Expatriation: Relinquish U.S. citizenship or turn in that Green Card

Relinquishment and the law

It is possible to “relinquish U.S. citizenship. This is governed by S. 349 of the INA (Immigration and Nationality Act). There are a number of instances in which someone is considered to have “relinquished” U.S. citizenship. A “relinquishing act” must have been performed “voluntarily” and with the “intention” of relinquishing U.S. citizenship.

Please note that “renouncing” U.S. citizenship is one way of relinquishing U.S. citizenship.

Renouncing U.S. citizenship is the most common way of relinquishing U.S. citizenship. This requires that you visit a U.S. Embassy or Consulate and renounce in the presence of a Consular officer. The experience varies from one part of the world to the next.

Your goal is to demonstrate that you are:

1. “voluntarily” renouncing U.S. citizenship;

2. with the “intention” of relinquishing U.S. citizenship;

3. with full understanding of the consequences.

The primary consequence of “relinquishing” is that you will no longer have the privileges and rights of U.S. citizenship.

Renouncing U.S. citizenship will NOT:

– erase any past tax obligations or obligations of military service.

Renouncing U.S. citizenship WILL

– mean (subject to the provisions of S. 877A of the Internal Revenue Code) that you will have no future obligations to the U.S.

The S. 877A tax consequences of relinquishing U.S. citizenship

Furthermore, certain people (depending on your net worth) will be required to pay an “Exit Tax”.

The “Reid Amendment” – A possible warning

Please note that as the result of a 1996 law (The Reid Amendment), the U.S. has the right to bar renunciants from entering the U.S. again. To date, this law has not been applied.

Renunciation of US citizenship should be a decision and not a reaction. There are pros and cons and you need to understand each. Each option will (in its own way) be both desirable and undesirable.

Green Card Holders

Please note that you are considered to be a resident of the United States for tax purposes until you “turn in” your Green card (filing the I-407 form). For how to do legally get rid of your “Green Card” see the following information from the State Department referenced in the following tweet:

Filing I-407 | Embassy of the United States: http://t.co/QZlcuyvMHN – How to turn in your "Green Card"

— US Taxation Abroad (@TaxationAbroad) February 27, 2014