Acquiring a second citizenship will not relieve you from the full boat of U.S. tax laws. No matter where you live, no matter how many other passports you carry, if you have the magic blue passport with the eagle on it, you are a U.S. taxpayer.
Supposing one does not want a second citizenship and is willing to renounce their US citizenship entirely, which country would you recommend switching to? How difficult is it and what are the consequences?
Yeah, while our taxes here in Aus are high, so are our standards of living. Although our new government seems intent on ruining that, in a bid to out-do the US in terms of idiotic legislation and curbing freedoms...
As jsankey says, we're really not highly taxed. Our tax load is on par with the US, and we have the benefit of a much simpler tax system, from income tax to business taxes. Cost of living is high, though.
I'm starting the work for my PR in Australia. We love it here, plus the paths are short and straightforward: 2 years as 457 => PR through employer sponsorship, 1-2(?) years as PR => citizenship.
Another traditional route to Australian citizenship is via New Zealand. Get a kiwi citizenship first, which is easier than an Aus one. With an NZ passport, it's easier to get an Australian one.
It's actually quite a serious problem for the kiwis, because they do the hard yards of bringing immigrants up-to-speed with the local culture (eg English language lessons), only to have them jump the ditch (Tasman sea) to Australia.
AFAIK, you can always change to another country. However, I can't see the US taking it very lightly that you've denounced your citizenship. In other words, I would assume they would try to make your life a living hell if you wanted anything to do again in the US. (Have no idea, just assuming based on preconceptions about the way the US already treats it's citizens who live outside of it already) Derek seems pretty open, might be worth trying to reach out to him.
Interesting, thanks for the links. Renouncing my citizenship isn't something I have immediate plans for, but I'm interesting in working abroad, so I'm curious to know how the process works.
Thanks for the response. I was interested in renouncing my citizenship once I've obtained citizenship elsewhere; I should have included that in my post.
"Still, leaving America can have a special tax cost. To exit, you generally must prove 5 years of tax compliance in the U.S. Plus, if you have a net worth greater than $2 million or have average annual net income tax for the 5 previous years of $155,000 or more (that’s tax, not income), you pay an exit tax."
"The theory of the exit tax is that is the last chance the U.S. has of taxing you. It is a capital gain tax as if you sold your property when you left. At least there’s an exemption of $668,000."
Acquiring a second citizenship will not relieve you from the full boat of U.S. tax laws. No matter where you live, no matter how many other passports you carry, if you have the magic blue passport with the eagle on it, you are a U.S. taxpayer.