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Ultrawealthy Americans are ditching their US citizenship in droves

Martin Everson

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https://www.businessinsider.com/ult...uncing-citizenship-in-droves-2021-8?r=US&IR=T
Interesting article. I can see a global minimum personal income tax coming ;).

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More of America's wealthiest citizens don't want to be American anymore, according to new data compiled by Axios.

In 2020, according to IRS data, 6,707 Americans gave up their citizenship — a 237% increase from the prior year. The rise is pronounced among some of the wealthiest people, who have been leaving at elevated rates since 2016 (with a notable dip in 2019).

Insider previously reported the US passport lost a big chunk of its value in 2020. Some of the reasons the richest Americans wanted to flee were the handling of the pandemic, general social unrest, and, perhaps most importantly, the presidential election.

At the time, America's wealthiest people were having a hard time finding a way out of the country, even for vacation, since so many countries weren't allowing Americans in.

Nuri Katz, the founder of Apex Capital, a firm that specializes in citizenship by investment programs, previously told Insider the wealthy had to adjust to not being able to travel for work or pleasure — which led to a desire to "diversify" passports.

Now, Axios reported, one concern propelling the wealthy out of the country might be taxes. President Joe Biden has proposed tax raises targeting the highest-earning Americans in an effort to pay for infrastructure spending. Those include a 39.6% capital-gains tax on Americans earning over $1 million, which would be levied in conjunction with a 3.8% Affordable Care Act tax. That would result in a 43.4% capital-gains tax for that group, nearly double current levels.

A report from the Institute on Taxation and Economic Policy found that the top 1% of American taxpayers would shoulder the burden of Biden's proposed tax increases, each paying an extra $100,000 in taxes every year.

The status of those tax increases is still up in the air, since they didn't make it into the latest bipartisan infrastructure bill. They could still show up in the party-line reconciliation bill that's being written by Democrats, but perhaps at not such elevated rates.

But, according to Axios, the prospective tax hikes might still be a dealbreaker for some wealthy Americans.


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Good question. My guess is that most are existing citizens of other countries rather than people than people with newly acquired citizenship in a third country. Could be wrong.
That makes a lot of sense. If I were an American citizen living abroad with no intentions of returning to the US I'd also consider to renounce. Nevertheless according to Where do the rich people live: Top 10 countries in the world it seems that there is still quite an influx of rich people *to* the US.

Which makes sense - I think that there are still lots and lots of people around the world looking to 'upgrade' their lifestyle by moving to one of the typical immigration countries like (in no particular order):
- USA
- Canada
- Switzerland
- Singapore
- Australia
- New Zealand

So my guess would be that we continue to see rich people moving to these places, even if the crowd of this forum (understandably) are not the biggest fans of US / Australian tax policies ;)
 
Sergei Brin (Alpha-Google) got Chipre nationality a couple of weeks ago.
Moving to US could make sense if your are NOT US citizen to be close to markets and avoiding own countries territorial taxation (LLC in some configurations can be considered offshore), while US citizens look for foreign nationality to avoid citizenship-based tax (which is currently exclusive of US and Ethiopia); two very different moves.
 
That makes a lot of sense. If I were an American citizen living abroad with no intentions of returning to the US I'd also consider to renounce. Nevertheless according to Where do the rich people live: Top 10 countries in the world it seems that there is still quite an influx of rich people *to* the US.

Which makes sense - I think that there are still lots and lots of people around the world looking to 'upgrade' their lifestyle by moving to one of the typical immigration countries like (in no particular order):
- USA
- Canada
- Switzerland
- Singapore
- Australia
- New Zealand

So my guess would be that we continue to see rich people moving to these places, even if the crowd of this forum (understandably) are not the biggest fans of US / Australian tax policies ;)
I think people move there and then they become rich. No need to move there if you are already rich elsewhere.
 
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Rich people are the less affected, they can count on good lawyers to shield their monies, way worst for middle class, no wonder it is disappearing in all western countries.
 
What could be classified as "Ultrawealthy" ca#"!

Depends but generally in Swiss private banking:

Affluent = $250k - $999k
High Net worth = $1m - $20m
Ultra High Net worth = $20m+

So 20m+ would be ultra wealthy in my book old)(#
 
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