PPRuNe Forums - View Single Post - Quality of life USA/EU (Easyjet/BA/Ryanair)
Old 28th May 2018, 10:17
  #38 (permalink)  
NEDude
 
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If you are a soon to be U.S. citizen, make your decision regarding where you want to live BEFORE you take the step to acquire U.S. citizenship. If you are unaware, the United States is one of only two countries in the world which practices "citizenship based taxation". That means you are legally obligated to file a U.S. tax return and pay U.S. taxes regardless of where in the world you live or make your money. There are some things which can limit your U.S. tax liability, such as the foreign earned income exclusion and tax treaties. But none of those cover unearned income such as investment dividends. Even if you ultimately owe no U.S. tax, you must still file a U.S. tax return and prove via the numerous rules and treaties that you owe no U.S. tax. You are also required to annually report all non-U.S. financial accounts to which you have access to the U.S. Treasury Department Financial Crimes Enforcement Network (The FBAR form). Failure to do so carries SIGNIFICANT penalties and THEY ARE enforced. This not only includes your personal accounts, but any corporate accounts to which you might have signatory access. Lastly FATCA (Foreign Accounts Tax Compliance Act) is a law that requires all non-U.S. financial institutions to report their dealings with 'U.S. Persons' to the IRS. Again, failure on the banks part to do so carries significant penalties for the bank which the United States does have the ability to enforce. The consequence of FATCA is that many banks around the world have placed limitations of services available to the so-called 'U.S. Persons', and some have completely shut off all dealings with people who have ties to the United States. Also be aware that these rules also apply to anyone who holds a U.S. Green Card, or who has held one in the past but failed to formally return it. Even if you retain your Spanish citizenship and are a dual citizen, you will still be obliged to comply with the above laws.

I am not trying to persuade you one way or another, but you need to be aware of the consequences of obtaining U.S. citizenship but then living some other place. Again, for you Green Card holders, the same rules apply to you unless you formally return your U.S. Green Card.
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