Tuesday, February 24, 2015

The U.S. Government’s Stupid Tax War on Expatriates

By Brett Arends

The U.S. government’s stupid, hateful and dishonest war on Americans living abroad claimed its latest scalp this week.

London Mayor Boris Johnson, a dual British and American national, says he will join the growing lines of Americans overseas who are now being driven to renounce their U.S. citizenship by the federal government for no good reason.

Johnson, a possible future British prime minister, was born to British parents in New York. His case is not important individually, but it is illustrative. A record number of Americans abroad renounced their citizenship last year, and the numbers are escalating fast. That’s in response to a growing set of U.S. financial laws that make it nearly impossible for them to keep two passports.

Most people don’t understand the government’s war on U.S. expats and dual nationals, so they buy the official spin that it is just “cracking down” on “rich tax cheats.” It is doing no such thing, and it knows that it is doing no such thing.

Indeed some of its most onerous financial rules, while “cracking down” on overseas grandmas with a $30,000 retirement account, specifically and deliberately exempt billionaires with money in hedge funds and private-equity funds.

Even National Taxpayer Advocate Nina Olson has pointed out in her official reports to Congress that the war on expats often punishes ordinary middle-class and even poor Americans abroad far more severely than it does the rich.

Olson is appointed to her role by the Congress, but she says that when she called up the Treasury to discuss some of the problems, they didn’t bother to respond.

Read the rest here.


  1. What a country.
    Be careful, folks. Even a foreign passport may not help.
    A (wealthy) friend was in Geneva last year and he thought it might be prudent to set up a bank account in Switzerland. So he goes to the bank, fills out an application, sits down with a bank officer who says, "All in order, please let me see your passport". So my friend hands over his LEBANESE passport.
    The banker looked it over and said "oh, it says you were born in New York". My friend says yes and the banker said "Sorry, we can't accept your application."
    The Bahamian banks won't touch me with a ten foot pole, of course.

    1. Was he also a citizen of the US? If so, I's think that's why. Otherwise it makes no sense to turn someone down just based on where they're born.

    2. Well of course it makes no sense. It de gummint!!!
      No, here's the deal. The banker never asked for nor did he see his U.S. passport. My friend had dual citizenship, and is a full citizen of Lebanon. The point is that this is a discretionary action by the banks. They're not required to grant you an account. They just want nothing whatever to do with anyone from the U.S. The New York birth would imply U.S. citizenship, of course, due to the stupid 14th amendment.