Giving up Green card - exactly what are the impacts
Mar 21st 2014, 6:13 pm
#16
Lost in BE Cyberspace
Joined: Jan 2008
Posts: 41,518
Re: Giving up Green card - exactly what are the impacts
Does you comment refer to my point on keeping one US Citizenship. If we go for the clean break option (file I407 and abandon status) then am I correct in saying after we file US taxed for year ended 12/31/15 we would no longer have to file any US tax returns. Clean break is our preferred option.
(Sorry I think I confused the issue a bit!!)
(Sorry I think I confused the issue a bit!!)
Mar 21st 2014, 6:27 pm
#17
BE Commentator
Joined: Feb 2010
Location: Los Angeles, California
Posts: 8,427
Re: Giving up Green card - exactly what are the impacts
My favorite abandonment of LPR case is United States v Yakou.
An I-407 can be filed with the Embassy in London. OP appears to know about the expatriation tax but I've heard that seeking a "sailing permit" may not be such a bad idea.
[I like the idea of a "sailing permit" prior to boarding a turbo-fan airliner.]
An I-407 can be filed with the Embassy in London. OP appears to know about the expatriation tax but I've heard that seeking a "sailing permit" may not be such a bad idea.
[I like the idea of a "sailing permit" prior to boarding a turbo-fan airliner.]
Mar 21st 2014, 8:36 pm
#18
Just Joined
Thread Starter
Joined: Feb 2012
Posts: 11
Re: Giving up Green card - exactly what are the impacts
The sailing permit is very helpful advice. In reading the regulations am I correct in thinking that a tax year will be any time you are a resident in the year. So our clock started ticking in March 2009 and January 1st 2016 will then be 8 years??
Also my W2 is around $200k but net worth is certainly below $2mm. When the legislation states "Your average annual net income tax liability for the 5 tax years ending before the date of expatriation is more than the amount listed next.
a. $139,000 for 2008, etc, etc"
Does this mean W2 income of more than $139k or tax due of more than $139k. This will be important to know so any help appreciated.
Also my W2 is around $200k but net worth is certainly below $2mm. When the legislation states "Your average annual net income tax liability for the 5 tax years ending before the date of expatriation is more than the amount listed next.
a. $139,000 for 2008, etc, etc"
Does this mean W2 income of more than $139k or tax due of more than $139k. This will be important to know so any help appreciated.
Last edited by Cincyscot55; Mar 21st 2014 at 8:45 pm.
Mar 22nd 2014, 3:58 am
#19
Retired
Joined: Apr 2004
Posts: 34,649
Re: Giving up Green card - exactly what are the impacts
The usual trick in this situation is that one of you (the one who earns the least) applies for US citizenship and gets it before you leave, then the other one gives up LPR status.
That way you pay little or no US tax, plus the US tax filing is simplified, but you can still go back to the US e.g. to retire because you can be sponsored in.
That way you pay little or no US tax, plus the US tax filing is simplified, but you can still go back to the US e.g. to retire because you can be sponsored in.
Mar 22nd 2014, 2:37 pm
#20
Just Joined
Joined: Sep 2003
Location: Cornwall UK
Posts: 22
Re: Giving up Green card - exactly what are the impacts
We were sort of in the same scenario, so just took out citizenship and left. Have been out of the US for 3 yrs now.
Mar 22nd 2014, 5:36 pm
#21
BE Forum Addict
Joined: Aug 2004
Posts: 4,754
Re: Giving up Green card - exactly what are the impacts
If you want to return to the UK and hold a GC I would get all your US finances sorted out. Sell things with the potential for capital gains and make sure you
understand HMRC's Reporting Funds rules for any US investments you keep. File a 2063 or 1040C and get a sailing permit if required.
Once in the UK I would complete I-407 and mail it to the US Embassy
http://london.usembassy.gov/dhs/uscis/abandon.html
then (if necessary) I'd file 8854 with the IRS. Finally I'd file a 1040NR as a dual status alien for the part of the year that you held the GC. If you have
US source income you will have to file 1040NR each year unless you can file a W-8BEN and avoid US filing using treaty provisions.
understand HMRC's Reporting Funds rules for any US investments you keep. File a 2063 or 1040C and get a sailing permit if required.
Once in the UK I would complete I-407 and mail it to the US Embassy
http://london.usembassy.gov/dhs/uscis/abandon.html
then (if necessary) I'd file 8854 with the IRS. Finally I'd file a 1040NR as a dual status alien for the part of the year that you held the GC. If you have
US source income you will have to file 1040NR each year unless you can file a W-8BEN and avoid US filing using treaty provisions.
Last edited by nun; Mar 22nd 2014 at 5:49 pm.
