Number of Americans Renouncing Citizenship Set to Break Record
More Americans than ever before are renouncing their U.S. citizenship to avoid paying their taxes.
The Internal Revenue Service (IRS) reported 1,130 people appeared on the list of citizenship renunciations during the second quarter of this year. That’s more than the previous high of 679 in the first quarter—and more than were reported for all of last year.
Americans are giving up their citizenship or permanent-resident status in response to the federal government going after Americans who stash assets overseas to avoid paying the IRS.
“The IRS crackdown on U.S. taxpayers living abroad seems to be having an effect,” tax lawyer Andrew Mitchel told The Wall Street Journal.
Penalties for failing to report assets can be severe, including up to 50% of an account balance for each year owed to the IRS.
The tax crackdown began after the September 11, 2001, terrorist attacks, and increased again after 2009 once tax officials learned that UBS AG and other foreign institutions were helping U.S. taxpayers hide assets.
To Learn More:
Number of Americans Renouncing Citizenship Surges (by Liam Pleven and Laura Sanders, Wall Street Journal)
Tax Evaders Renounce U.S. Citizenship (by Noel Brinkerhoff, AllGov)
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