Among American citizens who live outside of the US, one frequently discussed topic, generally around April (for the obvious reasons) is the taxation of US citizens who live outside of the US.
If you aren’t aware, and there’s no good reason why you should be, it does not matter where you live, if you have US citizenship, you have to submit a US income tax return every year. Of course, every other country in the world (except Eritrea) requires you to pay taxes based on residence so you have to pay twice. Now, fortunately, the US allows for a certain amount of income for US citizens to be tax exempt, assuming you’re pay taxes in your country of residence.
Unfortunately, you still may be double taxed, even if you aren’t, you have to file two tax returns, and the US imposes a whole host of other requirements on countries and citizens with regards to taxation. This is all done under the guise of trying to prevent US citizens from avoiding income tax by hiding their assets abroad.
Of course literally every other country on the planet (except Eritrea) has figured out some other ways to prevent this. Like, for example, taxing you based on your residence. So if you want to hide your assets abroad, you actually have to reside in the country and pay tax there to do so. (Less you think this will cause rich Americans to move abroad en masse, let me remind you that I pay about 30% more in taxes here than I would in the US. Also, there’s no Chipotle.)
There is a bill being discussed on Congress that addresses some of these issues, namely the bank reporting compliance (banks with US citizens as customers are required to turn over tax details to the IRS.)
It’s a good idea.
A better idea would be to join the ranks of literally every other goddamn country on the planet (except Eritrea) and get rid of the moronic citizenship-based income tax requirement.