How Many of the 5,211 Former U.S. Citizens (who Renounced in 2014 and 2015) are Still U.S. Taxpayers?
CORRECTION TO THIS POST: If you renounced your U.S. citizenship, you may think you cease to be a U.S. taxpayer. This depends upon when the termination of citizenship occurred.
More posts will follow addressing these issues.
Unfortunately, the law is not that simple, regardless of your wealth, income, assets or future inheritances or gifts.
The way the federal tax law works, is that the U.S. “expatriation tax law” applies to the poorest former U.S. citizen (and certain long-term LPRs), wherever they reside if they do not comply with the certification requirements of Section 877(a)(2)(C). See, Why “covered expat” (“covered expatriate”) status matters, even if you have no assets! The “Forever Taint”!
The law continues to obligate certain former U.S. citizens to be subject to the U.S. taxation laws on a worldwide bases, unless and until they notify the IRS and certify under penalty of perjury. This depends upon the time of the renunciation.
2 thoughts on “How Many of the 5,211 Former U.S. Citizens (who Renounced in 2014 and 2015) are Still U.S. Taxpayers?”
August 23, 2015 at 10:54 pm
My guess people living abroad are renouncing just to get the CLN to show their banks. Should most not be tax compliant, care to speculate what the IRS will do when they get wind?
August 27, 2015 at 7:09 pm
This article reads as though a former U.S. citizen would be subjected to U.S. taxation up to the date of the IRS having received her 8854 rather than her renunciation date. I suppose the IRS could try to insist on yet ANOTHER year being filed to cover up to the date the 8854 was received?!?