I would encourage any young person who has American citizenship to renounce it as soon as he/she reaches the age of 16 or at least before turning 18 1/2. The cost is the same but the paperwork involved is much less. Going out into the world as an American citizen will now mean less opportunity for you because no one is going to want to employ you and opening up a bank account will be pretty well impossible. Already U.S. citizens who live abroad are being denied bank accounts and losing out on high profile job opportunities because none U.S. companies don’t want to have anything to do with reporting their finances to the IRS.
If you don’t want to live like a second class citizen in your own country of birth or in another country or as an American who lives outside of the States then dump your U.S. citizenship. The Americans expect you to abide by all U.S. travel restrictions even if you hold citizenship in another country. America does not believe in dual citizenship. They won’t force you to drop another countries citizenship but when it comes to how you live your life you MUST live it as an American. So what that means is that you are not free to engage in the same freedoms as those of your fellow countryment.
When it comes to your financial life you have to be prepared for a life time of form filing and the forms are voluminous in number. But don’t think for one minute that you can file and complete these forms yourself because you can’t. It takes an accountant or tax lawyer to fill out these forms and believe me it will cost you a bundle of money. And that is if you can find a professional in your country and town who is certified by the IRS in the completing of these forms. It is a guarantee that you will commit an error when submitting these tax forms and then you will be slammed with disproportionate financial penalties.
And don’t think about investing your money. The last thing that the U.S. tax system is set up to promote is the financial success of its citizens who live abroad. You will not be able to partake of the same financial incentives that are available to the people in the country that you live in. You will not even be able to take advantage of the same financial incentives that are available to Americans who reside in America. This is because the U.S. treats all financial instruments that are sold outside of America as tools of tax evasion when they are bought by Americans. Some financial instruments you will be able to buy but you will have to report them every year when you file your taxes. And don’t fail to report them because that will draw a penalty.
Now I know that this last piece of advice seems to contradict my previous statement about foreign financial institutions turning away U.S. clients. Well I am no denying the former statement but I am telling you what things are like right now. We are currently in the transition period where Americans do still have assets in foreign bank accounts. The end game that the U.S. government is playing is one of capital controls by controlling the financial options that its citizens have. The Patriot Act has already forbidden U.S. citizens to hold financial assets in the U.S. if they do not have a U.S. address. The Foreign Account Tax Compliance Act (FATCA) is the sister legislation that will force expat U.S. citizens and their money back to the U.S. or else to drop their U.S. citizenship. Your choice.
As a U.S. citizen resident abroad you will be the citizen of the only Westernized country on the planet that subjects you to double taxation. Each year when you file your taxes you must submit a form that verifies to the IRS that you have indeed been a resident of a country other than the U.S., and this has to be done even if you are living in the country of your birth. Plus you have to answer if you were in the U.S. at anytime during the year. If you were in the U.S. then you must give the dates. The Soviet regime could not have made a better way to keep track of its non-resident citizens than the one that the U.S. has constructed under the guise of citizenship based taxation.
As an American living outside of the States you have very few freedoms. If you want to live anywhere else in the world that you like then you will have to drop your U.S. citizenship. Don’t be a sucker for the faux freedom that the U.S. is offering you.