Renounce or lose your citizenship | USAGov (2024)

FAQs

Why is it a bad idea to renounce US citizenship? ›

Renunciation has significant consequences. Aside from giving up the benefits granted to U.S. citizens, the U.S. Department of State advises that anyone considering renunciation of their U.S. citizenship should understand that, in almost all cases, the act is irrevocable.

Living in the U.S. after renouncing citizenship is possible. But you will be treated like any other foreign national. This means you would need to obtain the appropriate visa or residency permit to stay in the country.

Key Takeaways. The process involves legal procedures, including an interview at a US Embassy or Consulate and payment of a fee $2,350. Being tax compliant for 5 year is a prerequisite for renouncing citizenship. An exit tax may apply to those renouncing their citizenship, depending on their net worth and tax status.

Tax Implications of Renouncing US Citizenship

Once you renounce your US citizenship, you will no longer be subject to US taxation. However, you will have to resolve any outstanding income tax debts first, and you may also have to pay the exit tax.

Will I still receive my Social Security benefits after renouncing? Even after renouncing your US citizenship, you can still receive Social Security benefits if you qualify. However, the ability to receive these benefits depends on the country you move to after renunciation.

More than 30,000 Americans have given up their US citizenship over the past decade, according to the list of names published quarterly by the US government. The number of Americans renouncing has been running at between 1,000 right up to 6,000 a year since 2010.

Put another way, once a CLN has been issued, the oath of renunciation cannot be “taken back”, U.S. nationality is not merely “suspended” but irrevocably relinquished.

Tax avoidance is the main reason actor Yul Brynner, entrepreneur Eduardo Saverin, and inventor Earl Tupper abandoned U.S. citizenship. Author Henry James, film director John Huston, and Eugene O'Neill's daughter, Oona, stood on political principles to turn down U.S. citizenship.

* Both relinquishing and renouncing US citizenship result in a loss of citizenship. However the difference lies in the date when the loss takes effect. Relinquishing is a form of renunciation.

Tax Deferred Specified Accounts (Traditional IRA)

At the time of exiting the U.S., they are required to gross up the value of the IRA for example — and other similar types of tax deferred specified accounts – and include it in their income.

What are the benefits of renouncing citizenship? ›

The US exit tax is a tax on your worldwide assets. The tax applies to all property that you own on the date of renunciation, including personal items such as cars, boats, and jewelry. There are very few exceptions to this, such as foreign pensions you earned before becoming a US taxpayer.

What are the pros and cons of U.S. citizenship? U.S. nationality has pros such as voting rights, travel benefits, and family sponsorship, and cons such as tax obligations, jury duty, and possible loss of original nationality.

Non-citizen nationals are allowed to reside and work in the United States without restrictions. They are given U.S. passports with a special endorsem*nt stating that the holder is a U.S. national and not a U.S. citizen.

What Are the Challenges Stateless People Face Without Citizenship? Without citizenship, stateless people have no legal protection and no right to vote, and they often lack access to: education; employment; health care; registration of birth, marriage, or death and property rights.