Record number of Americans renounce citizenship

O’Malley promises immigration system overhaulThere has been another increase in the quarterly list of Americans who have decided to terminate their long-term residency in the United States or renounce their citizenship.  The third quarter of 2015 set a record high with regard to the amount of published expatriates, with the figure of 1,426 surpassing the previous high of 1,335 recorded in the first three months of this year.

Why are so many Americans choosing to renounce citizenship? There are a number of reasons, including family problems, legal complications and tax issues. Sometimes it is not possible to hold dual citizenship. In some countries a fee is charged when people hand in their passport and the United States has the most expensive fee in the world, according to MoveHub, at $2,350.

Americans who live abroad are the worst affected by the current system. They are often shunned by banks when it comes to everyday banking activities and they not only have to file tax returns in the country they live and work in but also in the United States.

Some can claim foreign tax credits when completing their US tax return, but not all double taxes are eliminated by this tactic. Leaving America is also very costly, with exit fees and capital gains taxes, and for an increasing number of people leaving and renouncing their US citizenship on the way out is becoming the best – and cheapest – tactic.