Tuesday, April 6, 2010
WSJ: More Americans Are Fleeing U.S. to Avoid Rising Taxes, More Aggressive IRS
Wall Street Journal, More Americans Give Up Citizenship As IRS Gets Aggressive Overseas, by Martin Vaughan:
The number of American citizens and green-card holders severing their ties with the U.S. soared in the latter part of 2009, amid looming U.S. tax increases and a more aggressive posture by the Internal Revenue Service towards Americans living overseas.
According to public records, just over 500 people worldwide renounced U.S. citizenship or permanent residency in the fourth quarter of 2009, the most recent period for which data are available. That is more people than have cut ties with the U.S. during all of 2007, and more than double the total expatriations in 2008.
An Ohio-born entrepreneur, now based in Switzerland, told Dow Jones he is considering turning in his U.S. passport. Mounting U.S. tax and reporting requirements are making potential business partners hesitate to do business with him, he said.
"I still do dearly love the U.S., and renouncing my citizenship is not something I take lightly. But more and more it is seeming like being part of a dysfunctional family," said the businessman, who asked that his name not be used for fear of retribution.
https://taxprof.typepad.com/taxprof_blog/2010/04/more-americans-.html
The article fails to mention that changes to the expatriation tax rules in mid-2008 broadened the exceptions for individuals who can expatriate without negative tax consequences, which surely increased the number of expatriates regardless of rising taxes. Further, this information was presumably culled from the Federal Register which frequently reports individuals as having expatriated several quarters after they have done so. There is no way to know from looking at the Federal Register when the individuals listed in Q4 2009 actually gave up citizenship.
Posted by: CM | Apr 8, 2010 2:04:00 AM