3 ms·
The federal government does something worse, you pay federal income tax on all income no matter where it is made and what country you are living in (with the ex
by todd8 6y ago
The federal government does something worse, you pay federal income tax on all income no matter where it is made and what country you are living in (with the exception of some deductions for income taxes paid to other countries one is living in). Other countries only make you pay taxes for income generated there.
Even if you give up US citizenship, which requires something like paying taxes on all unrealized gains and ten years of projected earnings before they let you out of the US, the feds still go after your estate for estate taxes when you die no matter how long you have been gone from the US.
And good luck getting back in for a visit after relinquishing your citizenship.
This all started with laws passed after the Dart family, wealthy for styrofoam cups, gave up their citizenship and left the US (how dare they!), see [1].
[1] https://www.latimes.com/archives/la-xpm-2008-jun-15-fi-perfin15-story.html https://www.latimes.com/archives/la-xpm-2008-jun-15-fi-perfi...
- mamon 6y agoBenefits of being the only global superpower. Believe me, other countries would gladly do the same, they just lack the aircraft carrier fleet to support such policy.
- DoofusOfDeath 6y agoI don't think military power is the key here. I think having so much of international banking tied to the U.S. may be the relevant lever.
- konjin 6y agoTriple citizen: first 100k is tax free. You still need to lodge US taxes which is a huge pain. There are reciprocal tax agreements with most of the developed world though. The only time this bit me was when I was looking at a very well paying job in Dubai: https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z https://www.irs.gov/businesses/international-businesses/unit... >And good luck getting back in for a visit after relinquishing your citizenship. Sadly all too true. There must be a list somewhere because everyone I know who has done this has gotten fucked very hard every which way they could get fucked by the govt.
- seanmcdirmid 6y agoThe reciprocal agreements are usually for social security and the like. You can still take the foreign tax credit even if the USA doesn’t have an agreement with said country. You get screwed in low tax/high fee countries (like Singapore) and have to start leaning on your housing deduction.
- da_big_ghey 6y agoAmerica has enough influence over the global financial system to do this. California does not.