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Old 01.09.2013, 18:41
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American nationals in Switzerland

Hi guys.

My fiancée is in the process of applying for American nationality. One of our friends suggested that maybe she shouldn't apply for it, because when she moves to Switzerland it will create unnecessary issues for her (i.e, taxation, difficulty in opening an account, ...).

Does anyone know what additional issues Americans face in Switzerland (if any?) or in the EU (since I may be moving to an EU country)?
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Old 01.09.2013, 19:09
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Re: American nationals in Switzerland

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Hi guys.

My fiancée is in the process of applying for American nationality. One of our friends suggested that maybe she shouldn't apply for it, because when she moves to Switzerland it will create unnecessary issues for her (i.e, taxation, difficulty in opening an account, ...).

Does anyone know what additional issues Americans face in Switzerland (if any?) or in the EU (since I may be moving to an EU country)?
No matter where she lives, she will be subject to filing American taxes. Depending on her income and where exactly she lives (and how much she pays in taxes there), she may also have to pay US taxes. This is also true if she has a green card and does not want to give it up. I have friends who got American citizenship without thinking about how the taxation issue would impact them if they ever decided to move back to their original country. She also has to report foreign bank accounts to the US government (see: FBAR).

For opening a foreign bank account, there is a US banking-related law called FATCA that is causing some headaches for Americans. As an American, there are basically three banks in Switzerland that will open an account for me, and even then, only the most basic of accounts - without millions of francs, it's unlikely that I can open an investment account here. If I ever wanted to buy property here, getting a mortgage would be difficult. You may have difficulties opening joint accounts. There is an account of someone on here who had problems even just opening a rental deposit account because he was American.

I don't know how it is in other European countries, but I have heard from some friends that they have difficulties maintaining already-opened accounts in other European countries. One friend had to basically sign away all authority of a long-opened Swedish investment account to his non-American parents.

So, those are the main issues to consider. Of course, depending on her original nationality, maybe having American citizenship is better in the long-run for her, in terms of freedom to travel, long-term goals to live in the US, etc.
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Old 01.09.2013, 19:12
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Re: American nationals in Switzerland

I believe she would have to pay taxes to the U.S. government for any income earned here in Switzerland if it's something like $97,000 USD or more per year. So there is a risk that she may be double-taxed on her income if she ever makes that much money here in Switzerland.
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Old 01.09.2013, 19:20
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Re: American nationals in Switzerland

What is her nationality? Where are you planning on living? Why is she appling for US citizenship?

A lot of Americans in Switzerland are renouncing their US citizenship as it causes a fair few problems, mainly with banking!
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Old 01.09.2013, 19:41
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Re: American nationals in Switzerland

She is probably already subject to global IRS harassment anyway, if she is a green card holder. Might as well be able to vote.
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Old 01.09.2013, 20:38
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Re: American nationals in Switzerland

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She is probably already subject to global IRS harassment anyway, if she is a green card holder. Might as well be able to vote.
Why? It will make no difference in any results.

Americans in all countries around the world are suffering problems due to FATCA. If she wants to be obliged by her bank to sign a form allowing them to pass on her bank details to the IRS, then tell her to go ahead. If I were her, I'd wait a few more years to see what transpires before taking the plunge if she really wants to.

You both need to do a lot more reseach into potential problems. There are plenty of threads here on the subject of FATCA, but here's just one:

http://www.englishforum.ch/finance-b...xperience.html

www.isaacbrocksociety.ca is also another source of info, mostly Canadian based, but there are others from around the world who also contribute.
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Old 01.09.2013, 20:58
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Re: American nationals in Switzerland

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Why? It will make no difference in any results.

Americans in all countries around the world are suffering problems due to FATCA. If she wants to be obliged by her bank to sign a form allowing them to pass on her bank details to the IRS, then tell her to go ahead. If I were her, I'd wait a few more years to see what transpires before taking the plunge if she really wants to.

You both need to do a lot more reseach into potential problems. There are plenty of threads here on the subject of FATCA, but here's just one:

http://www.englishforum.ch/finance-b...xperience.html

www.isaacbrocksociety.ca is also another source of info, mostly Canadian based, but there are others from around the world who also contribute.
If she is a green card holder, she is already subject to FATCA. That's my point.
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Old 02.09.2013, 01:52
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Re: American nationals in Switzerland

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Hi guys.

My fiancée is in the process of applying for American nationality. One of our friends suggested that maybe she shouldn't apply for it, because when she moves to Switzerland it will create unnecessary issues for her (i.e, taxation, difficulty in opening an account, ...).

Does anyone know what additional issues Americans face in Switzerland (if any?) or in the EU (since I may be moving to an EU country)?
Holding US citizenship may not only cause unnecessary issues for her but for you too if you eventually marry and live together in Switzerland as you may not be able to open/keep local jointly-held accounts (FATCA and FBAR reportable), you may face all sorts of issues with getting a mortgage if you intend to make Switzerland your home and she may face career glass ceilings (many non-US companies are not hiring Americans for positions that grant them signature authority over foreign corporate accounts).

And I'm sorry to say this, but US citizenship is pretty much a "genetic disease", it get's passed on to your children at birth and they also have to deal with all the associated complications, unless she or they decide to "cure" themselves by renunciation.

Trust me, the minute I naturalize, my US passport is going straight to the garbage bin unless those bozos on Capitol Hill pull their heads out of their rear ends.
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Old 02.09.2013, 09:03
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Re: American nationals in Switzerland

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If she is a green card holder, she is already subject to FATCA. That's my point.
True, so why think that being able to put an X on a piece of paper every 4 years is a bonus? Only if she has definite plans to live/work in the US for the rest of her life is getting citizenship worthwhile. If she doesn't, then ditching the green card and forgetting about citizenship is the best move she can make. As the rest of the world meekly lets the US enforce its laws outside it's own borders the problems will get worse not better.
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Old 02.09.2013, 10:50
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Re: American nationals in Switzerland

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Hi guys.

My fiancée is in the process of applying for American nationality. One of our friends suggested that maybe she shouldn't apply for it, because when she moves to Switzerland it will create unnecessary issues for her (i.e, taxation, difficulty in opening an account, ...).

Does anyone know what additional issues Americans face in Switzerland (if any?) or in the EU (since I may be moving to an EU country)?
This site has a summary of the main issues faced by americans abroad:
http://americansabroad.org/

Most of the issues also hold if she is a green card holder. Most of the issues also hold if she is not a green card holder and not american, but you have joint affairs (Eg joint financial accounts).

The main practical issues in a nutshell: the IRS makes it unbelievably complex for banks who offer accounts to US persons (citizens + green card holders). Lots of bureucracy, threats for fines, to the extent that:
- some banks (used to at least) stopped accepting americans as clients (even residents)
- may now have to travel to bank HQ branch just to open an account
- difficult to get mortgates, even if you do, often immediate payment of balance is due if you leave the country

Americans in Switzerland badly hit, but will affect the same in all EU countries in the coming years.
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Old 02.09.2013, 11:15
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Re: American nationals in Switzerland

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True, so why think that being able to put an X on a piece of paper every 4 years is a bonus? Only if she has definite plans to live/work in the US for the rest of her life is getting citizenship worthwhile. If she doesn't, then ditching the green card and forgetting about citizenship is the best move she can make. As the rest of the world meekly lets the US enforce its laws outside it's own borders the problems will get worse not better.
OP is getting advice from friends that his fiance shouldn't apply for US citizenship because of the host of problems that will come with it for US citizens in CH - my point is, if she is a green card holder, then she will have those problems anyway.

Having a US citizenship might actually be a net benefit for his fiance. We don't know her original nationality - if it's something craptastic, like Pakistani, then having the US passport would be a huge benefit in terms of worldwide travel. Even if she takes the OP's citizenship, she would still have to wait to get OP's passport color, so having a blue passport might be advantageous over having a green card in this interim time.

Of course there are a sh!tload of disadvantages of being American and a resident in Switzerland - you think I don't know that? US government, big bad hegemonic blah blah blah, yes, but maybe OP could benefit from, you know, actually thinking about the issue and doing a proper weighing of the potential advantages and disadvantages instead of jumping on the reflexive anti-US government train.
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