updated 11:36 PM CET, Nov 27, 2022

Opinion

Aussie accidental American describes 'OMG moment' when hit by the twin horrors of FATCA and 'taxation-based citizenship'

Having been born in Australia and lived her whole life there, "Amy," as she wishes to be known here, had no idea that her life was about to be turned upside-down, and changed forever, in March, 2020, when someone from her bank said that they needed to ask her to fill in some details having to do with her citizenship.

Then suddenly, Amy says, her "OMG Moment" – as it's often referred to by accidental Americans, a group which Amy was soon to discover she was a member of – arrived... 

U.S. tax expert Goulder: Theory of 'strategic forbearance' could help explain EU reluctance to challenge U.S. over FATCA

In July of 2018,members of the European Parliament resoundingly approved a resolution which supported the right of Europe's estimated 300,000 "accidental Americans"  to be allowed to cast off their American citizenship (and thus their taxation by the U.S.) more easily and cheaply than is currently possible under U.S. law. (The vote was 470 to 43, with 26 abstentions.) 

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Over the last few years, thousands of so-called "accidental Americans" have grudgingly accepted the unexpected news that the U.S. considers them to be U.S. citizens, even though they had lived their entire lives, since birth, as citizens of other countries – and as a result of this news, are considered to have tax-reporting and potentially tax-paying obligations.

HELP! What am I to do when foreign law impacts the U.S. treatment of my tax case?

As regular readers of the American Expat Financial News Journal possibly know better than most, U.S. taxpayers who live abroad (as well as their tax advisers) are increasingly having to consider the potential interactions between U.S. and foreign laws when determining the U.S. tax consequences of a particular financial transaction.

U.S. tax expert Virginia La Torre Jeker explains it this way: "In today's world, it is no longer possible for practitioners to ignore the possible implications of another country’s laws."

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