GLOBAL ECONOMY

Americans abroad renounce their U.S. citizenship at record rate

Americans living abroad renounced their U.S. citizenship at a record rate in the first part of this year, Bloomberg News reports.

Whether to unhinge themselves from U.S. laws that call for taxing citizens no matter what country they’re living in, or to be free of more recent complex reporting and tax requirements, some 1,335 one-time Americans bid adios, adieu or ciao to their U.S. citizenship, according to Bloomberg.

The U.S., or more specifically, the Internal Revenue Service, does not look kindly upon those who toss away their U.S. passport. Not only did it increase the fee for doing so a couple of years ago – from $450 to $2,350 – the agency also puts out what some call a “Wall of Shame,” or a publicly available list of each and every person who abandons citizenship.

The agency says it is simply complying with regulations that call for it to announce the identity of every American-no-longer-wannabe. It also attributed the hefty fine increase to the higher demand in processing paperwork.

In all of 2014, slightly more than 3,400 Americans renounced their citizenship, Bloomberg said.

The number of Americans who live overseas is around 6 million.

“The cost of compliance with the complex tax treatment of non-resident U.S. citizens and the potential penalties I face for incorrect filings and for holding non-U.S. securities forces me to consider whether it would be more advantageous to give up my U.S. citizenship,” Bloomberg quoted Stephanos Orestis, a U.S. citizen living in Oslo, as having written in a letter to the Senate Finance Committee. “The thought of doing so is highly distressing for me since I am a born and bred American with a love for my country.”

The United States is the sole nation among the members of the Organization for Economic Cooperation and Development that taxes its citizens no matter what country they live in.

Among more prominent people who have given up their citizenship in recent years are London Mayor Boris Johnson, who was born in New York and fought with the IRS over taxes, and Facebook co-founder Eduardo Saverin, who was born in Brazil but had become a naturalized citizen.

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