OUR STORIES OF RENOUNCING/RELINQUISHING U.S. CITIZENSHIP
This section of our site is devoted to telling the stories of people who have renounced or relinquished their U.S. citizenship. It is important we educate others who are not in our position to understand why we are doing this. It is also valuable for other expats trying to decide to have some insight from those who have made this decision. While it may be sad, difficult, etc., it remains a fact that these decisions are taken out of sheer necessity due to the treatment received by the government of the U.S. And that you WILL survive it and feel okay about it.
FEBRUARY 19, 2018
I LIVE IN FEAR for the rest of my life – I HATE IT
This is my (ongoing) story of pain, anxiety, and fear.
My situation
- – born dual Australian American
- – never lived in the USA
- – no social security number
- – also known as a US Citizen by Accident
- – no US bank accounts
- – in my 40s with a family
- – lived in Australia, New Zealand, Switzerland, and other places.
- – always paid my taxes and intended to do the right thing
- – Consider myself Australian
- – Interesting side note because i never lived in the US and inherited my citizenship from my dad i would not be able to pass my citizenship to my children! (unless i lived in the US for some time). Yet i still had to pay taxes!
My story:
One day, my life changed. By happenschance i came across information that said that my entire adult life i was meant to have been reporting and paying taxes to America – even though i did not consider this “my” country, even though i did not live there.
First, the few days of feeling physically sick, researching and trying to learn more, how to fix this mess.
Then, the days turn to weeks. Hours upon hours of research. Realizing that i would have to figure out how to align different tax years(!) and different tax systems for multiple countries. New Zealand year has a different tax year to US, so does Australia.
The more i researched the worse this got, i was looking at literally tens of thousands of accounting bills, literally! Plus the fees involved for being late ($10K per pop), plus any taxes due!!! (which in all likelihood would have been zero as all my countries had higher tax rates than US).
I contacted agents and paid $ to find out more. All accounts said to do it but they didn’t have to spend a large % of the years earnings on back-filing tax forms. Even the questions started to add up in costs (per hour accountants are not cheap (who understand this sh!t))… My wife was mad at me for letting this happen. She wanted it done right.
Sleepless night.
Fear.
Concern.
The more i looked the worse it got. I started to resent this country that was hounding me. I wanted to at least stop this from this point forward. I was not an American nor did i want to.
After weeks of researching renouncing vs relinquishing… i had decided to renounce.
Then i had to do the forms (and pay more $). I had to fill in my exit form and confirm i had done my income taxes. Without these signed and completed i would be a Covered Expatriate – two TERRIFYING words. The US govt and IRS could hunt me FOREVER and every mistake would be due $10K in fees.
This hell would not end!
More and more sleepless nights.
My wife still wanting me to sort it out “right”.
I eventually did renounce. Scary as sh!t going to the US embassy and seeing all these guns and going through the interviews and filling in the paperwork, etc. I am “lucky”, within 6 months i get my CLN (via Frankfurt Germany). I am somewhat free! No longer a US citizen by accident.
The US publishing my name as an renouncer.
To the IRS i am a Covered Expatriate. I am to be hunted.
I would like to visit the US (as a tourist) but i live in fear.
I live in fear that one day they will come for my bank accounts, my family house, my children’s future.
I will have no where to hide. I have no way out of this hole.
I live in fear… i live in fear for the rest of my life.
I hate it.
Anonymous
*******
FEBRUARY 15, 2018
I Chose not to “fly under the radar” as I am Enraged by US Policy & Object to its Effects on my Family
The United States ceased to be my home in summer 1994, when I was 20 years old. Two years earlier, while visiting family in Austria, I met and fell in love with the man I would later marry. We tied the knot in 1998 and in 2002 had a daughter for whom I claimed US citizenship. Those were the days when the US system of citizenship-based taxation and requirements, such as FBAR, were not really enforced, so we were blissfully unaware of any US tax reporting obligations and remained so for another few years.
That being said, when I first moved to Austria, the IRS was contacted to ask about any filing requirements, but since I was single and poor, I was well-below the reporting threshold. A few short years later, when I wanted to get married, I had to visit the US Consulate for a marriage license. The consular officer was very friendly, and yet, I was never given even the slightest hint that my filing status would be changing and might trigger a filing requirement. One might argue it is not the job of the State Department to inform individuals about IRS obligations, but it seems to me this point of contact would have been the perfect opportunity.
Luckily for me, my life abroad had been managed in way that made coming into compliance with the IRS and relinquishing US citizenship fairly straightforward. Never having had much income, I was not liable for any tax. Also, the laws in Austria, for example, don’t allow a non-EU citizen to purchase and own land or a home without explicit permission, so my name was never on any such assets. My husband and I had never opened any joint accounts, I had never needed signing authority for any banking, and I had only had a couple of savings accounts – set up and managed by my husband – that turned out to require FBARs.
One day, I think it was in 2013 or 2014, I had my initial OMG moment after getting a FATCA letter about one of those savings accounts in my name. I remember being so outraged about the invasion of privacy that I instructed my husband to close the account immediately because I couldn’t be bothered with the paperwork.
Still, at this point the full impact of FATCA and CBT hadn’t sunk in yet. Whenever I would speak to friends and family about my possible US tax obligations they would laugh and say that it’s ridiculous because I was a long-term permanent resident of Austria. Why would I have to file anything for the US if I didn’t have any US-source income?! The whole idea seemed silly. I tried to ignore the nagging feeling I was getting about it, but I wound up going online and discovering that I wasn’t alone, and groups (such as the Isaac Brock Society) had been established exactly because of the horrible consequences FATCA was inflicting under the CBT regime of the US.
After fully realising my “toxic American-ness”, I decided to give up my US citizenship and become Austrian, so I filed normally for the 2015 tax year and used the streamlined program to file the previous three years, and filed again normally for the 2016 tax year. We moved to a different province of Austria in 2016, so I had to wait until that autumn to apply for Austrian citizenship (because it’s awarded by the province of residence). It took several months for me to complete my application, including the German language and Austrian history and civics testing, until I was awarded an “Assurance of Citizenship” that I could use to relinquish. Austria does not allow dual citizenship for naturalised persons.
In August 2017, two weeks after having received the letter of assurance, I had my appointment at the US Consulate in Vienna. They were very business-like, neither particularly friendly nor dismissive. (I was dismayed to see several young couples there to obtain US citizenship for their infants, but I did not say anything to them because I was aware of video cameras watching the waiting area.) First, I was called up to a window to review what forms I would be signing and to check the spelling and content of what the clerk had typed in the blanks. Then I had to go to another window to pay the exorbitant $2350 fee, which I did, in cash (because I don’t even have a credit card!). The third and final step was taking the actual relinquishment oath with the consul and signing the documents. Once done, the clerk gave me a letter confirming I had relinquished my US citizenship and proceeded to inform me that the usual waiting time for the Certificate of Loss of Nationality was about five weeks and I could use it, for example, to show the bank. Her remark about the bank struck me as odd because I had never mentioned it. When I chose to write a short “expatriation statement” explaining why I was giving up my American citizenship, I never used the words “bank” or “tax”; I truthfully expressed my wish to become Austrian, after having called it home for 23 years, and emphasised how Austria is where almost all my family are located and how Austria has taken care of me since I became a resident in 1994. The clerk’s mention of the word “bank” makes it obvious the authorities are aware of certain difficulties faced by Americans abroad.
On the day of my relinquishment appointment, I was a nervous wreck. My mother-in-law accompanied me to Vienna for moral support because I was almost physically ill from the nerves. When I finally emerged from the consulate after almost an hour, I beamed at her and she congratulated and hugged me before we sent texts to everyone in the family with the good news! We went out to lunch and spent a wonderful afternoon in the city. Three weeks later I had my CLN and any remaining misgivings I may have felt vanished. Then, in October 2017, I received full Austrian citizenship and applied for a new passport.
Some people might wonder why a person like me wouldn’t hold on to US citizenship and try to fly under the radar. Well, here is my reasoning: I do not agree with FATCA , FBAR or CBT; I resent the heavy reporting obligations and invasion of privacy (my own and, possibly, my spouse’s); a professional CPA is too expensive, so I have spent thousands of hours reading, researching and form-filling to be compliant – for zero tax liability; I object to my husband maybe one day suffering the consequences of having an American wife (e.g. missed employment or business opportunities); I also am turning 44 this year and would like to plan for my retirement without restrictions or punitive penalties; lastly, I lament the fact that all of this had not really been a problem for most US expats until fairly recently.
Now it is February 2018. I just sent in my 1040NR and Form 8854 after having put another three weeks of effort into those. Yet that is not the final chapter of our family’s expatriation journey. Our dual-citizen daughter will probably renounce her US citizenship, too, as soon as she’s old enough because she has witnessed the high-anxiety levels and family arguments over CBT issues and hears about the many disadvantages of having US citizenship. It’s sad to have to burn such a significant bridge at such a young age, but the burden of compliance – which could conceivably get worse in the future – isn’t worth maintaining. More than anything, I wish for my daughter, born and raised in Austria, to be free to live the life she chooses without American interference or constraints.
Anonymous
*******
FEBRUARY 13, 2018
It’s Cruel how we Have had to Give up our Right to Return
I decided to renounce after realizing it would be too expensive to continue filing every year. I originally wanted to remain a dual citizen but hadn’t yet been aware of all the restrictions caused by dealing with two incompatible tax systems.
It would have been impossible and too expensive to stay compliant doing normal financial planning where I live. I was facing annual accounting bills north of 10% of my income.
What I particularly resent is the racket set up to benefit the compliance industry. No financial privacy and threat of huge penalties for footfaults. It’s cruel how we have had to give up our right to return.
Anonymous
*******
A Dual who Managed to Relinquish
I was born in the US to Canadian parents, and registered as a Canadian Birth Abroad. At age 6 my family moved back to Canada, where I have lived since then. I have never had a Social Security number nor a US passport. I knew growing up that I was a dual citizen, but thought I had given up US citizenship at age 21 when I voted in my first national election. Many years later the US border officials started to press the point that I was still considered an American, and in 2011 when Canadians were being scared into filing US returns, I knew that I needed to carefully consider my options and move towards expatriation.
I have been lurking on IBS since its inception (and before that on the Expat Forum), spending hundreds of hours becoming familiar with the issues, and filling a binder with printouts of articles and comments I felt were pertinent to me. And, thanks to the information found on this site, I had courage to arrange a one-day trip from Winnipeg to Calgary in June of 2012, to document my voluntary relinquishment. I had a fairly weak case, citing only voting in my first national Canadian election in 1972 (which was an expatriating act until 1978 and ex post facto laws being unconstitutional), and accepting a government job in 1994 (administrative secretary in a local hospital). My experience in Calgary was consistent with reports from others, except for the clear message from the Consul that he would NOT be recommending my application, and that I should just renounce and be done with it. I chose to stand firm, as I knew what would be required of me if I obtained a current-dated CLN. It took almost 18 months from my appointment to receive the coveted CLN, and only after I made inquiry at the 12-month point and then being asked if I had signed an oath of allegiance when I accepted my government job. I could only locate a confidentiality agreement sample of what I may have signed. My documents obviously sat on a pending pile for many months, as I was a rather unusual case, and I think they finally signed just to get rid of me.
So, there are two myths seemingly disproven in my case:
– that dual citizens MUST renounce, as relinquishment is not an option
– that if the Consul advises that he cannot recommend an applicant for CLN, that Washington never overturns that directive.
I am so pleased and relieved to finally have resolved the nightmare that has been a major part of daily life for the last few years. And, as good fortune would have it, I can also say that I relinquished before February 6, 1995, the icing on the cake!
Thanks to each of the regular IBS contributors! There are likely many of us minnows hiding in the weeds, but taking in all the information we can find on FATCA and expatriation issues. This site has been my best resource all along, and I am eternally grateful!
In retrospect, I feel greatly relieved that I did the hundreds of hours of research and proceeded with a consulate appointment, but waiting 18 months for a decision after my appointment took a great toll on my personal wellbeing. My husband would say that I spent an inordinate amount of time on the IBS website and others in my research, and it became an all-consuming quest to get my CLN. I have 2 brothers who live in the US, and any conversations I have raised on the topic of CBT have landed on deaf ears with absolutely no understanding. The more time that passes has given me better perspective, but sometimes I feel resentful that this matter stole several years from me that I can never get back.
Anonymous
*******
FEBRUARY 10, 2018
I Renounced – for Human Rights, for Privacy Rights, & for Showing Respect for my Husband’s Privacy
I was born in the US, but left 30 years ago. I married and live in New Zealand, am a New Zealand citizen, and I have been a teacher for many years. I have no financial accounts in the US, everything is here – my local bank, KiwiSaver, savings and teacher pension. Earlier this year, I got a letter from my bank, ‘a FATCA letter’ which bemused me. Then I read an article last April about Americans owing taxes to the US. I’ve then done some research:
I am required under penalty of US$10,000 for each violation (or 50% of the value of the account if willful) if I don’t report my ordinary NZ bank account, savings, and pension accounts to the US Financial Crimes Enforcement Network yearly. Apparently this law and penalty has been in place for many years. I have to report on the bank name, address, account number, balance, and it doesn’t matter if it’s a joint account or that my husband is not a US citizen.
I am required by the US government to file US income taxes – the instruction forms for my relatively simple situation run to 60 pages of small font typing, and I have to complete 5 multipage forms. The US IRS estimates this will take up to 13 days to do, for an average overseas US citizen. Again, there are penalties for not filing – it is illegal. By the way, in my situation I wouldn’t owe any US taxes at all, as fortunately it is covered by the tax treaty. So this time and effort will not earn the US any money. I have heard that 80% of overseas Americans wouldn’t owe taxes anyway, but the US is looking at gaining $ through penalties.
The capital gain on sale of your residence is taxable in the US, with a US$250,000 deduction. Now, let’s see, I have moved house 5 times in my adult life. So I am meant to track the US exchange rate price when I (with my husband) bought each house, track all the deductible expenses of maintaining the house, track the US exchange rate when the house was sold. Subtract the difference for the 5 houses from US$250,000. What if the exchange rate is way up – that’s a phantom capital revenue – pay tax anyway. Apparently the US tax code is 64,000 pages long, and there is a whole industry of tax professionals who are trying to scare US expats into compliance.
So, for human rights, for privacy rights, for showing respect for my husband’s privacy I chose to investigate handing over my US passport. Well, that’s not simple. I have to be US tax compliant and FBAR compliant for 5 and 6 years respectively, travel to the US consulate in Auckland, be interviewed by phone and then in person, and the processing fee is US$2350, Yes, that’s right, I paid NZ$3500 as a processing fee – money earned entirely within New Zealand – when I handed over my passport. That was two months ago, and I am waiting to hear if my application to renounce has been approved. I had to write an apologetic letter explaining my ignorance of the law and begging forgiveness when I sent in my US tax forms, under the voluntary streamlined programme. If my apology is not accepted, then I become a ‘covered expatriate’ and must total up all my assets as if they were being sold, and pay 30% tax on any amount over $650,000. Where I would get this money I don’t know – sell our house? ask KiwiSaver for emergency access? So I wait…
I remember with pride when New Zealand’s David Longe stood up to the US over nuclear ships. I feel like those days are gone. I am not treated as a proud Kiwi citizen, I am now ‘a US taxpayer habitually residing in New Zealand’.
I don’t know many American Kiwis here, but those I do know are still ignorant of this situation, and long may they remain undetected.
New Zealand has changed their privacy laws so that banks and financial institutions can find ‘US persons’, as I found out when I wrote to the Privacy Commissioner, this revised law ‘trumps’ the usual privacy legislation. However, the US has made no such changes in their laws – this FATCA is meant to be reciprocal.
Finally, Wikipedia states that the NZ government has spent $20 million towards FATCA, and banks an estimated $100 million – to track down about 25,000 ‘US persons’. Yes, that’s right $4,800 per US person, or about $27 per person living in New Zealand.
I wait for my Certificate of Loss of Nationality and for my name to be published in the Federal Register, forever seen on the Internet.
Anonymous
*******
FEBRUARY 5, 2018
Why won’t the USA Graciously let its People go?
To anyone who doesn’t really understand the fear and frustration of FATCA and the insanity of the US tax system:
I am not and never have been American. I don’t live in the USA and I have no financial connections to the USA.
However, many years ago I got a green card when I married an American. We lived in the so-called, Land of the “Free”, until we decided to move permanently to my home country to care for my elderly parents.
A year or so after my return to my home country my green card expired, became null and void, but I didn’t know I was supposed to return it to USCIS along with an I-407 form. (Green cards don’t come with a set of disposal instructions.) Years later when I found out about this I searched for days to find that old green card and then I sent it away. It was received (according to the mail trace) but never officially acknowledged and there were no replies to my follow-up inquiries.
This left me trapped in a perpetual state of deemed US “personhood” which comes with onerous US tax filing and now highly intrusive FATCA reporting too. The threatened penalties for not filing FBAR (FinCEN114) forms are staggering. They would exceed my life savings (mostly a modest inheritance from my non-American parents). If I lose my life savings to the IRS I could end up on welfare and that would not be fair to taxpayers here in my home country.
What did I take from the USA when I left? I took savings of less than $5K and a gain of less than $75K from the sale of the house we built with our own labour and paid for entirely from the savings I brought with me from my home country (no mortgage on that house). All of this was reported to the IRS and taxed appropriately.
What do I get from the USA? Absolutely nothing – NO right to return to the USA to live or work; NO US Social Security because I have never had US income; NO rescue by US marines in a disaster; NO US vote; NO representation in the US Congress; and since I haven’t visited the USA in almost 20 years (and never will again), NO benefit from the USA’s infrastructure. I do not want any of those things anyway.
What do I want from the USA? I want to be left alone so that I can lead a normal life without the stigma of being called a “US person for tax purposes” (and ONLY tax purposes).
What’s the biggest irony of my whole situation? Well, my husband is no longer American since he recently relinquished his US citizenship. He now has a priceless piece of paper called a CLN (Certificate of Loss of Nationality) which means he can open and retain bank accounts here with no intrusive FATCA reporting.
Meanwhile I, who never was American, will have to live with uncertainty for the rest of my life. If my bank finds out about my past connection and failed disconnection to the USA, it will report me and my accounts to my country’s tax agency which will forward that information to the IRS. And then … well I shudder to think.
Some Americans may hate me for saying this but I have no love or respect for what the USA is doing with its irrational citizenship-based tax system and now its FATCA overreach. These same Americans might even laugh and gloat about how I became trapped as a “US person for tax purposes” but at least my husband, an upstanding citizen, has escaped the clutches of the USA. He did so with no regrets and when his CLN finally arrived he felt nothing but relief. I and my country are proud and pleased to have him. His warm and welcoming citizenship ceremony here in my, now OUR, country was one of the best days of both of our lives.
Neither of us is “un-American” but we are “non-American” and we cannot fathom why the USA will not graciously let its people go.
Anonymous
*******
FEBRUARY 1, 2018
Last Generation American
I only see renouncing my US citizenship as something positive. Since FATCA was put in place, the only thing I saw my US passport as was an impediment, and that with each year it gets worse. It’s not normal for a 20 year old to have to worry about such things and it is even more abnormal that a government that ‘’values’’ freedom would intentionally keep me from living a free life. Having gotten rid of my citizenship, I truly feel liberated now. I can finally have a normal life and pursue my dreams without having to seek professional assistance to remain compliant to surveillance and controls by an ill-willed government to a country that I haven’t lived in since age 2. Sure, I won’t be passing on my American heritage, but instead I will be passing on a new heritage of a country that truly understands democracy and values the term ‘’freedom’’. I have no regret in renouncing. I will not be a slave to a tyrannical country.
Andrew Fitzpatrick
*******
JANUARY 31, 2018
How I Became Canadian and Ended up Renouncing US Citizenship
My story begins in 2004. After going through a difficult divorce, I decided to relocate and leave the United States. My choice was Canada. After a 2 year process, I arrived in Vancouver through the skilled worker Permanent Resident program. I found good employment in healthcare research and a nice place to live. At the time, I was blissfully unaware of US extraterritorial tax policy.
Things were peaceful in Canada. I was exploring my new homeland and enjoying my new life. I met new friends, some of whom had also come from the US. The US tax situation came up in conversation and I didn’t know anything about CBT until that time. No one believed that the US would ever try to impose their tax law across borders as the rest of the world had RBT.
In 2008 everything changed for me. I received a registered letter in the mail from the IRS. The letter stated that I owed them $140,000.US in taxes and penalties. They threatened liens on my property and bank accounts. This was my pre-FATCA OMG moment.
That night I didn’t sleep well. I woke up with symptoms which could have been heart burn or a heart attack. It got so bad I was about to call 911 for an ambulance. Then the symptoms started to subside. The next day, I called a lawyer. In a few months, he settled the matter, filing back US tax forms. The legal fee was $7,000.US but my money owing to the IRS was zero!
After that experience, I got rid of my modest investments which had been tracked by the IRS. Instead putting any reserve cash into my home and simple bank accounts. But most important, in 2008 I became a Canadian Citizen.
Now we come to FATCA. I’m sure my previous experience made my decisions about FATCA, CBT and renunciation easier. My FATCA OMG moment was more like a slow wave over time.
I learned about FATCA from the news on TV in 2013. Also there were a number of signs out by tax preparers about new US laws and importance of doing your US tax returns. After googling FATCA, Isaac Brock Society and the Maple Sandbox were among the sites to come up. These sites were very helpful and full of information. I changed my bank accounts from big banks to credit unions which had FATCA Local Client Base status at the time. In July 2014, FATCA became law which extended into Canada and other countries through the IGAs.
My turning point was after going to a presentation by John Richardson. He gave a very clear and understandable account of the implications of FATCA, CBT, FBARs, etc. I don’t know exactly what it was, but after that presentation I decided I no longer needed the burden of US citizenship. Later in 2014, I made an appointment with the US Consulate in Vancouver. At the appointment, my attempt to relinquish was rejected. I had used my US passport to travel until it expired in 2012. In 2012 I obtained a Canadian passport. I was not aware of the implications of using the US passport but it was indicated to me after the State Department review that I would need to renounce. I renounced in December 2014 and received my CLN several months later. It cost $2350.US.
I filed back tax forms, as well as form 8854. No tax was owed. I didn’t file any FBARS. There was no evidence I needed to file FBARS as my bank account information was not available to the IRS from my credit union. But be aware that this has changed as of 2017 when many credit unions upgraded their systems to be FATCA compliant, no longer using the local client base exemption.
No, I was not totally honest in my filings with the IRS but they had no way of checking on this. In the case of US Expats, FATCA and CBT are unjust laws and a way of extorting money from innocent people who actually owe nothing. In my world view, there is nothing wrong in withholding information from robbers and thugs who are after one’s hard earned savings for retirement.
Yes, my renunciation process was stressful but much less stressful than my previous encounter with the IRS. When I came to Canada, I had never thought of renouncing but FATCA changed all that. For me, renunciation was the best alternative to take back my freedom and privacy. I find peace of mind from being 100% Canadian.
At the same time, we all have a different story and different financial circumstances. It’s an individual decision as to how we can best handle this difficult situation.
Anonymous
*******
JANUARY 29, 2018
I Lost Hope
My husband and I renounced in 2010 after 38 years in the United Kingdom. The reasons? We had faithfully paid our US taxes, even the alternative minimum tax when the foreign tax credit was limited to 90% of the foreign tax paid! We were a professional couple and I had closely followed the change from “expatriation to avoid tax” subjective test to the objective ones–tax liability, compliance, net worth. We each felt compelled to relinquish before we reached the $2m threshold in order to protect our dual citizen children from the “succession tax” that would apply if they inherited from a covered expatriate. The increasing value of our house (which we had owned since 1979) and the exchange rate were causing concern. There was always also a high fear factor: not every UK retirement plan entered into in the 1970s and 1980s was going to avoid IRS scrutiny forever; what errors had I made on tax returns; should I have paid tax on certain UK benefits, etc.!
(Isn’t it ironic that the $2m exit tax test is still out there when the estate tax threshold has moved so far?)
I have a lot of sadness. I was never able to tell my father before he died what I had done; it seemed insulting to our family background, considering two of my ancestors had arrived on The Mayflower. I was born and raised in the US and still feel American, and I always will. I wish I could still vote and have a voice. But what I see—failure to move toward residency-based taxation; the OVDP/FBAR penalties; passport revocation for IRS debt; the “transition” tax on foreign corporations owned by US individuals; paying the Obama capital gains tax without being able to benefit from Obamacare; the dead weight the IRS requirements on bank account reporting place on American entrepreneurship and business partnership abroad; the fact that the IRS can place on US citizen children who inherit from an expatriate the burden of proof that their parent was not a covered expatriate, when this information is in the hands of the IRS (even more so, that the law punishes the US citizen children of a covered expatriate for the “sin” of their parent’s expatriating); the ever-increasing form filings and ever decreasing access to the IRS by non-residents—takes away the slivers of hope I have.
Mr. Rettig is, as far as I can tell from the tax community, at least capable of understanding these problems. I wish I could lock him in a room with Nina Olsen.
So that’s my story. I don’t regret expatriating, but I very much wish I had not had to do so. What I worry about now is the burden on my children. And the situation of several US persons I know here in the UK who have never filed and are terrified; they don’t know where to turn, or what to do next.
Anonymous
*******
I did not Leave America, the U.S. Government Left me
“It is not always the same thing to be a good man and a good citizen.”
— Aristotle (384-322 BC)
What follows are notes from my process in relinquishing my United States Citizenship.
I handed in my U.S. Passport 6 days ago as of this writing (almost a year ago from posting this).
I don’t know you and already I’ve hedged on the truth. The fact is that I i didn’t “relinquish” – instead I “renounced” the United States last week, and it pains me to write it so clearly – and I can hardly say it out loud.
I took this process very seriously, and I considered the implications deeply and over a long period of time. I hired lawyers (money well spent) and researched on the internet (marginal value). My reasons for doing this are my own. If you are considering the same – be absolutely certain of your own reasons. On the chance my notes might help anyone I’ve decided I will share them with you now.
Despite two years of consideration and agonizing over the details, the actual process of becoming an alien to the United States only required 1 phone call and 2 visits to my local United States Consulate for the country in which I reside.
The Call
I called the consulate and said “I would like to schedule an appointment to renounce my citizenship.”
I was given an appointment for the initial consultation set for 6 days later.
1st Visit
Although I setup the appointment under heading of ‘renouncement’, I arrived at the consulate with the intent of discussion my relinquishing U.S. Citizenship. More than anything, I liked the sound of the word “relinquishing” far better than “renouncing”. Even after two years consideration I could not bring myself to think ‘renounce’.
The end result was that I would renounce. The essential reason being the potential for delay, confusion and potentially denial by the U.S. if you relinquish.
While the possibility to have the Reed Amendment enforced under a renouncement is understood, it seemed clear that the process of relinquishing could be delayed many months. Washington DC State Dept. lawyers could deny if they chose. I made a personal decision during this visit to be ‘done done’ in 3 weeks by changing back to “renounce” and not wait on the good graces of the U.S. government.
The following are notes are from what I wrote down during the interview and from memory within 5 minutes of leaving the consulate on this day.
Logistics:
No problem. Easy check-in and short wait for my appointment. The security is exceptionally tight. Cell phone (turned off) and other objects left in security booth.
Attitude/Perceived issues on my part regarding consulate staff:
Consulate staff eminently professional and seemed most interested to ensure that I completely understood the process and ramifications of my decisions. I felt no disrespect or even disappointment from their demeanor (and I was looking for it).
I had called about Renouncing but walking into interview I immediately made it known that I would like to seek relinquishment.
This delayed my interview and the staff member asked me to go and sit again. I waited maybe 15 minutes. My assumption was the staff member needed to review the process and ensure that they handed me the correct information/forms.
The interview then proceeded.
Following a document and checklist the staff member made it known how and why I could relinquish, etc…They wanted to be sure I was not coerced and told me they were assessing my state of mind.
We got to the point of my having performed a relinquishing act 2 years ago (oath to another country for citizenship), but that I then was continuing to act as an American. (I had filed taxes for 2 years, I have used my U.S. passport many times during the ensuring 2 years).
This information would be reviewed by the lawyers in Washington D.C. and could potentially take many months to resolve before they approve my act of relinquishment.
There was a possibility (though never stated as a probability) of the relinquishment being denied, which would mean the date of my CLN would not be accepted.
I would have to reapply for a renouncement with a different CLN date.
Because of the potential for a complicated process with essentially the same end result, I then stated I would like to renounce.
This back and forth of my request was taken in stride and was understood to be a normal process in determining the best way forward as new information was processed.
We then went through the renouncement interview process.
I mentioned I had a fully filled out DS-4079 (Request for Determination of Loss of Citizenship) and was told it was not necessary to this interview, that the consulate would prepare all the forms on my behalf after gathering data.
All the same – having had this form with me and prepared helped answer some questions verbally.
The consulate staff member took copious notes regarding my dates of arriving in my country of residence, residence dates (I had a gap of 3 years over the last 27 year resident here when I was back in the U.S.), when I received permanent residency in the foreign country, my current wife’s’ citizenship, my former wife’s citizen ship, my children’s citizenship, my family members residing in the united states, divorce dates, other basic details.
I was asked if I wanted to make a statement regarding why I was renouncing and I said no.
Asked what other ties I have to the foreign country and I only stated “The center of my vital interests is where I am now living” which was transcribed.
I was given the consul reps business card and told to call if I had any questions.
It was made clear in this process that by being relieved of U.S. Citizenship:
– any illegal act having been made as a citizen would still be enforced as if I was a citizen
– that I would separately need to work with the IRS to resolve my obligation to them.
– via renouncement and for reasons of tax evasion, then it is possible to be denied access to the United States (Reed Act, although it was not referred to).
I was also given a manila envelope to hold other documents I was given. I was directed to study, but not required to fill out the DS-4081 (Statement of Understanding. Renunciation”) and DS-4080 (Oath of Renunciation)
I was also given three “Legal considerations” from the Travel.state.gov website
I was told to bring my original documents showing my new citizenship at the next meeting – they would not be taken from me, but would need to be reviewed.
Of course, to bring my passport with me to the next meeting.
Renouncements are done in this country one day a month (so i go back in 3 weeks).
I was told that after considering the information given me, and before the date of renouncement, I was to call the consular officer to state that I have read all information, understand it, and wish to proceed.
I left.
The whole process may have been an hour, but that time would have been much shorter if I had not changed back and forth from renounce to relinquish and back to renounce.
2nd Visit
3 Weeks and 2 days after attending the consulate for a first interview, I returned to the Consulate and gave up my U.S. Passport.
I’ve read some U.S. consulates and embassies will have a backlog and delay this process. I experienced no delay in scheduling or in wait times on the respective days.
Here’s how my day went.
I had an appointment for 2pm. I arrived just after 1:30pm in order to have plenty of time to go through security. I experienced a check of my passport at the street, entry through a thick door, a metal detector, scanner, and they wouldn’t even let me walk in with a pencil. Very tight security.
In the days leading up to the visit, I double-checked the time and ensured the consulate had all my information needed for the day.
I was first called to the window for payments. They double-checked my paperwork and took my payment of $2,350. I paid in local currency. They joked that I could have just paid in credit card format. I had my credit cards but used cash as I didn’t want a ‘problem with the credit card machine’ to delay the process and potentially require me to schedule another visit. All my paperwork was taken, proof of other citizenship, my U.S. Passport. As I didn’t have a passport –yet- of my second country, I brought a receipt which proved I had started the process. I brought my birth certificate for good measure, but it wasn’t required.
There was concern that I did not already have my 2nd passport. When I relinquished my U.S. passport I would be stuck in the country and have no way to travel. I believe it was simply concern for my well-being if I had emergency travel needs. They offered to delay the interview and I declined. I was fortunate that my new passport arrived 2 days later.
At this point, I went back to wait in the sitting area.
Only a few minutes later the consul general invited me to come into what I will call the ‘interview booth’. It’s a section of the same waiting room. Unlike the payment window which is directly adjacent, this is a one-person standing ‘telephone booth’ that you can shut the door on. In front of you is another thick glass window where the Consul General appeared. The whole process was standing there and talking through thick glass.
Although several forms are used in this process, and all available from state department website, the consulate did not want any form that I downloaded and fill out myself. They did all the paperwork. However, having read and filled out the forms beforehand gave me a better understanding of the process. DS-4081, DS-4079, DS-4080, DS-4083 are worth reviewing and having them handy.
I read documents and signed them. Two copies each.
They took my U.S. passport. I asked about getting it back and was told I would receive the cancelled passport back when my certificate of loss of nationality (CLN or COLN) arrived.
Consul general asked me why I was giving up my U.S. Citizenship. She already read and noted that I would not make a statement. I believe the question was out of general interest.
I only said “the center of my vital interests is in this country”. She accepted the answer and moved on to the paperwork and oath.
I received back one signed DS-4080 and the receipt as well as my originals.
Without fanfare, that was the end of my visit and I left.
The other part
I’ve just written about the practical side of renouncing my U.S. citizenship. The emotional side was almost overwhelming and is worth considering in the process.
For me, I had a two year time window of thinking logically about the decision. Would I do it? Relinquish or Renounce? What are the forms? What are the implications and the short and long term ramifications?
This was an extremely important time. An irrevocable action requires rational thought and a confidence in choosing your path. Once chosen, you could not turn back, only forge forward and deal with the circumstances.
I start with that because the day of handing in my U.S. citizenship was one of pure emotion, not rational thought. Listening to my heart and feelings on that day I would have run out of the consulate and decided not to do it. At that time I had to trust my earlier rational self and the thought process and reasoning that had brought me to that point.
I can’t find a proper analogy which makes sense of how I felt giving up my U.S. Citizenship. Was this a cancerous limb that had to be cut off – but is just painful to do when the moment comes?
At that moment it seemed more like this was ripping my heart out and the person I was no longer existed. Being an American is fundamental part of my self-image. When that’s gone, what am I?
I was known at the consulate. The local staff have known me, and I remember some of them from 27 years ago when I moved to this country. I consider them friends. A couple of these consulate friends came by as I stood in the booth with the consul general and said hello. I couldn’t even make an attempt to be social. I was acutely aware of the gravity of the moment and I think they saw it in my eyes.
In 5 minutes you go from being an American to being a literal alien to your country.
I love America. I grew up pledging allegiance to that flag of the United States of America every morning in school. 12 years of that will not leave you unaffected. I grew up watching re-runs of the old Superman TV show where Superman battled for ‘truth, justice and the American way’. Love of country was engrained in us in a thousand ways. An engraving on your heart can’t be wiped away in a moment of taking an oath.
So that day hurt like nothing else I’ve experienced. My appointment was at 2pm and I took the rest of the day off of work – knowing I’d be good for nothing.
At the consulate the consul general read the oath to renounce my U.S. nationality. I said I do, then signed the final form. My hands were shaking and my final signature looked indistinguishable from the first form I signed in that same visit. I was done and left.
I walked out of the consulate grounds very soberly. I hardly believing what just happened.
I cried in the parking lot. There was a death and I was mourning the loss.
I drove to the local and had a shot of Jack Daniels and a west-coast American beer by myself, in silence. My wife picked me up and we went home.
I broke down at odd moments for the rest of the day.
Confidence in a decision and the emotional response are two distinct and seemingly unrelated concepts here. I had processed the information for two years before this moment. I had a list of 30 determinations regarding why I was taking this action but when the moment comes it’s emotional only.
The reasons for action don’t mitigate the pain of the process.
What helped me the most on that day was what someone I trusted told me that morning before my appointment. They said “this doesn’t affect who you are. You are a fine and great representation of an American. You have agonized over the process and you are making the only real decision that you can. Now when it’s done, mark the occasion with your wife. Not to celebrate the loss of citizenship but to affirm your commitment to your family. You should be proud.”
I tell myself I’m still an American. I still believe in America, the ideals, the values.
There’s a quote by Reagan where he says he didn’t leave the democratic party – but the democratic party left him. I’ve stolen the idea for myself into the following. “I did not leave America, the U.S. Government left me.” And so I still will always feel part of my mother country and America is part of me. I just have no association to its government.
Is there life after ripping out your heart? Actually, the next day I was better. Each day that goes by is easier. I’m in good spirits to forge the new way ahead.
I will always stand with my hand on my heart for the Star Spangled Banner.
Anonymous
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NB There has been a great emphasis on the Reed Amendment by the tax compliance community. This is unfortunate; if they really understood what is required to apply it, it is unlikely they would push this so relentlessly. Their reference to it is simply a matter of fearmongering. You can find a series of posts via this link that examine all aspects of Reed. The fact is that since 1996, only two people have been refused and it was because they said they renounced for tax purposes. Otherwise, the onus is on the government to prove one did and the department responsible, DHS, has written the statute is unenforceable. Rest assured, though the issue of tax may comprise part of a decision to renounce, it has a great deal more to do with FBAR, penalties, information returns, reaction to the treatment received and so on. You are NOT renouncing for tax reasons but to release yourself from the attempt of the U.S. government to control your life as well as punish you for not living in the U.S.
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I Feel Cheated by my ex-Country who Treats its Citizens in This Way
Here is my story.
I have been living in Sweden for 41 years. In 2014 I had my first run in with FATCA. One of my banks was closing down their mutual funds, where I had some money, and I had to reveal to the new company that I was a “US person”. That is also when I came to the crude awakening about CBT. I called the London Embassy who still had an IRS representative and he told me how I could become tax compliant. So I streamlined.
Fast forward to 2017, closing in on retirement age. Also very active on Facebook groups about US Taxation. The more I read the more I felt trapped. All savings were put in my NRA husband’s accounts. Started to worry about what would happen if I was to become a widow with our house and my pensions. Had been flying under the radar with FATCA but didn’t see how I was going to do that in the future. Felt hemmed in.
Had only kept my passport as a just incase, but never travelled to any other country than the US with it. Felt by far safer travelling on a Swedish passport where I have been a citizen for the past 15 years.
I realized that I would NEVER move back to the US again, it is really not the country I left in 1975. I feel rather the tourist when I do go to visit family every 3 years. So thoughts about renunciation started to take shape when my parents said they really couldn’t understand why I was putting myself through all this trouble with tax returns, FATCA and FBAR.
The 18th of November 2017 I renounced and when I walked out of the Embassy, $2350 poorer, I felt an enormous weight fall from my chest and a kind of euphoria.
I do feel cheated by my ex-country who treats its citizens in this way.
Anonymous
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