Friday, February 3, 2012
Taxpayers Keep Leaving The United States
The number of expatriates continues to increase. The number for 2011 was 1,781 and represents more than a 15% increase from 2010.
Not all expatriates are wealthy and seeking to sidestep what they perceive as harsh and confiscatory government policies. The IRS itself estimates that up to seven million U.S. residents reside abroad. I have family overseas, for example, and they have no intention of returning. They must nonetheless file a U.S. tax return annually, file a FBAR and, assuming that they have not spent every nickel they ever earned, have to deal with FATCA reporting. Did you know that there are tax restrictions on a U.S. citizen marrying a non-U.S. spouse? Does that make sense to you?
The most recent assault by Treasury on non-U.S. financial institutions, such as UBS, has had the perverse effect of these institutions dropping U.S. clients – and certainly not accepting new ones. I am not condoning the uber-wealthy hiding their income and assets from the U.S., but it is a far reach to argue back that a U.K. bank should report electronically on the bank activity and balances of my family.
Here is a chart on the number of expatriates over recent years. Kudos to Andrew Mitchel for the graph. Draw your own conclusion, if a conclusion is there to be drawn.