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Original poster

Surrendering children's US passports

11 replies

Mummysaysno · 18/03/2013 08:44

Wondering if we were to surrender our children's US passports (or whatever correct terminology is) officially...so they aren't liable to pay US tax when older. I know as an adult if this is done there can be a very hefty financial cost to this...is this the case if we do it now for the children? (We don't live in US now, but do live in a country without a reciprocal agreement so have to pay US tax on top of local tax).
Totally taken in to consideration that this would mean they couldn't automatically live in US if we did this!
If I've not used correct tax/immigration terminology then apologies!

OP posts:

Original poster

Mummysaysno · 18/03/2013 08:55

DH just told me they can't till they're 18...however still interested if anyone has any experience of this as still hoping the cost of surrendering then would be less than once they've started their careers (if my understanding of how the cost is calculated is correct!)

OP posts:

Mitchy1nge · 18/03/2013 09:01

But you just have to send the return, you don't have to pay?

Want2bSupermum · 19/03/2013 17:37

I wouldn't be so quick to return a US passport. The tax issue only comes into effect if you are earning a lot. Call the IRS and have them explain it to you. The IRS are not like inland revenue. They are very helpful and great to work with. When it comes time for your DC to submit returns I strongly suggest calling the IRS for help filling in the forms before speaking to an accountant.

For DH to get a greencard it cost his employer $10K and he was beholden to them until he had that greencard. Had his employment been terminated he would have had 180 to leave the country. You never know what is going to happen in the future. I would keep all options open for as long as possible.

lljkk · 19/03/2013 17:48

Big long thread about this on MN recently, there's a big long procedure to go thru, not just sending passports back.

The earned foreign income threshold is relatively high (like £45k?) so I have no worries about DC being dual nationals & having to file taxes. You only have to file if you owe, see.

Mitchy1nge · 19/03/2013 17:50

no, you definitely* have to file whether you owe or not

sort of 98% definite

EldonAve · 19/03/2013 18:01

you have to file no matter how much you earn

SquinkieBunnies · 19/03/2013 19:51

You can't just return the passports to stop paying US tax, they would have to be 18 and fill out paperwork and go to the nearest Embassy to officially renounce US citizenship.

Original poster

Mummysaysno · 20/03/2013 01:03

Yes thanks for replies...however I know you have to officially surrender your passport at the embassy and a calculation is made based on paying to surrender...this is what I would like to find out about...as an adult it can be highly punitive financially to either surrender, and if you live in a country without a reciprocal agreements you also pay US tax (so not just having to file return like in UK) so I was just wondering if it would be prudent to do this earlier in their lives...but it doesn't sound like anyone's got any first hand experience of this. Thanks anyway for replies.

OP posts:

lljkk · 20/03/2013 08:15

Ah, I stand corrected, but only because OP lives somewhere without the reciprocal arrangements. IRS allows US residents of many countries a foreign-earned exclusion. And it's hard to get over the $9.3k income otherwise unless you've actually got investments in the USA (I have quite a bit and I can't reach that threshold).