Record Numbers Are Giving Up US Citizenship
The US government has reported that more than 1,750 people gave up US citizenship in the second quarter of 2017.
Tax practitioners speculate that the increase in expatriations is likely due to ever-increasing tax and financial reporting and compliance requirements. For example, the 2010 Foreign Account Tax Compliance Act requires overseas banks to disclose financial information to the Internal Revenue Service (IRS) about US citizen-owned accounts. US citizens who live overseas must comply with numerous reporting regimes regarding foreign financial assets and their sources of income. Failure to comply comes with steep penalties.
Practice Point: Expatriation from a tax perspective can be a very complicated endeavor. It is essential to consult with a tax professional that understands the rules and can assist in the efficient and effective renouncing of US citizenship.
Aaron Snellenbarger also contributed to this article.