Survey Shows Increase In US Citizenship Renunciations Due To FATCA

A recent survey has revealed even more US expats are considering renouncing their citizenship.

The USA is the only world country which taxes non-resident expat citizens on their world earnings, using a regime which causes confusion as well as anger amongst those it affects. Amazingly, this rule also applies to those known as ‘accidental Americans’, individuals who were born in the USA but had never lived there. Many attempts have been made to persuade the USA taxman to cancel the unfair ruling, but no action has been taken.

The issue came to the fore some years ago with the introduction of the hated FATCA double taxation law which is now causing major problems for expat US citizens living permanently all across the world. Since then, the only way out for US expats is renunciation of their citizenship, a move which is growing in popularity year on year as the effects of FATCA cause even more problems for those living permanently overseas. One issue is that, due to severe penalties on foreign banks should they not comply with FATCA regulations, many US expats have had their overseas bank accounts withdrawn.

For ‘accidental Americans’, many of whom are still not aware they’re in this category, there is no other way out but renunciation of a citizenship acquired as a baby and unused as well as unwanted ever since. A recent survey has noted the increasing numbers of US expats living and working overseas who’ve either already decided to renounce their citizenship or are seriously considering doing so.

Some 4,000 Americans living in 125 world countries took part, with just under 3,000 having already cancelled their link with the home country. A further four per cent were planning the move, 17 per cent were seriously considering renunciation and 41 per cent were in favour of the option. In addition, 70 per cent of respondents felt strongly they should not be required to pay double taxation.