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What are the unintended side-effects? I understand this is probably a well-meaning legislation, but: FATCA made it impossible for an American to have a bank-ac
by nickpp 6y ago
What are the unintended side-effects? I understand this is probably a well-meaning legislation, but:
FATCA made it impossible for an American to have a bank-account abroad [1]
PFICs made it impossible for an American to invest in non-US funds [2]
Together with world-wide taxation, punitive departure tax when renouncing the citizenship and huge estate tax when finally passing away, seems to me that Americans are becoming prisoners of their own government.
1. https://www.democratsabroad.org/what_is_fatca_what_are_its_impacts_how_we_aim_to_reform https://www.democratsabroad.org/what_is_fatca_what_are_its_i...
2. https://thunfinancial.com/home/american-expat-financial-advice-research-articles/american-expat-pfic-uk-non-reporting-fund-investment-trap-article/ https://thunfinancial.com/home/american-expat-financial-advi...
- FabHK 6y agoWell, Americans had a hard time laundering or hiding money abroad, but foreigners were welcome to do so in the USA. That has become harder now.
- nickpp 6y agoPlease note that I am not talking about anything illegal, just law abiding citizens who cannot do things that they could do before. I wonder, is the cost worth it? Was there so much laundering and hiding going on that it was worth losing even more freedoms over it?
- nerdponx 6y agoI thought we left estate tax FUD back in the Bush administration.
- vinay427 6y agoFATCA does not make it impossible to have a bank account abroad. I currently live in a country known for its historical banking secrecy and two different large banks I walked into were able to open an account for me with only one extra form that gives them consent to share my information with the IRS. There was at least one employee in both branches that knew exactly what to do, although not every employee did so I can understand some Americans trying to open accounts being turned away. As an American that lives abroad, I naturally don't support the extra taxation based on citizenship when I'm already taxed in my country of residence. There is paperwork to file to avoid double taxation, but hiring a lawyer to do it will probably cost me more than it saves at this stage in my life.
- _trampeltier 6y agoI think because of what the US did some years ago with Switzerland, some banks just try to reduce the legal risk by not having us customers. In the US is it not illegal to have a porn business, just no banc will give you an account. Here in Switzerland even hospitals started to refuse US customers because of legal risks. I guess that's the price for be the bully and push everybody in the world. https://www.tagesanzeiger.ch/die-angst-der-spitaeler-vor-der-us-justiz-798086131576 https://www.tagesanzeiger.ch/die-angst-der-spitaeler-vor-der...
- trophycase 6y agoI was thinking the same thing. Certainly an American passport is becoming one of the worst in the world to own.
- ur-whale 6y agoNot the worst though, there's Eritrea. They also tax their citizens worldwide [1] [1] https://www.taxesforexpats.com/expat-tax-advice/Citizenship-Based-Taxation-International-Comparison.html https://www.taxesforexpats.com/expat-tax-advice/Citizenship-...