[Lurking Libertarian]

More and more young entrepreneurs will LEAVE the USA and not pay taxes, retaining the right to return when they are older or if things go bad overseas. In the meantime the ridiculous taxes paid here, will not be paid by them.

U.S. citizens owe federal taxes on income earned anywhere in the world.

[DreamsofPolycarp]

U.S. citizens owe federal taxes on income earned anywhere in the world.

Right. And the speed limit in suburbs is 25 mph, it is illegal to download mp3s, the legal drinking age is 21, and smoking marijuana is against the law......, oh yeah, it is a crime not to declare all of your income if you are self employed.

[ikka]

U.S. citizens owe federal taxes on income earned anywhere in the world.

Actually there is an exclusion for 2006 of the first $82,400 . Surprisingly, you still have to pay SS and Medicaid taxes even if no federal tax is due.

You can avoid that, or income can be higher, depending on various tax treaties and tax totalization agreements - this all depends on which country you are in.