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Ask Slashdot: Should I Let My Kids Become American Citizens?
An anonymous reader writes "Can you help me decide whether to allow my small daughter and son to become American citizens? I am American and my partner is Swedish. We have both lived in Belgium for many years and have no plans to leave. I became a Belgian citizen some years ago and kept my American citizenship. My partner has both her original Swedish and now Belgian citizenship. We are not married. Instead we have a registered partnership, which is common in northern Europe, confers most of the benefits of marriage, and raises no eyebrows. However, the American government does not recognize such partnerships, so in their eyes I am still single. Generally, children of American citizens abroad automatically become American citizens themselves at birth. But our kids fall under an exception. Male American citizens who live abroad and have children out of wedlock with a non-citizen mother do not automatically transmit citizenship to their children unless they sign an "affidavit of support" promising to support their children until the age of 18. If you don't sign before the child reaches 18, the child is not considered an American citizen. This has been upheld by two Supreme Court rulings (Nguyen v. INS and Flores-Villar v. United States). For legal beagles, the relevant statutes are 8 U.S.C. 1401 and 1409. (Read on below for the rest.)
The kids have Swedish and Belgian citizenship. We could go down to the American consulate and get American citizenship for them any time, but I keep putting off the decision and I am not sure I want to do it at all. Sentimentally I would like the kids to have American citizenship, but there is really only one practical pro to it: American citizenship would allow them to live, work, or study in America more easily, if they choose, when they get older. The cons:
- They would be immediately enmeshed in the U.S. tax bureaucracy, which would require them to file U.S. tax returns for life even if they never set foot in the U.S. This, as I know from experience, is a huge bother, even when you don't owe anything.
- Sometimes they would owe U.S. tax, though, for example for capital gains, unearned income, and in some countries self-employment income.
- My son would have to register for the draft.
- The decision, once made, is difficult to back out of: renouncing one's U.S. citizenship costs $2300 and a lot of paperwork.
- They can easily travel to the US for family visits as Belgian/Swedish citizens.
- There are lots of good universities in Europe. And if they really wanted to study in the U.S., it's not too hard to do as a European.
What do you think I should do? The clock is ticking, and I find it hard to choose between the evil of not being able to be American if they choose, and the evil of unjust, lifelong pursuit by the IRS. Here are two good relevant links.
Yes. They don't lose anything by becoming citizens (there are tax issues but they are pretty minor), and being a US citizen has a lot of advantages, like the support of US consulate services. They can then decide which passport to travel on depending on what is most convenient. And they can then donate to American political causes if they want. On the whole the benefits outweigh the costs, and if it really does become an issue they can renounce citizenship later. However, you and they should talk to a lawyer about this first to make sure there aren't any special issues that might come up in your particular case. When in doubt, always go with real legal help not random people on the internet.
Why is 'the clock ticking'? You didn't mention their ages, but say that you have to make the choice before they are 18. Can't they make their own choice, long before their 18th birthdays?
Silly question. People are paying good $$$ to ditch American citizenship (and worldwide taxation) by the droves and you're considering hobbling your kids to the Home of the IRS? FYI the US is one of only 2 countries that tax non-residents as if they were living in the USA... the other is fuckin' Ethiopia, so that gives an idea of why not to shit on your kids' heads with eagle poop.
The USA is going down the shitter fast. Don't burden and indoctrinate your children with American citizenship.
When they are adults, they can choose what they want to do.
I am Canadian.
It is a common occurrence for Canadian children with one American parent to be automatically given US citizenship. This is not a good thing. The IRS will expect you to file tax returns. They'll try to charge you money, and if you don't bother, it actually makes you LESS mobile, not more.
It's expensive to renounce too. This is a real problem up here, and bites a lot of people. As a Canadian, you can visit the USA mostly without issue (working there is another matter). If you have dual citizenship, there is MORE scrutiny and more complication and more cost.
It is never worth it, ever.
Virtually everyone I know who has dual citizenship has officially (and expensively) renounced it, and none have any regrets, and all are still free to visit the USA.
You clearly already know the answer.
You have a long list of cons and the only "pro" is that you feel sentimental about it. With Northern European citizenship they'll never really have trouble going to the US if that tickles their fancy and they won't have to deal with filing tax returns or the draft.
My cousin is an American citizen, but lives in Switzerland. Her daughters are also citizens, having registered at the consulate. Swiss banking laws and IRS stuff is coming back to bite them, as they girls are both over 18, and now are working on renouncing. They have American, EU and Swiss citizenship at the moment. I fully support their renouncing, even my cousin, as the US laws have made their lives hell.
I'm posting as AC because I want nothing to impede their decisions, or have anything come back to bite me. If I could claim EU citizenship from Germany, I'd do it in a heartbeat.
No. Never.
I'm an Australian who has lived in a few countries and currently live in the US on a visa. I'd like to get my greencard, BUT NEVER CITIZENSHIP. The tax headache alone is NOT WORTH IT.
If the IRS ever changes its laws on citizens, then maybe, but that is not currently the case.
You can tell how powerful someone is by the magnitude of the crime they can commit and be able to get away with.
It sounds like you've already made up your mind. I suspect that you can delay the decision until a year or so before the kids turn 18. Your son and daughter will no doubt have a few good ideas about what they'd like to do at that point and I'd seriously recommend allowing them to participate in the decision as near-adults.
Why is this here? How is any of this related to what Slashdot is supposed to be about? I'm usually pretty lax about what's posted on Slashdot, but this question should be posted on a forum somewhere else, not on a news site for "nerds".
It isn't doing you any good, and your kids will never have it.
Good for them.
I'm a good cook. I'm a fantastic eater. - Steven Brust
They also receive the gift of being obligated to pay US taxes. They will love you for that.
No brainer. Earmark $2,300 for them now, set it aside, and when they're legal age they can decide if they want to file the paperwork to renounce their citizenship. Then when they're older they have a choice that most people never get a chance to have, at least not so easily.
No US tax is not something simple. Here in Switzerland, a U.S. citizenship can be a real burden. I know personally at least 2 ex US citizen who gave up the citizenship just because they were tired of the complex situation they were facing.
>there are tax issues but they are pretty minor
You're kidding. Have you actually experienced them? The tax issues are mindboggling in their complexity because the US law is written for US institutions and concepts. Trying to work out how arrangements in any of 160 other countries with their own laws and institutions translate into American concepts is a minefield. Something that is simple in your country of residence becomes impossible in another. Accountants who are familar with both local and US tax law don't come cheap so many people spend thousands of dollars a year trying to get it right; all to pay zero tax because there is rarely any tax to be paid. But if you get it wrong the penalties are punitive, all because the US views citizens who have the temerity to live overseas as unpatriotic tax dodgers.
And the benefits? What exactly would those US consulate services be that are so valuable? I can't think of any.
While working in Canada I had a boss who was a US citizen, but he had been born in Canada to US married parents. He had the tax id for his parents to claim him as a dependent till 18. But he did not have a SSN number. He refused to work in the states because he didn't want to get a SSN number and thus have to pay taxes for the rest of his life, but he was still a US citizen.
I have no clue if that was legal or not. And I have no idea if this matches your circumstances, but it may be something you want to look into. See if they will be forced to pay taxes even if they don't have an SSN number just the tax id (which is different for children, or so I've been told).
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I would disagree that the tax issues are pretty minor. The U.S. says it can tax all your income forever. Because of CISPA it is becoming extremely difficult for U.S. citizens to have bank accounts outside of the U.S. and the value of a U.S. passport over an EU passport is dubious. The largest reason I can see for obtaining U.S. citizenship would be if you were planning on moving with them back to the U.S. or if they were likely to seek employment in the U.S. in the future.
Yes. They don't lose anything by becoming citizens (there are tax issues but they are pretty minor), and being a US citizen has a lot of advantages, like the support of US consulate services.
I'm a dual citizen (born American, obtained British citizenship while I lived there), and while my default position would be "you should grant them US citizenship as that opens up more options to them if they ever want to live in the US" (and despite the many issues, there are still good reasons to want to live here for many people), it should be said that the tax bullshit really is onerous, and renunciation would be expensive. It is like the US congress has built a financial Berlin wall around the country ... sure, you're free to leave, if you can pay up (and pay for expensive tax preparers who specialize in filing US taxes for expats, as the forms are by no means easy), but good luck ever getting out from under our thumb.
It's not an easy question to answer, and as someone else suggested, I would involve your 16 or 17-year old child in the decision beforehand, with good financial and legal advice on the implications pro and con. Weighing the option of living here vs. the never-ending IRS headaches of living abroad--that's a tough one.
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The first year or two in any given country is generally pretty difficult to figure out how US taxes work with them. Once that's done it doesn't become an issue after that. As for US consular services, one gets all the advantages one gets from having another country as backup when something is going wrong. Unrest in a country you are staying in and people need to be evacuated? The US has done that many times for its citizens in the past. It has helped other countries evacuate their citizens as well, but they generally have given priority to US citizens. Have legal trouble in another country? Having access to people from the embassy of the country with the big military helps. US citizens are in many places treated better as a result.
No taxes ever again!
It does, namely that the US is far more aggressive on taxing its rich people than Europeans; all you need to do in Europe to escape taxation is move out of the country. Europe has such a high level of equality because most of the rich people have played musical chairs with residency and citizenship.
I've lived and breathed the US tax system as an immigrant to the US. I know just how hideously complex the citizenship-based US tax system is. I (and my family) live in NZ and I'm not a US citizen but my wife is, and my NZ-born daughter automatically inherited US citizenship from her. I plan on keeping my daughters US citizenship hidden from the world for her own benefit. Her birth is not registered with the US govt and she travels on a NZ passport. She technically has all the US tax and reporting obligations from birth with no choice in matter (on her part or my part). At great expense she is required to report annually her income, assets, trusts, and company directorships to the US govt. The US govt imposes fines for failing to do so accurately and they are draconian. She is required to pay taxes to the US beyond what she owes to the NZ govt. Thanks to the new FATCA regime imposed upon the world, banks in NZ are tying to detect her US citizenship so her details and financial info can shared with the NZ IRD who will then pass it on to the US IRS.
All this is and she is barely 2 years old.
If you are CERTAIN she will be living in the US in the future then sign her up for citizenship. And leave it to the last minute so she can give her informed consent when she is most able to give it. But US citizenship is more of a burden than a blessing so she is generally better off without it.
If you fail to register for the draft, you are ineligible for any sort of educational federal financial aid (should you choose to take advantage of it), and you will have great difficulty ever obtaining federal employment in many different agencies (if that's something you'd like to do.)
Dual passports is usually a win.
Not only are there some countries that won't like one or the other of your kids citizenships (solution: travel there on the other passport), some countries will give you a really hard time if you try to go there, but have a stamp from another country they don't like.
In addition, if you have a stamp from some countries, other countries won't let you work there. For example, it used to be that if you had an Israeli stamp in your passport, you were barred from Egyptian archeology.
Note that your kids need to do this before they are 18; after 18, they can be required to renounce U.S. citizenship to obtain alternate citizenship, and vice versa; a lot of children of Irish immigrants to the U.S. have found this out the hard way, for example, when they decided after age 18 to claim their Irish heritage, and use that to take advantage of opportunities to study in Europe, rather than going to a U.S. university.
Finally, they can always renounce later, if they become Internet billionaires, like Eduardo Saverin, who the U.S. effectively paid $700M to renounce his citizenship, although there's a 15% "exit tax", so if they go this route, they should do it *before*, rather than *after* the IPO - he'd have been another ~$300M richer if he'd done that and left the country before the actual IPO.
They may not owe US taxes, but they will probably have to file paperwork every year declaring such. Failure to file the paperwork can result in large fines, which are a problem if they ever decide to travel to the US.
being a US citizen has a lot of advantages, like the support of US consulate services
And the disadvantages if they travel to hostile places, like being taken hostage and shot, just because you're American.
I'm a US citizen living abroad with a dual-citizen son. I can tell you that there are advantages and disadvantages. The benefits are that they can travel freely to the US and live and work in the US without having to obtain a green card. Also they can travel on either of their pasports largely depending on which country they travel to and they will qualify to receive assistance from any US consulate or embassy when overseas. They will be legally entitled to vote in any federal elections in the US when they turn 18, although if they have never actually lived in the US in practice they can't because no state will allow them to register to vote in that particular state.
The disadvantages are that when they start working they will always have to file a tax return in the US, regardless of where they actually live. For the most part they will receive an exemption for US taxes for any income they receive while working overseas with the exception of self-employment income, if they are legally self-employed then they will have to pay self-employment tax in the US in addition to any tax they pay overseas (some, but not all foreign countries have a self-employment double-tax agreement with the US, though which mitigates this). For me to avoid this tax I had to form a foreign corporation and work for that corporation so I'm not legally self-employed.
Another disadvantage is that they will be required to register for the US selective service when they turn 18 (the draft). There has not actually been a draft since the Vietnam war, though, so this is not likely to become an issue, but it is certainly something to consider.
As stated by the parent they can always renounce citizenship later and avoid the tax and selective service issues, but this is expensive (about $2500USD).
Also speaking of expense, having to file two tax returns means additional accountants fees and additional paperwork, especially if the country you live in has a different tax year than the US (which is very common). Having to maintain two passports is another extra cost as well, but not very expensive when you spread the fees out over the life of the passport.
All of the above said, I made an informed decision to register my own son as a US citizen and I do agree that the benefits outweigh the down sides, but it's certainly not a "nothing to loose" situation, there are downsides and it pays to make an informed decision with full knowledge of them.
Windows is a bonfire, Linux is the sun. Linux only looks smaller if you lack perspective.
For all the hate the US gets on Slashdot, it's still the country of record. It's hitting the big time. Top finance jobs are centered in the US. Top technology jobs are centered in the US. The movie and TV industries are largest in the US. 9 of the world's 10 best universities are in the US. Sure, such jobs are available in Nigeria, but the best most and the most talented tend to work in the US, and you're limiting your kid's future by not allowing it.
I know so, so, so many Chinese people (both PRC and Taiwan, Malaysia, etc.) killing themselves to get their kids in the US because it has the best school and the top jobs. Not to mention, my wife's parents, several of my best friend's parents, etc. NOT doing it, when it would be easy to fill out paperwork, just seems like irresponsible parenting.
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that a rational answer is "hell no, there's no reason to get your kids burdened with dealing with the US government and laws". But I wouldn't be surprised if Europeans said the same about the EU.
Actually, having moved between EU countries, I haven't found any disadvantages whatsoever in having a EU nationality. The tax situation that US citizens living outside the USA are caught in is frankly bizarre. As a EU citizen, you can live wherever you want, pay your taxes there, and your own country will leave you alone (slight complication in a year where you move from one country to another, but that is independent of your nationality).
Or ask your children - and then do the opposite. What do they know, anyway? ;^)
I became a US citizen in my teens and left when I was in my 20s. FACTA has made banking next to impossible. I'm legitimately thinking of ditching it at this point but I can't afford the fees (yes it costs money to renounce your citizenship). FACTA only screws over the low wage earning US citizens abroad, it does nothing but turn us into criminals while those it was meant to catch (rich tax evaders) are able to pay accountants and lawyers to navigate the laws both at home and abroad.
I've never filed taxes in the US, upon discovering that I had to submit a return I emailed the IRS and explained my situation. Their response was to threaten me with hundreds of thousands in fines for not complying AND not answering my question (which was "What exchange rate do I use when filing? Yearly average? Year end?'). Honestly, fuck the United States government.
Tax on their world income. Forever. Even if they never ever set foot in the US. Make them Canadian instead. Almost all of the benefits (Canadian passport gets you into almost anywhere without a visa, including the US) but Canadian tax law is sensible - you need to reside in Canada 183 days out of the year in order to be liable for tax.
Seven puppies were harmed during the making of this post.
A massive expense? When probably 99% of the people filing owe no taxes? If you have a regular salaried job, it takes approximately 30 minutes, as long as you're not a drooling moron, to fill in a 1040, a 2555, and an 1116 (Income statement, declaration of foreign income, and foreign income tax credit).
If you're in "the 99%" - and probability says you are - then you pay zero taxes to the American government each year, you simply have to spend 30-60 minutes filling out a form and mailing it. If you own a 40% stake in Facebook, yeah, you get hit with taxes. If you're working for even relatively good wages, chances are you won't owe a thing unless the foreign country you're in has REMARKABLY low tax rates - again, probability says that in Europe, you're not.
So yes, for the vast majority of people, the tax issues are very minor - a yearly hassle that doesn't even begin until after the kid gets a job paying more than ~9500 a year... and in return, you get all the benefits of an American citizenship. Which for all the poo-pooing being done here, let's be honest: nobody's lining up to illegally cross the border into Somalia because of all the great benefits they'll get there.
Lack of a Social Security Number in no way makes it legal for you not to file taxes. It only makes it so you are harder to track.
You're not required to file tax returns if you fall below a certain limit or otherwise don't owe taxes. Of course, if you don't file and do owe taxes, you get punished. (And if you don't file, you can still be audited, which is fun if it turns out the IRS owes you six years of refunds)
Exactly this. I'm a US citizen who worked for a few years in Canada. Don't listen to OP - the tax issues are monumentally major.
Most countries tax based on residency. You earned money in your country of citizenship, you pay taxes there. You earned money in another country, you work out the taxes over there. Your native country doesn't get involved. This is why Canadians working in the U.S. for part of the year have to be able to document the number of days they stayed there. If they're in the U.S. for more than 183 days, they're considered a U.S. resident and don't owe Canadian taxes.
The U.S. taxes based on residency and citizenship. You earn money anywhere in the world, the IRS expects you to pay U.S. taxes on it if you're a citizen. If your kids become U.S. citizens, ignore the U.S. tax filing obligations for 20 years because they're living in Sweden or wherever, then when they're in their 30s and married and have kids they decide to visit the U.S., the moment they try to step foot into the U.S. the IRS will nail them for back taxes on everything they earned for the last 20 years. (Ok, there's probably a statute of limitations, but you get the idea.)
A lot of Americans living abroad work their butt off trying to renounce their U.S. citizenship just so they don't have to deal with this tax hassle. Do not subject your kids to it unless they intend to live in the U.S. (Some U.S. states do the same thing. California is notorious for it. If you were living in California prior to taking a job in the U.K., California still considers you a "resident" since you didn't move to another U.S. state, and expects you to pay California taxes on everything you earned in the U.K. Even California kids who go to college out of state and don't formally establish their residency in that state have gotten nailed for it when they work a part-time job while at school.)
The U.S. has tax treaties with most developed nations, where taxes paid in those countries on earned income (i.e. wages) can be applied as credit to taxes the IRS says you owe. Since most countries have a higher tax rate than the U.S. Federal taxes (U.S. Federal + State ends up being about the same), this usually means you won't owe the IRS any taxes on earned income. But they still expect you to file a tax return every year. And if you've got unearned income (e.g. interest on a savings account, stocks), you're probably gonna end up double-taxed on that (in both your country of residence, and by the U.S.).
Unless your kids are going to live in the U.S., don't do it.
If your children are small and the deadline to sign the affidavit of support isn't until they're 18, as you said, wouldn't it make the most sense to simply put off the decision until:
A) They're nearing the age of 18, can weigh the pros and cons themselves, and can indicate their desire to you
B) There's an unanticipated but immediate use for it (e.g. war or natural disaster strikes Europe)
C) The situation changes such that the decision becomes clearer one way or the other (e.g. tax burden lessens, becomes harder for foreigners to work in America, etc.)
More or less, I don't see the urgency in making this decision now, rather than in a decade, and this sounds like the sort of decision that could very easily make itself for you if you simply give it enough time.
Bull. The US tax laws change all of the time. In the last couple of years, they have become even more complex with more forms. The IRS is legally obligated to know everything about what you own, what accounts you have, everything. The US has lost many citizens in the last couple of years just for this reason.
Taxes are lower in the US though. And I guess it may not be the general opinion in the US but they are at least spent on:
1) Upholding the law & society.
2) Upholding the border.
and hence:
3) Guarantee the society of their citizens.
You seriously need to take off those rose-tinted glasses.
Or maybe just read a US news website once in a while. The US is a country where a) justice is applied very unequally, depending on your race (ref: the recent analysis of Ferguson, Missouri); b) where there are all sorts of political battles raging right now over the number of illegal immigrants living in the US (estimated in 2008 as 12 million people; more than the entire population of Sweden! The basis is often about how the President isn't doing enough to "protect the border"), and has the highest murder rate of any of the western, industrialized nations (by quite a bit -- you're nearly 7 times more likely to be murdered in the US than in Sweden, for example).
There are a lot of things to laud the United States over -- but the ones you specifically picked aren't them. Unless you were going for sarcasm, in which case "whoosh!" to me.
Yaz
US citizens residing in foreign countries are still required to pay US Federal Income Tax while abroad, even if they never return. I guess you're paying for the protections the local embassies could theoretically give you, if you don't expatriate and renounce your citizenship in accordance with 8 USC 1481(a)(6).
-=/\- Jizzbug -/\=-
Some quick links I found covering the issue.
Americans Living Abroad Becoming Trapped by Citizenship Based Tax Rules
Mayor Of London Boris Johnson Announces He'll Renounce U.S. Citizenship
When American Expats Donâ(TM)t Want Their Kids to Have U.S. Citizenship
Meet the 'accidental American' with a big tax bill
PwC suggests a check to see if you're an 'accidental American'
âAccidentalâ(TM) Americans Still Owe Income Tax
Statute of Limitations is 10 years IF YOU FILE.
If you don't file: there is no limitation. They can collect for all earnings over the course of your entire life.
Citizens have a different limitation than the IRS. The IRS' limitation never expires if you don't file, but your limitation to collect from the IRS, should they owe you, expires in 3 years if you don't file. There is a potential loophole to this in the Codes, but the IRS privately interprets that loophole to apply to amended returns only (I tried using the loophole). As a kid I was dumb and ignorant, and I considered about 5 years of returns as a savings account I'd collect on later. Well, I lost all of those returns because of the 3-year limitation for citizens to collect from the IRS. And I'd have to sue the IRS in federal court and win to get them to honor the loophole exemption on all returns, not just amended returns.
-=/\- Jizzbug -/\=-
no, I agree with jeremiah.
we have failed. we are a failure. some may not see it, but we will implode sooner or later and then, all hell will break loose.
there is NO plan for sustainability, here. we keep spending on wars and hostility and yet we let 'home repairs' go undone. for decades, now, we have done this.
we are the country of 'dumbing down'; we have the worst healthcare system in the world; we let people go homeless if they lose their jobs and can't find a new one quickly enough; we have crime rates that are astronomical; we have half of the country thinking the world is a few thousand years old and that half also denies science whenver possible.
we are no shining example of what a good country is, anymore. our politics are a mess, our spies are ruining WORLD WIDE security for everyone and we are the main cause of this kind of escalation.
don't even get me started on the work environment here. very little maternity leave, no paternity leave, a recent push for no sick time or vacation time (they lump it all together) and we also have the shortest amount of vacation time compared to all the modern countries. our corporations work the workers to death and then dispose of them, IF you can even GET a job in the US (h1b, yes! born here, sorry.)
there are many good things about the US, don't get me wrong. but if you are not already 'stuck' here, I would certainly NOT entertain coming here, moving here, doing business here and certainly not becoming a citizen here!
(of course, I expect to be added to some watchlist given my comments here. and that's yet another reason to avoid the US. you can't trust the US anymore. we don't even follow our own laws uniformly. if you are rich, you have all you want; if you are not rich, then a 2nd set of laws will apply to you).
don't. just don't. we used to be great. maybe we will again in the future, but right now, its a disaster here.
--
"It is now safe to switch off your computer."
I'm a US citizen living abroad with a dual-citizen son. I can tell you that there are advantages and disadvantages. The benefits are that they can travel freely to the US and live and work in the US without having to obtain a green card. Also they can travel on either of their pasports largely depending on which country they travel to and they will qualify to receive assistance from any US consulate or embassy when overseas. They will be legally entitled to vote in any federal elections in the US when they turn 18, although if they have never actually lived in the US in practice they can't because no state will allow them to register to vote in that particular state.
The disadvantages are that when they start working they will always have to file a tax return in the US, regardless of where they actually live. For the most part they will receive an exemption for US taxes for any income they receive while working overseas with the exception of self-employment income, if they are legally self-employed then they will have to pay self-employment tax in the US in addition to any tax they pay overseas (some, but not all foreign countries have a self-employment double-tax agreement with the US, though which mitigates this). For me to avoid this tax I had to form a foreign corporation and work for that corporation so I'm not legally self-employed.
Another disadvantage is that they will be required to register for the US selective service when they turn 18 (the draft). There has not actually been a draft since the Vietnam war, though, so this is not likely to become an issue, but it is certainly something to consider.
As stated by the parent they can always renounce citizenship later and avoid the tax and selective service issues, but this is expensive (about $2500USD).
Also speaking of expense, having to file two tax returns means additional accountants fees and additional paperwork, especially if the country you live in has a different tax year than the US (which is very common). Having to maintain two passports is another extra cost as well, but not very expensive when you spread the fees out over the life of the passport.
All of the above said, I made an informed decision to register my own son as a US citizen and I do agree that the benefits outweigh the down sides, but it's certainly not a "nothing to loose" situation, there are downsides and it pays to make an informed decision with full knowledge of them.
My wife is dual Peruvian/US citizen, and has passports from each country. Because traveling as a Peruvian generally means getting a visa beforehand her Peruvian passport remains unused. When we went to the college one of the first things that she did after getting her legal residency was to establish her legal residency in the town where we lived so that she could pay local tuition rather than the much higher out-of-town tuition or the obscenely expensive foreign student tuition. Working here in the US is also a royal pain, should your kids ever wish/need to do so, for a non-citizen.
BTW, I lived in Peru for three years, never filed to pay taxes during that time, and when I moved back to the US just filed them as "late" and paid a very minor fine. This was two decades ago though, so that might have changed.
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
I find it quite hilarious that non-citizens are supposedly among the first people who'll be drafted to fight for this country. WTF
This is completely false. There's a massive deduction for income earned overseas, so that you don't have to pay US taxes at all unless you make over a certain very large amount. I live overseas and make six figures (USD), and my taxes every year amount to entering the amount I earned, skipping to the overseas deduction, and entering the amount I earned again. I don't pay a dime of taxes in the USA. If you are doing that, you are doing it wrong. If your accountant is telling you that it's a lot of work, fire them and get an honest accountant.
It's more than just tax paperwork. There are asset declaration forms to send to Treasury Dept. Failure to file these can result in prison sentences.
The situation is MUCH more complex than just having to do a 1040 like everyone else in the US. Furthermore, there are regulations the US gov. is enacting which affect how international wire transfers are handled by banks, which is forced upon any bank that has a branch in the US. These regs. can cause you to automatically loose "witholding" taxes on transfered amounts, and then have to go through an ordeal to get the money back if it isn't justified by your overall tax picture.
Finally, the US .gov will happily pass new laws that create new reporting obligations that they will do very little to warn people about. Ie., don't expect a highway billboard to warn you of new reporting obligations. So unless you are proactive about determining whether the legal landscape has changed, you may find yourself out of compliance with some new rules that almost no one knows about, where failure to comply entails possible prison sentences.
They are not nice people creating these rules. Conduct yourself under the US global empire accordingly, if you wish to stay out of trouble!
Note that some of these rules get sold to the public by capitalizing on the resentment toward the "1%." But then what actually happens is that it's the normal people who are most at risk of getting penalized since we don't have tax attorneys constantly monitoring the legal landscape, unlike rich people. So once again, if you cheer on the .gov when it claims it's going to "help" you by giving the shaft to "the rich," unless you are an IDIOT you should know damn well that if you go along with it you are being played for a fool, just as it's always been.
You're trapped in a slow motion death spiral of a two party system slowly eroding your constitution. Maybe not failed yet, but most people have noticed the decline.
Personally, I don't see that any of these things as compelling practical advantages, given that the kids already have dual Swedish and Belgian (and therefore EU) citizenship. If they were Moldovan and South Sudanese, that'd be a different story. Or if they were citizens of a country from which getting a visa to enter the US might be difficult in the future.
But most importantly I think this is one of those decisions that you just don't make primarily on a cost-benefit basis. It's not like deciding to join Costco or subscribe to Hulu. Citizenship entails responsibilities. If you want your kids to shoulder those responsibilities and feel allegiance to the US then it makes sense to get them that citizenship come hell or high water. But given that they already have two perfectly good citizenships from two advanced western democracies with generally positive international relations worldwide, I don't see much practical advantage in adding a third.
Still, I wouldn't presume to give advice, other than this. The poster needs to examine, very carefully, that feeling he has that maybe his kids should be Americans. The way he expresses it, "sentimental reasons", makes those feelings seem pretty trivial, in which case it hardly matters if they don't become Americans. After all, most other Belgians seem to get along perfectly well without being Americans too. But if this is at all something he suspects he might seriously regret not doing, or if it nags him in ways he can't quite put his finger on, he needs to get to the bottom of that in a way random people on the Internet can't help him with.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
Think about your assumptions!
Someone who is elderly or ill may find what seems to you like just moderately time consuming infrequent burden, to be instead an insurmountable, overwhelmingly complex ordeal.
Wealthy Chinese are paying big $$$ to birth their children in America, but I'm not sure if the reason is they want them to be US Citizens per se; or if the Chinese Govt has undertaken a long term initiative to eventually be able to influence US elections from the inside.
Did you ever wake up in the morning, with a Zombie Woof behind your eyes? -- FZ
I'd estimate the paperwork (including searching to ensure you are not ignoring legal obligations as a US citizen, occasional accountant/lawyer visits, etc.) to be on order of 20 hours a year. Less many years, some years you could spend 100 hours trying to make certain you are not breaking US law when you buy a house, are self-employed, etc.
Over 80 years, that's 1,600 hours. If you value your leisure time at $50/hours, than consider it to be about $80K worth of hassle to be a U.S. citizen. Add in $20K in lawyer/accountant fees over the years, and you could be looking at a total lifetime cost of about $100K.
Is it worth it? Well, if you're child chooses to work there, then it's easily worth it. But otherwise, probably not.
So, what you really want to decide (and only you can do so), is "Is the life-time option of working in the US worth $100K?"
What do you mean "Let them"? -- This is a choice that will affect *them* primarily for the duration of their adult lives. Military draft, taxation, future residency plans, or plans for college/post-secondary -- adult things.
My suggestion is that your role here is to compile a list of facts, pros, and cons to US citizenship, and prepare to have a frank and earnest conversation with your kids about it when they become 16 or so, and tell them that you'll help them begin the process when they're 17 if they choose to go through with it. Your role here is facilitator, not dictator.
It wasn't necessary for your kids to have SSNs for you to be able claim them as dependents until ca. 1986. Maybe the poster's boss was raised before then?
Even though I moved around a lot as a kid, and didn't live in Louisiana until 1985, I have a Louisiana SSN because that's when my parents had to get me one.
It doesn't hurt to be nice.
You should be asking your S.O. and your attorney.
"Well, honey, I asked a bunch of random strangers on the internet if we should let our kids be US citizens and they said..."
General Relativity: Space-time tells matter where to go; Matter tells space-time what shape to be.
it's about possible future chances for their kid to riches, fame and education. Chinese really love to plan ahead. A foreign passport will make education abroad much easier and help with job prospects, even back in China. Not to mention you avoid the hassle that traveling on a Chinese passport gives you - like having to apply for a Visa for pretty much anywhere - i.e. forget ad-hoc trips.
Also the entry barriers for this 1st class Western citizenship are rather low. Just give birth. In other countries you have to have lived there for X years and hold on to legal work - now that is much more difficult for the average "I only speak Chinese and I don't want to work as cook" Chinese upper middle class person.
Bullshit. I probably have the most complicated tax situation (being a citizen of one country, living in another, filing taxes in a third one and having significant US income without SSN) and US taxes were not a problem at all apart from understanding the tax forms. And regular expats won't even have to pay anything unless you earn more than about $200k and live in a tax-haven country like Singapore.
It's not even just taxes. The US is so weird about all sorts of things that can bite you. When I got engaged in Iceland, Iceland wanted a certificate from the US proving that I'm not already married - it's a standard requirement here, and most countries have such a certificate. But not the US! In the US you can get a certificate proving that you are married from the state you got married in, but not a certificate proving that you're not married. The only way around it is to find the one sherrif's office in the country who considers a signed affadavit to be sufficient to wed (all of the others disagree).
I would never dream of cursing my kids with US citizenship. How mean could you be to them? I can't bloody wait to get my Icelandic citizenship so that I can formally renounce my US citizenship.
You know when it's okay to shout fire in a crowded theatre? When it's on fire.
My first year in Iceland, my US return was so complex that most tax attorneys refused to touch it. One offered to do it for over $1000. I ended up doing it myself. Three years later I'm still dealing with the IRS on it. It was as thick as a book.
My subsequent returns have been simpler but are still really annoying.
Seriously, don't do this to your kids. Just don't.
You know when it's okay to shout fire in a crowded theatre? When it's on fire.
It's worse than that.
In practice, you can't invest in foreign mutual funds.
Foreign institutions are required by US authorities to withold 30% of all gains if the client is an american citizen.
That's a major PITA for them, so what they do instead is just deny american citizens from opening an account.
-- Another senseless waste of fine bytes.
All right Mr. Pedant, yes, if you qualified to not have to file in the US, then you're probably OK not to file as a non-resident. However, if you're an adult non-resident with any significant source of income, you do have to file, even if that income is below the non-resident exemption (approx $90,000 USD) where you won't owe any income tax. But do note that the US is virtually alone in taxing non-resident citizens.
If you don't make substantially more than $90,000 and only have an income from a job (i.e., not self-employed, own a business, or have substantial investment income), it's not a huge deal beyond having to file a second tax return. Otherwise, it can mean major tax headaches. A friend of mine up here who's also a non-resident US citizen folded his one-man business and took a regular job because the tax benefits to owning an incorporated business in Canada were nullified after the IRS claimed their share (and then some).
The point being, yes, there can be serious tax consequences to having US citizenship if you don't earn your living in the US. I don't foresee renouncing my US citizenship anytime soon, but for a foreign national considering whether to pursue US citizenship, I would advise them to think twice about doing so without a compelling reason.
Momentarily, the need for the construction of new light will no longer exist.
and I'll argue your 'jobs' point right back at you, against you.
there is NO retirement here. none. you will work until you physically die. or even longer ;)
there is no social safety net. not really. get sick or lose your job and you're homeless.
as you get older, jobs are harder to find. its not that way in other countries, at least in non-3rd world countries, but we go nuts about youth, but really hate our old folks. even middle age gets you rejected from many (most?) of the so-called hot jobs and hot companies.
you will have the least amount of time off, the most pressure to work, work, work! when you need to take a rest, they will fire you and hire a new fresh person. ie, they use and wear-out their workers, here.
jobs looked great to me up until I entered mid 30's and then things really changed. this is what happens when a culture favors youth to an extreme, like we do, here.
yes, there are a lot of top name companies here and many of their HQ's are here. but that does not mean that a job working for that same big-name co is not just as good (or better) overseas.
please don't give people the impression that work-life here is so great. its not. we kill our own people by overworking them and paying just enough to keep them there, but rarely do we employ people long-term anymore (at least in the bay area).
a steady job with workers rights overseas would be far preferable to the rat-race jobs in the US.
--
"It is now safe to switch off your computer."
I am an American citizen. I have had seven children; my children have five mothers. Two in America, one in Thailand (died), four Thais still alive.
I prefer my children to be Thai. Indeed, if it were possible, I would give up my American citizenship and become a Thai citizen myself.
IANAL, but ...
You make the normal mistake that any kid of yours is an American citizen at birth.
I disagree.
AFAIK only YOU can get your kid an American passport.
Uncle Sam, in all his egocentric power, cannot force him to be a US citizen.
The USA passes laws that regulate the behavior of U.S. citizens even when they live overseas.
For example, sex with a girl under 18 is a federal felony.
What the hell will that mean when my son is 14 years old and discovers 15 year old girls?
My bank refuses to open accounts for US citizens because of IRS regulations,
how is that going to affect my offspring?
After our divorce, my ex-wife asked me to get our son a US passport, so I did. He's in Australia right now.
As a practical matter, a boy is not a US citizen unless the US government knows about him. If a boy is eligible for dual citizenship, I have heard that he must decide on one or the other before he's 18. My son is now 7; I figure he's got another 10 years to go before he has to make his own choice. Then it's up to him. Until then, let Uncle Sam ignore my son.
Andy Canfield (www.andycanfield.com)
move to sweden. Have fun with that 75% tax.
This. Exactly This.
Stay in Europe, and you won't be paying US taxes effectively, due to the foreign tax credits. Yes, you'll have to file a tax return every year, but that's not extremely difficult, especially if you don't have to pay any taxes. Taxes are significantly higher in most of Europe.
I faced a more or less similar choice a few years ago. Me and the misses were in the U.S. on a non-immigrant visa, and my wife was about to deliver. We could have chosen to deliver outside of the U.S. and avoid U.S. citizenship for my daughter. We chose to give birth in the U.S. so out little peanut would have dual (actually triple) citizenship. She will always be free to work in both the E.U. as well as the U.S. without any immigrant processing. She can choose to attend U.S. college, or European.
We reckoned that the simple fact that she would have to file a tax return every year would be an acceptable cost of all the benefits.
I'm not a complete idiot... Some parts are missing.
If you want socialism, maybe you should move to sweden. Have fun with that 75% tax.
And yet Swedes have a higher quality of life than Americans.
There is more to life than just money money money.
but don't deny your kids a chance at something millions of people would die for.
Millions of third world peasants maybe, but those of us in the developed world couldn't give a shit about American Citizenship. You couldn't pay me to have it, and my anecdotal evidence tells me a lot of other people I've met agree.
Stay in Europe where the word progressive still has some meaning. (Note for haters, I'm neither European or American)
As a fierce American patriot, I have to recognize that what originally made America so special was the core liberal values that are now much more universal, esocially in Europe. (PS - I do not mean the "Liberal" caricature that is standard fodder on American media today, but basic liberal values as defined universally: universal suffrage; free press; no state religion; representative democracy with regular election cycles; military subservience to civilian, elected control; respect for private property rights; and full legal equality for all citizens.) More so, given the seemingly mad rush to insanity encompassing us here today, I would encourage you to give very, very serious consideration to staying more "European". Sadly, we are becoming much more "Idiocracy" than we should, and I see no real benefit to becoming American. Unless, that is, your religion is the Gun, and you are willing to make regular sacrifices of your children and fellow citizens to appease this American God(TM) In that case, sign them up and arm them well and train them well in how to pray to their new God. (PS - I own 3 firearms: a Ruger 10/22; a 1911 ACP clone; and a Ruger .357 magnum. I like my guns a lot, but I do not love and worship them. If the local police - and I live in a rural Georgia county, so that ain't likely - for whatever reason asked me to register and/or test fire my weapons for them to help with solving a crime, I would have no problem with that. But, that's the difference between liking something and worshiping/sacrificing citizens to something.)
Cheers!
I don't necessarily disagree with your main premise, but our medical system is head and shoulders above almost everyone else. Yes its financial burden may not be equitable, but in extreme situations no one really holds a candle. Is it best for the largest area of the bell curve? Maybe not. But an enormous amount of energy goes into servicing the tails; that isn't necessarily a bad thing.
Or don't get US citizenship, and solve the complexity issue for $0 / year.
In a lot of other countries (most of them with a better median quality of life than the US) your "liberals" would be considered at best centrist, and in most cases right wing.
Head and shouldes above the rest? Yes, if you like to go bankrupt on the simplest procedure.
The USA spends more on health care than most other countries, and gets less "health" in return.
Heck, even the French pay less per person than the US, and gets better results. Don't believe me? Fine, read it and weep.
Also totally relevant: Breaking Bad could not happen in Europe. Wrap your mind around this one.
The right to offend is far more important than the right not to be offended. (Rowan Atkinson)
It's 56%, which includes great healthcare and lots of other benefits. If you compare what Swedes get for their taxes compared to Americans, you'd see that 56% is actually a pretty sweet deal.
Well, if they are almost 18, why don't you just let them decide for themselves? Explain the pros and cons, they should be old enough to understand. If you think they lack the maturity to make the decision, then they'll probably be better off without the complexity of filing American tax reports for the rest of their lives. Basically, don't do it unless they understand the consequences and want you to.
The US is doing quite well compared to Europe; Europe is imploding.
It really isn't.
Wanna buy a shirt?
https://www.redbubble.com/people/stealthfinger/shop?asc=u
I missed applying for a German ID at the age of 16 which would've automatically made me a German citizen. I could've kept my amercian citizenship. I had to renunciate it when I wanted to become a German as a grown up. It's a bit of a shame I couldn't get my lazy teenage ass to go to the citizens bureau for 20 minutes to pick up my ID a few years earlyer. If I still were american, I'd have zero hassles entering the US whenever I want to.
I am glad to be German, Germany has quite a few upsides, especially these days. But it would be cooler to have both citizenships. No suprise here.
If you can get U.S. citizenship for your kids without needing to renunciate their other citizenship(s), by all means do it.
On the other hand, ditching a perfectly neat european citizenship for a U.S. citizenship is something I probalby wouldn't do.
Quite a few countries public don't allow for multiple citizenships, but in pratice they let them slip (who's going to find out anyway?). If you can sneak into a dual-citizenship for your children without to much of a legal risk, do it. Just tell them when they're grown up, and tell them not to advertise it at every occasion, especially not at US customs(!!!).
Ask other swedish/belian people in simular situations and try to find out how belgium/sweden handles dual citizenships and if there are any serious legal pitfalls.
Good luck.
We suffer more in our imagination than in reality. - Seneca
You have already identified the cost of ending American citizenship - $2300 and "a lot of paperwork". If the possible benefits outweigh the current cost to you (filing tax returns now and a future expense of $2300 and paperwork to renounce if you/they choose to do so) then go ahead and make/let them become citizens. If the possible benefits don't outweigh those costs, then don't do it.
If you do it, you can change your mind later. If you don't do it, you can't change your mind later. My personal choice would be to do it, bearing in mind the future expense of $2300 and paperwork per child. It keeps your options open for what seems to be a fairly low cost compared to the potential benefit.
There certainly wouldn't be any shame in renouncing citizenship in the future on the part of your kids, given that they hadn't had any choice in becoming citizens now. If they decide, upon reaching the age of majority, that they would rather not have that tie they can dissolve it for the cost you already mentioned (probably plus a little inflation). If you really want to cover them, invest $2300 per child in a fund now that will pay for their dissolution of American citizenship later. At their majority, hand the fund (with its accumulated earnings) over to them and let them make their decision. You will have protected the future option for them but preserved their ability to decide at no cost to them.
At first I want to note something, I'm not part of the doom&gloom brigade and this is a personal decision about the personal identity.
If you ever can have dual citizenship, take it! Especially an european and an american!
Both are geographically seperated, offers different ways of life but also share a similiar culture. If everything "blows up" (war, economic crisises, legal troubles, surveillance) your children have the choice move to a other country immediately. If everythings "becomes nice" (peace, stable economy, environment protection, political union) you can live in a general social-system in europa or a more liberal economic-system.
Your childs will have twice the full rights, but remember also, the full duties of both.
But are tax forms such a burden, to dismiss the american citizenship? Ask your kids, before they become 18!
Also, there's FBAR - foreign bank account report. A US person must report any and all of their foreign accounts, even if they don't owe any taxes. Should you happen to forget that, the fine can be as high as the maximum value of each account - for every year that you forgot to file.
You're lucky! Where I live, banks have realized that they can avoid the whole FATCA rigmarole by not accepting US persons as customers. You want a securities account? Great. Oh, you're a US person? Sorry.
This US person "disease" also spreads via power of attorney. You're not a US person, but your spouse is and you gave him or her power of attorney over your accounts? Well, you better revoke that or have your accounts cancelled.
If you want socialism, maybe you should move to sweden. Have fun with that 75% tax.
Yes, it's not like you get a decent education or healthcare or welfare system for your money, the government just blows it all on ludicrously expensive foreign wars.
Oh, wait...
To have a right to do a thing is not at all the same as to be right in doing it
You've kind of skipped the entire nightmare of FATCA which, unless you're quite poor, is a total fucking nightmare.
http://en.wikipedia.org/wiki/F...
If you're not aware of this already and are obligated to but haven't been filing...try not to have a heart attack.
blindly antisocialist = antisocial
Exactly; when what you get back is so much more valuable, it is worth it. Still, as an American, it is easy to get cynical about taxes when they've been redirected to burden the poor and working classes the most, let the rich off scott free, buy very little medical care, roads that are usually in disrepair, bridges that are falling into rivers in rush hour traffic, law enforcement that's losing its war with its own conscience, a bloated and demonstrably less-than-effective military, etc etc etc. We've grown accustomed to getting much less than we pay for.
"The only way around it is to find the one sherrif's office in the country who considers a signed affadavit to be sufficient to wed (all of the others disagree)."
That sounds more like an Icelandic problem than anything. If Iceland doesn't accept another country's designated paperwork then how is that a US problem?
It's a bit like going to a country that doesn't allow gay marriage, trying to arrange a gay marriage, having it refused, and then blaming your home country rather than the country that refused it. The US has a procedure for getting the necessary documentation to act as proof of being free to marry and that's to gain that affidavit which you can do at the embassy, or via a US lawyer, it's not preventing you getting married, Iceland's bureaucrats are.
The US can't control what other countries do and don't accept, and nor should it. Similarly the US shouldn't have to change it's legal framework because one of the smallest and most unimportant countries in the world is being difficult to someone about something - especially when most other countries have no problem with the US affidavit.
The USA charges its citizens for evacuation, unlike all other countries in the world who also evacuate their citizens from trouble zones ..... for free.
These costs have bankrupted people in the past, leaving them wishing they had not been "rescued".
US citizens are becoming systematically toxic and are treated like shit as a result, especially by the financial system. FATCA is a completely insane law and has resulted in banks around the world terminating accounts and refusing to make loans just because someone is a US citizen or has a green card. And unfortunately what many don't realise is you cannot get out of US citizenship just by paying a few thousand dollars as the summary suggests. There is a crippling exit tax that forces you to pay tax on the assumption you just sold all your assets. It's a form of capital control, except one you cannot escape from due to the long arm of the US government. Even better, USA can decide that the citizenship revocation is invalid if they think it was done for tax reasons. They can just keep forcing you to pay taxes forever, if they want to. It's basically modern slavery.
My advice to the story submitter - don't do it!!. US citizenship is already dramatically worse than citizenships in other civilised countries and it's getting worse every year. In fact it's akin to a form of slavery. US citizens abroad have no functioning representation in Congress and they are routinely exploited as a result, citizenship based taxation being only one example.
Swedish and Belgian citizenship together is a perfect combination! Why would you want anything more?