As I’m sure you expect, I disagree with you, mostly because you blame it all on supporting what you call social welfare states. I do support a social welfare state: the Netherlands is a good example, and the Scandinavian countries are even better examples, of social welfare states that work. You predict they will eventually fail, and I have no guarantee that they won’t, but I disagree that supporting such a system is to blame for the government’s bad decisions, including FATCA. I would never, for example, have voted for Rand Paul. I agreed with him on FATCA, but not much else. The overseas Americans who do follow US politics have been very divided all along about who to support, and I can’t see that changing. They have, on the other hand, been able to raise money for lawsuits related to FATCA. I have more faith in that succeeding than in any political change.

“many of the overseas “Americans” are the “accidental Americans” I’ve written about, i.e. they were born in the US but moved as children to their home country.”

I was not taking about such people. I completely understand their plight. I was talking about the failed duty of all the Americans who live offshore and either do not vote or vote for a social welfare state. A social welfare state ALWAYS leads to increased control of the population and the increased need for revenue to feed ever-growing social welfare programs, which is why FATCA was enacted (to obtain a new revenue stream by exercising extra-territorial jurisdiction). Those people have no one to blame but themselves. The true victims are the accidental Americans that you mentioned and those who do vote for small government (like the Tea Party people) who must live with the results of the actions of others.

“I would agree with it when you’re talking about temporary expats, i.e. the ones who go live in another country for a few years for their job, but have every intention of going back and consider America their home.”

Those are exactly the people who are NOT impacted by FATCA, because they are returning to the U.S. Whether or not they vote is irrelevant. In fact, because about half of them will vote for the politicians who enacted FATCA you do NOT want them to vote.

“We don’t live there, so it’s not our government anymore, yet it’s legislating in a way that particularly victimizes us.”

It is victimizing you because there is no political price to pay, because you are not organized and do not vote. If just ten percent of the people actually impacted by FATCA donated just $10 per year to a single-issue political organization it would result in a $10 million political war chest. This could have resulted, for example, in Rand Paul as a nominee for President (who has offered legislation to repeal FATCA, as well as a lawsuit challenging it).

I guess that you are looking at the past while I am looking at the future. FATCA is just the tip of the iceberg. These types of abuses will continue while voters continue to vote for a social welfare state. The future of liberty is now in those nations that have already lived through socialism, felt its sting, and evolved into capitalistic Constitutional Republics. The other blessing is that the large welfare states will eventually collapse under the weight of their own unsustainable debt. It is unfortunate that these failed zombie states will impose untold misery until they collapse.

Interesting. To answer your question, many of the overseas “Americans” are the “accidental Americans” I’ve written about, i.e. they were born in the US but moved as children to their home country. Many don’t know, or didn’t know until recently, that they’re American citizens and are supposed to file tax forms in the US. Growing up as, for example, a Canadian, it would never have occurred to them to vote in the US. In addition, if you’ve never voted in the US, you’re not registered anywhere, and I’ve heard it’s a bit of a bureaucratic nightmare to get registered anywhere. Many of them don’t even have a social security number.

Another large group of overseas Americans have lived overseas for so long that they’ve integrated into their adopted country, become citizens often, etc. The longer you live in another country, the less you keep up with politics in the US enough to feel competent to vote. So saying “In a democracy people get the government they deserve” is, in this case again, blaming the victim. I would agree with it when you’re talking about temporary expats, i.e. the ones who go live in another country for a few years for their job, but have every intention of going back and consider America their home. But the rest of us are not in that category. We don’t live there, so it’s not our government anymore, yet it’s legislating in a way that particularly victimizes us.

Greetings Rachel:

Why would you not vote just because you live overseas? Upwards of 10 million expats live outside the U.S., which is enough to swing almost any Presidential election. No President Obama = no FATCA = not need to renounce U.S. citizenship. An old adage applies here: “In a democracy people get the government they deserve.”

I will be a PT so I will move every three months or so. My preference is Eastern Europe, which is slowly becoming more capitalistic and entrepreneurial than the U.S. (e.g., Romania, Bulgaria, Serbia, Bosnia, Macedonia, Lithuania, Latvia, Estonia, Georgia, Moldova, etc.) For example, Croatia and Malta have no property tax, which means that the government can never confiscate your property for the non-payment of tax. Here is a good introductory primer on opportunities in Eastern Europe:

http://nomadcapitalist.com/2016/06/01/best-countries-in-eastern-europe-business/

In addition, after the European Union implodes (as it must) even more opportunity will arise in Western Europe — both in terms of freedom and economic prosperity. Finally, we are not yet half way through the war cycle period (you may have noticed the increasing levels of unrest, financial instability, and violence). As a result, I will have my assets, modest as they may be, diversified throughout the world. As an introduction to the topic of historical cycles, you can read more about that here:

http://ggc-mauldin-images.s3.amazonaws.com/uploads/pdf/160619_TFTF.pdf

Best wishes.

Well, I agree with that last point, but not much of the rest of what you wrote. Yes, FATCA was passed by Democrats, and yes, it is unlikely to be changed. However, the people who are victimized by it for the most part do not vote, as they live overseas, and even of those who did vote, I would suspect that more or less half voted Democrat and half voted Republican. So saying we’re fleeing from our own voting behavior is classic “blame the victim.” I moved overseas to live in the Netherlands with my Dutch husband. This was long before FATCA was passed. So how is this all my fault? Given your political views, I’d be very curious to know where you’re planning to live once you leave the US.

“Supplementing the reporting regimes already in place was stated by Senator Max Baucus (D-MT) to be a means of acquiring more financial data and raising government revenue.[28] After committee deliberation, Sen. Max Baucus and Rep. Charles Rangel (D-NY) introduced the Foreign Account Tax Compliance Act of 2009 to Congress on October 27, 2009. It was later added to an appropriations bill as an amendment, sponsored by Sen. Harry Reid (D-NV), which also renamed the bill the HIRE Act.[29] The bill was signed into law by President Obama on March 18, 2010.”

https://en.wikipedia.org/wiki/Foreign_Account_Tax_Compliance_Act

I have no sympathy for those who vote for a social welfare state and who then flee from the results of their own voting behavior (leaving the rest of us to deal with the fallout).

I plan to leave the U.S. within the next two years, because it has become a socialist welfare state where neither property nor freedom is secure. When Republicans are in power they simply slow down the slow slide towards tyranny. They seldom repeal pernicious laws enacted by the Democrats, such as FATCA, so I see very little hope for the future.

I’ve heard a lot of Americans make comments like that lately, but leaving America means dealing with FATCA, FBAR, etc, so do your financial planning first, if you ever decide to leave!

Exactly. I haven’t read the IGA to see whether my pension would be double-taxed here in NL. Renouncing means I won’t have to figure that out. But I know that in some countries people have retired and then found out that their pension earned outside the US is considered UNearned income by the IRS, which means it doesn’t fall under the $100,000 or so exemption we get on earned income. The thing is, they’ve already paid taxes on it as it went into their pension account (in some countries) or they get taxed as they withdraw it as a pension, but at a low rate. Either way, it ends up double-taxed. Completely unfair, and for some pensioners, it’s disastrous.

While Tax Treaties alleviate double taxation, some forms of double taxation are guaranteed through tax treaty gaps. Outside of the FEIE on earned income, any tax the US has but not your country of residence, any higher US tax rate, or US tax by a different name flows through as double taxation. Compliance cost is also a tax related cost and this is definitely doubled up and substantially more expensive to wade through the overlay of the 74,000+ page US tax code on top of the tax code of your country of residence, as if you still live in the US (which penalizes “foreign” accounts and assets).

All for no services in exchange.

http://isaacbrocksociety.ca/fatca-and-australia/comment-page-20/#comment-6726208