kodokan

Is it possible for one spouse to take citizenship, and other not? For example, my hubby works in an industry where he would have more job choices if he was a US citizen. If, in 5 years' time, he decides to become a citizen, do I have to as well? That way, if we retired back to the UK, we could separate the finances so that I could be the one with the share accounts, ISAs, etc.

theOAP

It's certainly possible for one spouse to be a USC, and the other not. Unfortunately the plan you propose, which has worked successfully for many in the past, will almost certainly be more difficult to utilize in the future, given individual circumstances and the foreign countries involved.

The true response is 'no one knows at this time'. FATCA is a massive cockup. The US Treasury has no forethought, and even less concern, about the effects on Americans Abroad. Foreign banks, (etc.), and foreign governments are being forced to respond without sufficient information as to the consequences of their decisions to grant/deny accounts to USCs, but are reacting as best possible simply to prevent the loss of 30% of their revenues.

In some areas, this has resulted in the total denial of any access to accounts where there is even the remotest possibility of a US tie (indicia). Spouse; children born to US spouse (even if born in the foreign country); the current response by some FFIs is bordering sheer paranoia. No one could possibly predict what the situation will be in any country in 18 to 24 months time. That includes the UK.

jeffreyhy

This might be a place to start:
http://travel.state.gov/law/citizens...nship_776.html

And, as always, have a consultation with a US immigration attorney.

Regards, JEff

kodokan

Oh well, we're a long way off yet - still waiting on the GCs, hopefully early next year. So at least I've got 5 years to see how the whole thing pans out; hopefully it'll all be a lot more sane by then.

nun

Probably something to mention here is the US tax liability for US residents. Remember, just like a US citizen, you are taxed by the US on your worldwide income and you have to comply with all IRS rules......so that's FBAR and 8938 if applicable and you have to correctly deal with any foreign mutual funds, pensions and foreign tax advantaged accounts like ISAs. So your previous financial life can cause some issues if you move to the US without appropriate planning.

Steve_

Read IRS publication 54. http://www.irs.gov/pub/irs-pdf/p54.pdf

Also the instructions for Form 2555.

Steve_

You can do this. Works best if the person who has the least income becomes the US citizen. Bear in mind if you've been an LPR for at least eight years though there are all the expat provisions, read IRS publication 519.

If you ever move back to the US, you can file an I-130 for your spouse.

HOWEVER, I stress this point because people always forget to do it - if you give up LPR status you must file an I-407 AND file a dual-status tax return, using the date on the I-407 as the break point. There is an example in 519 of how to file a dual-status return, AFAIK there is no software that can do it and H&R Block definitely can't. The only general exemption to this requirement is if you give up LPR status on December 31st. (Or if there is a provision in the tax treaty - there isn't in the one with the UK).

Steve_

http://www.nytimes.com/2012/04/16/bu...mplicated.html

http://www.theglobeandmail.com/comme...article627365/

Cape Blue

I had a quick flick through IRS 519, but didn't see the "eight years" thing jump out at me - can you tell me a bit more about it?

Cook_County

Internal Revenue Code 877A imposes an expatriation tax on the abandonment of a long-term green card in circumstances outlined within section 877A.

JAJ

http://www.irs.gov/Individuals/Inter...patriation-Tax

The financial thresholds for the tax are fairly high so as long as form 8854 is filed, relatively few taxpayers are liable. In addition, the deemed capital gain is normally reduced by over $600k. There are a few other complications, like deemed distributions from deferred income accounts (401k, etc).

Expatriation tax rules in the future could be different.