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BocaNY
Joined: 24 Mar 2009 Posts: 131
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Posted: Tue Jul 29, 2014 4:50 pm Post subject: Giving up residency in the US |
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Hi,
I was wondering if this could be done and if anyone has done it? What would it mean for a US citizen to do so? Does it get you out of paying states taxes? I know you won't be able to vote but other then that what are the pros & cons?
Cheers. |
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nomad soul
Joined: 31 Jan 2010 Posts: 11454 Location: The real world
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Posted: Tue Jul 29, 2014 5:03 pm Post subject: |
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You mean renounce one's US citizenship. Frankly, those who did aren't likely to show up on this forum.
I posted this topic a few months ago: "More Americans renounce citizenship but deny stereotype" (http://forums.eslcafe.com/job/viewtopic.php?t=106720).
Last edited by nomad soul on Tue Jul 29, 2014 6:08 pm; edited 1 time in total |
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spiral78
Joined: 05 Apr 2004 Posts: 11534 Location: On a Short Leash
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Posted: Tue Jul 29, 2014 5:06 pm Post subject: |
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No, actually, it's possible to maintain no residence in the US and retain citizenship (my current status).
You CAN in fact vote in national elections, from the state which was your last place of residence.
You do not have to file or pay state taxes, but you do have to file (probably not pay, as an EFL teacher!) federal tax forms annually, and you are responsible to report on FBAR any foreign account with 10,000 usd equivalent or more in any year. |
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BocaNY
Joined: 24 Mar 2009 Posts: 131
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Posted: Tue Jul 29, 2014 5:21 pm Post subject: |
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Thanks Spiral.
Do you think it's worth it? What is FBAR? Do you know the gov website by any chance? |
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spiral78
Joined: 05 Apr 2004 Posts: 11534 Location: On a Short Leash
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Posted: Tue Jul 29, 2014 5:27 pm Post subject: |
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For me, it's totally worth it. I don't own anything in the US, including a bank account, haven't earned a US dollar since 1998, and have no plans ever to return. Frankly, I'll give up citizenship when I have time to go through the process.
But I've been on 'no US residence' since 2000 and I personally think it simplifies things.
You can google FBAR - go to the IRS site. |
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BocaNY
Joined: 24 Mar 2009 Posts: 131
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Posted: Tue Jul 29, 2014 6:20 pm Post subject: |
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Thanks again Spiral. I was reading the IRS stuff and it maybe my head hurt. LOL. Where or who do you contact if you want to maintain no residency? The only thing I own in the US is a bank account and a few credit cards. |
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nomad soul
Joined: 31 Jan 2010 Posts: 11454 Location: The real world
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Posted: Tue Jul 29, 2014 6:26 pm Post subject: |
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BocaNY:
Sorry, I misunderstood. You want to keep US citizenship for whatever reasons, but live out the rest of your life outside the country.
From the FBAR site:
FBAR Assistance
Help in completing the FBAR is available Monday through Friday, 8 a.m. to 4:30 p.m. Eastern Time, at 866-270-0733 (toll-free inside the U.S.) or 313-234-6146 (not toll-free, for callers outside the U.S.). Questions regarding the FBAR can be sent to [email protected]. |
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spiral78
Joined: 05 Apr 2004 Posts: 11534 Location: On a Short Leash
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Posted: Tue Jul 29, 2014 6:33 pm Post subject: |
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Quote: |
Where or who do you contact if you want to maintain no residency? |
My last state of residence was Virginia (another reason I haven't given up citizenship - it's a swing state in national elections, so I can fantasize that my vote actually counts for something;-)).
I contacted the state voting registration and filled out a form saying that I no longer maintained a residence in Virginia (or in any other state) and am officially registered as (an independent) voter whose vote is counted in the state of Virginia. This freed me from tax requirements in Virginia.
Not sure if it's the same in all states - or if the procedure has changed over the past 15 years - but your last state of residence voting registration centre is probably a reasonable place to start. |
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spiral78
Joined: 05 Apr 2004 Posts: 11534 Location: On a Short Leash
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Posted: Tue Jul 29, 2014 6:38 pm Post subject: |
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On a side note, I have serious reservations about the whole FBAR thing. It's not really designed to 'catch' people like EFL teachers, but like many IRS functions, it seems to assume guilt rather than innocence.
My spouse is not a US citizen and has never been employed in the US. Our income is nothing to do with the US, and it worries me that I must report bank accounts which contain nothing whatsoever owing to the US.
I'd like to trust the IRS, but they made a mistake years ago that cost me 7 years of bad credit (a lien on me that was in fact an IRS error). It also cost me 7 years of stress and strain to get them to take it off. After this experience, I'm obviously gun-shy about reporting our assets, even though I'm doing absolutely nothing off-color in terms of filing or paying anything due to the US.
Nomadsoul's pointed out that a growing number of US expats are renouncing citizenship for this reason....I may in fact join them at some point. |
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BadBeagleBad
Joined: 23 Aug 2010 Posts: 1186 Location: 24.18105,-103.25185
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Posted: Tue Jul 29, 2014 10:01 pm Post subject: |
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spiral78 wrote: |
On a side note, I have serious reservations about the whole FBAR thing. It's not really designed to 'catch' people like EFL teachers, but like many IRS functions, it seems to assume guilt rather than innocence.
My spouse is not a US citizen and has never been employed in the US. Our income is nothing to do with the US, and it worries me that I must report bank accounts which contain nothing whatsoever owing to the US.
I'd like to trust the IRS, but they made a mistake years ago that cost me 7 years of bad credit (a lien on me that was in fact an IRS error). It also cost me 7 years of stress and strain to get them to take it off. After this experience, I'm obviously gun-shy about reporting our assets, even though I'm doing absolutely nothing off-color in terms of filing or paying anything due to the US.
Nomadsoul's pointed out that a growing number of US expats are renouncing citizenship for this reason....I may in fact join them at some point. |
I am in the process of renoucing. It is a major pain, but I have assets in Mexico that are not in my name for just that reason. My husband is not a US citizen and we have no plans to live in the US, ever. We don't have a joint bank account and I don't file joint taxes, because I think it is ridiculous to have to report his non US income, or for the IRS to have access to information about HIS money. Morally, it is also blurry to me. I can open an account as a Mexican citizen, with my Mexican papers, that the US would likely not have any way to trace, but if they did, I could be in trouble, so it is just easier for me to give it up. Not something I did lightly, but after a lot of thought, it really seemed like the only possible solution unless I want everything to be in my husband's name. Not that I think that is a problem, but in case he were to pass away before I do, even though I am on everything as the survivor who knows how easy, or hard, it would be to get everything taken care of. |
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naturegirl321
Joined: 04 May 2003 Posts: 9041 Location: home sweet home
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Posted: Wed Jul 30, 2014 3:52 am Post subject: |
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Get everything out of the USA. Property, credit cards, bank accounts, etc. anything you have that could tie you there. |
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BocaNY
Joined: 24 Mar 2009 Posts: 131
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Posted: Thu Jul 31, 2014 11:15 am Post subject: |
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This makes me wish I still had residency in FL..no state taxes. :/ The FBAR seems kinda messed up. It seems that if you open a foreign account for retirement you have to report it and the US gov't can then tax it if they want. That seems very unfair. I don't get why the US is the only country that taxes it's citizens on wages they made overseas. |
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nomad soul
Joined: 31 Jan 2010 Posts: 11454 Location: The real world
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spiral78
Joined: 05 Apr 2004 Posts: 11534 Location: On a Short Leash
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Posted: Thu Jul 31, 2014 12:19 pm Post subject: |
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Quote: |
the US gov't can then tax it if they want. |
Technically, no, they can't tax the income of a full-time resident abroad unless you make over something around 90,000 usd/equivalent in a given year. As this is unlikely, taxes aren't really a worry.
At least, that's the current law!
However, the fact that they have exact bank account information for couples where one spouse is not a US citizen worries quite a lot of people. |
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naturegirl321
Joined: 04 May 2003 Posts: 9041 Location: home sweet home
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Posted: Thu Jul 31, 2014 2:56 pm Post subject: |
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Spiral is right. People have taken the issue to court. Some have won. I make less than the 90ish K and I still pay taxes. If you are self employed or have property or income from stocks for example you're still supposed to pay.
With that being said I've worked with many people who weren't even aware that they had to file. And they hadn't for years. But if you ever go back it could cause problems. A friend of mine had to backfile because of the FAFSA. Another because he needed to get his wife a visa. Another to take out a mortgage. |
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