Democrats Abroad Survey Finds Americans Living Abroad Face Extreme Tax-Paying Difficulties

Democrats Abroad Survey Finds Americans Living Abroad Face Extreme Tax-Paying Difficulties
April 28, 2019

Earlier this year, Democrats Abroad (an organization dedicated to providing Americans living abroad a Democratic voice in the government and electing Democratic candidates by mobilizing the overseas vote) conducted an in-depth survey of almost ten thousand expats. The results of the survey echoed Greenback’s findings from last year: Expat taxes pose a constant burden and expats see the requirements as unfair and severe.

What Were the Findings?

During January and February, 9,885 expats – including expats from each US state – living in 123 countries across six continents gave Democrats Abroad information on their tax situation and opinions on the fairness of current US tax law. Of these expats, spanning wide ranges of demographics and backgrounds, 1 in 3 reported that they have suffered serious harm because of the current tax requirements. A third also reported being denied products or services from foreign financial institutions, including amenities like retirement savings accounts and other investment products. That large number is shocking and clearly indicates expats are unable to prepare for their financial futures with ease.”

Accidental Americans made up over 2% of the respondents. Many within this subsection of expats were unaware of their tax-filing obligations until they ran into FATCA-related problems at their banking institutions. And, many Accidental Americans are considering renouncing their citizenship but have not done so because of the price and effort involved in the undertaking.

The findings also included noteworthy information on how the Tax Cuts and Jobs Act is affecting business owners. Americans living abroad who are majority shareholders in a foreign registered company reported that they face two new taxes, which makes the continuation of their business dicey.

Lastly, retired Americans living abroad have been devastated by the impact of a provision in the Social Security Act known as the Windfall Elimination Provision (WEP). This provision cuts retired expats’ benefits by up to 40%, and affects one in six retired expats. 

How Does Expat Taxation Affect Americans Living Abroad?

The lifelong tax-filing responsibility that follows expats around the globe has made many expats consider citizenship renunciation. Expat taxation has been an irritating drawback for Americans living abroad for years, but, until recently, this issue was largely ignored by politicians. But with the recent lawsuit filed by Accidental Americans in France and the Tax Fairness for Americans Abroad Act being introduced, expats are slowly but surely bending the ears of politicians.

To keep this momentum going, expats will need to continue to make their voices heard by voting and participating in surveys like the one offered by Democrats Abroad. If you’d like to make your opinion known and help increase the profile of expat-related issues, take the 2019 Greenback Opinion Survey! We conduct this survey annually to identify and raise awareness of how expats feel about their tax-filing obligations. Plus, when you take our survey, you’ll be entered into a drawing for a $1,000 Hotels.com gift card!

Did You File Your Taxes Yet?

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