Check out our summary on the first quarter citizenship renunciation numbers that were recently published in the Federal Register. These numbers are often reflective of several issues that concern expats: taxes, political environment, and more. But typically, one of the top factors is US expatriate’s tax. Let’s take a look at the recent development in renunciation trends to get a sense of the expat mindset in general.
Why Are Citizenship Renunciation Trends Important to Expats?
Citizenship renunciation and US expatriate’s tax are inextricably tied. Yes, there are many other factors that expats consider when they take the plunge to renounce their citizenships. But being reminded every year during tax season of a significant financial drawback to being an American citizen has compelled even some of the most patriotic expats into the decision to relinquish their citizenship. And the birth of FATCA (Foreign Account Tax Compliance Act) made the routine task of finding a place to bank an absolute nightmare for some expats. These elements are often the deciding factor when American citizens elect to become citizens of other countries.
What Happens When You Renounce Your Citizenship?
Renouncing citizenship is not just a big decision – it’s also a very permanent decision. Expats who do decide to renounce are relinquishing their right to vote in American elections, government assistance provided overseas, and unhindered travel in and out of America. For expats with family members who still reside in the US, this decision can be especially fraught. Further, once you surrender your citizenship, you can never reclaim it. Lastly, you must be US expatriate’s tax compliant before you renounce. But even with these irritations looming on the minds of expats, sometimes the endless taxation in their future is enough for them to pull the plug on their citizenship.
How Many Citizens Renounced Their Citizenship in the First Quarter of 2019?
According to the Federal Register, the first quarter renunciations from 2019 came in at 1,018. If you look back through the annals of citizenship renunciation, it’s evident that the immense upswing started in 2010. FATCA also started in 2010, and the vast financial implications stirred expats to action. Its lasting impact is evident, as there has not been a major decline in renunciations since it’s creation. Before 2010, some quarterly renunciation totals were in the double digits, but often the number was in the ballpark of 100-200. Ever since, the citizenship renunciation numbers have been in the 400-plus range for most quarters, and now, many quarters see upwards of a thousand renunciations, a trend that continues to soldier on in 2019.
How Does This Compare to 2018?
Every quarter in 2018 saw over a thousand citizens renounce their citizenship, save for the last quarter. This pattern also occurred in 2017. The fourth quarter drop-offs are often attributed to busy holiday schedules and the sometimes-prohibitive expense that goes hand in hand with renunciation. Although there’s been a slight decline, both years continued the lightning pace of renunciation that we’ve come to expect ever since FATCA was first enacted.
Get US Expatriate’s Tax Compliant Today!
Whether or not you renounce your citizenship, becoming tax compliant is essential. Greenback’s experts can help with that. Get in touch with us, and we can help answer any questions you have.