Expats Give up US Citizenship to Evade the IRS
|November 18, 2013||Posted by Staff under Taxes, The Progress Report|
A 2013 excerpt of RT, Aug 10.
The United States is the only country out of 34 in the Organization for Economic Co-operation and Development (OECD) that continues to tax citizens regardless of where they live around the world.
Now, facing a high national debt and drastic cuts in government spending, US tax enforcers are employing stricter asset-disclosure laws under the Foreign Account Tax Compliance Act (FACTA). For that reason, more Americans living abroad are weighing whether it is worth holding on to their US passport.
In the three months through June, 1,131 American expatriates turned over their passports at US embassies around the world. It was a drastic surge from the same time span in 2012, when just 189 people renounced their citizenship, according to the Federal Registry. The first six months of 2013 alone has seen 1,810 such instances, compared to 235 in all of 2008.
In 2012 there were between 5 and 6 million Americans who resided overseas.
The US tries to undercut tax havens. Countries like Switzerland earn that designation by protecting an individual’s finance information, requiring only nominal taxes, or a general lack of transparency. “The United States wishes to ensure that all income earned worldwide by US taxpayers on accounts held abroad can be taxed by the United States,” the Swiss government stated earlier this year.