Part 2 – Unintended Consequences of FATCA – for USCs and LPRs Living Outside the U.S.
An earlier post discussed how USCs and LPRs living overseas have historically not been a focus of the policy makers at the federal government under FATCA; until now. See, Part 1- Unintended Consequences of FATCA – for USCs and LPRs Living Outside the U.S.
The FATCA legislative history nor preamble to the regulations discussed or focused on USCs and LPRs living outside the U.S.
Another unintended consequence of FATCA is that U.S. citizenship (at least among a certain group of individuals) has become devalued. This is a reflection of how many people are renouncing citizenship, which in relative terms has been an explosion; e.g., a 500%+ increase in ten years from 2003 to 2013.
Still, in absolute terms, it is a very small number; particularly considering the number of non-U.S. citizens who wish to become a USC. In 2012, the USCIS reported there were 13.3 million lawful permanent residents (LPRs). See, DHS report, Estimates of the Legal Permanent Resident Population in 2012.
Presumably, most of these LPRs wish to become naturalized citizens?
In addition, 779,929 individuals became naturalized citizens in 2013. See, Department of Homeland Securities, Office of Immigration Statistics, U.S. Naturalizations: 2013.
In relative terms, there are many fewer individuals leaving/renouncing USC status, compared to those who are coming to the U.S. To put this into perspective, more individuals naturalized from each of the following countries compared to the total number of USCs who renounced in the entire year:
- Ecuador
- Iran
- Pakistan
- Peru
- Nigeria
- Bangladesh
- Haiti
- Guatemala
Nevertheless, I am confident that this large percentage increase in USC renunciations was not a goal or intention of the policy makers behind FATCA; an unintended consequence.