U.S. tax laws force Americans to choose between citizenship, divorce or jail

No man should have to leave the United States to seek freedom, but under our current tax regime that’s exactly what’s happening.
Last year nearly 1,800 Americans renounced their U.S. citizenship or handed over their green cards, Reuters reports.  They love the United States and consider themselves proud Americans, but complicated, uneven U.S. tax laws force many to renounce their citizenship to avoid being forced to divorce or go to jail for laws tax attorneys can’t even interpret.
That’s a record number since the Internal Revenue Service began publishing a list of those who renounced in 1998. It’s also almost eight times more than the number of citizens who renounced in 2008, and more than the total for 2007, 2008 and 2009 combined…
…The United States is one of the only countries to tax its citizens on income earned while they’re living abroad. And just as Americans stateside must file tax returns each April – this year, the deadline is Tuesday – an estimated 6.3 million U.S. citizens living abroad brace for what they describe as an even tougher process of reporting their income and foreign accounts to the IRS. For them, the deadline is June.
The National Taxpayer Advocate’s Office, part of the IRS, released a report in December that details the difficulties of filing taxes from overseas. It cites heavy paperwork, a lack of online filing options and a dearth of local and foreign-language resources.
For those wishing to legally escape the filing requirements, the only way is to formally renounce their U.S. citizenship. Last year, IRS records show that at least 1,788 people did, and that’s likely an underestimate. The IRS publishes in the Federal Register the names of those who give up their citizenship, and some who renounced say they haven’t seen their name on the list yet…
…But those of more modest means renounce, too. They say leaving America is about more than money; it’s about privacy and red tape.
On April 7, 2011, Peter Dunn raised his right hand before a U.S. consular officer in Toronto and swore that he understood the consequences of giving up his U.S. citizenship. Dunn, a dual U.S.-Canadian citizen who has lived outside the United States since 1986, says he renounced because he felt American citizenship had become more of a liability than a privilege.
As an American, Dunn had to file tax returns and report all of his bank accounts – even joint accounts and his Canadian retirement fund. If he didn’t, he would be breaking U.S. law and could face penalties of up to $100,000 or 50 percent of his undeclared accounts, whichever is larger. Dunn says he was tired of tracking IRS policy changes, and he had no intention of returning to the United States. Renouncing his citizenship, as he puts it, was “a no-brainer.”
“If it was just me then it would be one thing,” says Dunn, a part-time investor who worried that having to share information with the IRS would deter future business partners – and upset his wife, who is Canadian. “Disclosing joint accounts I hold with my wife and anyone I ever want to do business with – that’s just too much. My wife’s account is none of their business.”…
…Around the world, American women’s clubs – known for promoting American culture overseas through Fourth of July celebrations and Thanksgiving dinners – are growing empathetic toward those who renounce.
The American Women’s Club in Dusseldorf, for instance, now links to renunciation information on its Website. The Federation of American Women’s Clubs Overseas has opposed new IRS rules, in part because the rules were pushing members to give up their citizenship. “The candidates are not tax-evaders or un-patriots,” reads the organization’s last annual report.
In Europe, American women say they feel pressure to renounce even from their husbands.
“American women married to non-Americans are only just now finding out that they have to disclose years and years of income and accounts,” says Lucy Stensland Laederich, a leader of the women’s club who lives in Bordeaux, France.
Laederich has been acting as the group’s liaison with politicians and bureaucrats in Washington, D.C., and plans to attend a meeting to discuss expatriate tax issues with Maloney and Treasury Department officials on Tuesday.
“When they decide to come clean and report everything,” she says, “they have to go ask their husbands for all of their bank information, retirement funds, and investment accounts, everything.”
Some of their husbands, Laederich says, refuse to hand over information to the IRS. That leaves the women in difficult predicaments.
“Your options are to ignore the IRS and stick your head in the sand; take your name off of all the accounts and live in a completely cash economy; divorce; or renounce U.S. citizenship,” Laederich says. “We’ve seen all of these things happen.”
Originally blogged at the LNCC.

Americans give up on Obama, Romney's ability to fix the economy

• 38 percent of Americans say the economy will improve in the next 12 months; 19 percent expect it to get worse, 42 percent expect it to “stay the same.”

• 36 percent say President Obama’s policies “helped” the economy; 33 percent say they “hurt” it, 30 percent say his policies have not made much difference on the economy.

• 32 percent say that if Mitt Romney wins the presidential election, economic conditions will be “helped.”

• 24 percent say economic conditions will be hurt, 39 percent say his election will not make much difference.

• 31 percent say that if Mr. Obama wins re-election this year, economic conditions will be “helped.”

• 30 percent say economic conditions will be “hurt,” 37 percent say his re-election will not make much difference.

Source: An NBC News/Wall Street Journal survey of 1,000 U.S. adults conducted April 13 to 17, reported by The Washington Times' Jennifer Harper.

Keep in mind this is just a poll of adults, not likely voters, so it's essentially meaningless.  But it shows a larger skepticism of the ability of Republicans and Democrats to fix the economy.