Why Are Americans Renouncing US Citizenship?

why are so many Americans renouncing their US citizenship this has been a big story in the news for years ever since new laws in the United States came out that have been driving expats to hand back in their US passports and the issue that I have is someone who's been through this process is that the media often gets it wrong because when it comes to anything offshore it's hard to entirely know unless you've done I'm going to answer the question why Americans are handing in their passport in this video [Music] hi I'm Andrew Henderson and here's the reality nobody really knows how many people are renouncing US citizenship you see the US government maintains what they call a name and shame list where they published a list of covered expatriates every quarter the media has latched on to this and they've said hey in 2016 well over 5,000 people renounced in 2017 a slightly lesser number still over 5,000 announced 2018 first quarter still turning down a little bit but over a thousand people the truth about that list is that not everyone who is a covered expatriate is on it and not everyone who isn't isn't so the list is notoriously inaccurate and really who knows how many people have given up US citizenship because there's some of the different reasons that people do it but the media has talked about this tiny number and yes it is a tiny number in contrast to how many people are obtaining US citizenship how many people are waiting in line but I'm going to talk about the reasons people do this there are a wide number of them not all the reasons apply to each renunciant and perhaps if you're looking into this for yourself you'll see you know is this something for me the big thing the media talks about number one is taxes now the United States has always had this policy long after every other country abandoned it that hey we're gonna tax our citizens no matter where they live if we have plenty of videos where we talk about that here on our channel you can check those out and so a lot of people who are you know as a friend of mine he's living in Switzerland for 20 years he says you know I'm a Swiss citizen I don't need the US passport I don't need this nonsense it's getting in the way of my business in Switzerland he says I'm just gonna renounce so taxes are a reason but the bigger reason is in the details for one person who came to me recently the issue was compliance we went through everything he was doing he has businesses all around the world some business businesses in the United States that pay plenty of US taxes but he also has operations in other countries that weren't paying US taxes cuz they're operating in other countries what happened under some of the new tax laws that came out under the Trump america-first Tax Reform was that he was going to have so much complexity and his tax return thanks to guilty and thanks to all these different provisions that are new that when I talked to a friend of mine who was a tax lawyer he said you know this guy it's probably in the costume seventy or eighty thousand dollars a year to do his taxes just a file not to pay but to comply under all the new provisions because he'd have to have different people in every country handling things it just pick him overwhelming he said forget it I'll just renounce other people there was a big story that came out I believe in the Wall Street Journal recently where they talked about what was called the transition tax under the term tax reform where people who lived in other countries including high tax countries - UK Australia were being forced to pay a transition tax of about 15% on all the money they've piled up since 1996 is what's called retained earnings money that had kept in the company head and distributed the u.s. previously didn't tax it they said hey now we're gonna come in with on a tax it and so those people who in those high tax countries let's say they live in London they were having to declare in some cases dividends from their own UK in that case company take the money out pay some UK tax then give it to the US all because they're living in a different country it wasn't like they were sitting on some island in the Cayman Islands necessarily you know they weren't sitting in a tax haven there are a lot of people I would say most the people who are renouncing are because they just got stuck in the system the other big thing that often also goes on discussed is what's called FATCA and you can watch our video on this as well where not only do you have to report and pay and file on all your taxes but you have to report all of your foreign bank accounts your foreign brokerage accounts lots of different accounts now on numerous different forms and what that did was it made a lot of countries a lot of banks in other countries say wow this is really burdensome complying with all these rules let's just not taking US citizens and I've had numerous people over the years call me and say what do I do because I'm running a company with these guys in Europe and they don't even want to be my business partner anymore because they're having trouble getting credit getting bank accounts doing business in some cases even getting contracts because there were some companies said we don't want to do business people with the u.s. we don't want that exposure so this is kind of the tax and compliance and infrastructure that the US has put in place where every one citizen green card holder whatever resident or not how long they lived there you know or how long they've not lived there has to follow all these rules and so you know what happened was it just became extremely burdensome for people new rules now under the America first tax reform saying you can't even live overseas and retain earnings anymore now you've got to pay a certain amount of tax you had to pay you're gonna have a formula for calculating how much dividend you're gonna pay you've got to take some of the money out you've got to pay a certain tax needed a 50% credit it's become more confusing people who have the option have increasingly said I want out but taxes and finances and compliance and burdensome business practices aren't the only reasons I have a guy who came to me recently who said interim a libertarian I would rather be a citizen of a country like one of the Caribbean when they get a passport their cell phone my cryptocurrency I'll invest in a passport in that country and I just don't want to be associated with this and I know how he feels because you know when you're from a country you just don't feel like you fit in there you know I remember going to different countries and using the US passport and sometimes it's like it'll give me the stink-eye you feel embarrassed I had another guy who was British by birth and he became American he never liked the British part he didn't want to use the UK passport and he wanted to keep the US passport because he felt like without it he would go back to being British and he would be embarrassed about that so there's a whole list of things that people feel feelings about citizenship especially in a country like the United States not everyone believes that they fit in nah drone wants to be associated with that and while the US passport is one of the world's best passports a lot of people say you know what I'll gladly get a couple of extra visas to get this burden out of my life and to feel better I can tell you for me you know I don't have a problem visiting the United States but the idea of going and saying hey this is my you know country these are my values I feel a lot more comfortable now and it's not like necessarily about tax or finance or any of that sure it's it's nice to be able to open up a foreign company and not have to file you know this many forms for it we're people to open a bank account and not be harassed or have to fill out extra forms or worry about reporting it or worry about some of the stress but the bottom line is for many expat entrepreneurs people who own business in other countries in many cases paying tax in those countries sometimes not and that's fine too but often cases living in the Switzerland's the UK is the Australia is paying plenty of tax part of that life part of that country the u.s. overreached more than any other country in the world and they said we don't want to be a part of this anymore there's a myth that it's all about Trump before that it was all about Obama maybe about Obama's policies with FATCA and all the things he put into place this idea that people are leaving because they don't like Trump has always been nonsense and we've seen that personally here at nomad capitalists but what one person did tell me is it's not about Trump it's about the role of the government as what he called a quote-unquote psycho girlfriend where you never know what they're gonna do next art is tomorrow gonna be the day where they do the next thing where they go back to 1986 and say uh we changed the rules you never know he said and that I think is why a lot of people are saying I'll be better off over here I'm going to go where I'm treated best i'm andrew henderson and if you're looking for a way to legally reduce your taxes build your freedom and create wealth faster as a global citizen then you've come to the right place i want you to do three things right now number one click the buttons to subscribe to our channel make sure to get notifications so you never miss a new video number two get a copy of our number one best-selling book no mad capitalist on amazon and learn all the dozens of benefits of our lifestyle and number three if you're already a six or seven figure entrepreneur and you want to put these strategies in place go to nomad capitalist calm and find out how to get some help

Channel: Nomad Capitalist

Views: 13,661

Rating: 4.8582091 out of 5

Keywords: nomad capitalist, renouncing us citizenship, renouncing us citizenship taxes, renouncing american citizenship, renouncing ciizenship usa, us citizenship renunciation, how to renounce us citizenship, how to renounce us citizenship in two easy steps, how to renounce my us citizenship

Id: XNnxKopwV7k

Length: 9min 2sec (542 seconds)

Published: Thu Mar 07 2019