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.

March 26, 2014
US citizen living abroad. Concerned about increasing taxes

US citizen living abroad. Concerned about increasing taxes

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 […]
March 26, 2014
When is a Permanent U.S. Resident subject to the Exit Tax?

When is a Permanent U.S. Resident subject to the Exit Tax?

The so-called Exit Tax applies when a Permanent U.S. Resident decides to turn in his or her green card. More exactly, he or she must have […]
March 26, 2014
Can you avoid the Exit Tax prior to expatriating from U.S.

Can you avoid the Exit Tax prior to expatriating from U.S.

Possibly. It is often very difficult to entirely remove oneself from the U.S. tax system, but with proper exit planning the associated tax bite can be […]
March 26, 2014
What is the scope of the Exit Tax?

What is the scope of the Exit Tax?

The Exit Tax includes both an income tax and an inheritance tax element. The income tax element consists of a deemed “mark‐to‐market” tax on the inherent […]
March 25, 2014
What is the exit tax?

What is the exit tax?

For all taxpayers that expatriate after June 16, 2008, the new Internal Revenue Code §877A applies. IRC 877A imposes a mark-to-market regime, which generally means that […]