Catch up and give up your American tax residency

Can I ever stop paying and filing US tax returns?

As a matter of fact, if you are a dual national, yes you can depending on your situation. In this video, Expat US Tax Managing Director, Andrew J. Landin talks about relinquishing your US citizenship, who can do it and what to consider.

If you are a dual national and are seriously considering expatriation it is very important you understand if you are considered to be a "Covered Expatriate".

Also consider "Exit Tax" as this can be a very large sum you have to pay in cash to the IRS in order to give up your tax obligations with the US.

If you are living in Saudi Arabia, the UAE or elsewhere in the Middle East, it can be very difficult to become "naturalized". If you were a dual national at birth, you can escape being noted as a "Covered Expatriate" and you will be able to avoid paying "Exit Tax".

What is Exit Tax?

Exit Tax is a tax you will have to pay in order to relinquish your US Citizenship and tax obligations. If you are noted as a Covered Expatriate you will be subject to Exit Tax. Basically, Exit Tax is calculated based on the current value of all your assets, the day before your citizenship or resident status is terminated.

Who has to pay Exit Tax?

  • U.S. citizens who terminate their citizenship; and
  • Permanent residents of the United States (holders of a “green card” visa) who terminate their permanent resident status after holding it for many years.

Can I avoid Exit Tax?

You can only avoid Exit Tax is you are not classified as a Covered Expatriate or you do not fall into one of the two categories above.

Am I a Covered Expatriate?

There are three ways that determine if you are considered a Covered Expatriate.

  • One & Two: If the IRS defines you as "too-rich"
  • Three: If your tax paperwork is late in filing your expatriate paperwork, your previous 5 years of tax return filings are not up to date and if you've ever been less that truthful in those documents.

Can I have a free consultation?

Of course, Andrew has helped many Dual Nationals living in Saudi Arabia and the UAE go through this process. Get in touch today so we can help you too.

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