Recently, there has been a trend of individuals renouncing their US citizenship due to various political and social issues. Over the last decade, more than 10,000 US citizens had formally renounced their citizenship, according to the US government’s data. This process has multiple implications, so any decision to do so should be made with a well-thought-out strategy.
Note! The Astons company does not encourage you to renounce your citizenship. This is a personal decision, and we are here to assist you in navigating this process smoothly.
What does renouncing citizenship mean?
Renouncing citizenship involves giving up one’s citizenship along with all associated legal rights, privileges, responsibilities, and governmental obligations. The process of renunciation includes the following steps:
- Appear in person before an American consular or diplomatic officer
- Sign an oath of renunciation
- Pay the required fee.
Note! Citizenship is officially terminated on the date of the renunciation ceremony.
Pros of renouncing US citizenship
Renunciation of citizenship offers several advantages, but it’s essential to follow the correct procedures to access these benefits.
Taxes
US citizens are subject to a unique system of citizenship-based taxation, meaning they must pay taxes to the USA no matter where they live in the world. This requirement persists even if they haven’t been in the United States for decades. For instance, if a child is born in this country and receives citizenship but does not live in the state, they are still obligated to pay taxes throughout their life. Renouncing American citizenship can help individuals avoid significant financial burdens, including double taxation.
Prospects of new citizenship
Some countries, such as Japan, Austria, and the Netherlands, do not permit their citizens to hold multiple passports. In these cases, renouncing US citizenship is often the only way to obtain a new citizenship and nationality.
Financial privacy
US citizens must comply with the Foreign Account Tax Compliance Act (FATCA), which requires them to report their foreign financial assets. However, after renouncing their US citizenship, individuals are no longer obligated to do so.
Cons of renouncing US citizenship
It is important to consider the disadvantages of renouncing American citizenship, which include a loss of the opportunity to live legally in the USA, closed access to the American market, etc.
Loss of the opportunity to live and work in the USA
Renouncing US citizenship means losing the legal right to live and work in the country. One significant advantage of US citizenship is the ability to access the world’s largest importer market and the second-largest exporter market without restrictions. For business people and those working in economic sectors, losing citizenship can pose a considerable disadvantage.
Loss of the opportunity to travel the world
The USA offers one of the most powerful passports globally, granting visa-free access to over 185 countries. Renouncing your US citizenship will eliminate this advantage, making it more challenging for you to travel easily around the world.
Irrevocable act with generational impact
In the US, renouncing citizenship is legally considered an irrevocable act, meaning it cannot be undone. This decision not only affects the individual but also has implications for future generations.
Fees and documents required to renounce US citizenship
To renounce US citizenship, you will need to provide the following documents:
- A passport or birth certificate as proof of citizenship
- A US consular report of birth abroad, if applicable
- Bio-pages of all active foreign passports
- Evidence of any name changes, such as marriage or divorce certificates, if applicable.
Note! The cost to renounce US citizenship is $ 2 350.
In addition to the documents, several government forms must be submitted:
- Form DS-4079 — for determination of a possible loss of citizenship
- Form DS-4080 — an oath and approval of US nationality renunciation
- Form DS-4081 — a statement of understanding concerning the consequences of renouncing US citizenship.
Note! All forms are available on the website of the US government.
How to renounce American citizenship
Renouncing US citizenship must be done abroad at a US embassy, and the entire process typically takes between 4 to 6 months. The key steps involved are as follows:
- Meeting the requirements: A US citizen must pay all taxes before beginning the renunciation process.
- Preparing the documents and attending the first interview: After selecting an embassy, you can schedule the first interview. At this initial stage, only copies of the required documents (without signatures) are needed.
- Attending the second interview: For this interview, you must provide the original documents. Following this interview, you can sign the necessary forms, take an oath, and pay the applicable fees.
- Obtaining a Certificate of Loss of Nationality (CLN): This final stage may take several months to complete.
Astons – Experts in Plan B strategies
In most cases, investors renounce their country’s citizenship upon obtaining another passport. For example, you can get a Maltese passport by buying a property with a minimum cost of €700,000. Such a passport will allow you to live in a country with a more affordable quality of life and enjoy the benefits of a strong passport. Maltese citizens can visa-free travel to 190 countries, including the UK and the US.
Astons offers confidential consultations with experienced professionals who can analyze your situation and understand your goals and requirements. We will provide you with tailored solutions for your Plan B strategy, including options for dual citizenship programs and golden visas.
Frequently Asked Questions
What happens if you renounce your citizenship?
Renouncing citizenship means giving up your citizenship along with all associated legal rights, privileges, responsibilities and governmental obligations.
How to renounce US citizenship?
Can you renounce US citizenship?
