ACCORDINGLY, I AM CONSIDERING RELINQUISHING MY U.S. CITIZENSHIP (OR PERMANENT RESIDENT STATUS). IS THIS A GOOD IDEA?
The decision to relinquish your U.S. Citizenship or Permanent Resident Status is a serious and non-reversible one. Only you can weigh the non-tax reasons in favor of that decision. However, what is often forgot or overlooked are the various tax and estate planning consequences of relinquishing your citizenship (or permanent resident status). Indeed, many multinational executives, managers, entrepreneurs, and investors fail to appreciate these consequences.
One of the most important considerations to consider is the so-called “Exit Tax” or “expatriation tax.” This is a tax that is imposed once a U.S. Citizen or Permanent Resident decides to leave the United States. This tax is stiff because the United States wants to deter people from leaving. The Exit Tax began in 2008, and it is imposed upon citizens who renounce their citizenship or to permanent residents who give up their green cards.
