Residence-Based Taxation | TaxConnections

01 Sep 2023

TaxConnections Members’ Blog Post About Expatriate Taxes Has Received More Than 7024 Reads (A Great Reason To Post Your Blogs With Us)

(This blog reposted due to its popularity and commentary. What has changed for expatriates in the past few years?)

Revenue Neutrality And A Move To Residence-based Taxation: Open Letter To Democrats Abroad

OPEN LETTER TO DEMOCRATS ABROAD

Democrats Abroad (DA) reached out to the Democratic presidential candidates to ask them about issues relevant to Americans living overseas. The questions DA posed and the responses it received can be accessed at this link:

https://www.democratsabroad.org/democrats_abroad_talks_with_the_candidates?fbclid=IwAR0TKNlkqnxPjdhQz22tUsnnBDotPiSR7NaRVm430LXvlZHma8FWF1HuhQs

We strongly applaud DA for this valuable initiative. But we believe that it is important—indeed, vital—to call out the framing of this question:

“Most Americans living abroad think that the time has come for Residency-Based Taxation, the principle guiding all other countries’ tax systems and a fix for numerous unjust burdens on Americans living and working abroad. There are bi-partisan, revenue-neutral proposals to implement RBT that include robust provisions to protect the law from abuse by tax evaders. All we need is a moment of leadership to get this done. Will you be that leader?”

We believe that it is a grave error to condition a move to residency-based taxation (RBT) upon a demonstration of revenue neutrality. Doing so would serve to perpetuate the immoral and unjust system in place today.

These are the reasons why:

Written by John Richardson | Posted in TaxConnections

02 Jun 2021

Toward A Definition Of Residence-Based Taxation For Americans Abroad

Introduction

The discussion of tax reform for Americans abroad is increasing in intensity. Whether through amendments to the Internal Revenue Code or a “Regulatory Fix To Citizenship-based Taxation“, Americans abroad are in desperate need of change. The US tax system as it impacts Americans abroad is forcing renunciations of US citizenship.

The language in the discussion for change reflects a desire (on the part of individuals and organizations) to move from the US system of “citizenship-based taxation” to a system of “residence-based taxation”. Various individuals and groups describe the goal using the language of “residence-based taxation” AKA RBT. It would be a mistake to assume that RBT means the same thing to different people. The purpose of this post is to describe definitions of RBT and and how those definitions may be defined for different individuals or groups.

Written by John Richardson | Posted in Americans Abroad • Residence Based Taxation

17 Dec 2019

Revenue Neutrality And A Move To Residence-based Taxation: Open Letter To Democrats Abroad

(This blog reposted due to its popularity and commentary)

OPEN LETTER TO DEMOCRATS ABROAD

Democrats Abroad (DA) recently reached out to the Democratic presidential candidates to ask them about issues relevant to Americans living overseas. The questions DA posed and the responses it received can be accessed at this link:

https://www.democratsabroad.org/democrats_abroad_talks_with_the_candidates?fbclid=IwAR0TKNlkqnxPjdhQz22tUsnnBDotPiSR7NaRVm430LXvlZHma8FWF1HuhQs

We strongly applaud DA for this valuable initiative. But we believe that it is important—indeed, vital—to call out the framing of this question:

“Most Americans living abroad think that the time has come for Residency-Based Taxation, the principle guiding all other countries’ tax systems and a fix for numerous unjust burdens on Americans living and working abroad. There are bi-partisan, revenue-neutral proposals to implement RBT that include robust provisions to protect the law from abuse by tax evaders. All we need is a moment of leadership to get this done. Will you be that leader?”

These are the reasons why:

Written by John Richardson | Posted in TaxConnections

07 May 2019

How Do I Protect Myself?: A Case Study In The Marginalization of Americans Living Overseas (Part 1 of 4)

Before moving to the post, if you believe that Americans abroad are being treated unjustly by the United States Government: Join me on May 17, 2019 for a discussion of U.S. “citizenship-based taxation” as follows:

You are invited to submit your questions in advance. In fact, PLEASE submit questions. This is an opportunity to engage with Homelanders in general and the U.S. tax compliance community in particular.

Thanks to Professor Zelinsky for his willingness to engage in this discussion. Thanks to Kat Jennings of Tax Connections for hosting this discussion. Thanks to Professor William Byrnes for his willingness to moderate this discussion.

Tax Connections has published a large number of posts that I have written over the years (yes, hard to believe it has been years). As you may know I oppose FATCA, U.S. citizenship-based taxation and the use of FATCA to impose U.S. taxation on tax residents of other countries.

Tax Connections has also published a number of posts written by Professor Zelinsky (who apparently takes a contrary view).

Written by John Richardson | Posted in Residence Based Taxation • TaxConnections • Worldwide Citizenship Taxation

20 Jul 2017

2017 Residence Based Taxation Request To Chairman Hatch

It’s tax reform season and Senator Orrin Hatch wants to hear from you (again).

As reported on the Isaac Brock Society and other digital resources for those impacted by U.S. taxes, you have until July 17, 2017 to tell Senator Hatch what you think needs to be changed in the Internal Revenue Code. After great deliberation, it occurred to me that people who either are (or are accused of being) U.S. citizens or Green Card holders living outside the United States, might want the USA to stop taxing them. After all, they already pay taxes to the countries where they reside. This is your opportunity to “Let your voices be heard” (well maybe). Read More

Written by John Richardson | Posted in Tax Reform

01 Oct 2015

Part 2 – Understanding “Exit Taxes”

Part 2 – Understanding “Exit Taxes” in a system of residence based taxation vs. Exit Taxes in a system of “citizenship (place of birth) taxation

Let’s begin with some politics …

In an interesting post Robert Wood writes:

Both Mayor Johnson and Senator Cruz are U.S. citizens. Both Mayor Johnson and Senator Cruz either have or are renouncing the citizenships of the countries where they were born. There will no tax consequences to Senator Cruz for renouncing Canadian citizenship. Mayor Johnson will probably be spared America’s draconian “Exit Tax” (assuming he was born a dual citizen) for renouncing U.S. citizenship. The “Exit Tax” Read More

Written by John Richardson | Posted in Expatriate • FATCA

05 May 2015

Making Citizenship-Based Taxation Reform Easy

Making Citizenship-Based Tax Reform “Easy”

Heitor David Pinto wants to “make it easy” for Congress to move from citizenship-based taxation (CBT) to residence-based taxation (RBT).

Pinto thinks CBT is “absurd.” And he aims to help Congress change it.

Because of CBT’s complexity and because it’s a low priority for Congress, Pinto was concerned Congress might take a long time or might not do tax reform at all for Americans abroad. But, Pinto hopes “if it’s mostly done already, they might do it faster.”

When the naturalized American citizen immigrated to the United States from Brazil a Read More