ricedoll wrote:Thanks Eagle for your explanation.
You mentioned you have 3 passports - the US, the UK and Canada. By keeping your US passport, do you have any strong desire to live and work in the US in the future? Because I know many Americans are now moving to Canada. And those with US/Canada dual citizenship would now rather renounce their US passport for tax reasons.
I emigrated to the US in 1965 with my parents. I have lived continuously in Texas since 1966. I became naturalized in 1978. I am currently in Texas since leaving Singapore in 2013. I have no intention of moving to Canada... I have lived through enough winters there... and my wife would kill me if we went somewhere where the snow is on the ground 6 months of the year.
I don't personally know anybody planning on renouncing their US citizenship for tax reasons... or for any reason... except maybe Trump or Cruz getting elected
I've read the numbers, though... around 5,000 in 2015, much larger than earlier years, more prompted by FACTA than taxation issues, and still only a tiny tiny fraction of the population.
Secondly, do you pay any US taxes from overseas? Yes we pay US taxes, but its all my husband's honest and hard-earned money! Just because we earn a lot doesn't justify citizenship based taxation! Its day-like robbery!
Ya know... everybody that pays taxes pays it from their "honest and hard-earned money". EVERYBODY. So what are you bitching about? I already told you that their is a foreign income tax credit to avoid double taxation. In fact, if you were living in a country with tax rates higher than the USA you could end up not paying any US tax. The forms are complicated but the rules are simple. You always pay foreign tax on the excluded income amounts. Foreign taxes above the excluded amount are deducted dollar for dollar from your US tax bill. Pay enough foreign tax and you won't have a US tax bill.
So, the only thing you seem to be griping about is the fact that the US tax rates are higher than Singapore tax rates, yes? I mean, why aren't you also complaining about graduated tax rates percentages?
I certainly paid US taxes while overseas. Not on my income because I structured my company to pay me the maximum excluded income amount and left the rest in the company. But, I paid taxes at the highest marginal rate on my passive US income.
Thirdly, you mentioned about benefits of your US citizenship while being overseas. Can you elaborate on this? My husband surely hasn't felt any.
I have already listed several benefits of US citizenship, perhaps not to your liking since they are not directly dropping coins into your pocket. The US has a huge network of embassies and consulates that are available to citizens and they will come to the aid of a citizen in distress.
If you hold property
in the US, it is protected by police, by fire, and by a legal system that keeps it from being taken away just because you are not in the country.
You have the absolute right of return to the country, regardless of your status otherwise. You can vote from overseas. While some countries in the middle east don't like us too much, the US passport is one of the best travel documents you can have.
If he sells our house where we are living now, the US taxes the profit of this transaction! This is not just filing taxes, but paying taxes on what you make through your own overseas property!
Again, you are failing to take into account foreign tax credits and tax treaties with many countries. Capital gains are treated like income in most cases... your US taxes are offset by foreign tax credits.
Also, like I mentioned in another thread, the company will be paying 80% of our future kid's schooling. Whatever the company subsidised will be taxed too! His retirement fund is also NOT recognised in the US, so it gets cashed out every month and we pay taxes on it too.
How do you figure that subsidies paid to you shouldn't be income? There is absolutely no difference to you if the company pays the school $25,000 directly or gives you the $25,000. You are getting $25,000 worth of income from the company.
Singapore treats allowances exactly the same way... any kind of allowance. Allowances paid for schooling, day care, club memberships, trips back home... all are treated as ordinary taxable income in Singapore, as well as the USA, as well they should be.
As for your retirement fund, I have no idea what you are talking about. The US, like most countries, recognizes certain types of savings as retirement accounts, aka an IRA, but not others. If you are invested in a mutual fund, its gain/loss must be computed yearly and taxes applied.
Bottom line, you really strike me as someone living the good life, with a high income stream, much better than most, and plenty of assets, griping about taxes. So, what else is new?