Wall Street Journal Tax Report: Overseas Americans: Time to Say 'Bye' to Uncle Sam?, by Laura Saunders:
Here is a sign that life is getting complicated for U.S. taxpayers
with assets abroad: More of them are deciding they are better off
cutting official ties with America.
In the first half of 2013, 1,809 people renounced their American
citizenship or permanent-resident status, according to a tally by Andrew
Mitchel, a tax lawyer who tracks U.S. data. At that pace, the 2013
total would double the previous high of 1,781 renunciations in 2011. ...
The increase in renunciations is one sign that ordinary Americans who have lived and worked abroad for years, as well as green-card holders in the U.S. and overseas, believe they are at growing risk because of the intensifying government pursuit of undeclared foreign assets. ...
Although the U.S. State Department doesn't keep official statistics, it estimates that 7.2 million U.S. citizens live abroad. ... Despite the campaign against undeclared accounts, U.S. taxpayers filed only 825,000 foreign-account reports last year—meaning that millions of people likely aren't complying with the law.
"It's clear that compliance is dismal, and also why the IRS is being aggressive in its enforcement efforts," says Jeffrey Neiman, a former federal prosecutor now practicing law in Ft. Lauderdale, Fla.
So many people could be affected by the crackdown that mass-market
tax preparer H&R Block has expanded services for taxpayers with
international ties. In May, the company launched a tax-preparation
service via the Internet that is targeted at expatriates and highlights
the firm's ability to help taxpayers with unfiled prior-year returns.
U.S. laws and rules provide few options for people who are in a
showdown with Uncle Sam. Here is some of what U.S. taxpayers need to