American Citizens Abroad holds 'Town Hall meeting' for London expats
Key lawmakers on Capitol Hill really are aware of the issues being faced by expatriate Americans, and the dysfunctionality in particular of the United States' citizenship-based tax regime, delegates to the American Citizens Abroad's latest "Town Hall" in London were told the other evening.
But that's not to say the issue is done and dusted, ACA legal counsel and lobbyist Charles Bruce told the gathering, of around 30 American expats, at London's Caledonian Club in Belgravia (pictured above).
"So we need to be lobbying. And that needs to be a well-costed and broadly-supported effort," Bruce said, explaining that in addition to individual expatriates, U.S. companies that stand to benefit from a more expat-friendly U.S. regime also need to begin getting more involved in lobbying Congress on behalf of the expat cause, which he says currently should be focused on getting the needed legislation signed into law.
"Do not be an Eyore on this subject... or at least, don’t be an Eyore in front of me," he continued, adding that he believed success, contrary to what some critics may think, is possible: "I do believe we can get this."
His optimism, Bruce explained, reflected the fact that, in part due to extensive research the ACA has done in the way of obtaining data about the American diaspora, Washington was at last starting to pay attention to such arguments as the fact that the U.S. is an outlier compared to almost all other countries in the harsh way that it treats its expats, and that allowing Americans who are resident overseas to not have to file U.S. tax returns or be potentially subject to U.S. tax while abroad could – as he notes ACA research has shown – be achieved in a "revenue-neutral" manner.
"I’m going to repeat: Key people on people on Capitol Hill are into this subject. And they are paying attention," Bruce said. "And they are working on it. And they are not joking around."
Among the other speakers at the ACA event were representatives from a number of firms specializing in assisting American expats with their financial and tax matters, including Dan Hyde, a partner and founder of Westleton Drake, a London-based U.S. tax specialist, with outposts in Geneva and Zurich, and a Blick Rothenberg Group affiliate; David Foster, a private client associate director at Frank Hirth, another U.S. tax specialist based in London, with offices in New Zealand and the U.S.; and Robert Paul, a partner at London & Capital, the London-based wealth manager.
In between presentations by these speakers about what American expats need to be aware of in terms of their taxes, pensions and other financial concerns, a representative from the U.S. government's Social Security offices was also on hand, giving what he suggested might be portrayed as the other side of the story: "What we, the American government, will be giving you back" in the form of Social Security payments, at least for those Brits and Americans who have worked in the U.S. long enough to qualify for them.
Jack Leuchtman, who is based at the U.S. Embassy in London, and whose title is regional federal benefits officer, began by asking the audience to hazard a guess as to how many people in the United Kingdom currently receive U.S. Social Security benefits.
Thirty-six thousand, he finally revealed, noting that they receive a total of US$25m a month, or around US$700 each.
Another question – which an audience member got rightaway – was how old you need to be to be able to receive Social Security benefits. (62, though – as a follow-up question revealed – there are advantages to waiting until one reaches age 70, after which there is no reason to wait.)
His main message, Leuchtman stressed, was that anyone who had any kind of question about their Social Security benefits, eligibility or anything else, shouldn't hesitate to get in touch with his office at the embassy.
"We’re here to help you.
"Every year we talk to 80-year-olds, all throughout the United Kingdom, who have just found out, on, like, their 80th birthday, that they could have been getting Social Security benefits for the last 18 years.
"And [for them] it is lost money [because the U.S. government doesn't compensate those who have failed to begin taking their payments].
"At the end of the day, it is money that doesn’t exist."
This is why, he went on, if anyone had any questions whatsoever, "ask!"
"I would rather tell 100 people no, [they are not eligible for benefits], then have to explain [to one] 80-year-old person, who is just getting by on public assistance here in the UK, that they could have had a much better house, food etc for all of these years [because they were eligible for U.S. Social Security but didn't realize it]."
Another thing about Social Security many people who have lived and worked in both the U.S. and U.K. often aren't aware of is that the U.S. Social Security administration and the U.K.'s Department for Work and Pensions "have a reciprocal agreement" which insures that such individuals ultimately end up getting benefits from both "that add up to [being] equal to one pension," Leuchtman went on.
That said, he urged his audience not to think of Social Security as a form of pension but rather, "as an insurance program".
"[Because] if something happens and you didn't start taking your Social Security, or you pass away without getting it, and you leave behind any family, there is no pot of money waiting", the way there might be with a pension, he explained.
"It’s just like health insurance or car insurance – you pay into it, and if you need it, you get it."
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