Even if someone gives up their citizenship, I have also found out they will tax you for 10 years. And if they think you gave it up for tax reasons, they'll apparently never stop taxing you.

I'll tell you why, jwalker : There is something called the "Exit Tax".

Let's take my example : I discover that just because I was born in the US I have to report my worlwide income and possibly pay tax to a country I left 35 years ago. No problem, I have no connections with this country, I am just going to renounce this US citizenship.

Here we go :

1) To do so, you have to be in full compliance with the IRS, which means that you have to file the previous 6 years and of course pay tax accordingly
2) There is this "exit tax" : The tax will apply to the net unrealized gain on the expatriate's worldwide assets as if such property were sold (the ‘deemed sale') for its fair market value on the day before the expatriation date. Any net gain on this deemed sale in excess of US$600,000 will be taxable. (By the way, I do not own so many assets that this would apply to me. But that's not the point, what if I did? It's pure racket ).

Is that what you mean, when you say "I have the choice"?

You seem to be a a great defender of the US taxation system. It's your choice. Again, I really believe it's like the mafia : they terrorize you and even worse, when they have you in their grasp there is no escape.

Out of curiosity, do you work for the IRS or the US Government or some affiliate?

Not now, nor ever in my life.

You've contradicted yourself: you stated the tax wouldn't apply to you, so of course you do have a choice. You simply lack the courage to take it. And, if it /did/ apply, you still have the choice.

I have never defended the tax code (of any country; do you care to chat about the ethics of a wealth tax?); I have simply tried to point out that the US tax code hasn't changed substantially, so all the complaining is a bit puzzling.

basically, the rules haven't changed, but that the irs has now decided to act more severly in chasing down all this "available" money.

of course the entire idea of "taxation without reprentation" was the basis of the creation of the first colonies declaring their independence from england.

maybe history will repeat itself.......

can you imagine if in some years we as ex pats will have to pay in to a general health fund in the usa, but as foreign residents, not be eligible to
receive any health benefits overseas.

We already pay for a lot of things we are never able to take advantage of.

Once I get myself up to date, I'm contacting the rep from my old home state of Ohio (Kucinich...yay, a rabble rouser, might actually help). We may have taxation without representation, but it is worth a shot.

Do you actually understand what "taxation without representation" means? You have the right to vote (in whichever state you were last resident), so you are represented in Congress.

Doesn't that only apply if you own property there?

Regardless, that representative in congress will representing the people of that state and their interests - not mine. My interests are not the same as them. Nobody in congress represents my interests.

So yes, I completely understand what taxation without representation means.

I can only assume it would not apply to me. How can I be sure? Is an IRS guy going to come, audit my house and show me the bill?

I do have the choice to be bullied by a foreign state I have nothing to do with

Don't worry, the rumour is that your president is thinking about it

Well, you completely failed : the exit tax law became law last year. Isn' that a major change in the US tax code?

Actually, you can quite easily know whether or not it applies to you by simply reading the IRC, or doing a Google search on "Heart Act", and then reading the definitions with respect to income, assets, and (most importantly for you) dual citizenship and "minimal contacts" with the USA. (You could also ask an attorney who specializes in US tax law.)

Yet, while you whine about your citizenship ("this bloody birthplace"), you don't seem to have the energy to investigate your options. I'm very optimistic that you can give up your citizenship without a tax liability...and we will all be happier if you do so.

No, since what you call the "exit tax" is old news, and the change last year (the Heart Act of 2008) changed the calculation of tax not the fact of a liability. To make it very simple for you: whether you renounced your citizenship in 2005, 2007, or 2009, you would still have a tax liability under the conditions stated in IRC 877.

As far as I know that does not exclude anyone from the exit tax.
The exclusions I am aware of are rather restrictive and do not cover my situation.
If you are "stamped" american according to their rules, you are trapped. Unless you are ready to pay the big money to get your freedom back.
http://www.aca.ch/joomla/index.php?o...d=167&Itemid=2

Yet earlier you wrote "I do not own so many assets that this would apply to me." You also wrote the US is "a country I left 35 years ago."

Well, from the article you linked, with emphasis added, where do you see yourself as included in this definition?

The provision applies to any U.S. citizen who relinquishes citizenship and any long-term resident who terminates U.S. residency, if such individual (“covered expatriate”) (1) has an average annual net income tax liability [note: not income, but "tax liability"] for the five preceding years ending before the date of the loss of U.S. citizenship or residency termination that exceeds $124,000 (as adjusted for inflation after 2004 – $139,000 in 2008 ); (2) has a net worth of $2 million or more on such date; or (3) fails to certify under penalties of perjury that he or she has complied with all U.S. Federal tax obligations for the preceding five years or fails to submit such evidence of compliance as the Secretary may require.

Exceptions to an individual’s classification as a covered expatriate due to (1) or (2) above (but not (3)) are provided in two situations.

The first exception applies to an individual who was born with citizenship both in the United States and in another country; provided that (1) as of the expatriation date the individual continues to be a citizen of, and is taxed as a resident of, such other country, and (2) the individual has been a resident of the United States (under the substantial presence test of section 7701(b)(1)(A)(ii)) for not more than 10 taxable years during the 15-year taxable year period ending with the taxable year of expatriation. The second exception applies to a U.S. citizen who relinquishes U.S. citizenship before reaching age 18½, provided that the individual was a resident of the United States (under the substantial presence test of section 7701(b)(1)(A)(ii)) for no more than 10 taxable years before such relinquishment."

Swiss government to open tax hotline for US citizens

If you vote in US elections, your vote counts in the state where you last lived - the regulations may differ from state to state, but generally you vote in "federal" elections (president, senator, house of representatives). In theory it does not matter if you retain a residence in the US, in practice, I just don't know.

But I agree with you that most representatives are not going to represent the interest of expat Americans.

And, expats are not counted in the census, the basis for drawing up congressional districts.

Since we are not counted, we are generally ignored.

So, I contacted the IRS to verify if I have to report our bank accounts in Switzerland. My uncertainty is that while I am a US citizen, my husband is neither a US citizen nor holds a green card. My husband has told me that I am not the account holder so he does not think we need to report it. I do, however, have access to the accounts and can withdraw money.

I called the IRS and one person told me he does not know if I have to report the accounts. The other person told me it is ''better to be inclusive rather than exclusive.'' And 'this is just for informational purposes'.

My husband prefers not to report the accounts. Does anyone else have solid confirmation on what I must legally do (according to US law)?

Has anyone just chosen to remove themselves from the account?

There are quite clear instructions on form TDF-90 here which tell you who must file. If you wish further detail on who is a "US person", read both IRC section 7701(a)(30) and 7701(b)(3)(B) here.

Unless your husband spent 183+ days in the US, he has no obligation to file the TDF-90 form.

However, your obligation is not clear from what you wrote: see the Form instructions. If you have signature authority, or the ability to withdraw funds at will, then you have to file.

I'm not sure what you mean by "remove" yourself; if you have any legal authority over an account, but are not the legal owner, of course you can give up that authority now, and thus not have to file for future years. However, that won't change your obligation for the prior & current years. (I hope that is helpful; I'm not quite sure what access/authority you have.)

Also, if you do not owe any taxes at all, the IRS has stated in its publications that you should not join the amnesty program at all, but you should just file the FBAR forms, and there will be no penalty levied. See the IRS Q&A #9 here.

Thanks jwalker!!!!

Yes, I have signature authority on our Swiss accounts and I will have to file the FBAR form. Thank you for clarifying the difference between the amnesty program and the regular FBAR filing, which is now for me 3 years delinquent.

I did not file taxes in April 2009 (2008 taxes) and owe a minimal amount few (maybe a few hundred dollars?...I worked very part-time for a US company). I think I will file my 2008 taxes and then send in the: 1) TDF-90 along with the explanation and 2) a copy of my taxes for the past three years.

I did understand that my Swiss husband does not have to report his accounts, but since my name is on his accounts (not sure if this is a joint account or what it is-but I DO have signature authority) he is quite annoyed that his account information is being required for a country that he has never lived in-he sort of sees it as a security risk and of course as a breach of privacy. Anyway, at the end of the day, it does not really matter what anyone thinks of the reporting, since to not do so means that any US citizen who does not comply would face civil or criminal penalties. I wonder what happens in the case where a Swiss husband (or to be fair, it could be a wife) refuses to give the account information to the spouse.

Thanks again for your assistance with this. It is appreciated!

Please remember you are entitled to a tax credit (not a deduction, but a 1-to-1 credit) for Swiss income taxes paid, and there is still an "earned income exclusion" which simply exempts from US tax a portion of your CH income. (They are quite separate provisions.)

So, from what you wrote, you most likely have no tax due at all.

The irritation is understandable; separate accounts is a solution.

If a US person has signature authority (etc) he/she must know the account number, so you just put the bank & number on the Form TDF-90, and where it asks for the max value write "unknown", with a 1-sentence cover letter explaining why you do not know.

The penalty is for non-filing of the form; there is no penalty listed for non-cooperative spouses.