Posted on 06/01/2016 10:20:58 AM PDT by NRx
...And indeed, government statistics show record numbers of people are renouncing their U.S. citizenship. But it’s not Trump that has persuaded them to go. It’s taxes.
...The regulations also created new filing requirements for individuals with assets overseas and increased the fines for missing a form. The penalty for failing to file is $10,000 per form. The consequences are even steeper for intentionally not filing a document known as the Report of Foreign Bank and Financial Accounts, which could result in a fine of $100,000 or 50 percent of what’s in the bank account — whichever is greater.
“They’re like, 'Oh my, God, the IRS is going to bankrupt me,'” Mitchel said of his clients. “People get terrified of this, and they don’t want to have anything to do with the IRS, and then they want to renounce.”
Mitchel said that many of his clients have been paying taxes in the country where they live now and may not have bothered filing a U.S. return. Most countries in the world expect you to pay taxes only when you live inside their borders. But two nations — the United States and Eritrea — require its citizens to pay taxes on income while living in other countries. And Mitchel said it’s not just the very wealthy who are chafing under the new regulations. Many of his clients are moderate-income households and retirees living overseas who find navigating the morass of requirements more trouble than it is worth.
(Excerpt) Read more at washingtonpost.com ...
Time for the tree of liberty to be watered.
And who gave us this? Dodd-Frank if I am not mistaken. Who held out for 2 weeks before he ok'd the bill in the Senate? Scott Brown former Senator of MA, home of many "Investment" type companies what was he holding out for, if anything of course...
The store manager told me that the reason that most shoes are made offshore and not in America has little to do with the wage differential. It is the EPA, which so over-regulates the manufacturing process with restrictions on glues, etc. and chemicals used in the leather making process that it forces companies overseas.
It's not that the American worker is non-competitive, quite the contrary, it's the regulatory mechanism that the D.C. bureaucrats have imposed on us so they can cash in, at our expense, on their bloated pension and gummit benefits.
So there you have it. Eritrea is ObaMao's model for the United States.
Seriously, this is really stupid. Japan has a much higher percentage of their citizens living abroad who understand the local cultures and report home so they can make products every other country wants to buy.
America has just a fraction of their citizens living and working abroad. The biggest categories are military and retirees. No knock on the military, but they overwhelmingly live on base with other Americans. It is their job to protect, not learn about other cultures. Some do, of course, but not to the extent that their foreign counterparts who work in the United States or other countries.
Retirees, of course, are not there to open new markets for American products but to (usually) stretch their retirement dollars.
The remainder (those there to work) usually work at either a level so high or a term so short that they do not provide a benefit comparable to their companies which their Japanese, Latin American and European counterparts do. The tax treatment is one major factor as to why.
Canada has universal taxation, too, when its residents are living abroad.
What if you’re being paid by the foreign government while living in their country; or does it mean if you’re being paid by an American company and working overseas for them you pay taxes to the US? It could also be a double whammy where you pay taxes to both countries.
Eritrea... isn't that somewhere near Kenya? /S
The US is keeping bad company here with it's policy of taxing worldwide income. All justified in the name of fairness.
If legislatures spent as much time trying to control spending as they did trying to find ways to tax people, we’d be in a lot better shape.
The tax required for a non-existent program is zero.
There is no “could” about it. It is a double whammy. The current exemption is something like $120,000 a year. Over that point you owe US taxes even if you pay taxes where you live. This does not take the local cost of living where you live into consideration. $100,000 a year in Hong Kong is nearly poverty level in the US.
BTW the most common occupations of expatriate Americans is are school teachers and missionaries, neither of those are particularly high paying occupations.
The US tax laws in this area re simply criminal. I would almost vote for PIAPS if she promised to end this practice. Almost, not quite
Retiring in the US is going to continue to be an option for fewer and fewer people as time goes on, so I expect more people to take their assets and flee to greener pastures.
Yeah, my buddy would only buy Red Wings because they were the only boots he could find that were made in the USA. Good boots too, they will last a long time if you take care of them.
Well, there are two possibilities here to explain the “stupid” rule, I think.
#1 - It’s just designed to give the politicians a soundbite. They know it’s not going to accomplish anything, but they can go on tv and say “we closed a loophole”, and few people in the public will realize the “loophole” wasn’t a problem in the first place.
#2- It’s designed in anticipation of future laws, to close a loophole that WILL be problematic soon enough. For example, if they are planning to grab our 401ks, they would want to get something like this in place to make it harder for people to flee with their assets ahead of the implementation.
I make far less than $120,000 per annum (pure salary) here in Germany - and yet also routinely pay $5,000 - 10,000 or more per year on dividends, profits from the sale of stocks, etc. on the assets I hold with my stockbroker in the U.S.
Regards,
Best post for this thread. For sure.
This is not such a big problem as WaPo would have you believe. It is mostly “anchor babies” who have never lived in the U.S., don’t care about the U.S., and don’t want to be bothered with U.S. tax laws.
“made offshore and not in America has little to do with the wage differential. It is the EPA”
Why do you think microchips and high tech stuff are made in China? Pollution regulations and others. Same thing for gobs of other products.
“BTW the most common occupations of expatriate Americans is are school teachers and missionaries, neither of those are particularly high paying occupations.”
I had a friend who was living in Asia, teaching English, he had a good job in the US but his Asian-born wife preferred to live in her home country so he moved there.
He was called to the US Embassy one day and they asked to see his passport, he naturally gave it to them whereupon it was confiscated and told it would not be returned to him until he settled his obligations to the IRS, obligations that he had previously been unaware of.
Naively assuming that he didn’t need to he had not filled out an IRS return for several years. What with fines for non-compliance and tax he was alleged to owe on earnings in the foreign country (none of which were correct) he was presented with a bill for $60,000.
Like I say he was on an English teacher’s salary supporting a wife and two kids. He paid up but was financially ruined.
Our gubmint is now tyranical in nature.
RedWing shoes/boots, are the best.
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