Maintaining US Citizenship

[David M]

I would like to see a reference to the ten year requirement after renouncing US citizenship. I don't see how the US could possibly have any power over anyone who is not a US citizen and who is not on US soil. I'm curious because my wife has dual citizenship in this country and another and I may one day become a citizen of her native country. I would be allowed to do this through our marriage and a five year residency requirement.

Legally, I don't see how the US can have any sort of 10 year requirement on anyone who is not a US citizen. US laws simply do not apply to non-US citizens unless they are on US soil. If this were the case, the US could write law that requires every French citizen to pay US taxes...and that would make no sense.

Given non-US citizens cannot vote, wouldn't this also be "taxation without representation"? Clearly this supposed requirement is unconstitutional. As far as I know, the US cannot write laws contrary to the US Constitution even if it does apply to non-US citizens because the US has no power over non-citizens. It would be a self-canceling law...a nonsense law.

[svHyLyte]

David--

See the following:

LOSS OF NATIONALITY AND TAXATION
P.L. 104-191 contains changes in the taxation of U.S. citizens who renounce or otherwise lose U.S. citizenship. In general, any person who lost U.S. citizenship within 10 years immediately preceding the close of the taxable year, whose principle purpose in losing citizenship was to avoid taxation, will be subject to continued taxation.




See …

• Internal Revenue Service Instructions for Completion of Form 8854
• Internal Revenue Service Guidance on Expatriation Reporting Requirements
• Internal Revenue Service Expatriation Tax

Copies of approved Certificates of Loss of Nationality are provided by the Department of State to the Internal Revenue Service pursuant to P.L. 104-191. Questions regarding United States taxation consequences upon loss of U.S. nationality should be addressed to the U.S. Internal Revenue Service.

The Lady's question was whether she and her family might suffer the loss the their US citizenship because of their travels. The answer seems to be No except under very limited conditions which they are very unlikely to meet.

FWIW...

s/v HyLyte

[James S]

Originally Posted by LtBrett

Yes, you must file a tax return even if you owe nothing.
Brett

But if you have no income I don’t think you have to file, weather you live in the states or not.

[Ex-Calif]

Originally Posted by David M

I would like to see a reference to the ten year requirement after renouncing US citizenship. I don't see how the US could possibly have any power over anyone who is not a US citizen and who is not on US soil. .

If you truly decide to leave and never return they don't. However people change their minds. As everyone has said the issues are complex but can be simplified. As an American living overseas since 1984 I can tell you that the rules periodically change. Mixed marriages create another layer of complexity.

Bottom line is that it is virtually impossible to lose citizenship.

If you don't file those tax returns, and yes you have to file even with zero income, the statute of limitations is 7 years so yoiu could simply file 7 years of returns when you get back. Countries do not report income to each other - use your conscience here...

A foreign national renouncing home citizenship for US often carries no weight either as the home country can "claim" their citizen back according to the rules of the home country.

The one thing for OP to consider is if there are children involved or in the future. There are issues around where a child is born and how long they can stay out prior to 18 before things start to be affected.

However as someone recently posted the US immigration website explains things pretty clearly.

[MarkJ]

I don't think these people are telling the truth.

As soon as you leave the USA you lose your Citizenship.

You take on the citizenship of the next country you arrive in.

Often times this is Cuba. (See Wikipaedia - Frank Sinatra)

Other times it is England. You must learn to speak the language there before they let you out of jail.

If you land in Australia we deport you to New Zealand.

[James S]

Originally Posted by Ex-Calif

yes you have to file even with zero income,.

I think this is not correct.

I believe that if you have no income and meet some other requirements you do not have to file at all.

This link is from the IRS site.

Do You Need to File a Federal Income Tax Return?

[Christian Van H]

Originally Posted by MarkJ

You must learn to speak the language there before they let you out of jail.

MarkJ must be correct. Just look at Madona...she moved to the UK and had to develop a perfect accent in 6 weeks!

[sushirama]

Yes you have to file even with zero income or the IRS will do your return for you based on they "think" you made. They do it flat - no deductions, no exemptions then send you the bill. They dont get the concept that you can live with out income or an address.. After you dont pay it they seek to get hold of anything you own. You can file a return whenever and pay a penalty. The IRS(treasury department) isnt like other agencies, they can go after anything just about ANYWHERE with out due process. The out of country form is like 1 page if you made less that 86k its easy.

You also cannot just revoke your US citizenship theres like 3 or 4 reasons they let you get away with it. Just saying the government sucks and you dont like it here isnt enough. And citizens and non-citizens can be subject to US laws everywhere. Theyve done that in tax, drug, child support, child pornography, sex tours, wildlife protection laws etc. A few years ago a couple was in a south pacific country and were filmed swimming with whales. They were charged with a felony as if they were in the US where its illegal to get within a certain distance. The US govt is trying to make it where our laws apply to US citizens regardless of where you are on the planet which is why they dont want you to quit being a citizen.

[David M]

The problem appears to be that the US will keep you as a citizen even if you renounce it, especially if they think you are doing it to avoid taxes.

[Gypsy Angel]

Wow this thread got wild. Thanks so much for all the helpful info. After posting, I found another thread that discussed this same issue as well. For some reason BF thought the 6 month thing was important.

We will probably end up using a relatives address for mail, etc...

Hud3 - thanks for the homeschooling info!

[David M]

Once someones question gets answered, its okay to go off on to a little bit of a related tangent. This makes the forum more interesting and yet still organized and structured, in my opinion.

[Hiracer]

Originally Posted by TaoJones

As to the tax liability question, I can only post what I believe to be the case, and I assume others who are more up-to-speed on the subject will correct me if this is inaccurate. If a US citizen earns income in another country and is obligated to pay income taxes to that country, he is given credit on his US tax obligation for any such taxes paid. He would only have to pay tax to the US if his obligation as calculated under the US Tax Code exceeds the amount paid to the country where the income was earned.

TaoJones,

The reason why this is so complicated is because there is no law in the sense of Internal Revenue Code 'statutes.' The taxation of duel citizens is determined by treaty between the countries, and in the absense of a tax treaty then taxes for both countries is fully owed (i.e., double taxation).

[Hiracer]

I think we are getting tangled up in our underwear here, with regard to filing requirements.

If your gross income is below a certain amount, you are not obligated to file. If your gross income is above that amount, you must file a tax return even if you own no tax.

The IRS has three years after a return has been filed (generally--exceptions may apply) to assess a tax liability. If no return has been filed, then the period for tax assessment is unlimited.

Thus, some advise to file a tax return even if you are not obligated to file because three years from your return filing the IRS cannot then disagree and assess a tax against you (generally speaking). This is actually good advice because in the tax field, once a tax has been assessed for any or no reason, the burden is on the taxpayer to prove that the taxpayer doesn't owe the assessed tax (and penalty and interest), and this can be alarming difficult in some cases--particularly if the evidence has grown stale or records are not at hand.

Anytime, however, there is intentional tax evasion, all statutes of limitations for both assessment and collection revert to unlimited--which is why the three-year rule must be caveated. Also, if you file a return and 25% or more of your income is understated, the period for assessment is 6 years, not 3 years.

[Hud3]

The discussion of tax laws is interesting, but way off topic. The original poster asked the following question...

What do we need to maintain our U.S. citizenship? Is a residence required or can we just throw all our stuff in storage and hit the water?

[Hiracer]

Originally Posted by Hud3

The discussion of tax laws is interesting, but way off topic.

Well, yes, but . . . . The original question was too easy to answer and I am the king of off topic posts. Sorry.

Still, if somebody is going to do a year or two sabbatical and living off of capital (which is maybe why they asked the citizenship question in the first place), they may not be obligated to file an income tax return for lack of income yet they would be well advised to anyhow, which is why I wanted to clarify. Not only do you keep your citizenship without any effort, you also continue to suffer all the burdens and risks that come with a U.S. citizenship.