Monday, February 10, 2014

US Expatriation Increases By 221%

A record number of U.S. taxpayers renounced their citizenship or green cards in 2013, according to new data.

Each quarter the U.S. Treasury publishes the names of the Americans who officially expatriated during that period. In the last quarter of 2013, 630 people renounced their citizenship or relinquished their green cards, added to the previous 2013 quarters (2,369 people), bringing the total for 2013 to 2,999.

According to the International Tax Blog, the 2,999 amount represented a 221% increase over the 932 total in 201 and “shatters” the previous record of 1,781 set in 2011.

The International Tax Blog points to three possible reasons for the increase in expatriations last year.
  1. “Increased awareness of the obligation to file U.S. tax returns by U.S. citizens and U.S. tax residents living outside the U.S.,” he writes. 
  2. “The ever-increasing burden of complying with U.S. tax laws; and 
  3. “The fear generated by the potentially bankrupting penalties for failure to file U.S. tax returns when an individual holds substantial non-U.S. assets.
The increase in expatriations may also be partly due to a 2008 change in the expatriation rules.
According to Forbes tax columnist Robert Wood, while many expatriations are likely motivated by convenience or family matters, taxes can “help sway a decision.” Most expatriations are probably motivated primarily by factors such as family and convenience. Many people like Ms. Turner have built a life somewhere else and may not plan to need a U.S. passport.

William McBride at the Tax Foundation further notes that the last four years have seen more people renounce their U.S. citizenship and green cards (7,246) in 2013 than the total number in the twelve years prior (5,775).

"Should I Stay or Should I Go"?

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US Treasury

International Tax Blog


Tax Foundation

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