Why expat Americans are giving up their passports
By Russell Newlove Business reporter, BBC News

How does it feel to give up your nationality, to renounce the country you were born in, potentially forfeiting the chance to ever return?

"It's not going to be easy at all. It's the last thing I ever thought of doing," Jane tells me when I meet her in a Paris cafe.

Her voice cracks and her eyes well up. She is in the process of relinquishing her American nationality. Soon she'll visit the US embassy formally to renounce her citizenship, she says, under duress.

"I'm very proud of being an American. It's what I am when I look in the mirror.

"If it weren't for Fatca [the Foreign Account Tax Compliance Act] and the decision by the bank, I'd never be doing this. Never ever. It's just breaking me in half."

She's not alone. According to the US Treasury, a record 4,279 individuals renounced their US citizenship or long-term residency in 2015 - an increase of 20% on the previous year, which was itself a record-breaking year.

In 2010, just 1,006 gave up being US citizens, but since then the numbers have risen every year.


Double taxation

Reasons for giving up your US citizenship aren't officially listed, but one of the main reasons cited is Fatca - a 2012 law designed to target overseas accounts held by wealthy Americans.
As a US citizen you must file a tax return, no matter where you live, and often pay US taxes on top of the tax you already pay in your country of residence - so-called double taxation.
But Fatca expands the scope of what can be taxed, and places a burden on foreign banks to identify US citizens among their customers to US tax authorities. The penalty for failing to do so can be as high as 30% of all a bank's dealings with the USA.


Refused banking

As a result, ordinary Americans abroad are being denied access to basic banking facilities; banks would rather refuse US citizens' custom than run the risk of hefty penalties.

"I went to one and as soon as I typed in I was born in the United States, there was a big set of red letters that said 'No to US persons'," says Jane.

"I've got to pay my bills, I've got to buy food - I've got to have a bank."

For people like her the only option is to renounce their citizenship, and this is causing such a backlog of paperwork that in November, the fee for renunciation was put up to $2,350 - an increase of about 400%.

Jane has lived and worked in France for 30 years drawing what she calls a "humble" salary. She has filed a tax return every year even though she earns significantly less than $106,000 a year.

But under Fatca her pension and savings can also be taxed, and that's money she can't afford to lose.

The process to renounce is humiliating, she says.

It must be done in person, in front of other Americans at the US embassy. Her real name will then be published in the Federal Register (Jane agreed to talk to the BBC anonymously) - a move she feels is made to shame those who renounce.

And it's expensive too.


'Accidental Americans'

Many foreign banks are taking no chances either. They are closing down accounts of anyone who might be an "accidental American". This could be anyone with an American parent but born outside the US, or people of other nationalities born in the US - like Fabien.

"I live in France, I work in France, my life is in France. I have no link to the United States. My life as a Frenchman is in France," Fabien tells me through an interpreter. "I don't even speak English!"
His bank demanded he either provide proof he had renounced his US citizenship, or his social security number. He had neither. Renouncing his "accidental" US citizenship is no mean feat, either.
"We have to enter into the American system at the risk of substantial penalties. I have to submit the last five years' tax returns, but then also the next two years in order to renounce," he says.

"We're in a situation where it's unknown what will happen when we start. I have to have money to be able to pay the expenses to enter into the system, and then I have to pay to renounce."

http://www.bbc.com/news/35383435

. ..

Okay Op points noted!




Cheeeeers

well, I dont know how the supreme court situation will affect things.

we just have to wait and see.

Accidental Americans'

Many foreign banks are taking no chances either. They are closing down accounts of anyone who might be an "accidental American". This could be anyone with an American parent but born outside the US, or people of other nationalities born in the US - like Fabien.

"I live in France, I work in France, my life is in France. I have no link to the United States. My life as a Frenchman is in France," Fabien tells me through an interpreter. "I don't even speak English!"
His bank demanded he either provide proof he had renounced his US citizenship, or his social security number. He had neither. Renouncing his "accidental" US citizenship is no mean feat, either.
"We have to enter into the American system at the risk of substantial penalties. I have to submit the last five years' tax returns, but then also the next two years in order to renounce," he says.

1. What is an "accidental American"?

2. What is the age of this person (if he's a real person)?

3. You dont become American (for official purposes such as the one stated in the example given) if born outside the US, if you dont officially register your presence and birth with the embassy or in some official capacity somewhere. You might be American through one or both parent/s , but you have to officially acknowledge this fact first.

4. Which other forms of id are acceptable by banks besides a passport?

seems "Accidental American" is on wiki already, first time I'm hearing the term:



Accidental American


An accidental American is a citizen of a country other than the United States who may also be considered a U.S. citizen under U.S. nationality law but is not aware of having U.S. status, or has only become aware of it recently during adulthood.[1] Accidental Americans' U.S. citizenship arises due to their parents' ties to the United States rather than their own choices: they may be born in their own country but to one U.S. citizen parent who emigrated from the United States, or they may be born in the U.S. to parents residing in the country temporarily for work or study and then return to their own country in their early childhood, with few if any memories of the United States. The term may also sometimes be applied to people who definitely are not U.S. citizens but have some other sort of connection with the country, for example green card holders who moved back to their country of origin and let their green cards expire without formally cancelling their U.S. immigration status, or non-U.S. citizens married to Americans abroad. Such tenuous connections to the United States began to become a more salient issue in the late 2000s due to Internal Revenue Service crackdowns which were ostensibly aimed at tax evaders hiding assets in secrecy jurisdictions but ended up having much broader effects on people with U.S. citizenship who resided in other countries, as well as their families.

Birth abroad and role of registration

U.S. law also states that a child born outside of the U.S to a U.S. citizen parent who previously spent sufficient time in the U.S. is a U.S. citizen at birth, regardless of whether the child also has the citizenship of the country of birth or another citizenship. U.S. citizens married to fellow U.S. citizens can transmit U.S. citizenship to their children if either parent has ever had a residence in the United States (without any minimum time limitation on how long they held that residence.) However, for U.S. citizens married to non-U.S. citizens, the required period of residence is longer; under the Nationality Act of 1940 and the Immigration and Nationality Act of 1952, the required period of residence was set to ten years, five of which had to be after the age of 14. The Immigration and Nationality Act Amendments of 1986 reduced this to five years, two of which had to be after the age of 14.

This makes it possible in some cases for "accidental American" status to be passed down over multiple generations, for example if an accidental American spends sufficient time in the U.S. to meet the physical presence requirements to pass down their U.S. citizenship to their own children born outside of the United States. This is most likely to occur in the case of unmarried parents. Under 8 U.S.C. § 1409(c), only one year of continuous physical presence in the United States is required for an unmarried mother to pass down citizenship to children born abroad. The Second Circuit and Ninth Circuit have split on the question of whether 1409(c)'s gender restriction violates the Equal Protection Clause; the Second Circuit, in holding that it does in 2015, ruled that the son of an unmarried U.S. citizen father who failed to meet stricter physical presence requirements of 1401 is also a U.S. citizen at birth.

Under a strict reading of U.S. nationality law, consular registration is not required in order for a child born outside of the U.S. to a qualifying parent to "become" a U.S. citizen; the child is a U.S. citizen from the moment of birth. However, for practical reasons, if a child's birth is not reported to a U.S. consulate or United States Citizenship and Immigration Services, the child would not have any proof of U.S. citizenship and the U.S. government might remain unaware of the child's citizenship status. Retired U.S. State Department official Andrew Grossman wrote in 2007 that in cases of "doubtful nationality" in which a child's derivative U.S. citizenship remained undocumented and unreported to the U.S. government, the child was not regarded as a U.S. citizen either for tax or other purposes, and he expected that it would be quite difficult for tax authorities to make determinations of jus sanguinis citizenship on their own. Karen Christensen, also of the U.S. State Department (Deputy Assistant Secretary for Overseas Citizens Services, Bureau of Consular Affairs), stated that "it is the process of being documented as a U.S. citizen that would result in official government recognition of the child’s U.S. citizenship status". This ambiguity has resulted in American emigrant parents, particularly those married to people of other nationalities, choosing not to report the births of their children born in other countries to U.S. consulates, in the hopes that this would allow the children to escape notice by the U.S. government. Mark Matthews of Caplin & Drysdale stated, "When clients who have lived abroad for years come in, concerned about whether they have an obligation under FATCA, they sometimes react to the suggestion that their kids might be American the way one might react to a horrible medical diagnosis."

https://en.wikipedia.org/wiki/Accidental_American

tpiar:
well, I dont know how the supreme court situation will affect things.

we just have to wait and see.

What supreme court? Is your comment intended for this topic or Saraki's case?

SmartMugu:

What supreme court? Is your comment intended for this topic or Saraki's case?

was Saraki mentioned on the thread? Why are you referring to him?


Supreme court situation meaning I dont know if immigration or birth citizenship is going to be debated there in the near future.


https://www.nairaland.com/2500735/dominican-republic-retroactively-revokes-citizenship#36585472

tpiar:


1. What is an "accidental American"?

The explanation here is pretty clear. One American parent can travel anywhere, have a child with a native of that land. That child is an accidental american, even though he might have never visited America before.

2. What is the age of this person (if he's a real person)?
Dunno

3. You dont become American (for official purposes such as the one stated in the example given) if born outside the US, if you dont officially register your presence and birth with the embassy or in some official capacity somewhere. You might be American through one or both parent/s , but you have to officially acknowledge this fact first.

If you're born by at least one American parent, you are american. Wait till something happens to that accidental child anywhere in the world, regardless of if that kid has a US passport or some paperwork, as long as the American parent can prove that's his kid, the child should expect same treatment as other Americans in similar situations in the same region.

Certain forms request you state the countries of your parents' nationalities. Several financial firms in many countries don't want to do business with US residents or people with ties to the US, which may be what this person is going through.


4. Which other forms of id are acceptable by banks besides a passport?

Banks where? In the US or in France? In the US, just a state ID or Drivers license is good enough.