Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Report: Rising Number of Americans Relinquish Citizenship to Avoid High Taxes
Author: Scarinci Hollenbeck, LLC
Date: September 18, 2013
Key Contacts
Back
A growing number of Americans are renouncing their U.S. citizenship and handing in their passports at faster rates in an effort to avoid rising high tax rates and complicated tax law, according to a newly-published government report.
The Internal Revenue Service released its Quarterly Publication of Individuals who have chosen to Expatriate in the Federal Register. The findings reveal that during the fourth quarter of 2012 – ending on December 31 – 45 Americans renounced their U.S. citizenship. This number increased to 679 during the first quarter of the year, ending on March 31, and jumped by 1,130 during the second quarter alone.
The spike in the number of people renouncing their citizenship has largely been attributed to the upcoming implementation of the Foreign Account Tax Compliance Act (FATCA), which will require foreign financial institutions to disclose more account information on assets and investments held by U.S. taxpayers. The new tax law is expected to provide for more transparency, build an international network of institutions combating tax evasion, and lower the prevalence of tax law violations. New penalties recently announced by the government revealed that Swiss banks that want to avoid criminal lawsuits may be required to pay as much as 50 percent in penalties for hiding foreign accounts held by Americans. This move is expected to greatly diminish the viability of Swiss tax havens.
As these penalties and further pressure on foreign institutions continues, some Americans who can no longer gain favorable tax treatment by hiding assets overseas have opted to renounce their citizenship to legally avoid American income tax. However, some analysts agree that the FATCA is not the sole driver of the spike in renounced citizenships recently. An increase in capital gains and income tax rates in 2013 may also be a component in the high number of renunciations, the San Francisco Gate reports.
- Practices: Tax and Trusts & Estates, International Law & Trade, Sophisticated Estate Planning & Wealth Preservation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
BESS Interconnection: Managing Grid, Cost, and Schedule Risk
For battery energy storage system (BESS) developers, securing equipment and site control is only part of the development equation. A project must also connect to the electric grid, and increasingly, BESS interconnection is one of the biggest sources of schedule, cost, and contractual risk. Key Takeaways This article is Part 3 of our Battery Storage […]
Author: Nicholas Wall
Navigating Director and Officer Liability in Times of Financial Distress
Director and officer liability increases sharply when a company is in financial distress. Decisions that would draw little attention in a healthy business can later be challenged by creditors, shareholders, bankruptcy trustees, and regulators as breaches of fiduciary duty, fraudulent transfers, or oversight failures. Understanding where that exposure comes from, and how to manage it, […]
Author: Michael Mietlicki
Before You Buy: Managing Real Estate and Permitting Risk for BESS Projects in New York and New Jersey
For developers pursuing battery energy storage system (BESS) projects, finding the right property is only the beginning. BESS site selection is as much a legal and transactional exercise as a real estate decision, with risk analysis central to the project’s ultimate success. Key Takeaways The core questions for BESS site selection in New York and […]
Author: Nicholas Wall
What Business Owners Get Wrong Before Meeting a Litigation Attorney
What should you expect when meeting a litigation attorney about a business dispute? You should expect to describe the dispute in your own words, hand over the most important documents, flag any deadlines or immediate threats, and leave with a clearer picture of the problem, what information is still needed, and the likely next steps. […]
Author: Michael Mietlicki
Arbitration vs. Litigation vs. Mediation: What New Jersey Businesses Should Know Before Signing a Contract
Arbitration resolves disputes privately before an arbitrator whose decision is usually final, while litigation resolves them in court with full rights of appeal. Whether a business ends up in arbitration or litigation is often decided when it signs the contract, long before any dispute arises. Key Takeaways When facing a contract dispute, carefully consider your […]
Author: Graham Staton
Can You Own Part of a New Jersey Business Without a Written Agreement?
Can you own part of a business in New Jersey without a written agreement? Yes, it is possible. Under New Jersey’s Uniform Partnership Act, a partnership can arise when two or more people carry on a business as co-owners for profit, whether or not they ever intended to form one. Ownership doesn’t necessarily depend on […]
Author: Michael Mietlicki
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.