American expats continue to set records for giving up citizenship

American expats continue to set records for giving up citizenship

[Ed. – Everyone, try to do a little simple thinking.  It’s not that hard.  These Americans aren’t the super-wealthy trying to avoid paying taxes.  They’re having to give up citizenship largely because America’s FATCA law makes foreign financial institutions unwilling to accept their business.  In many countries now, it’s impossible for all but the very wealthiest Americans to find a place to get a basic checking account.  The same goes for investment accounts and short-term deposit instruments.  FATCA places onerous burdens on foreign banks if they have American account-holders abroad.  The banks and their parent companies would rather be able to do business in the U.S., but not have to deal with those burdens.  So they cancel the accounts of American citizens abroad, and won’t allow Americans to start new accounts with them.  The people hardest hit by this are the middle class expats whose tax obligations are ordinary and relatively simple.

It’s true that America’s nearly unique policy of double-taxing them is also a particular burden for these same people — but the U.S. was double-taxing them on overseas income before FATCA was implemented, and the rising exodus from citizenship didn’t start until after FATCA went into effect.  It’s FATCA and its deadly effect on financial services availability to American expats that have made the difference.]

A record 1,335 Americans living overseas renounced their citizenship in the first three months of 2015, according to the Internal Revenue Service.

That number is 18 percent higher than the previous record, according to Bloomberg. In all of 2014, 3,415 individuals gave up their U.S. citizenship, the second straight year when renouncements hit a new record high. …

The 2010 Foreign Account Tax and Compliance Act (FATCA) required foreign banks to report on accounts held by U.S. citizens. Roughly 110 countries and 160,000 financial institutions have agreed to comply with the law, even as the U.S. stands apart from most other nations by taxing income its citizens make while living anywhere in the world.

The Obama administration touts FATCA as the “global standard” in battling tax evasion, but it has come under criticism from some, including many Americans living abroad who argue it is too burdensome.

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