anyone regretted becoming a us citizen
 

has anyone become a citizen and regretted it. I am thinking mainly financially since that is the only real negative I can imagine in being a us citizen. At least with a green card I can just decide to not pay taxes and give up the green card. If I become a citizen I have to pay us taxes for life!
Is the tax ting an actual burden if I were to move back to live and work in the UK say for 10 years. I know the two countries have a tax agreement. Does it only really affect you if you have say property or business interests in the US. Presumably because the UK income tax rate is higher you would never actualyl need to pay tax to the US, just file it each year? Unless you have a lot of cash lying around the world..

Re: anyone regretted becoming a us citizen
 

Please read this:
http://www.irs.gov/businesses/small/...164371,00.html

Some of your comments are confusing and not entirely accurate.

A US Permanent Resident (aka Green Card holder) will always have to file a US tax return, even if he/she owes nothing to the IRS.


NC Penguin

Re: anyone regretted becoming a us citizen
 

Not if you leave the country and cease to be a PR which I think is the OP's point.

Re: anyone regretted becoming a us citizen
 

sorry if it wasnt clear.. I meant that the difference with a green card is that I can always give it up and stop filing taxes eventually. Whereas with citizenship I cant really give that up can I? Or at least if I did it would be much harder to get it again...

Re: anyone regretted becoming a us citizen
 

Just because you have to file doesn't mean that you actually have to pay anything

Re: anyone regretted becoming a us citizen
 

We get money back every year...

When hubby lived in France in 1995, we moved to the US in late November, and the government gave him money back for staying away for over half the year. LOL! :D

Re: anyone regretted becoming a us citizen
 

You could give up US citizenship, but doing so for tax purposes puts a permanent bar from ever entering the US again.

Having US citizen has other financial advantages though, any inheritance you receive won't be taxed to buggery for instance, handy if your married to a septic.

The reciprocal tax agreement means each person in a marriage gets $80K each, or total of $160K a year tax free between the two of you if you move back to blighty, so unless your earning serious cash, it won't be an issue....it only really becomes an issue if you move to a tax free state like DXB, KSA etc...

Re: anyone regretted becoming a us citizen
 

Quite frankly, the US isn't that big a stickler for filing income taxes (edit to add in the UK), unless you're making some kind of big money. I didn't file all the time I lived over there (with exception of when we filed for my husband's visa to move to the US) And then it was just filling out a bunch of paperwork......they didn't take my husband's income into account and I made diddly squat.... Never had any problems because I didn't file in a timely manner.

Re: anyone regretted becoming a us citizen
 

You mean you're giving the US government an interest-free loan every year :confused: There should be a law against that...

Re: anyone regretted becoming a us citizen
 

How would they prove it was for "tax purposes" though? Unless you were significantly wealthy and renouncing citizenship would save you $$$s down the road, I don't see how this could be proven.

One of the reasons I became a citizen... but with the threshhold at which inheritnace tax kicks in rising significantly over the past few years, again, it's probably not an issue for most at the moment.

It's likely to be an issue if you have significant non-wage income.

Re: anyone regretted becoming a us citizen
 

I don't quite understand your concern about filing US taxes. There are software packages that allow you to plug in your numbers to create a tax return and if you're earning a lot of money, then you should consider getting an accountant to do your taxes and get a tax advisor on how best to save your money/lower your taxes.


NC Penguin

Re: anyone regretted becoming a us citizen
 

its not about the practicailty of doing the taxes though it is a pain in the arse even with the software.. just keeping track of all the info etc.
its about whether I actually would lose out financially. I say this because a co worker went through this and was rather shocked to find she was paying quite a bit to the US. Sure she was on a pretty significant wage, certainly way above the 80K threshold.
Our combined income if we moved to the UK would probably end up being above the 160K especially with the way the dollar is going down the drain (soon everyone will be hitting that threshold if they have a job in the UK!).
By the time I become a citizen its likely I would have a property in both the US and the UK one of which I would be renting out most probably.
I just wondered if anyone had been hit financially in any serious way by becoming a citizen.

Re: anyone regretted becoming a us citizen
 

I wouldn't have a clue, but it's all scribbled down somewhere in deep depths of USCIS, somewhere *l*

Re: anyone regretted becoming a us citizen
 

IRS actually:
http://www.irs.gov/instructions/i8854/ch01.html

Renouncing US citizenship may cause a problem with Social Security later on. Plus the not-so-small matter of being unable to return to the US or get a US passport should you change your mind later on (many people do).

Re: anyone regretted becoming a us citizen
 

If you have a rental property in the US you will have to file a US tax return anyway, although obviously this would entail less record keeping than having to file a return that included wage income.

It's at least theoretically possible that you will end up more heavily taxed if you are a US citizen, because that leaves you open to the possibility that some aspect(s) of your worldwide income are taxed more heavily by the US than by the UK (or whatever other country you earn income/interest/capital gains in). Also, do a search on why being a US citizen really hurts you in respect to UK Unit Trusts and some other UK investments as well. However, specifically in regards to wage income it's unlikely, because US federal tax rates tend to be lower than their UK counterparts and you will presumably not owe any state tax (except perhaps in the year you move).

The question I would ask is why you want to become a US citizen if you intend to go back to the UK? Is this a case of hedging your bets if it turns out you subsequently want to come back to live in the US again?

Re: anyone regretted becoming a us citizen
 

thanks for your very informative post..
Of course I realise that much of this is the territory of professional accountants etc. but its good to get some background info.
As for why I want to be a citizen. Well I really don't want to be a citizen but I have just married a US citizen and we are having a baby in a few months. In my line of work (movies) there are only a few places in the world that I can work and the work is getting increasingly global. One country's downturn is another's upturn. If work is slow in London then I always have the option if needs be of returning stateside for a few years to work. of course how this will play out with the family is another matter. Its a very changeable industry and can be highly dependent on factors such as government tax breaks which come and go with the winds. America tends to have a more stable base of work but isnt really where I would choose to bring up my children. So yes its all about hedging my bets :)

Re: anyone regretted becoming a us citizen
 

Non, je ne regrette rien.

How good do you actually think the IRS are at knowing what you earned outside the US? They find it difficult enough with domestic stuff.

Re: anyone regretted becoming a us citizen
 

This has changed, somewhat, for certain filers.

http://www.bdo.com/about/publication...triate7-05.pdf

Apparently, if you meet certain requirements, even if you give up a green card, you can still be required to file a US tax form (not a 1040, but a 8854) for 10 fricking years!

I'm not sure if you hit that level, but it does give you an idea of the evil reach of the IRS.

By the way, isn't there a 10 year travel ban to the US if you relinquish citizenship? I thought you were not allowed back in the US for 10 years if your give up your citizenship?

Re: anyone regretted becoming a us citizen
 

Wow! Where did you read that?

Re: anyone regretted becoming a us citizen
 

It's a permanent bar.

Re: anyone regretted becoming a us citizen
 

Exactly the reason I took out citizenship :) And as you are married to a US citizen that reduces the scope of the issue to income that is specifically yours - he will be filing a US return on his worldwide income anyway.

Re: anyone regretted becoming a us citizen
 

Huh?? so my son who's dual if he decides he doesn't want the US citizenship he can't ever come back to the US again??

Re: anyone regretted becoming a us citizen
 

I've heard it is a ten year ban from a few people, but it can become permanent if you do certain things. However, I've also read that there isn't a ban technically, in some cases.

The fact is that renunciation is an extremely complicated process, and if you wish to reenter the US after doing so, you could go through several dozen layers of bureaucratic hell. There are websites that say you can come back (even the DoState) but there are others that say "when hell freezes over". And the taxes and military service obligations (draft registration) will follow you even if you are successful in renunciation.

The best advice I saw was "talk to an immigration attorney" especially if you hope to reenter one day.

p.s. I don't think parents cannot make the renunciation for their minor children--it has to be done by the child themselves when they turn 18.

Re: anyone regretted becoming a us citizen
 

I wish I had done it and completed everything with it sooner.

plus, just doing it later is a headache.. trying to find or remember the POE and days/months/years involved

you are generally going to pay taxes where you live and receive your income

if you were taxed twice, can't imagine there'd be much left

Re: anyone regretted becoming a us citizen
 

NO.
Reg. Frank R.

Re: anyone regretted becoming a us citizen
 

Any citizen can live in another country, without losing citizenship.

Re: anyone regretted becoming a us citizen
 

I agree, but the previous comments about the tax implications of expatriation (giving up US citizenship) are a bit wrong. The rules change about a year ago and if your net worth is less than $2M the IRS assumes that you are NOT giving up US citizenship for tax purposes and you won't have to file for another 10 years like you use to.

Getting US citizenship has advantages if you are resident in the US, but if you go back to the UK it means that you will have complicated tax returns. Also the big financial issue is that as a US citizen its a very bad idea wrt taxation to own foreign mutual funds and you have to declare any foreign accounts over $10k to the US Treasury.

So if you plan to return to the UK I'd be wary of taking US citizenship as your invetsment options in the UK will be severely limited and your taxes will be complicated

Re: anyone regretted becoming a us citizen
 

you briefly mentioned a subject that i have never been clear about. You said that you have to declare any bank accounts with more then $10K in them. Several people I know have this situation including myself. The question being is that a total of all bank accounts or in any one account? I assume the former since otherwise one would just open a bunch of accounts with less than $10K in them

Re: anyone regretted becoming a us citizen
 

I think this is getting off topic, but there is some interesting stuff here.

I'm really not sure about bank accounts over $10k. The main reporting requirement deals with cash over $10k.

There is a famous court case about a guy who won like $50,000 in Las Vegas. Instead of taking one big payment for $50k, he structured several smaller payments for the purpose of avoiding the $10k cash reporting requirements. The courts found that you are guilty of 'structuring' if you conduct financial transactions, such as coming in with $9,900 instead of $10,000.

Here are some links of people found guilty of structuring:

http://www.northcountrygazette.org/a...006USAGas.html
http://www.irs.gov/compliance/enforc...129118,00.html
http://www.kscourts.org/ca10/cases/1997/07/95-1408.htm

and this, most recently:
http://lawprofessors.typepad.com/whi...ing/index.html

Ratzlaf Redux: Intent for Structuring

In Ratzlaf v. U.S., 510 U.S. 65 (1994), the Supreme Court interpreted the "willfully" element for a currency structuring violation under 31 U.S.C. Sec. 5324 to require proof that the defendant knew the structuring was illegal. Congress responded rather promptly to the Court's holding by dropping willfulness from the statute, so that now all the government needs to prove is that the defendant knows that the financial institution is required to file a Currency Transaction Report (CTR) for transactions over $10,000 in cash, and that the defendant intended to avoid having the report filed by structuring the transactions to keep them under $10,000.

Re: anyone regretted becoming a us citizen
 

If the total of your overseas accounts is over $10k at any time during the year
you have to declare them all to the Treasury on a TDF 90-22.1

http://www.irs.gov/pub/irs-pdf/f90221.pdf

Penalty for not doing so can be up to $500k or half the value of the accounts! which ever is the greater.

Accounts means everything, banks, investment accounts, pensions, national savings etc.

So becoming a US citizen has serious taxation and financial reporting implications if you ever plan to return to the UK.

If to go to the UK and convince the UK that you are domiciled in the US there are some tax advantages. Still, unless you have family, retirement accounts, investments or SS payments in the US I'd think twice about US citizenship.

Re: anyone regretted becoming a us citizen
 

I think at age 18 you are suppose to make a choice and there is no penalty in such a case.

Re: anyone regretted becoming a us citizen
 

The idea that a dual US/British citizen has to make a "choice" is an urban myth. No such requirement under US law. Nor under British law.

Re: anyone regretted becoming a us citizen
 

Maybe this misconception comes from when you fill out the application for passports etc. Also, I wonder what percentage of dual citizens actually comply with the tax filing regulations.

Re: anyone regretted becoming a us citizen
 

Reading at another forum, it would seem that most of the septics haven't been filing in the UK to the IRS...and it seems many haven't had an issue with it, though I'd hardly recommend doing the same..

Re: anyone regretted becoming a us citizen
 

I you are a US expat and don't file taxes I'd hate to deal with the issues this would
cause if you ever returned to the US and started to file again

Re: anyone regretted becoming a us citizen
 

that was my thought too *l*

Re: anyone regretted becoming a us citizen
 

Wasn't it that that used to be the case? Its understood that it is different now.
I had heard that things changed a few years ago in this respect, no?

Re: anyone regretted becoming a us citizen
 

no.

Re: anyone regretted becoming a us citizen
 

Care to expand? :D

Re: anyone regretted becoming a us citizen
 

I think it changed in the 1940's or there abouts....so a few years either way :)