To Consider Giving up US Citizenship?

[NotFunBeingAnAmericanInLondon]

Posting here for traffic.

Desperate to talk to other US citizens settled in Britain who doubt they will be returning to the US for personal reasons.

Am I the only one who's been here so long I didn't notice the FBAR thing? I don't file FATCAs, but I am never sure. What are we supposed to do if our British born, dual US citizen kids have CTFs? I have a SIPP with mutual funds in it, my accountants tell me not to even bother mentioning it now?! Apparently this is a time bomb for later.

Social Security and State Pension are supposed to be reciprocal, but I cannot get any information from anyone.

I used to file my own 1040 forms, but now that there are so many forms to file with the threat of prison if I mess up that I am truly cowed and pay someone else £400 a year to file for me. And I am a housewife with no income!

The state department has just raised the cost of expatriation from $450 to $2500 which worries me even more.

I wonder, should I just give up my citizenship now and make life much easier?It's a lot of worry and stress to carry around for emotional/nostaligic reasons.

QS - info here www.irs.gov/Individuals/International-Taxpayers/Frequently-Asked-Questions-About-International-Individual-Tax-Matters#GreenCardHolders

Eldon I read somewhere that I should carry prove that my children are not eligible for US citizenship when they travel with me to the U.S. on their UK passports but have never seen it substantiated. and no idea how I would prove it without carrying a shitload of information with me to show I've always lived in UK.

proof not prove

Now I've got the form all filled out and I don't know if I should send it or not. If I don't send it back then they'd probably never figure out how to track me down for tax on my ISA interest etc whereas sending them the form is telling them exactly who I am. I don't want this hanging over me though. If they tracked me down later then I could end up owing them loads of CGT etc.

queenStromba, if I were you, I would probably not send the forms and keep my head down.

Further word of warning here.
I recently opened a new bank account (at Santander).
Out of the blue a couple of months later, I got a letter from them saying they believe that I may be a citizen of another country and requiring me to sign a declaration. How they know, when i hav enever lived in the states nor currently even hold a passport, I just don't know. But they are worried about their own FactA obligations and need to pass it on to me.

I've been looking into it all and because renunciation has become so very popular for people "like us", there's a now a fee of over £2k to do so, in addition to all the filing requirements. There is however a new streamlined process for back filing if you voluntarily commence. I've found a load of places who'll do it for you, but the difference in price is eyewatering (from $350 / year to some online place based in Brooklyn to £5k per year for london based accountants who specialise in this). I don't know who to go to as I've been warned by a friend that a lot of the online places will take the fee up front and then not do the filing (& by that stage they have an awful lot of sensitive personal data).

if anyone has a recommendation of who to use to catch up on back filing, I'd love to know.

I think I'm going to have to shell out for a lawyer. I'm hoping that my green card has just lapsed since I haven't set foot in the US for over a decade.

I used taxesforexpats Tranmere. It was a budget service but they do a deal when you do the back filing for the streamlined procedure. I haven't heard anything negative back from IRS and I submitted it all last year (they don't bother to let you know if everything is ok/acknowledged they've even received it which is kind of them). I don't think they are the people to use if you want tax advice or planning but they can churn through the forms ok and they did do the work so not a total scam like you mention.
Fbars are pretty easy to do so I'd only get them included if they are part of the package.

Tarka - that's fantastic to hear, they're the ones I was in touch with but people just told me "if it's too good to be true, it is". Done. Am going to send over my P60s etc now.
THey suggested they do one FBAR and let me copy so will do those. Annoyingly, I have lots of bank accounts - kids accounts, EMPLOYER bank accounts I'm signatory on (but in no way shape or form a beneficiary of).
Have you renounced now?
I know I should - I am not American - I haven't lived there, have never pledged alliegance, don't know the words to the star spangled banner but at the same time it seems really churlish to give up something that people lose their lives floating on a raft to Miami for or swimming the rio grande. At the same time, screw Uncle Sam and this whole taxation without representation - I had thought he cared about that! I should just do it now before I sell the house and it becomes more complicated (expensive)

I did the streamlined compliance procedure by myself without a lawyer or accountant. There is no need to pay loads of money unless your affairs are really complicated. All the forms are on irs.gov and have (admittedly very lengthy) explanations attached. FBARs are easy. I found the people on the International Helpline in Philadelphia helpful. You can also get free help from the IRS helpline at the US Embassy in London. Basic tax forms are designed to be used by non-accountants.

For someone with just earned income (i.e. a job) under something like US$96K per annum, you just need a 1040 form (the basic tax form for individuals) and a 240EZ (for foreign earned income exemption). If you have dividends, rent, interest you'll need to declare the income and foreign tax paid. This also applies if your income is higher than the $96K. There is a treaty between US/UK which means that you are not double taxed (like someone above claimed).

I renounced my US citizenship a few months ago. The price went up last year to about £1.5K (which is outrageous), but the procedure is really simple. The information is on the US Embassy website. You send in scanned documents (you have to have a valid passport of another country) and you get an appointment. You go in and read an oath at a window. They don't ask why you want to renounce or try to persuade you not to. I heard two other people do their oaths when I was there.

I have to do one more short tax return for the period until I renounced and the final expatriation tax form, which needs to be done next year. Then I won't have to worry about this anymore. Expatriation tax is also worth looking up. There is information online. It won't apply to most people, but you do need to have completed 5 years of tax returns.

OP- I can't really comment on the taxation, but giving up your citizenship is such giant step.
I have dual- citizenship, as do my young DC, and I think about the future. What if my DC decide to live in the States? What if I want to move there to be closer to them but can't. What if in 30 years DH and I want to retire and live there. What if the UK/US have a falling out and you're not allowed to visit even (unlikely, true).

I think of my American parents who would love to move to the UK to be closer to their only GC, but haven't got a chance of ever getting any kind of visa other than a tourist one. I worry that would be me in 30 years if I gave up my citizenship. In fact, I even worry the DH doesn't have US citizenship. What if rules change and he wouldn't be allowed to live in the States with me at some point. I should say that this is all hypothetical. I have lived basically my entire adult life in the UK and DH has no interest in living in the US, but being American is such an intrinsic part of me that I don't think I could give it up. Obviously, not everyone feels the same way.

Thruaglass

I've drawn a line under the whole darned thing. I do worry about my DD who of course have dual citizenship. I'll advise them to hand in their citizenship at 18. I just hope it won't be more expensive/arduous then.

It's very difficult to be a US citizen based outside the US, unless you are a member of the super-rich. It's OK, if you are away for a just a few years and then going back to your "real life" in the USA.

If you are not going to live your life in the US, keeping the citizenship is an expensive option to hold open. I've reached an age where I realise that my life and future is here in the UK, and I will not be suddenly uprooting my home, children, pension plans, etc. to flit back to the US, after working so hard to build a life here.

Emotionally, it's a little sad. But not that sad. Being an American (a white American) means that my recent ancestors were just a bunch of chancers looking for the best deal. Me bouncing back across the pond is just a continuation of form. It is absolutely the kind of move my great, great grandparents would have made.

hennybeans could you ever move to the USA? I figured out that I would never be able to retire there. I don't have 40 quarters of SS payments, so I will not be covered by medicare. While there is a reciprical agreement over SS payments/state pension between the US/UK it only applies in regards to social security. NOT medicare. To be eligible for Medicare you have to have worked in the USA for at least 10 years.

I cannot imagine being rich enough to afford private health care in the US as an elderly person.

Goodarvo I don't think I could've done the return by myself, well done! I looked into it and there were definitely bits the accountant filled in that I would've done differently. Having said that the IRS overseas helpline were pretty good at answering questions. It's form 2555 for the foreign earned income exclusion isn't it? And despite the double taxation treaty you could still end up owing tax on ISA interest or the capital gains if you sell your home (ie things that aren't taxed in UK).

I'm planning on renouncing if we don't move there with dh's job in the next few years. Dh is a high earner and so our joint wealth (if things continue as they are, obviously) might make things complicated if we leave it long term.

I should add that I grew up in CA among so many immigrants who would have given anything for citizenship. I had friends whose whole lives were ruled by not having citizenship.

My best childhood friend's parents immigrated from Europe when they were little and America really was the land of golden opportunity for their family ( I know is it certainly not that way for everybody). So I grew up around people who cherished their citizenship, people who really felt blessed to be among the small percentage of the world's population with US citizenship. I think that for me (I'm not criticising other's choices with this), it would feel really ungrateful to actually pay to be rid of this thing that is actually a privilege.

See I don't feel it is a privilege if you don't have any intention to live in the country. I have to pay £100s a year to accountants to tell a country I have never lived in nor feel any connection to that I don't owe them any money. What do I get in return as an EU citizen in an EU country?

Who knows what the healthcare system will be like in 30 or so years. I won't have worked 10 full years so wouldn't be covered, but will there even be Medicare anyway? For me, I just wouldn't want to burn my bridges.

Tarka I can understand that if you have no emotional ties and didn't grow up there, it is basically just an expensive piece of paper.

Aargh. This is a subject (not) dear to my heart. Husband is a US citizen and kids have dual citizenship. We live in Switzerland, where my husband has not been able to have a bank account for the last two years. We're just filing now, but can't do it separately (I presume) because our Swiss taxes are jointly filed. What's a pain is that I earn more than $10,000 a month (Swiss salaries are very high, that's not a stealth boast), so even though DH has been unemployed for most of the last five years, I guess we will still owe money and have to file FBARs as well.

One of my kids is likely to work in the US in the future; the other is currently considering whether to give up his citizenship. My husband will definitely do so in the future.

We're using an online service, so I hope the horror stories above aren't true!

I'm in line with Tarka. My children have no entitlement to US citizenship through me because I've never lived there anyway so I see no benefit in retaining a major administrative burden which could become exceedingly expensive one day (when I win the euromillions etc)

Hennybeans regarding ppl who feel blessed for having us citizenship, the same can be said of many immigrants in the eu, specially those from third world countries. Having the legal right to live where you live is asset. Having an additional citizenship is an extra asset, but possibly less valuable. I would not think that anybody is ungrateful for giving up something that causes more difficulties than rewards. But i agree that not burning bridges is a safe idea.

Tarka - yes it is the 255EZ. You're right.

I was worried about the IRS coming out of the woodwork one day and I don't want my British husband and kids (they are not US citizens, because I didn't live there long enough as an adult) having to deal with the IRS after my death or getting caught on Capital Gains Tax. I'm glad that I'm almost finished with dealing with this, but I'm also glad I did it above board.

I also had no idea about these obligations until I read about it on Mumsnet.

Shame you can't sell your unwanted citizenship to someone who wants it. Especially in the entrepreneurial US.

OK, I've figured out that due to my fucking greencard I should have been filing tax returns etc as if I was a US citizen. Does anyone know how far back they can make you file? I have a couple of things I'm particularly worried about. I can't for the life of me figure out if they would think I owe them taxes on my PhD bursary - it was basically a salary but untaxable under UK law. Also, I received a ~£10k inheritance from my grandmother in Ireland (who is in no way a US person) - are they going to want some of that?

I'm getting really upset about the whole thing. I only have a greencard because my abusive father who lives in the States (and is Irish) wanted to be able to threaten my mother with going for full custody.

I think you have to go back 7 years.

I feel really grateful to be a UK citizen.

I understand about not burning bridges. For me, watching it become more expensive/difficult, I started to worry that I may get caught out if I let things keep drifting. What if I waited and waited and then it became even more expensive/burdensome to sort it all out?