4 ms·
US Citizen here! Unfortunately, it won't end! First, you have to fill out personal taxes every year for foreign income, regardless of whether you live in the U
by mbesto 13y ago
US Citizen here! Unfortunately, it won't end!
First, you have to fill out personal taxes every year for foreign income, regardless of whether you live in the US or not. All income globally is treated in the eyes of the IRS as income.
Second, you have to declare FBAR if you hold foreign accounts of over $10,000.
Third, you have to "open your books" for any foreign corporations you are the director (or have ownership) of. Check IRS forms 5471 and 5472.
Yaaa! Land of the free!
Source: American with a business in the UK, lived and worked in the UK. Not a lawyer, or an accountant.
- philiphodgen 13y agoYes, mbesto is right. Acquiring a second citizenship will not relieve you from the full boat of U.S. tax laws. No matter where you live, no matter how many other passports you carry, if you have the magic blue passport with the eagle on it, you are a U.S. taxpayer.
- joseph 13y agoSupposing one does not want a second citizenship and is willing to renounce their US citizenship entirely, which country would you recommend switching to? How difficult is it and what are the consequences?
- mbesto 13y agoFor what it's worth - Derek Sivers chose Singapore: https://news.ycombinator.com/item?id=3944339 https://news.ycombinator.com/item?id=3944339 http://www.guidemesingapore.com/incorporation/introduction/singapore-incorporation-advantages http://www.guidemesingapore.com/incorporation/introduction/s... AFAIK, you can always change to another country. However, I can't see the US taking it very lightly that you've denounced your citizenship. In other words, I would assume they would try to make your life a living hell if you wanted anything to do again in the US. (Have no idea, just assuming based on preconceptions about the way the US already treats it's citizens who live outside of it already) Derek seems pretty open, might be worth trying to reach out to him.
- joseph 13y agoInteresting, thanks for the links. Renouncing my citizenship isn't something I have immediate plans for, but I'm interesting in working abroad, so I'm curious to know how the process works.
- jpatokal 13y ago+1 for Singapore, at least from a business perspective: http://gyrovague.com/2013/10/30/half-the-donut-why-an-entrepreneur-earning-100k-gets-to-keep-over-99k-in-singapore-but-under-57k-in-san-francisco/ http://gyrovague.com/2013/10/30/half-the-donut-why-an-entrep... Personally, I'm going for Australia though -- there's more to life than low taxes.
- ajtaylor 13y agoI'm starting the work for my PR in Australia. We love it here, plus the paths are short and straightforward: 2 years as 457 => PR through employer sponsorship, 1-2(?) years as PR => citizenship.
- vacri 13y agoAnother traditional route to Australian citizenship is via New Zealand. Get a kiwi citizenship first, which is easier than an Aus one. With an NZ passport, it's easier to get an Australian one. It's actually quite a serious problem for the kiwis, because they do the hard yards of bringing immigrants up-to-speed with the local culture (eg English language lessons), only to have them jump the ditch (Tasman sea) to Australia.
- jpatokal 13y agoYou need 4 years total though. Which is still pretty good though, in places like the US you're lucky to get even a green card in 10 years...
- toomuchtodo 13y agoThe EU also has 8-10 year residency requirements, based on country. Malta is the shortest, at only a year, but you have to cough up € 1 million.
- girvo 13y agoYeah, while our taxes here in Aus are high, so are our standards of living. Although our new government seems intent on ruining that, in a bid to out-do the US in terms of idiotic legislation and curbing freedoms...
- toomuchtodo 13y agoThanks for the response. I was interested in renouncing my citizenship once I've obtained citizenship elsewhere; I should have included that in my post.
- scotty79 13y agoI heard that to renounce your citizenship you need to pay some one time tax on cash and valuables you own.
- toomuchtodo 13y agohttp://www.forbes.com/sites/robertwood/2013/11/15/u-s-citizens-renouncing-skyrocket-the-tina-turner-effect/ http://www.forbes.com/sites/robertwood/2013/11/15/u-s-citize... "Still, leaving America can have a special tax cost. To exit, you generally must prove 5 years of tax compliance in the U.S. Plus, if you have a net worth greater than $2 million or have average annual net income tax for the 5 previous years of $155,000 or more (that’s tax, not income), you pay an exit tax." "The theory of the exit tax is that is the last chance the U.S. has of taxing you. It is a capital gain tax as if you sold your property when you left. At least there’s an exemption of $668,000."