From: stephen@sprunk.org   
      
   On 24-Jun-14 11:40, John Levine wrote:   
   >   
   >>>> I think that's an income tax thing.   
   >>   
   >>> No, it was Afroyim v. Rusk, a Supreme Court decision in 1967,   
   >>> which reversed several other decisions going back to 1898 and   
   >>> said the only way to lose US citizenship is to voluntarily   
   >>> renounce it.   
   >>   
   >>> Since then the Congress has indeed passed a bunch of laws that   
   >>> make it hard to renounce your citizenship, and demand large   
   >>> payments to compensate for all the taxes a nonresident would   
   >>> presumably stop paying.   
   >>   
   >> So you're saying it's like a tax law thing.   
   >   
   > Only partly.   
   >   
   > Historically, the US viewed citizenship as a privilege, and if you   
   > did something disloyal like vote in someone else's election or fight   
   > in their army or accept their citizenship, you lost it, and courts   
   > confirmed that.  In the 1960s, the courts did a U-turn and now read   
   > the 14th Amendment to say that you're a citizen almost regardless of   
   > what you do, until you specifically say you're not.   
      
   ... until you _freely_ say you're not.  If you're renouncing it in   
   return for something else, e.g. nationality of another country, then   
   that is not considered "freely".   
      
   > The US is the only country to demand that non-resident citizens pay   
   > income taxes just like residents.  As taxes have become more   
   > complicated, this means that if you live outside the US, it is a   
   > huge hassle to be a US citizen.  Even though there are credits for   
   > most double taxation (US and where they live), friends who live   
   > outside the US assure me that just the paperwork is a huge hassle.   
   > As a result, the vast majority of people who renounce US citizenship   
   > do so to stop having to pay US taxes.   
      
   Unless they live in a tax haven, they probably don't have to pay any US   
   taxes at all; they get a (non-refundable) credit for foreign taxes paid,   
   which in most cases are far higher than the US taxes that would have   
   been due, so by renouncing, all they're really avoiding is having to   
   file a (very complicated) return every year.   
      
   The penalty for _not_ filing a return, even if you owe no US taxes due   
   to said credits, can be quite substantial--and that's probably where a   
   lot of the horror stories come from.   
      
   > The Congress has realized this is a gravy train, all these allegedly   
   > rich people who live outside the US, pay taxes, and consume no   
   > services.  So they've made it harder and harder to renounce.   
      
   It's not hard at all: just walk into any US consulate and recite the   
   oath.  The only catch is that the US claims the right to continue to tax   
   your foreign income for 8 more years, even though you're not a US   
   national anymore!   
      
   S   
      
   --   
   Stephen Sprunk         "God does not play dice."  --Albert Einstein   
   CCIE #3723         "God is an inveterate gambler, and He throws the   
   K5SSS        dice at every possible opportunity." --Stephen Hawking   
      
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