Record number of Americans renounce citizenship for tax reasons

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All-Time Record Numbers Renounce American Citizenship Abroad – www.philippineslifestyle.com

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

The figure is 18 per cent higher than the previous record, according to Bloomberg. In all of 2014, 3,415 Americans gave up their citizenship, the second successive year to see renouncements hit a new high.

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The data only provided the names of Americans giving up their passports, and not their reasons for doing so. But the spike comes as the US government is getting increasingly aggressive about ensuring that Americans living abroad are unable to hide funds that should be taxed back home.

The 2010 Foreign Account Tax and Compliance Act (FATCA) required foreign banks to report on accounts held by US citizens. About 110 countries and 160,000 financial institutions have agreed to comply with the law.

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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Furthermore, the US has reached a number of high-profile settlements with foreign banks, particularly in Switzerland, over their efforts to help Americans hide income in foreign accounts.

 

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