| > The Department of Homeland Security has stated that they
| cannot obtain the information required to enforce the
| amendment unless the former U.S. citizen "affirmatively
| admit[s]" his or her reasons for renouncing citizenship,
| and so from 2002 to 2015, only two people were denied entry
| to the United States on the grounds of the amendment.
| [deleted]
| dr-detroit wrote:
| The nefarious part is reap all the advantages of American
| Democracy and then turn around and don't want to share their
| toys with middle class slobs.
| texasbigdata wrote:
| Your representation is a bit exaggerated. The law
| simplistically simplifies to: if your income is above $X, then
| if your foreign tax payment $Y is less than the theoretical
| amount of tax you would have paid doing the same work under
| American Tax laws $Z, then please remit the difference ($Z-$Y)
| to the American government.
|
| I've personally filled out the forms several times, for
| multiple periods (full and partial). However I do agree with
| you: sure it would be nice not to pay that fee, isn't that true
| of every expense in general?
|
| It seems you either have a complicated personal situation or
| are in a jurisdiction that's purposefully set up to
| benefit/interact with the US in a tax advantagous way (aka a
| tax shelter, though that's going away - see general
| harmonization trends in EU, etc). Without delving into your
| personal situation, your personal tax situation should not
| impact your employment. Your citizenship might in certain
| highly regulated industries maybe. In the US you are not asked
| if you file joint or single on your tax return as part of the
| interview.
|
| You are correct on renounciation. And worse, let's assume the
| renounciation fee is 1/3rd of the wealth, should your net worth
| be concentrated and iliquid (you own nothing but a paid off
| home) you now need to generate a transaction which you might
| not want to otherwise do (sentimental, bad timing, poor market
| prices for the asset or low liquidity).
|
| If you have a complicated personal situation, you also hire
| professional help even if you reside purely domestically. Not
| fair to pin it all on the foreign taxation code.
| shry4ns wrote:
| Noob question -- what do you mean by harmonization trends in
| the EU? I couldn't quite understand from a google search or
| maybe even what exactly to search for.
| disabled wrote:
| This is a good read: https://www.hklaw.com/en/insights/publ
| ications/2021/07/agree...
|
| For example
|
| Control/Command + F = "Ireland"
| academia_hack wrote:
| Some years are fine, just subtract the earned income
| exemption and move on. Others are nightmares.
|
| Unlike in America, where there are accountants lurking around
| every corner, the tax code here is very "simple" (the vast
| majority of people probably never fill out a tax return in
| their lives). This means accountants charge like you're some
| sort of multi-millionaire business owner (since that's who
| their clients typically are). My last quote to get US &
| domestic taxes filed here when I was a grad student was
| $6,000 on a total income of <$50k. My situation wasn't that
| complicated - I had 2 part time jobs, won a competition prize
| for $20,000 and sold some stock.
|
| I just did my best to file on my own. I probably got
| something wrong since it's crazy confusing. Prizes are tax-
| free here, but taxable in the US and not typically "earned
| income" but are maybe covered by the foreign income exemption
| or a dual taxation agreement (since I did have to report it
| to the taxman here, the tax rate was just zero). I literally
| couldn't afford to figure out how much tax I owed and to who
| - nevermind the taxes themselves!
|
| Hopefully the IRS doesn't care enough to seize me the next
| time I visit my family. I tried my best, but that doesn't
| necessarily mean much in court. I think a lot of the problem
| is with the American tax code in general, but American
| accountants know nothing about the tax code here so I can't
| just ring up H&R Block and ask them to file over zoom (I've
| tried). Meanwhile, the only accountants who know about
| American taxes over here are specialist catering to the
| millionaire expat market. An hour of their time costs more
| than I earn in a week.
| throwaway287391 wrote:
| > Prizes are tax-free here
|
| Off-topic but: this always seemed like the most bizarre
| thing to me. What's the rationale? Why do governments want
| to incentivize people winning "prizes" over "honest work"?
|
| (My HN engineer brain also wants to know what the
| distinction is that prevents companies from calling any
| payment for a one-time contract a "prize" for completing
| the work, but I'm sure there's some unsatisfying "you know
| it when you see it" or "laws are people not code" type
| answer.)
| lozenge wrote:
| I can answer for the UK - the system is designed so that
| most people don't explicitly interact with the tax
| system. The only people that need to do so is the self-
| employed, running a business, or very highest earners.
| For everybody else, they can take advantage of tax breaks
| without filling in any forms, just by opening the right
| bank accounts/pensions or getting certain services from
| their employer. When they qualify for benefits, like
| Child Benefit, it gets paid separately into their bank
| account.
|
| A surprising number of tax benefits are possible this way
| - even the income tax deduction on charitable giving is
| done by getting the charity to do the paperwork instead
| of the individual taxpayer.
|
| So when it comes to taxing something that isn't going to
| be a significant tax stream and would require people to
| fill in declarations, the solution is-- just don't tax
| it.
|
| And the answer to your second question is, the payment
| would be "income" (defined as payment for completing
| work) and would fall under income tax. There's no
| exception in income tax for prizes because prizes aren't
| even income at all, as you don't work for them. But if
| you still tried it, it would fall under the General Anti-
| Abuse Rule.
| throwaway287391 wrote:
| Right, that makes sense. Thanks for the answer.
|
| > And the answer to your second question is, the payment
| would be "income" (defined as payment for completing
| work) and would fall under income tax. There's no
| exception in income tax for prizes because prizes aren't
| even income at all, as you don't work for them.
|
| Is it really so clear cut? I'm thinking of things like
| programming competitions -- in a sense you "work" to win
| a prize at one of those, don't you? So then what stops my
| employer calling all of my work as a programmer a
| programming competition? You could say "the competition
| organizers can't profit off of the work", but is that
| always true? Netflix could've legally profited off of the
| entries in the Netflix competition (even though they
| didn't), right? Similar for Kaggle contests. Would prizes
| from those count as taxable income? And even on something
| like a game show, they're profiting (or hoping to) from
| your participation/appearance.
| AdrianB1 wrote:
| My company frequently has campaigns with prizes: we pay
| the taxes, so the prize looks "tax free" to the winners.
| It is just where the tax and paperwork burden is placed,
| on the payer or on the winner.
| throwaway287391 wrote:
| Is it taxed at (average?) income tax rates or VAT rates
| or what? Unless it's taxed at the highest marginal income
| tax rate, it seems like there's still at least some
| loophole potential.
| monksy wrote:
| > Basically the only country in the world that charges taxes on
| money you make and spend somewhere else,
|
| Only country in the world that charges taxes on money that they
| have no business over.
| charonn0 wrote:
| It must be nice to have problems like that.
| larrysalibra wrote:
| As a former American who lived abroad for about 11 years before
| renouncing, "cartoonishly cruel" is a pretty accurate
| description of the system. It's even worse an American
| entrepreneur abroad because that makes things even more
| complicated.
|
| I gave up jumping through the hoops in 2018 and the self-
| torture and renounced. I shared my story in case anyone is
| interested: https://larrysalibra.com/goodbye-usa/
| dr-detroit wrote:
| interesting he hates america but loves that stylish iWatch.
| he just wants to reap a luxury lifestyle and give nothing
| back tot he peasant class.
| dsomers wrote:
| I feel for you. My grandparents were apart of the Italian
| diaspora too, but they ended up in Canada. I often thought
| how difficult it would be if I had to choose because both
| countries are close to my heart. I've seen a number of
| American friends that are also duel citizens have to deal
| with the stress and unfairness that you have. I just feel
| really lucky and privileged that I don't have to be in the
| position to choose even though I no longer live in Canada or
| Italy.
| gr1zzlybe4r wrote:
| Have you ever wondered if it weren't HK - where your exit
| country would be? Did Italy or any other place in the EU
| appeal to you at all? I hold dual US-UK, which means the EU
| isn't really an option for me anymore.
| larrysalibra wrote:
| I think about it time to time. But haven't come to any
| conclusions. Some things about Italy are great - the
| geography and people. And compared to the USA they treat me
| very well as an Italian abroad - they proactively send me a
| ballot to vote every year and even give overseas Italians
| our own representatives in the legislature.
|
| I've certainly liked visiting a number of places in the EU
| - it might be fun to try to live there.
| bcrosby95 wrote:
| I sort of wish I did this when I was younger. But I have
| kids, family, and extended family (on both sides) all in
| California. It makes it difficult to leave the state much
| less the country.
| vertis wrote:
| This is a really interesting read. I'm not a US citizen (AU &
| NZ) and don't face the same problems when being overseas, but
| I definitely relate to it not really feeling like home now
| that I've been away for several years.
|
| Thankfully, it's not as hard to not pay AU/NZ taxes, it's
| still a little bit painful to prove you're not living there,
| but not even in the same league as the US.
| shell0x wrote:
| This was a good read. It's interesting that you decided to
| stay in HK after the protests/hostile takeover in 2020. My
| partner and friends all left HK for the UK, Australia, and
| Canada.
| larrysalibra wrote:
| Thanks for reading!
|
| The stay versus go debate in HK is always very interesting
| and one that has been going on for decades and will no
| doubt continue for many people.
| shell0x wrote:
| I think it reached a point of no return. HK is still a
| very special place, but I see a lot of expats leaving for
| Singapore and Hkers leaving for overseas(BNO visa).
|
| Singapore is more stable, but has even less freedoms than
| HK though.
| walshemj wrote:
| Depending on how bad it turns out I could see a wave of
| HK emigration to the UK.
|
| Similar how a lot of Asians living in Africa (Uganda
| Kenya etc.) did in the 1970's, Without the ethnic
| cleansing aspect.
| pas wrote:
| What's the tipping point for you? (Or possible lines in
| the sand?)
| hitekker wrote:
| > By funding and participating in the system, we give the
| system legitimacy and only make the system stronger and the
| problems worse. Exiting is the high leverage and most
| effective option.
|
| Very interesting indeed.
| [deleted]
| eplanit wrote:
| Other nations reject our wealthy, while we prioritize herding
| the impoverished into the US. The future does not look so
| bright.
| 3327 wrote:
| Nice summary 100%.
| baxuz wrote:
| I don't see how wealth has much to do with it. It's a question
| of citizenship and taxes.
|
| The other extreme is what we currently have in Croatia:
|
| A vast group of people who don't live here have citizenship and
| they express their patriotism by voting for the conservative
| right without exception for the past 30 years.
|
| If you want to be treated as a citizen -- live here and pay
| your taxes. If you don't, the door's that way.
| danmaz74 wrote:
| If you're Italian and living abroad, you can vote to elect
| one of the few members of parliament which actually represent
| migrated Italians. This way they can still have a bit of
| representation, but without the same amount of influence as
| if they were living in the country.
| Leherenn wrote:
| Is the ratio of electors/MP different for expats vs those
| living in the country?
|
| I can certainly understand the anger of the GP, apparently
| roughly 25% of the Croatian citizens do not live in the
| country. As an expat myself, having a say in how my home
| country is run is nice, but I feel it's a bit "easy",
| because I mostly do not have to live with the consequence
| of my choices.
| danmaz74 wrote:
| Yes, I don't remember the actual ratios but it's much
| fewer representatives per person for citizens living
| abroad.
| NoOneNew wrote:
| >If you want to be treated as a citizen -- live here and pay
| your taxes. If you don't, the door's that way.
|
| Lol, that's considered "conservative right" ideology in the
| USA.
| hehetrthrthrjn wrote:
| For a bit of context, there is a bit of 'tension' between in-
| country Croatians and expats. Generally the latter left for
| greener pastures and the former stuck it out through
| communist rule and the war. There are at least as many
| Croatian expats as not.
|
| The expats usually left because they didn't like the
| strictures or ideology of communism. Some had property
| confiscated and/or were harrassed by the authorities for
| whatever reason. Most of these people have a reflexive
| aversion of the left and are reliable right wing voters.
|
| Those who stayed seem to be those that agree with communism
| to whatever degree, who were part of the communist regime in
| some way or those that did not mind or did not have the means
| or will to leave. Some have been indoctrinated to some
| extent, or maybe more correctly they have grown up in the
| culture of that time.
|
| Many ordinary people suffered from a relatively poor quality
| of life under communism. Croatians received a relatively
| smaller share of resources and opportunities because of
| Serbian dominance of Yugoslavian government.
|
| The differences are not all or even mostly political. Many
| locals just resent expats who avoided the misery and show up
| with money and a particular attitude, usually a critical one
| as to the dysfunction and corruption in Croatia, amongst
| other criticisms.
|
| Full disclosure: I'm an expat (who lives in Croatia, for
| now), so that may colour my view.
| throw37388 wrote:
| >> Basically the only country in the world that charges taxes
| on money you make and spend somewhere else, just because of
| where you were born.
|
| Some other countries do that as well. Norway for limited time
| period. Some others have exit fees etc.
| emodendroket wrote:
| Most people don't actually owe anything so the burden is mostly
| administrative, and what you're going through it for is not
| "where you were born" but continued citizenship and attendant
| benefits. As the article describes, you're free to give that up
| if you don't think it is worth it.
| depressedpanda wrote:
| The article states
|
| > "There are probably 20,000 or 30,000 people who want to
| [renounce citizenship], but they can't get the appointment,"
| Lesperance said. "There's not a peak demand -- the system's
| capacity has peaked."
|
| Also, it seems you need to pay a non trivial sum to do it,
| which is a real problem for US citizens abroad who are not
| rich.
|
| "Free to give that up" does not apply, unfortunately.
| emodendroket wrote:
| Not sure where you got the thing about the cost, which
| doesn't seem to be in the article, but it also flatly
| states that "The people who flee tend to be ultra-wealthy,
| and many of them are seeking to reduce their tax burden."
| depressedpanda wrote:
| The article talks about the ultra wealthy, but they have
| the power, money and means to easily deal with the
| citizenship taxation bs. I don't care about them.
|
| The problem is that those rules are punishing regular
| people.
|
| I know one person who wasn't allowed to open bank
| accounts because of her citizenship. Another who yearly
| gets stressad out because filing US taxes is such a
| grueling process compared to the local process where
| you're done within ten minutes. Another wants to renounce
| citizenship because he doesn't want to deal with the
| bureaucracy, but he cannot afford it.
|
| They all live in Sweden, which I doubt anyone sane would
| consider a tax haven.
|
| If Eritrea is the only other country in the world that
| implements similar draconian tax laws, maybe there's
| something wrong with those laws?
| christkv wrote:
| Oh god don't get me started. I cannot have a shared account
| with my wife because she is american. She can only be
| authorized. She cannot get her own credit card but has to be an
| authorized card holder on my account.
|
| If I tried to actually but her as a shared account user the
| bank told me they will terminate the relationship.
| jimkleiber wrote:
| When I lived and worked in East Africa, I know that most, if
| not all of my income, was not taxed back in the US because of
| the Foreign Income Exclusion Act. Basically, for foreign earned
| income anywhere below ~$80,000 at the time, I didn't have to
| pay tax, which the limit is now around $108,000 or so.
|
| However, as you point out, that doesn't seem to apply to
| dividends and capital gains and other types of income [1].
|
| I wonder why it doesn't apply to those other incomes and if it
| did, whether that would alleviate many of the problems for most
| Americans overseas. In other words, why not just have a
| threshold below which all foreign income is not taxed and then
| tax above it?
|
| I'm curious to learn more about the history of that act and why
| it developed as it did.
|
| [1]: https://www.irs.gov/individuals/international-
| taxpayers/fore...
| emodendroket wrote:
| It seems like it is a more progressive scheme to protect
| wages over investment income.
| mellavora wrote:
| The problem isn't paying tax, it is
|
| 1) filing, which is enormously complicated, and 2) severe
| restrictions on what financial services you can access.
| ithinkso wrote:
| It's also problematic in other way, my friends moved to US for
| a job for few years and had kids there. US gives you
| citizenship by place of birth so the kids have US citizenship.
| Now that they are back they are in a bit of a pickle not
| knowing what to do, the kids might be screwed and own money to
| the US for nothing when they grow up but renouncing it now for
| them also doesn't make sense (if even possible) because they
| might want to have it, who knows.
| [deleted]
| Dracophoenix wrote:
| Look up "Accidental Americans". It's been a problem for a lot
| of people including, especially Canadians and Mexicans who
| were born on the wrong side of the border.
| paulddraper wrote:
| US states do the same thing.
|
| States with income tax will tax you whether you work in the
| state, or you are resident in the state.
| a4a4a4a4 wrote:
| Or if you're in NY for too many days, even not for work,
| they'll tax you too :)
| paulddraper wrote:
| Or if you're remote but company HQ in NY.
| umeshunni wrote:
| Or in the case of California, up to 4 years after you leave
| the state.
| [deleted]
| Klonoar wrote:
| Virginia also has some oddities here, frustratingly.
| Justsignedup wrote:
| This was to close certain problematic tax avoidance issues.
| People were fleeting from the US to avoid paying taxes, but
| kept all the benefits, or hid the money off-shore.
|
| The problem here is that they never raised the amount you must
| report, because in the past, 150k used to be a lot. Now that
| should be closer to 500k. But like the minimum wage and tax
| brackets, they haven't kept it up with inflation. Not in the
| way they needed to at least.
|
| Unfortunately the main loss from US citizenship loss is voting
| and potentially travel to the US. But the wealthy influence
| politics by lobbying not voting.
|
| Now if Citizenship was required to fund lobbying... wooh that
| would be a big hit for those abandoning the US.
| unishark wrote:
| Kept all what benefits? People who fled the US are now living
| under some other country's benefits, and pay taxes there
| instead.
|
| Don't citizens of (almost) every other country in the world
| have the ability to go live abroad and keep all their
| benefits, whatever they are? I'm not following where
| Americans can actually get away with anything special.
| masklinn wrote:
| > Don't citizens of (almost) every other country in the
| world have the ability to go live abroad and keep all their
| benefits, whatever they are?
|
| aren't those benefits just the travel-ability of their
| passport and the right to return?
|
| I can only guess the US is such a great country you need to
| pay fir the right to return?
| AniseAbyss wrote:
| Always amused me how every financial service the world over
| asks if you're a US citizen and denies you if you answer YES.
| Nobody wants to deal with the IRS.
| gautamdivgi wrote:
| Could it be because you're eligible for social security even if
| you don't reside in the US? I'm not sure about medicare or
| unemployment benefits.
| jleyank wrote:
| My understanding is that US-ian expats can collect Social
| Security while outside the country (not sure if it can be
| deposited, as we're not doing that). Medicare has no meaning
| outside the US but we're eligible. Non- (and I assuming
| renounced) citizens can't get Social Security unless they
| live in the US, I think. And don't forget there's also a
| foreign tax credit as well as the Earned Income exclusion.
| api wrote:
| AFAIK if you live in a country like Canada with higher taxes
| you still have to file to maintain citizenship but you end up
| paying zero since you can deduct what you paid in your home
| country.
|
| This would apply to people relocating to countries with a lower
| tax base. In that case you have to renounce.
| guyzero wrote:
| Deductions vary greatly between jurisdictions. Capital gains
| taxes vary greatly, tax-sheltered savings accounts may not be
| recognized, certain rollovers programs probably only exist in
| one of the jurisdictions, etc. None of these people
| renouncing their citizenship just make straight employment
| income.
| christinamltn wrote:
| There isn't always symmetry in the tax status of various
| elements. The US doesn't recognize Canadian Tax Free Savings
| Accounts (similar to Roth IRAs) so you can't benefit from
| them without being taxed in the US.
| [deleted]
| simonh wrote:
| You can still get caught out. Taxes in the UK are generally
| higher than in the US, but Boris Johnson still got hit with a
| US tax bill when he inherited a flat in London.
| kingosticks wrote:
| And any ISAs (or similar tax free savings things) you hold
| are fully taxable by the US. Joy.
| fourthwaveska wrote:
| By most western standards my family teeters on the line between
| middle and upper middle clas.
|
| We sold all of our US property last year; and now we are shopping
| for 4-6 unit buildings within 100km of Barcelona to get our
| Golden Visas. Our goal is to get citizenship and access to the EU
| then renouncing my US citizenship.
|
| It isnt about money, I am juwt ashamed to have an American
| passport and know my tax dollars are being spent on war and
| murder in the name of christ and oil profits.
|
| I was born an American and would prefer not to die that way.
| sergiotapia wrote:
| Stop the cap
| sec400 wrote:
| Greece + Italy golden visas also worth taking a look at.
| marcyb5st wrote:
| Yes! Also, not tied to golden visas, but in Italy we have
| this going on: https://1eurohouses.com/ . It is legit and not
| the classic Italian scam (it's sanctioned by the government).
| fourthwaveska wrote:
| I wish! Greece was my secone choice (I used to study Lyra in
| Crete, and Rembetiko Bouzouki (Rembetiko style) in
| Thessaloniki and Athens.
|
| We almost bought a flat in the Exarchia neighborhood of
| Athens! Politically/Energetically It's what Berkeley was like
| in the early/mid-90s.
|
| The day Trump was elected we were in Barcelona, and decided
| never to go back to the USA, flipped a coin between Spain and
| Greece. I always lose coin flips!
| keewee7 wrote:
| Spain is a NATO country involved in many American wars in the
| past 30 years.
|
| If you oppose US wars and hegemony you should have followed
| Edward Snowden and moved to a country that actually oppose
| American influence in the world.
| fourthwaveska wrote:
| Re: Nato, fair point. There is still a difference between
| being bullied into submission to American hegemony and being
| part of the us empire.
|
| I really, really detest cold weather and drunk people, both
| of which Russia has in abundance. Russia and China are just
| as offensive to my own moral compass as the USA.
|
| Once we attain citizenship I'm going to try to convince my
| family to move to Esbjerg, at least for a few years.
| lordnacho wrote:
| The city on the west coast of Denmark? Is that a typo?
| fourthwaveska wrote:
| Yes, I love it there. My two closest friends moved there
| to study marine archaeology and within 3 years another 7
| had moved there. We were married in Fano. I'm old, I like
| the quiet.
|
| Ideally we would spend our winters somewhere warm and the
| rest of the time in Denmark.
| lordnacho wrote:
| It's certainly nice in the summer. Long but not too long
| sunlight, warm but not oppressive. I guess if you just
| spend summers there it wouldn't be hard to arrange.
| coldtea wrote:
| > _Spain is a NATO country involved in many American wars in
| the past 30 years_
|
| Which doesn't mean much. NATO is not some alliance, it's the
| US calling the shots and others doing as told, or else
| (insert diplomatic, economic, etc. pressure).
| coldtea wrote:
| > _By most western standards my family teeters on the line
| between middle and upper middle clas. (...) we are shopping for
| 4-6 unit buildings within 100km of Barcelona_
|
| I'm not sure this is what upper middle, much less middle, class
| is.
|
| A family that can pay several millions for houses abroad just
| to get a visa to change citizenship is way above middle class,
| or even upper middle class for that matter.
|
| Pew Research defines middle class: $53,413 - $106,827 year, and
| upper-middle class: $106,827 - $373,894.
| fourthwaveska wrote:
| The Spanish golden visa will require a EUR550k housing
| investment, then the normal amount of accrued in-country time
| for citizenship.
|
| Maybe we're sort of upper midde-class then. We gross about
| $200k consulting. Not rich, not poor.
|
| We live in the developing world now so here we are definitely
| upper middle class/rich, and do not have millions in assets.
| ggggtez wrote:
| You are upper class. Yes you're not rich, but you're not
| middle class.
|
| The middle class American dream is a house in the suburbs
| with a white picket fence, 2 cars, and a dog.
|
| You're talking about buying a half million dollar house in
| Spain because of a moral concern about global geopolitics.
| You're not middle class.
| vernie wrote:
| Rich people love to say they're "middle class" or
| "comfortable"
| cactus2093 wrote:
| The amount of the US where you can buy a detached single
| family home with a white picket fence and 2 car garage
| for significantly under half a million dollars is
| probably not as much of a majority as you seem to think.
|
| Not everywhere is the bay area, where you'll struggle to
| find this for under $1.5M. But $500k is not that much for
| a house these days in a lot of the markets where huge
| percentages of the population live (from the tri-state
| area, to Boston, to Seattle, LA, Austin, etc.) and lots
| of middle class people live in houses valued at more than
| this.
| PaulDavisThe1st wrote:
| To be fair to the poster, they said that they sold their
| US propert(ies|y) which if they are older Americans
| probably releases an amount of capital that substantially
| covers the cost of the building they may acquire in
| Spain.
|
| But yeah, when the median US household income is about
| $68k, early $200k a year puts you far outside the middle
| class, even if it doesn't feel that way. [ yes, cost of
| living in NYC or SF has some impact on this, but not
| much, given the median household income in those cities
| not actually being much above the national figure ]
| boulos wrote:
| Just a nit, but the San Francisco median household income
| is around $112k [1] for the same year as the $68k you
| mentioned [2]. I think 50% more counts as "much above the
| national figure".
|
| [1] https://www.census.gov/quickfacts/fact/table/sanfranc
| iscocit...
|
| [2] https://www.census.gov/library/publications/2020/demo
| /p60-27...
| grumblenum wrote:
| >It isnt about money, I am juwt ashamed to have an American
| passport and know my tax dollars are being spent on war and
| murder in the name of christ and oil profits.
|
| You know Bush isn't president anymore, right? That hasn't been
| a a popular (and I would say erroneous, even when it was
| popular) talking point for more than a decade.
|
| I do find it interesting that expatriation trends seem to pivot
| in years with presidential elections, according to that chart.
| tech_tuna wrote:
| Congratulations, I would do the same but I do not have the
| means to do so.
| remir wrote:
| Please don't take this personnaly as I'm not targeting you
| specifically with my comment: but I don't know how I feel about
| wealthy foreigners coming to a place, buy property and extract
| rent from locals, who may not even be able to afford ownership
| in the first place.
| cpursley wrote:
| Spanish tax and legal system is a nightmare. Have you looked at
| Portugal?
| fourthwaveska wrote:
| Yes, but my wife has spent the past four years learning
| Spanish and every time I suggest Portugal she gets a
| murderous look in her eyes.
|
| My preference is actually Denmark, but it is an order of
| magnitude more difficult to move there, and my wife hates the
| language :(
| Izikiel43 wrote:
| Portuguese is not that different from spanish.
| moneywoes wrote:
| Don't they have no capital gains tax?
| donretag wrote:
| While the taxation due to US citizenship has occurred now for a
| hundred years, only now is the US govt enforcing it, mainly due
| to the Foreign Account Tax Compliance Act (FATCA) signed into law
| by Obama.
| JCharante wrote:
| I'm surprised more HN readers don't view citizenship as a
| subscription tier. Non citizens can work in the US but it's
| harder to do the paperwork.
|
| What's wrong with comparing benefits between service providers?
| Yes the US will try to save you if you get kidnapped by
| extremists, but they won't go out of their way to get you
| vaccinated against covid unlike the Chinese government who sent
| sinovac supplies abroad to vaccinate their citizens.
| mariuolo wrote:
| > subscription tier
|
| One word: draft.
|
| Would you die for your service provider?
| dna_polymerase wrote:
| How many of those never even lived in the U.S. but where born
| there and left as babies?
| https://www.washingtonpost.com/world/2020/10/27/us-citizensh...
| In this case it was 'only' a nurse, but if she'd made $2 million
| she would be on that list, right?
| zarkov99 wrote:
| Of course they are. When the dominant narrative is that America
| is a racist hellscape, built on oppression and plunder then
| things like patriotism and civic spirit seem absurd, quaint
| notions, ripe for ridicule.
| fourthwaveska wrote:
| Patriotism? What exactly is that word to you? To me it is merey
| loyalty to mud.
| s1artibartfast wrote:
| Caring about your society, institutional values, and
| countrymen.
| luffapi wrote:
| That's not the "dominant narrative", it's historical fact.
| Slavery, segregation and genocide of Native Americans aren't
| fabricated stories, they actually happened.
|
| Patriotism is for fools. Civil spirit starts with not rejecting
| citizenship for tax reasons.
| Dma54rhs wrote:
| Every border in the world is built upon blood and war, not
| any different really.
| libbroscrubber wrote:
| The US had segregation until 1964. It's pretty much done
| non-stop military adventurism since it's inception. Yes,
| most countries are unethical and morally repulsive, but the
| US is at the very top of the heap and it has been for a
| long time.
| revolvingocelot wrote:
| This line of argumentation is always so strange to me because
| it supposes a strange sort of emotional fragility in the rich
| that I can't quite square with the exceptionalism we allllll
| know they possess.
|
| You think the dominant narrative is that America is a racist
| hellscape? No, no; America is the greatest country on the
| planet. I heard it on the news. Surely the increasingly
| consolidated media, owned by the emotionally-fragile rich,
| could address the dominance of that narrative? Failure to come
| together to address such a horrifying distortion of reality,
| after all, would be extremely dangerous to our democracy[0].
|
| In seriousness, I think that your conclusion that the rich are
| leaving because of culture-war issues is unsupported by the
| assertion that the dominant narrative is that Murica sucks. The
| dominant narrative is that America is the land of the free,
| dude. Unpleasant realities like Trump profiting from the Secret
| Service having to stay at his hotels, or the dynastic nature of
| Presidential politics, or how the IRS goes after the poor for
| lack of the funding that hitting the big-time cheats would
| require, or how three of the most recent dynasties had ties to
| an infamous pedophile, or how that pedophile "killed himself"
| while in high-profile protective custody -- it's all
| unimportant. Propaganda both subtle and gross smooths things
| over. The Pledge of Allegiance seems very, very strange to many
| other cultures, especially Western ones.
|
| I think it's far more likely that they're striking out, as
| their ancestors once did, to seek a better life. If I were in
| the habit of cluttering my environment with effluent ponds of
| various negative externalities, I too would probably want to up
| and move somewhere with more of a pleasant aspect. Especially
| if I got to keep all the proceeds of my previous exploitations.
|
| [0] https://www.youtube.com/watch?v=ZggCipbiHwE
| zarkov99 wrote:
| I think you misunderstand me. I am not saying the rich are
| leaving because of culture war issues. I am saying that the
| incessant claims that America is just the worse erodes the
| social fabric for everyone, including the rich, and one
| manifestation of such erosion is that it becomes morally
| acceptable to cheat the system. After all it is a corrupt,
| racist, oppressive, hypocriptical imperialistic system, so
| why pay into it?
| revolvingocelot wrote:
| The problem with your supposition here is that America's
| rich have been already acting like "corrupt, racist,
| oppressive, hypocriptical imperialists" for at least 120
| years. United Fruit Company[0], the Business Plot[1], etc.
| For the rich, it has always been morally acceptable to
| cheat the system. The 20th century saw the establishment of
| pensions, then they were raided barely a generation
| afterwards.
|
| I think what you're complaining about is that the
| historical propaganda (not to mention historical material
| abundance for the plebes) which smoothed over the bad stuff
| doesn't work as well in the modern age. There's cellphone
| cameras, whistleblowers, shrinkflation, and planned
| obsolescence these days. What investment and fellow-feeling
| _should_ the little people feel for The System?
|
| [0] https://en.wikipedia.org/wiki/United_Fruit_Company
|
| [1] https://en.wikipedia.org/wiki/Business_Plot
| [deleted]
| throwaway5752 wrote:
| I've considered it (not wealthy by the definition here) because
| of the prior four years and lingering weakness in the system of
| government. There was very nearly a successful putsch this year,
| and it's widely popular with the party that attempted it. I am
| patriotic and pay my taxes - I would pay more - but I have
| explored dual citizenship for the same reason that Germans did in
| the 1930s.
| da39a3ee wrote:
| US salaries are much more than salaries in, say Europe/UK (for
| software engineers). Is it worth maintaining US citizenship in
| order to make it easier to work remotely for US companies from
| outside the US?
| xorfish wrote:
| How the US treats expats is really bad.
|
| No wonder that many renounce citizenship.
| hnbalsamicw wrote:
| As a permanent resident living in the US I find myself wondering
| if it thusly makes sense to never take US Citizenship. It seems
| like I can easily abandon my residency the moment I want to
| retire and leave the US. Am I missing something ?
| liquidmetal wrote:
| Permanent residents are also subject to the expatriation tax
| AFAIK.
| gniv wrote:
| It's more complicated than that. If you've had the green card
| more than (I think) 8 years you will be treated like a citizen
| should you want to give up the residency. So you have to pay
| the exit taxes (mentioned somewhere else in this thread).
| liamdgray wrote:
| If I am a US citizen with negligible assets and a plan to move
| abroad and renounce my US citizenship, and I plan to found a
| software startup, how should I go about it to minimize the taxes
| I eventually pay to my soon to be former government, whose unjust
| practices I'm trying to stop funding?
|
| I could potentially wait until my US citizenship is a thing of
| the past before I even build anything, let alone create a new
| legal entity. But ideally I would find a way to start this now.
| sunstone wrote:
| So long and thanks for all the fish.
| throwpo wrote:
| I stand to make a life changing amount of money through an
| impending future liquidity event. I cannot understand people who
| do this.
|
| Throwing away US citizenship for mere extra dollars in ones bank
| account... What is the state of your life? Have you no family or
| community? Are you really willing to uproot yourself and your
| entire lifestyle for mere wealth?
|
| The HN libertarians love to comment on articles like this and
| point fingers at progressives like they are ruining the US. As
| someone who would actually feel a significant impact from this, I
| can tell you I cannot relate to that position at all. Even should
| there be a wealth tax, or whatever, it would take Jan 6 levels of
| violent upheaval on the regular before id ever consider giving
| away my citizenship.
|
| Maybe the minuscule number of people who do this don't have all
| that much to tell us--except that avarice knows no limits?
| expathrowaway wrote:
| I am considering renouncing my US citizenship and it has little
| to do with money. I've been living abroad for 10 years now and
| I have no interest in moving back. I am in regular contact with
| my family and friends back in the US and I also have a social
| local social life. All I'll be giving up is paying US taxes and
| being able to spend more than 90 days a year visiting.
| surfingdino wrote:
| International tax reporting is a real burden and I am not
| surprised they choose to go down that route if it makes life
| easier for them.
| alephnan wrote:
| There's this idea floating around in this thread that people get
| rich, then get richer in and then leave to evade taxes.
|
| If optimizing for money really was people's intention, it's much
| more optimal to leave before you become mega rich.
|
| You can move to Singapore once you have $6 million to buy a visa-
| by-investment. There's no cap gains taxes there, so your money
| can compound unencumbered.
|
| Then again, not every ex-pat who renounces their citizenship does
| that, maybe because they don't want to live in Singapore. Some of
| us ex-patriate to countries with even higher taxes than the
| states.
|
| Look at the number of people ex-patriating with a grain of salt.
| It's like the Drake Equation, there are many factors that would
| allow you to narrow the 'search space', and after all is said and
| done, there will just be a small amount of people who have
| outsized influence in the states and also evading taxes.
| ttyprintk wrote:
| This --- they have the wealth to initiate the process.
| Citizenship by investment (CBI) is even cheaper in the
| Caribbean. Interestingly people from mainland China and the
| Middle East hit the Caribbean first for this. I don't think
| it's a stretch to say that the reasons haven't changed.
| someguydave wrote:
| The interesting thought experiment is what would happen if the
| US dropped its worldwide claim to taxes. I suspect there will
| be a pretty big exit migration of wealthy US citizens to
| capitol gains tax havens like Singapore.
| MuirsGhost wrote:
| >it's much more optimal to leave before you become mega rich.
|
| It is almost as if the US provides some kind of useful,
| taxpayer funded, environment for becoming mega rich....
| 1270018080 wrote:
| Buying political parties?
| c_o_n_v_e_x wrote:
| Overseas American here. The whole paying tax and getting nothing
| out of it really sucks. I've been out over 10 years, here are
| some of my good and bad experiences.
|
| Good: 1. When I first got here, super cheap drinks put on by the
| marines at the US embassy. People would get wasted and it was an
| obvious security threat so those parties don't happen anymore.
|
| Bad: 1. No access to covid vaccine despite paying taxes and not
| having vaccine access in local country for a while. This was a
| hot topic in many US expat communities. Globally, Embassy and
| consulate staff were all vaccinated but it was "bad optics" for
| overseas citizens to have vax access. 2. Brother (also citizen)
| was on a trip to Kilimanjaro as covid was kicking off. The Europe
| travel ban was announced so I tried calling the embassy for
| travel advice, not even a return call. 3. While I haven't
| personally needed it, if the doo-doo hits the fan, you're on your
| own. You pay for the cost of your own evac, even if it's a Govt
| flight. 4. The annual pain and cost of tax filing and bank
| account reporting. 5. The ongoing pain of trying to get financial
| services as an overseas US citizen. Banks, stock brokers, etc
| don't want you.
|
| It's my understanding that in French government, they have a
| specific representative for overseas citizens. In the US, our
| voices are scattered across 50 states (and homelanders don't care
| about us) so we always get shaft.
|
| All that being said, I have no plans to renounce.
| throwaway5372 wrote:
| > 1. No access to covid vaccine
|
| Countries were not vaccinating permanent residents? I had no
| problem getting a vaccine as a foreigner in Turkey. I thought
| all countries would be like that.
| c_o_n_v_e_x wrote:
| I got the vax eventually. Given that I was a foreigner and
| under 40, I was at the back of the line to get my shots. My
| family back stateside were fully vaxxed a good 4 to 5 months
| ahead of me.
| roenxi wrote:
| Wow. Eric Schmidt, Cyrpruscian. Cypricite? Cyprosii?
|
| The real question here is what the context and amounts of money
| involved are. % figures in small numbers are useless, a few
| billion dollars means nothing to America. It isn't even clear to
| me that this is evidence the "people will stay, even if taxes
| rise!" crowd have to admit a mistake.
|
| And the US has declared a War Against American Citizens Investing
| in Foreign Countries. The restrictions Americans face on opening
| a foreign bank account are quite stunning from what rumours I've
| heard.
| ilammy wrote:
| > _Cyrpruscian. Cypricite? Cyprosii?_
|
| Cypriot.
| tremon wrote:
| _Eric Schmidt, Cyrpruscian. Cypricite? Cyprosii?_
|
| Cyprous.
| arbitrage wrote:
| this is not new. nor is trying to surreptitiously gin up sympathy
| for tax avoiders' plights via polemical journalism pieces like
| this.
| oriettaxx wrote:
| someone calls this "voting with your feet". you do not like it,
| and you just leave.
| jl2718 wrote:
| > Eric Schmidt, the former Alphabet CEO, has applied to become a
| citizen of Cyprus.
|
| Is he going to pay an exit tax, or has he found a way around this
| too?
| circular_logic wrote:
| Interesting facts about renouncing American citizenship:
|
| - There is renunciation fee that has to be paid and currently
| stands at $2,350 (the highest in the world).[1]
|
| - A final tax return will sill need to be filed. [1]
|
| - An Expatriation tax is payable if [..] Your net worth is $2
| million or more on the date of your expatriation. you will be
| treated as having disposed of your assets the day before your
| expatriation and will be subject to capital gains tax.
|
| - The highest capital gains tax bracket in the USA is 20% [2]
|
| Now there will be ways this is avoided but it would seem that the
| IRS is trying very hard make this process unappealing
|
| [1] https://www.expatnetwork.com/how-to-renounce-us-
| citizenship-...
|
| [2] https://www.nerdwallet.com/article/taxes/capital-gains-
| tax-r...
| shell0x wrote:
| While $2350 is expensive, compare that to Australia. My friend
| got sponsored by his partner for a partner visa and the fee is
| AUD7,850 for most applicants.
|
| https://immi.homeaffairs.gov.au/visas/getting-a-visa/visa-li...
|
| It's a huge rip-off like everything in this country.
|
| The $2350 seem to be cheaper than fees for filing annual tax
| returns for the next 50 years :)
| GordonS wrote:
| On the other side of the equation (getting citizenship,
| rather than renouncing it), here in the UK I have a Chinese
| friend for whom it cost over PS20k to gain citizenship after
| she married a local. (this was the total paid to the
| government over, I think, a 3 year period).
| smnrchrds wrote:
| The fee for renouncing Australian citizenship is 265 AUD
| equivalent to 196 USD.
|
| https://immi.homeaffairs.gov.au/citizenship/give-up-
| citizens...
| bell-cot wrote:
| > ...it would seem that the IRS is trying very hard make this
| process unappealing
|
| IANAL, but I believe that all the unpleasantries which you note
| were decided by the U.S. Congress. (Most probably with the
| President's sign-off.) Making the IRS out to be the Real
| Villain(tm) here only helps a bunch of self-serving politicians
| to evade responsibility.
| AdamN wrote:
| +100
| azinman2 wrote:
| And what's wrong with this? Personally I'm very happy to see
| it. The idea that you make tons and tons of money by what
| America has worked hard to offer you and then you want to
| skip town because of taxes? Taxes that help pay for all the
| advantages that got you that wealth in the first place?
|
| Good for Congress for trying to prevent this.
| junon wrote:
| Ehhh not sure about that. America doesn't have high taxes
| compared to many other places to live. This isn't as clear
| cut as I think you think it is.
| azinman2 wrote:
| Then you're refuting the basic premise of the article,
| which is that the ultra wealthy want to avoid taxes.
|
| Why else would Eric Schmidt want to become a citizen of
| Cyprus, which then also allows him to live elsewhere in
| the EU? It's certainly isn't to end up laying more in
| taxes than he would in the US.
| ucha wrote:
| Being a citizen of Cyprus gives him visa free travel and
| work options in Europe. As he hasn't renounced US
| citizenship, he certainly isn't taking advantage of that
| for tax reasons. The article seems to imply otherwise,
| but that's basically what bad journalism is... strongly
| suggesting an incorrect interpretation of facts while
| still "telling the truth".
| jleyank wrote:
| There is a real problem with the US-expst taxes when
| moving to a lower-taxed state... The difference is owed
| to the US and it's now a positive number.
| washadjeffmad wrote:
| Not to derail, but surely you're aware that tax-funded
| services taken for granted in those "many other places"
| are separate fees in the US.
| junon wrote:
| Not sure what you mean. Please explain.
| bell-cot wrote:
| If the unpleasantries only applied to a few very rich, who
| were trying to skip town that way, then you'd have a decent
| argument.
|
| Unfortunately, it sounds like the vast majority of targets
| bear no resemblance to your stereotype. And the system has
| no interest in discriminating between the few filthy rich
| town-skippers and the vast majority who are just easy
| victims.
|
| Targeting all members of large group - because a small
| minority of them are "bad" in some emotional-button-pushing
| way - has a very long and disreputable history.
| apples_oranges wrote:
| Can a citizenship be exchanged? For example you get my
| Australian passport, I get your American? Neither country loses
| a taxpayer this way.. ;)
| shell0x wrote:
| Not exchanged, but considering Australia and America are both
| immigrant countries, you may be able to get an Italian or
| Irish passport based on ancestry if your ancestors came from
| there.
| ttyprintk wrote:
| I believe to renounce you must first have dual nationality.
| You could marry a foreigner for nationality, then
| (eventually) both renounce your home country.
| circular_logic wrote:
| While that is the smart way to go. The USA is one of the
| few country's that will allow you to become stateless.[1]
| But I am not sure why you would ever do that.
|
| [1] https://en.wikipedia.org/wiki/Renunciation_of_citizensh
| ip#St...
| cblconfederate wrote:
| I always wanted to start a "couchsurfing for passports" , or
| even airbnb. If one is a citizen, they can vet for an
| exchange citizen, sounds democratic to me.
| Retric wrote:
| That honestly seems quite reasonable. Citizenship comes with
| all sorts of obligations like getting drafted and serving on
| juries, taxes are simply the most obvious.
|
| On the up side you can apparently still qualify for Social
| Security benefits.
| FredPret wrote:
| Citizens are not assets of the state
| Retric wrote:
| It's a reciprocal relationship with rights and obligations
| on both sides not ownership. For example the FBI doesn't
| invoice victims or their families when it gets involved in
| kidnapping cases.
|
| Capital gains are deferred _without interest_ until an
| asset it sold, that doesn't mean there wasn't an obligation
| for those years.
| FredPret wrote:
| Reciprocal relationship = either party can end it under
| certain circumstances. If the taxpayer wants to move, the
| state has no moral right to force them to stay
| trasz wrote:
| > FBI doesn't invoice victims
|
| what
| Retric wrote:
| They don't charge money to investigate crimes.
| trasz wrote:
| Just like every other civilized country. The fact that it
| was even mentioned suggests that for Americans it might
| not always be the case in some situations, which is quite
| frightening.
| Retric wrote:
| It's not an issue in American. Thing is we are talking
| about renouncing citizenship so the comparison is to
| other countries.
|
| Looking deeply at the social counteracts of other
| countries is really interesting because of how many
| different things we take for granted aren't universal.
| Free speech in the US is more limited than I would like,
| but it gets much worse even in countries that look
| civilized in other ways.
| trasz wrote:
| FBI has no jurisdiction outside the US, so you don't gain
| anything this way.
|
| Free speech in US is poorer than in most Western
| countries, as it fails to protect you from anything other
| than most government institutions. For example in US it's
| fine for your employer to fire you because they don't
| like what you say in your private time. Other countries
| provide better protection.
|
| My question is still unanswered: why would anyone in US
| even think about their law enforcement invoicing the
| victims?
| Retric wrote:
| https://www.fbi.gov/about/leadership-and-
| structure/internati...
|
| The FBI may get involved for citizens outside the US. The
| international situation is complex but being or not being
| a US citizen can very much change FBI involvement.
|
| PS: _My question is still unanswered: why would anyone in
| US even think about their law enforcement invoicing the
| victims?_ It's a concern if your considering renouncing
| citizenship and moving to a country where it's a concern
| just as free speech should be a concern if your moving to
| a country without it.
| bcrosby95 wrote:
| > as it fails to protect you from anything other than
| most government institutions.
|
| Depends on the state. The US isn't as simple as you're
| making it out to be.
| Tostino wrote:
| For investigating a crime the victim was involved with.
| At least that's how I interpreted GP's comment.
| danuker wrote:
| > rights and obligations on both sides not ownership
|
| I would say consequences of infringement are much worse
| for individual citizens than for the government.
|
| If the government confiscates some of your money through
| "civil forfeiture", you then have to sue the government
| and prove the money was gained legally.
|
| https://en.wikipedia.org/wiki/Civil_forfeiture_in_the_Uni
| ted...
|
| On the other hand, try not filing your taxes. What
| happened to John McAfee might happen to you.
| Retric wrote:
| It's not an equal relationship, but governments failing
| their side on wide enough scale end up failing.
| geomark wrote:
| Yeah, but receiving payments can be an issue because U.S.
| banks won't deal with you without a U.S. address.
| walshemj wrote:
| A friend who has a US wife is in the states now to visit
| family and also most importantly renew her Colorado drivers
| license for similar reasons.
| Chris2048 wrote:
| > Citizenship comes with all sorts of obligations like
| getting drafted and serving on juries
|
| If you've already done those things, does the IRS pay _you_?
| Retric wrote:
| Obligations don't work that way, do you get paid for paying
| your debts?
|
| The personal benefit from the obligation to serve on juries
| is the option of being tried by a jury of your peers.
| [deleted]
| jandrese wrote:
| It's even more expensive than that since they don't refund you
| the money you paid into Social Security when you renounce.
| emodendroket wrote:
| Why would they refund past taxes you'd paid?
| jandrese wrote:
| The money you put into taxes went into national defense
| that kept you safe, roads you drove on, schools that
| provided an educated workforce that made the goods and
| services you consumed, etc...
|
| Money put into Social Security is just lost to you unless
| you are renouncing your money after retirement.
| emodendroket wrote:
| That's a rather generous assessment of how my money was
| used in Iraq, for instance. That sounds glib, but if you
| could pick and choose which things your taxes funded or
| not it would kind of make the whole concept of the state
| untenable.
| whymauri wrote:
| lol, as Gen Z I've more-or-less accepted that my Social
| Security is just setting my money on fire and dancing in a
| circle.
| wait_a_minute wrote:
| Why? It doesn't have to be that way. Social Security has
| been successfully bolstered in the past and can be again. I
| don't see why it can't remain solvent for the foreseeable
| future...
| kevinh wrote:
| My boomer parents felt the same way and yet they're
| receiving it right now. 65+ year old people are one of the
| most powerful voting blocs.
| BeetleB wrote:
| Social Security is not a pension - this is a common
| misconception.
|
| The SS tax is to pay current retirees. There's a formula that
| states how much you'll get when you retire, but the money
| you're putting in now is not being saved/invested for your
| benefit in the future.
|
| The short version: Money you put into SS is not _your_ money.
| jandrese wrote:
| You still put a bunch of money into it on the promise that
| after retirement you will have income, and that promise is
| broken when you renounce your citizenship. Also, Social
| Security is closer to real pensions than you think, they're
| just different from the theoretical concept of a pension
| that isn't actually used outside of the Post Office.
| BeetleB wrote:
| You're using vague words like "promise". "Hope" would be
| more accurate. Someone can correct me, but if Congress
| passes a law tomorrow saying they're not going to pay
| social security after 2025, that is probably allowed. The
| only "promise" is to people who are currently retired.
|
| Furthermore, if you renounce your citizenship, it is you
| who are choosing not to get this benefit. It is a defined
| benefit for citizens, and you are choosing not to be one.
|
| As for similarity to pensions: Far from it. When the
| government has an excess (i.e. total SS taxes collected
| is greater than payouts for a given year), they are _not_
| allowed to hold it or invest it. Pensions are /were
| always invested, or at least held.
| psychlops wrote:
| The stimulus checks allowed them to afford to renounce
| citizenship.
| depressedpanda wrote:
| You're assuming everyone got a stimulus check. That's not the
| case.
| ziggus wrote:
| The 20% capital gains tax bracket is applicable to assets held
| longer than one year.
|
| Short term gains are taxed at your normal tax rate.
| javert wrote:
| "- The highest capital gains tax bracket in the USA is 20% [2]"
|
| Not really, because they can arbitrarily change it and backdate
| the change at any time, and they are currently planning to
| raise it to 43% and backdate the change.
|
| In truth, the US does not have a fixed capital gains rate.
| 2xpress wrote:
| It's really weird how an obviously bad law that's been active for
| 11 years now and hurt so many people has not been fixed yet.
| clarkbw wrote:
| As an ex-pat what bothers me most is the lack of representation,
| I'd keep paying taxes if we actually had some virtual state.
| Citizens abroad are essentially gerrymandered by their last state
| of residence meaning there is no useful representation for those
| abroad. However with an estimated 9 million+ citizens living
| abroad ex-pats all together would represent the 10th or 11th most
| populace state. 9 million US citizens is similar to the
| population of New Jersey which has 2 senators and 12
| representatives working for them. Where's my Cory Booker?
| altcognito wrote:
| They've been allowed for decades to avoid paying for the
| infrastructure and management of the country while simultaneously
| holding most of the influence.
|
| "Renouncing citizenship" means they'll give up none of the
| influence, lose the taxes, live how and wherever they want.
|
| The best thing to do is forbid them re-entry into the country nor
| to hold controlling interest in any company in the US.
|
| Faced with actual consequences and true separation from the
| actual thing they care about (their source of wealth, not the
| country) they will reconsider. I'm not sure if this is a net
| plus, as they are a selfish lot.
| alephnan wrote:
| You are assuming 100% of these people are moving to countries
| with lower taxes. That's simply not true.
|
| In fact, countries that have high standard of living usually
| have equal or higher taxes than the states.
|
| Contrary to what you may assume, especially people who have
| sought an alternative lifestyle abroad value value having a
| high standard of living, and not going to move to some shithole
| just because it has lower taxes.
| mekal wrote:
| What countries are they moving to? Currently if you save and
| invest your money you can pass it to your children (or
| whoever) with a step up in cost basis. So the investments can
| go on indefinitely from generation to generation essentially
| without tax. Because technically, you haven't realized any
| gains yet. In the meantime, you can borrow from banks against
| these investments (also I believe not taxable, at least not
| like income tax). These new laws would get rid of the ability
| to pass on your wealth without a significant (like 50%?) tax
| because they would recognize death or gifts as a taxable
| "transaction". Unless you donate it to charity. Which might
| be why Buffet is leaving all of his money to charities (which
| are run by his kids...or at least some of them).
|
| I'm honestly still trying to figure this out but that's what
| I understand so far. Another interesting consequence is that
| calculating long term investment cost basis's sounds like a
| f'ing nightmare. Maybe that's why the step up rule exists?
| space_rock wrote:
| It's funny that citizens of every other rich country on the
| planet have this free arrangement where we only pay tax where
| we live. But in your fantasies this behaviour and freedom is so
| evil we should be blocked from returning home
| libbroscrubber wrote:
| There can be two issues happening simultaniously:
|
| 1. It's unfair for the US to tax it's "citizens" when they no
| longer live in the country.
|
| 2. Billionaires can only become billionaires through
| exploitation and now some are using this to further shirk any
| sort of social responsibility or paying back to the systems
| that created them.
|
| The real problem is that we've allowed billionaires to exist.
| cltby wrote:
| > avoid paying for the infrastructure and management of the
| country
|
| The premise here is dead wrong. The top 1% pay ~40% of taxes;
| the top 5% pay ~60%. So not only do these people create the
| wonderful consumer goods that enrich your life; they also
| provide the roads, police, fire fighters, etc. Show some
| gratitude!
| alephnan wrote:
| > while simultaneously holding most of the influence.
|
| There are 20 million millionaires in the states. This is not
| even 10,000 people year over year with assets, not even net
| worth, over $2 million. This is a tiny fraction of the
| population, most of whom are contrarian or pursue an
| alternative lifestyle, given that they are living abroad.
|
| I would hardly call someone with $2 million as having outsized
| influenced, they're barely upper middle class or be able to
| afford a house in San Francisco. If we assume this distribution
| obey a power-law, there are a small percentage of individuals
| here there who are ultra ultra wealthy to have that influence.
|
| There are ideological reasons to renounce citizenship, and
| maybe having a small amount of wealth enables to pursue this
| option as it involves legal fees and also affordance of living
| off investment income. There are likely many poor people who
| would like to leave to, but don't have the financial means to.
| The data set will be biased towards those who can afford the
| process.
|
| Furthermore, renouncement of citizenship involves exit taxes,
| on which people have already paid taxes.
|
| > The best thing to do is forbid them re-entry into the country
|
| On what legal grounds? They can't enter on a tourist visa? To
| visit a dying friend or family member one last time?
|
| > nor to hold controlling interest in any company in the US.
|
| Then we should stop all foreign investments and investors.
| trutannus wrote:
| > The best thing to do is forbid them re-entry into the
| country
|
| Given the track-record lefty authoritarianism has, I'm always
| a little nauseated to see people pull out the truncheon and
| jack-boots to enforce "economic justice". That and
| suggestions like this don't even make any sense, and rarely
| ever do. It always looks to me like retribution is the aim
| here, rather than effective economic policy.
| papito wrote:
| Well, now, let's not paint "authoritarianism" as "lefty".
| Some Marx-reading student on campus is not exactly a
| threat, is it?
|
| The ultra-left sentiment is, indeed, anti-liberal at its
| core, but it is still an irrelevant _fringe_.
|
| The actual, viable threat of authoritarianism is coming
| from the opposite side, which is a spit away from holding
| absolute power, here in the States, at least. And then,
| it's on.
| trutannus wrote:
| This is a complete misrepresentation of my point. I never
| tried to 'paint "authoritarianism" as "lefty"'. I
| specified there's an issue with _lefties who are also
| authoritarians_. If you don 't think that can exist and
| if you think it's not that big of a deal, I suggest you
| take a look at the latter-half of the 20th century. It's
| pretty uncharitable to paint my argument as being afraid
| of a student on a campus who's read the Communist
| Manifesto. That's not even in my argument and requires a
| lot of bad-faith interpolation to get to from what I
| said.
|
| > viable threat of authoritarianism is coming from the
| opposite side
|
| This is nothing more than whataboutism. There's
| authoritarians on both sides. They're both just as
| dangerous in the end-game. In Canada, it's the left
| mainly. In the US, there's highly vocal, and influential
| to public opinion, left wing authoritarians. In Canada
| lefty authoritarianism isn't just a _fringe_ , it's
| mainstream. This is true in a lot of places too. I'm not
| sure why some folks insist on downplaying the risk of
| authoritarianism when it comes from the left as opposed
| to the right. Both kill just as many people, one just
| uses gas where the other uses starvation.
| depressedpanda wrote:
| > Both kill just as many people
|
| Let's be honest here, lefty authoritarianism has
| historically killed way more people in total.
|
| Fortunately, righty authoritarianism was stopped;
| unfortunately lefty authoritarianism wasn't.
| trutannus wrote:
| You're correct. And the reasoning behind having not
| stopped lefty authoritarianism is actually very
| interesting and complex. At least one American general
| got ousted from his position after suggesting the USSR be
| subjugated after the Second World War.
| depressedpanda wrote:
| The road to hell is paved with good intentions. I'm not
| sure subjugation of Communist states by force would have
| lead to a better outcome, historically.
|
| I just find it fascinating and a bit sad that
| authoritarianism is often seen as somehow better, if it
| comes from the left.
|
| If people truly value democracy and freedom,
| authoritarianism should be opposed regardless of its
| underlying political color.
| trutannus wrote:
| > bit sad that authoritarianism is often seen as somehow
| better, if it comes from the left
|
| This is exactly the train of thought I had thrown at me
| by another commenter who was insistent on bringing up the
| fact that the right wing is "worse" somehow. You're
| right, it is very disappointing to see.
| papito wrote:
| "highly vocal", "influential to public opinion". I am
| sorry, these are just words. Prove that it's influential.
|
| Is there an effort by these "loud" individuals to drive a
| focused disinformation campaign targeted at nullifying
| legitimate votes? One third of the United States is
| entirely sold on it. _That_ is quite "influential", I
| would say, and presents clear and present danger.
| trutannus wrote:
| This is just whataboutism again. There's nothing
| constructive to say to someone who's entrenched in
| ideology like you clearly are. I'm not taking about the
| right, and never have been. The right is irrelevant in
| this conversation. All you have done is derail this into
| _but the other guys are bad too_. Did I say "the right
| is fine?" No, I explicitly did not. I actually said both
| are tyrants when they can be.
|
| You've addressed nothing I've said and launched a demand
| for sources on cherry-picked words from the point I made.
| I don't want to, and won't, argue with ideology and party
| lines.
|
| You've made nearly identical points to me just about the
| right for some reason, despite the fact that I'm not even
| talking about them. I've used the word 'right' once in
| any other comment until this one. Not sure why you're
| trying to turn this into a right-left partisan shit-
| slinging match. Not every discussion of the left
| necessitates a discussion about the right's negative
| traits, and vice-versa. If you truly believe this, I
| suggest you get your head out of American partisan
| ideology.
| peterbonney wrote:
| $2 million is the minimum to be listed - it is not the
| median, let alone the mean. Eric Schmidt alone has wealth
| equivalent to 10,000 people with a "mere" $2 million.
| alephnan wrote:
| Yes, for every 10,000 millionaires we have a few Eric
| Schmidts.
|
| There are still hundreds of billionaires in the states, and
| they can still access tax havens regardless of renouncing
| citizenship.
| catillac wrote:
| This is a fair point
| alephnan wrote:
| Hence, my point about the power-law / exponential
| distribution.
|
| Take the logarithm of the number of people who renounce
| citizenship and you will have the number of people with
| outsized influence.
| aabaker99 wrote:
| Unless there are more than 20 million millionaires, you're
| talking about the top 6 percent of the wealth distribution. I
| wouldn't call that particular percentile "barely middle
| class". That term probably should be reserved for the 60th
| percentile, no? Middle being 60 to 40? 70 to 30?
|
| Edit: fixed my percentile thanks to child comment!
| pedrosorio wrote:
| > Unless there are more than 20 million millionaires,
| you're talking about the top 0.6 percent of the wealth
| distribution
|
| 6 percent
| adventured wrote:
| You're including non-adults (330m population @ 6%). It's
| closer to 8% of the adult US population. Not very many
| people under 18 are millionaires or reasonably likely to
| be. The non-adults in question fall under the millionaire
| household grouping.
|
| And if anyone is interested in the household wealth
| distribution (as of 1Q21):
|
| Top 1%: $41.5 trillion | 90%-99%: $48.8 trillion |
| 50-90%: $36.5 trillion | bottom 50%: $2.6 trillion
|
| $129.5 trillion total household assets.
|
| There are around 128 million households in the US. The
| average American household is now worth a million dollars
| (the median is obviously far lower).
|
| That top 1% of US households - 1.28 million households -
| holds an average of roughly $32 million in assets.
| alephnan wrote:
| > "barely middle class".
|
| Inflation. Being a millionaire or having a six figure
| salaries used to have much more weight during the 80s.
|
| Pretty much any senior level engineer at FANG can be a
| millionaire if they saved, but they can barely afford a
| standalone home in San Francisco. What does the term
| 'middle class' even mean if they can't afford a home?
|
| Only 20% of millionaires surveyed feel they're rich.
|
| https://www.cnbc.com/2021/05/12/net-worth-to-be-
| considered-w...
| mywittyname wrote:
| Senior-level engineers at a FAANGs are already a pretty
| rare and prestigious class of people. I'm a reasonably
| intelligent person and I've failed to pass the hiring bar
| at every FAANG.
|
| And of course they don't "feel" rich. Lifestyle inflation
| is a thing. Trade the Civic for a Tesla; send the kids to
| private school; buy organic groceries; take international
| vacations every year or so; yet still find the means to
| save more money each year than the average household in
| the USA earns. _Feeling_ is a state of mind, not a state
| of being.
| lmilcin wrote:
| A lot of assumptions.
|
| Maybe people no longer want to live in US and it is wealthy
| that have it easier to actually go through with this?
|
| Or maybe they actually live somewhere else and don't like
| paying their taxes TWICE. Almost every country in the world
| (except US) requires taxes based on residency, not citizenship.
|
| For example, being Pole, if I spend more than 180 days in
| Sweden, I now owe taxes in Sweden but no longer owe them in
| Poland. That is because Poland recognizes that, while I am
| Polish citizen, I actually was Swedish resident during that tax
| year. And have an agreement with Sweden so that it is clear
| where I have to pay my taxes.
|
| The US doesn't want to play nice and will only provide you with
| a little bit of credit for the tax you had to pay in another
| country. But if you earned a lot, you now have to pay it twice.
|
| I actually know 2 or 3 people that work here in Poland that
| resigned their US citizenship for exactly this reason. Because
| IRS will hunt you down and demand your taxes even if you don't
| set foot in US for decades. It has been a topic in our
| newspapers couple of years ago when we still looked up to US as
| better place to live and people would need explanation for why
| somebody in right mind would want to resign US citizenship in
| favor of Polish.
|
| I have even heard of a person that had to US citizens as
| parents but never set foot on US soil, that was hunted by IRS
| to pay taxes.
|
| It is not like people don't have to pay taxes in other
| countries, though some have smaller rates. To get better
| picture you would have to look at where they actually went.
| PaulDavisThe1st wrote:
| > For example, being Pole, if I spend more than 180 days in
| Sweden, I now owe taxes in Sweden but no longer owe them in
| Poland. That is because Poland recognizes that, while I am
| Polish citizen, I actually was Swedish resident during that
| tax year. And have an agreement with Sweden so that it is
| clear where I have to pay my taxes.
|
| The US has similar arrangements with many countries, and you
| are not doubly-taxed. You simply pay taxes at the highest
| rate of the two (US and <other country>).
|
| Likewise, if you move to the US from a higher-tax country,
| and the US has a tax treaty with that country, in your first
| year in the US (assuming you move mid-year), you will owe
| taxes to both countries, but will only pay the US rate
| overall. My first year in the US, the US government paid me
| US$600 because in their eyes, I had paid the UK too much in
| taxes for the 5 months I had worked there.
|
| The hassle is that you still have to file with the IRS, even
| if your actual tax liability to the US is zero.
| nxmnxm99 wrote:
| It's probably pointless to discuss this with someone who
| insists on generalizing anyone above a certain net worth as
| being selfish, but -
|
| As it turns out, it's no longer the 80s, and there are
| increasingly multiple other countries were the super-rich can
| move their activities, wealth and lifestyle to without missing
| a beat.
|
| Hanging around financial circles, I've seen a large exodus of
| people through the pandemic star the process of moving pieces
| towards places like Dubai and Singapore.
| ren_engineer wrote:
| the point is that generally there is some expectation of
| loyalty to the country that allowed you to become super-rich
| in the first place. In finance specifically many of these
| people participated in outsourcing a huge chunk of the
| American economy for short term profit and their own gain and
| are now abandoning ship
|
| abandoning your country for lower taxes so you can "live your
| lifestyle without missing a beat" is disgusting to most
| humans. The wealthy have abandoned any sense of duty to their
| fellow citizens and are somehow shocked people are angry
| about the situation
| nxmnxm99 wrote:
| No, "most humans" aren't going to moralize and want to give
| back to their country in the form of taxes as a thank you
| when they strike gold.
|
| Being forced to give a large portion of my family's hard
| earned wealth to a tired, ineffective institution which
| aims to invest it in initiatives I think will ruin the
| economy? Why in god's name would I do that if I have the
| choice not to?
| Chris2048 wrote:
| > the country that allowed you to become super-rich in the
| first place
|
| But it's never enough. taxes already work on a scale such
| that the rich pay more (% wise), and they _still_ owe more?
|
| Almost every aspect of participating in the economy is
| taxed, e.g paying business-related taxes - those that
| participate more therefore pay more of these taxes too.
|
| It seems "what is owed" is never clearly stated so you can
| always be hit up for more.
| cpursley wrote:
| The wealthy in America cover the bulk of the tax revenue
| collected if the IRS stats are to be trusted.
| wpietri wrote:
| I'd say that's less about the generosity of the wealthy
| and more about the huge rise in concentration of wealth
| that we've allowed over the last 50 years:
| https://www.chartbookofeconomicinequality.com/inequality-
| by-...
| luffapi wrote:
| The wealthy pay far less in taxes in proportion to their
| wealth than everyone else. Long term capital gains is
| only 10%.
|
| The wealthy are only wealthy because the non-wealthy
| people who vastly outnumber the wealthy, allow them to
| keep their capital. I think massive wealth inequality is
| making a significant number of people rethink this
| generous position.
| Chris2048 wrote:
| > Long term capital gains is only 10%
|
| But it has yet to be taxed as income. Even if it doesn't
| devalue, you can't use it until you dispose of it,
| incurring additional tax.
|
| > The wealthy are only wealthy because the non-wealthy
| people who vastly outnumber the wealthy, allow them to
| keep their capital.
|
| The wealthy can afford better weaponry than you. Are you
| alive only because they allow you to live?
|
| > rethink this generous position
|
| Do you think you are entitled to something just because
| you could (forcibly) take it?
| papito wrote:
| These are the same people who fund and profit from outfits
| that keep telling some of us that maybe we should be more
| patriotic.
| bitdivision wrote:
| You seem to be making a lot of assumptions about who is giving
| up citizenship here. Obviously there are some high profile
| people who are still highly involved with the US, but I'd
| imagine a lot of folks doing this are those who don't live in
| America and don't want to deal with the hassle and cost of
| filing US tax returns every year when they earn no money in the
| US.
| tartoran wrote:
| This article is about wealthy people. We all know they are
| paying relatively no taxes or doing their best to.
|
| Yes, Americans who moved to Europe and are happily making a
| living there are also giving up US citizenship but end up
| paying taxes in 2 places or deal with a lot of hassle they'd
| rather not
| rwmj wrote:
| No one's moving the Europe for the lower taxes.
| alephnan wrote:
| Cyprus gives you access to the EU while being a tax
| haven.
|
| https://www.vox.com/recode/2020/11/9/21547055/eric-
| schmidt-g...
| pjerem wrote:
| Well, you know that you pay taxes on the country you live
| & work in ? So you have to find a job and a house in
| Cyprus. And on top of that, Cyprus is one of the few
| european countries that are not yet in the Schengen area.
| So you'll have to stay on the tiny 9,251 Square
| Kilometers.
| TacticalCoder wrote:
| > Well, you know that you pay taxes on the country you
| live & work in ? So you have to find a job and a house in
| Cyprus.
|
| Remote work? Or own a foreign company and pay yourself in
| dividends? These are extremely common cases.
|
| > And on top of that, Cyprus is one of the few european
| countries that are not yet in the Schengen area. So
| you'll have to stay on the tiny 9,251 Square Kilometers.
|
| That's not how Schengen works: Schengen is about being
| able to freely travel in the Schengen area without having
| to even _show_ your passport / national ID card. For
| example I regularly cross borders, by car, between
| Belgium, France, Spain, Monaco and Andorra (Monaco is
| Schengen while Andorra, wonderful place on earth btw, is
| not, but Andorra has got agreements for free travel with
| France and Spain anyway) and I've never been asked my ID
| once. Heck, lately I've always been doing my PCR tests,
| as officially required due to the sars-cov-2
| restrictions, and although it's mandatory to cross
| borders I've never been asked to show them.
|
| A passport from Cyprus allows you to travel, without the
| need for a visa, to most countries in the world if I'm
| not mistaken. The thing is: because Cyprus is an island
| you'll very often be flying to/from there and you'll have
| to show your passport. But you're definitely not stuck on
| the island.
| alephnan wrote:
| > So you have to find a job and a house in Cyprus
|
| I think Eric Schmidt can afford that
|
| > you know that you pay taxes on the country you live &
| work in
|
| Yes, I know this. I live abroad.
|
| Yes, every country has taxes. The tax rates are not the
| same. Additionally, countries like Singapore have zero
| capital gains tax. Executives can just take a symbolic
| job and pay themselves a symbolic salary, but they're not
| getting rich off their salaries
| cblconfederate wrote:
| Ehm, you can travel to all of EU, the only thing that
| changes is you stand on a different line in the airport
| iso1631 wrote:
| Not just travel - many people can travel to all of the
| EU. A Cyprus citizen has the right to live and work
| anywhere in the EU.
| cblconfederate wrote:
| correct. you re not in any way confined to the island
| _0ffh wrote:
| > you'll have to stay on the tiny 9,251 Square Kilometers
|
| No you won't, you'll just have to pass a border control
| whenever you leave or re-enter the country. That's hardly
| a huge hindrance, unless you're wanted.
| cblconfederate wrote:
| It's no different than ireland (same % taxation), are
| they both tax havens? Cyprus is not on the OECD tax
| havens list for years, and in fact are considered a
| rather safe choice, hence the rise in popularity of their
| residence/citizenship programs (and their fees)
| alephnan wrote:
| > It's no different than ireland (same % taxation), are
| they both tax havens?
|
| Any country can be a tax haven if you're not already
| living there and rich enough to negotiate special terms.
|
| Greece and Cyprus offers citizenship-by-investment, and
| there are many ways wealthy people can 'invest' in the
| same way they do 'philanthropy'.
| cblconfederate wrote:
| greece does not offer citizenship-by-investment (and
| cyprus' program has been suspended)
| 4r4r4r wrote:
| Cyprus! Hilarious.
|
| My bank account's got robbed by European Commission. Over
| 700k is lost. March 28, 2013, 06:00:15 PM
|
| https://bitcointalk.org/index.php?topic=160292
|
| P.S. The worst thing is, that even a month ago I was
| suspecting that things can go wrong. In February, I
| several times called my banker and lawyer and asked them
| if money on the account is safe, mentioning that article
| in Financial Times. But they convinced me that there is
| no reason to worry, and even if country goes default, in
| no way current accounts may be affected. "This is
| European Union and banks here can't just grab your money
| and go" I was told. I got a hard lesson and now I know
| the meaning of phrase "TRUST NO ONE".
|
| The rest of the money (100k EUR) are still subject to
| Capital Control and we can only transfer 5K monthly.
|
| Today I had a conversation with a manager from Laiki
| Bank. He has been honest and confirmed that we may forget
| about anything over 100K as it's already spent to pay
| country's debts. Also, I was warned that the financial
| situation in the country is getting worse and worse and
| we should be ready to lose even part of insured (under
| 100K) money during this year (this is why they keep
| capital control enforced).
|
| By the way, this style of "bank restructuring" is going
| to be adopted in the whole European Union. Soon,
| everyone's uninsured money (over 100K EUR) in EU banks
| will be at risk of seizure.
| berinateni wrote:
| Cyprus is in Europe
| tartoran wrote:
| Yes, Cyprus is in the Mediterranean Sea close to Turkey,
| Israel and Lebanon but it is the EU.
| moonchrome wrote:
| There are quite a bit of places in EU with low capital
| gains tax and can be gorgeous to live in if you're
| wealthy. For example Croatia is a EU member - capital
| gains tax is flat 12%, and is a popular tourist
| destination with beautiful coast. It's not a bad deal if
| you're a remote freelancer - you end up paying like 20%
| in taxes total + something like 300EUR/month flat for
| health insurance and minimal pension contributions.
|
| Monaco is the place if you're super rich.
| ceejayoz wrote:
| Monaco?
| KptMarchewa wrote:
| If you're software engineer in Poland and spend some time
| architecting your contract, you can pay only 5% income
| tax (+ irrelevant amount for social security) as "R&D tax
| relief for commercializing IP rights".
|
| Point you're making applies to countries like Belgium or
| France.
| nivenkos wrote:
| You'll still get like 10% of a US salary though.
| oblio wrote:
| 10% is a gross exaggeration, though. Romania has lower
| salaries than Poland, as far as I know, and in Romania as
| a senior engineer in a decent company you can get a total
| <<net>> compensation of EUR3.5k - EUR4k per month, that
| would be ~$4k - $4.8k per month, so ~$48k - ~58k. Again,
| net. And probably more since there are companies that
| give you RSUs/ESPPs, so you can go along for the ride.
| Not as many as in the US, obviously, but a decent chunk.
| So you could even push towards something like $70k.
|
| I think even at the biggest FAANGS in the US, you total
| <<net>> compensation as a senior engineer will be
| $250k-$300k, leaving the ratio somewhere around 4-5x (and
| this is for a super limited set of companies and
| positions; I'd imagine that the average ratio would be
| closer to 2-3x).
|
| And don't forget that local living expenses are minimal.
| You'd get to keep maybe even 90% of your salary.
| goodpoint wrote:
| 10% is a gross exaggeration but "the average ratio would
| be closer to 2-3x" sounds equally exaggerated in the
| other direction.
| oblio wrote:
| The median US gross salary for US software developers is
| $108k. I imagine that's $60k net or less.
|
| The median Romanian net salary for software developers is
| RON 7000 per month. That's about EUR1400 or $1600 per
| month, so $19.2K, net. 3x.
|
| You were saying?
| goodpoint wrote:
| 3x != 2x, and I suspect 3x is still too low; also
| comparing median salaries is not enough.
| oblio wrote:
| I said:
|
| > I'd imagine that the average ratio would be closer to
| 2-3x
|
| To which you replied:
|
| > 10% is a gross exaggeration but "the average ratio
| would be closer to 2-3x" sounds equally exaggerated in
| the other direction.
|
| My original example pointed to the top of the range and
| then I used the median, which is the statistically most
| relevant indicator for comparing salaries.
|
| > 3x != 2x, and I suspect 3x is still too low; also
| comparing median salaries is not enough.
|
| At this point, you're arguing in bad faith.
| depressedpanda wrote:
| I don't know if whether the numbers you quote for Romania
| are correct or not (Polish salaries for devs are not even
| remotely close to that), but a salary that nets you
| EUR4k/month after taxes is not very common in Sweden -
| which is considered a richer country than Romania.
| tester756 wrote:
| If you're using IPBox as average software engineer that
| has nothing to do with actual R&D or innovation then you
| should feel ashamed cuz it's straight doubtful from
| ethical and moral standpoint
| peteretep wrote:
| I am executing a residency change to Bulgaria at the
| moment, in no small part for the taxes
| pwinnski wrote:
| On the contrary! The overall tax burden of many European
| may be lower than that of the US when you compare like
| for like. That is, the cost of all taxes in Europe and
| the cost of all taxes and the fees paid for equivalent
| services in the US.
|
| For most people, that's taxes in Europe vs taxes + health
| insurance premiums in the US.
|
| Even if the combined totals are equivalent or higher in
| Europe, government-provided healthcare provides cost
| predictability that doesn't exist in the US. One year I
| might pay a much lower amount in the US, while the next
| year a single medical procedure could easily double my
| expenses.
| uCantCauseUCant wrote:
| Also, lots of us taxes are hiding in plain sight as
| "mandatory services". "Gated Community" is basically a
| different version of social transfer tax. Health system
| is another huge "mandatory tax". Enormous debts to
| complete education, whos equivalent you can get for free
| in europe. If you sum it all honestly up, the us is a
| pretty bad deal.
| darksaints wrote:
| That might be true for a lot of people, but not for
| wealthy people.
| syops wrote:
| If a person has no income or capital gains from the U.S. and
| doesn't live in the U.S. shouldn't they be exempt from paying
| U.S. taxes? Also, shouldn't foreign financial institutions be
| exempt from reporting to the U.S. about financial activities of
| U.S. citizens when they are outside the U.S.? I think the
| answer to both questions ought to be yes.
|
| EDIT: I'm aware of the rules regarding income taxes for
| Americans based on their citizenship and not on where the
| income was earned. My questions address this and by saying
| 'yes' to them I'm indicating that these rules are dumb in my
| opinion.
| [deleted]
| alephnan wrote:
| Foreign banks in nations with treaties with the United States
| require you to file a special form to the IRS when opening a
| bank account, furthermore they will report information on
| your bank account to the US government.
| eatbitseveryday wrote:
| Ought to, but US citizens must still report taxes every year
| on all global income. Some amount is exempt, though one still
| needs to file.
| ironchef wrote:
| "If you are a U.S. citizen or resident alien, the rules for
| filing income, estate, and gift tax returns and paying
| estimated tax are generally the same whether you are in the
| United States or abroad. Your worldwide income is subject to
| U.S. income tax, regardless of where you reside." - per the
| IRS (https://www.irs.gov/individuals/international-
| taxpayers/taxp...)
| Miner49er wrote:
| Wouldn't this create loopholes? A US citizen could leave the
| US to make foreign investments, then come back to the US and
| be exempt on taxes on this foreign investments while enjoying
| the benefits of being in the US and not paying their share of
| taxes.
| jimmydorry wrote:
| Most civilized countries determine tax status based on
| where the person lived for the year. Reporting how much you
| earn overseas is one thing, but paying taxes twice while
| living and earning overseas is extraordinarily cruel.
| AYBABTME wrote:
| Most countries tax worldwide income of their _residents_
| (not citizens). So in your scenario, you'd end up paying
| tax on the foreign investments if you profit from it when
| you resume being a US resident. Unless you don't declare
| the foreign assets, which would be illegal (gotta file an
| FBAR each year).
|
| There's no loophole here, a large majority of countries
| work this way, and OECD countries certainly do (although
| some have different treatments for short term residents).
| Usually the logic is: if you don't pay taxes in country A,
| you'll pay in country B anyways. And you'll pay an exit tax
| when you go from country A to B in many cases, so country A
| gets their cut.
| FabHK wrote:
| As the article mentions, the USA and Eritrea tax based on
| citizenship, not residence.
| hizanberg wrote:
| IRS thinks Green Card Holders who are non-citizens and non-
| residents owes them taxes on income on their country of
| residence and citizenship.
|
| They're effectively the only country that believes they're
| entitled to non-citizen and non-resident income, but we're the
| "selfish lot" for relieving ourselves of a double tax burden to
| a country we don't reside in? No thanks you can have it back.
| lr4444lr wrote:
| Forbidding them reentry on what basis that you can legally
| uphold vis a vi their being a foreign citizen from another
| country we are friendly with? Controlling interest in any U.S.
| company... chances are their company is already by accounting
| principles registered somewhere else internationally, or they
| might move asset ownership to some sort of family trust, or
| form shell companies to hold US Stock that you'd never trace.
|
| I think you're underestimating the legal maneuvers these people
| can afford to find that have got then to where they are.
| alephnan wrote:
| Forbidding people would only punish your normal ex-pats.
|
| The billionaires can just dock their yachts in international
| waters.
| cpursley wrote:
| > They've been allowed for decades to avoid paying for the
| infrastructure and management of the country while
| simultaneously holding most of the influence.
|
| Maybe you didn't know this but Americans living overseas still
| have to file and pay US taxes, often getting double-taxed buy
| two different countries - and often by a higher tax country
| than the US.
|
| In fact, the US is one of only two countries in the world with
| this arrangement. I'm an American living overseas and it's a
| bit of a logical nightmare dealing with all the requirements.
| Even opening a simple checking account is difficult now for
| Americans overseas.
|
| Americans who haven't lived overseas or haven't traveled much
| often have difficulty empathizing. But when we were living in
| the US, I would have found it very strange if not absurd if my
| non-US born wife had to file and pay taxes to her country of
| birth.
| bagacrap wrote:
| I think gp was referring to how capital gains aren't taxed
| until realized. Having billions in unrealized gains gives you
| influence, even though you didn't yet pay tax on it.
|
| However, when you relinquish your citizenship you pay an exit
| tax which is more or less equivalent to what you'd pay if you
| sold all your assets and paid gains taxes, so I'm not sure
| how this move really helps billionaires, except that they
| don't have to pay taxes on future gains.
| PaulDavisThe1st wrote:
| > I'm not sure how this move really helps billionaires
|
| I am sure they never, ever, ever lie about their assets.
| PaulDavisThe1st wrote:
| > often getting double-taxed buy two different countries -
| and often by a higher tax country than the US.
|
| If there's a tax treaty between the two countries, they're
| not going to be double taxed. They will simply pay tax at the
| higher-country-rate, and owe nothing to the other.
|
| If there's no tax treaty ... I'm not familiar with how that
| works. The US has tax treaties with many countries around the
| world, especially the OECD nations.
| bellyfullofbac wrote:
| Close to the top of the article:
|
| > Between the lines: While the numbers are down this year,
| that's probably because many U.S. embassies and consulates
| remain closed for COVID-19, and taking this grave step requires
| taking an oath in front of a State Department officer.
|
| So it seems these are American passport holders who already
| live in foreign countries, so contributing to American
| infrastructure, etc, but not benefiting of those things.
| Obviously having embassies you can go to for help anywhere
| around the world is useful, but if these are dual-passport
| holders they probably have the second embassy, for example any
| EU embassy would help any EU citizen [1].
|
| But well, 2020 saw the worst of Trump saying "Everything is
| under control!" while ICUs (and morgues) overfilled, so maybe
| that's a reason for the renouncements. Or maybe was there some
| new law which was going to come to effect in 2021?
|
| Anyway, I find "forbidding re-entry" is extreme and tinpot-
| dictatorship-esque.
|
| [1] https://ec.europa.eu/info/policies/justice-and-
| fundamental-r...
| papito wrote:
| They would not be EU citizens. The taxes are even higher. The
| article is around specifically _renouncing_ American
| citizenships. Also, dual-citizenship is useless. If you are,
| say, in Russia, and you have your Russian passport on you,
| the American consulate won 't lift a finger - your ass is
| wholly Moscow's.
| bellyfullofbac wrote:
| Ah, this comments thread will just be full of ignorants
| won't it...
|
| Yes, true about local passports, but if I have a German and
| American passport in Russia, I'd just call the German
| embassy. Or is it not good enough, America number 1,
| Germany number 8?[1] BTW in your (correct) scenario, what's
| the point of owning the American passport?
|
| On the topic of taxes, most countries have tax treaties. If
| their tax level is 30% in Germany and 5% in the US, they
| can pay the 5% and fill in a paper for the German tax
| authorities, and the 5% is discounted.
|
| Maybe they're just people who didn't want to finance an
| idiocracy with the biggest firepower in the world. But rah
| rah, 'Murica!
|
| [1] https://knowyourmeme.com/memes/taiwan-1
| mikelward wrote:
| The people in the article aren't the only ones affected.
|
| If I ever move back to Australia, I'll have to file US
| taxes and other reports such as FBAR for the rest of my
| life. If you get it wrong, they can and have seized up to
| 50% of your wealth. Not because it's owed, but just as a
| penalty.
|
| And many Australian financial institutions won't let me
| open an account because of the reporting requirements.
|
| This isn't just about the rich avoiding taxes. It's about
| the US overreaching and creating headaches for lots of
| people.
| xtracto wrote:
| >The best thing to do is forbid them re-entry into the country
| nor to hold controlling interest in any company in the US.
|
| This is so wrong at so many levels. Im not from the USA, yet I
| own Disney stock and visit the USA every year for tourism.
| Should i be blocked as well?
| gruez wrote:
| >The best thing to do is forbid them re-entry into the country
| nor to hold controlling interest in any company in the US.
|
| That seems unnecessarily vengeful considering that foreigners
| (that weren't originally US citizens) weren't subject to the
| same restrictions.
| foolinaround wrote:
| > The best thing to do is forbid them re-entry into the country
| nor to hold controlling interest in any company in the US.
|
| Do we forbid foreigners from holding US stocks, assets, etc?
|
| Who do you think is financing the profligate lifestyle we live,
| compared to our true earnings?
| luffapi wrote:
| > _Who do you think is financing the profligate lifestyle we
| live, compared to our true earnings?_
|
| Globalized labor and environmental exploitation, of which the
| wealthy are gaining the most.
| goodpoint wrote:
| Why the downvotes? It's well documented.
| hnthrwy1111 wrote:
| I'm an "accidental American" who has navigated this issue and
| it's incredibly easy. Just don't file. Every professional that
| writes blogs about this has a professional duty to give legal
| advice but the practical advice is just don't file. Look into
| what exactly triggers data to be sent to the IRS under your tax
| treaty and the policies of your financial institutions. Being
| "accidental" is the key here. If you tell your bank you aren't an
| American and you have a non-American birthplace and birth
| certificate they have absolutely zero way of knowing and your
| information will not be sent. If you have an American birthplace
| you can lie and say you renounced, but this carries some risk as
| the IRS maliciously publishes lists of renouncers so it's
| possible they could guess you lied. FATCA and FBAR are egregious
| violations of your rights. Not even the NSA has the right to spy
| on Americans abroad, but the IRS can do dragnet surveillance on
| American financial data from foreign countries with no probable
| cause and no warrants. You have a duty not to comply.
| ihattendorf wrote:
| And then you slip up, the IRS finds out, and on a connecting
| flight on your way to another country you get arrested for tax
| evasion.
| bingohbangoh wrote:
| It's a misdemeanor to not file, its a felony to lie when you
| do file.
|
| Ergo, they can't call Interpol to get you for not filing.
|
| (correct me if you're a tax accountant, but I'm 99.999%
| positive on that first statement and 80% confident on the
| second)
| ihattendorf wrote:
| Not a tax accountant, but while just failing to file is a
| misdemeanor, if you actually owed money and it can be shown
| that you willfully attempted to evade paying taxes owed,
| that's a felony (I.R.C. SS 7201).
|
| Now, chances are they don't find out, or if they do you can
| play innocent and pay a fine. Personally, if I were in this
| situation I would either file, renounce, or never set foot
| on US soil.
| bingohbangoh wrote:
| It's difficult to renounce and you never know if being in
| the US may become necessary.
|
| People who renounce their American citizenship do so with
| the funds to overcome this or because they're committed
| to living somewhere else.
| emodendroket wrote:
| Not that I think it's good advice but it is very rare for
| connecting flights to go through the US, since it requires
| everybody to go through immigration even if they're not
| staying in the US.
| Klonoar wrote:
| Eh, it's not as rare as you'd think - there's literature on
| how to avoid it: https://en.wikivoyage.org/wiki/Avoiding_tr
| avel_through_the_U...
| alephnan wrote:
| > You have a duty not to comply.
|
| If you're making income in America, you owe US tax taxes.
|
| If you are a permanent resident of the United States, you owe
| US taxes.
|
| Whether the IRS is using mafia tactics or not, what you are
| describing is tax evasion. There are legal ways to minimize
| your tax burden, but this is horrible advise.
| hnthrwy1111 wrote:
| In my case as an accidental American I was not born in the
| US, I have never lived in the US, I have never worked in the
| US, I receive no benefits from the US, I was ineligible for
| the covid stimulus, I am unable to vote in US elections. It's
| comical to categorize my refusal to participate in this scam
| as tax evasion. I don't live in the US, I live in a
| supposedly sovereign nation. Just as Americans pointed out
| the absurdity of China's new laws that target foreign HK
| dissidents extraterritorial overreach should always be seen
| as the joke that it is.
| boulos wrote:
| Can you clarify how you are an accidental American? E.g.,
| were you born on a US base in another country?
| pitaj wrote:
| Wikipedia says [1]:
|
| > U.S. law also states that a child born outside of the
| U.S to a U.S. citizen parent who previously spent
| sufficient time in the U.S. is a U.S. citizen at birth,
| regardless of whether the child also has the citizenship
| of the country of birth or another citizenship. U.S.
| citizens married to fellow U.S. citizens can transmit
| U.S. citizenship to their children if either parent has
| ever had a residence in the United States (without any
| minimum time limitation on how long they held that
| residence.) However, for U.S. citizens married to
| non-U.S. citizens, the required period of residence is
| longer; under the Nationality Act of 1940 and the
| Immigration and Nationality Act of 1952, the required
| period of residence was set to ten years, five of which
| had to be after the age of 14. The Immigration and
| Nationality Act Amendments of 1986 reduced this to five
| years, two of which had to be after the age of 14.
|
| So you're automatically a citizen if you're born in the
| USA, if both of your parents are citizens (and at least
| one has resided in the USA), or if either of your parents
| is a citizen and lived in the USA for 5 years (2 of which
| after the age of 14).
|
| [1]: https://en.wikipedia.org/wiki/Accidental_American
| throwaway5372 wrote:
| As someone who meets the third condition (one parent a US
| citizen and lived there for more than 5 years), it was
| really hard to convince the US that I was a US citizen.
| Every one I talked to told me to go to a country I hadn't
| been in since I was 5 and apply for citizenship through
| family sponsorship. This was more than 20 years ago and
| no one threatened to deport me.
|
| After trying to get citizenship without leaving the
| country for about a year, I went to the post office and
| applied for a passport again, with every document that
| could possibly be relevant. The post office person looked
| through my pile of documents, declared my mother's
| passport good enough, stuffed it in the envelope, and a
| passport came in the mail for me. I think you may have
| explained to me how that worked out.
| seanc wrote:
| I'm a US expat living in Canada, and a parent of Canadian
| children. They are eligible for US citizenship, but don't
| become US citizens unless I go through a procedure to
| register them as such.
| junar wrote:
| That's not true; they are in fact citizens under US law.
| They may not have an SSN or a passport, but neither is a
| condition for citizenship.
|
| Also, at least from a tax perspective, if you plan on
| remaining a US citizen, you might benefit from getting
| SSNs for your kids so you can claim the child tax credit
| and stimulus payments for 2021.
|
| And if they don't want to be citizens, renouncing
| citizenship in the 6 months immediately after they turn
| 18 can avoid tax complications.
|
| https://hodgen.com/expatriation-between-age-18-and-18-12/
| SonicScrub wrote:
| I agree that you are ethically in the right, but it is
| still legally "tax evasion", and therefore probably not the
| best advice to be given to others. I say this as someone
| who has personal experience with the "accidental American"
| status. Depending on where you are, the IRS may discover
| your "American" status, and the penalties could be worse.
| For example, Canadian banks share information with the IRS
| under FATCA.
|
| https://www.cbc.ca/news/politics/fatca-tax-deal-forces-
| canad...
| paxys wrote:
| If North Korea passes a law tomorrow saying that every
| person on the planet owes it $1000 in taxes, if you
| ignore it are you committing a crime?
| SonicScrub wrote:
| Legally? You'd be breaking the law in North Korea, so
| technically yes, but that's not really the point here.
| Does North Korea have the ability to realistically
| threaten my assets, livelihood or freedoms? If so, then
| the proper legal advice here would be to pay it. We are
| not discussing ethics here, we're discussing whether or
| not following the "just ignore it" advice is a good idea
| or not.
|
| In the case of the US, they have the capacity to make
| legitimate threats against me regardless of where I live,
| with zero defense provided by my sovereign nation. So
| what's the right move?
| paxys wrote:
| If ethics are not a concern then the right move is
| whatever you can get away with. As other posters pointed
| out, if you don't disclose your US citizenship to foreign
| banks then that information is not going to make its way
| back to the IRS. Canada is probably the only country
| where you wouldn't want to try this.
| SonicScrub wrote:
| Which is exactly the point I was making in my comment.
| And also:
|
| > if you don't disclose your US citizenship to foreign
| banks then that information is not going to make its way
| back to the IRS
|
| I would not assume this to be true. Certainly not without
| researching into any specific case more.
| [deleted]
| vgatherps wrote:
| This comment isn't about somebody living in America. This is
| about somebody who doesn't live in america, has never lived
| there, doesn't have a passport, but are considered "american"
| by the IRS - somebody born in the USA to non-citizen parents
| while traveling for example.
| AdamN wrote:
| Not by the IRS, by the USG.
| paxys wrote:
| Actually it is just the IRS. The US government (by way of
| USCIS/DHS) has a very different definition of citizenship
| and residency. Most long term visa holders are considered
| residents by the IRS for tax purposes, for example.
| Chris2048 wrote:
| And if you are not a permanent resident of the United States,
| making no income in America?
| someguydave wrote:
| I would not plan on transiting the US for life if I were you
| though
| zz865 wrote:
| Ask John McAfee how not filing turned out.
| wil421 wrote:
| Why complain? Renounce your citizenship and get over it.
| globular-toast wrote:
| Do you ever travel in the US? Do you hold a US passport?
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