US - Lose Passport if tax debt unpaid

[Foreigner]

Government will be able to deny new passports or revoke issued ones if seriously delinquent debts remain in arrears:

WSJ: “Americans: Pay Your Taxes - Or Lose Your Passport†| LoyaltyLobby

Not sure how plan would be implemented if debt is in corporation account.

 

[Deleted member 6404]

As all ways the corporation will be OK, its the individuals who will lose out, guilty or not as always in the land of the cough cough Free.

 

[Hvr]

The cancellation/non-renewal of US passports is also done for non-payment of child support.

 

[drron]

On the other hand they really throw a hissy fit if you renounce your US citizenship.

 

[chelzmalee]

on the other hand they really throw a hissy fit if you renounce your us citizenship.

but their freeeeeeeedommmmmmmm!

 

[Dr Ralph]

Something similar is already present in Australia in relation to bankruptcy proceedings, although this involves the Trustee:

https://www.afsa.gov.au/debtors/ban...gs-i-have-to-do-and-be-aware-of-when-bankrupt

 

[andye]

I don't disagree with the principle of this.

Paying the appropriate legal taxes is one's responsibility as a citizen

A passport (and the associated protections the state provides) is a right of being a citizen

Slightly muddied if one is an expat, but the principle remains

 

[Altair]

Well in the last two years with the changes to reporting of bank accounts, increased diligence over IRS filings etc, many US expats are renouncing their US citizenship, which of course the US State Department increased their fee for renouncement to USD $2.5k with a long waiting list.
The US is the only system in the world where they tax based on citizenship as well, eg if you are a US citizen living out of the US for more than 186 days you are still required to file a tax return and liable to pay income tax if the differential between resident country income tax and the US income tax is in the US favour.
Confiscation of passports is only another step in the process that the IRS is using to ensure compliance with income tax regulations.

 

[andye]

I can see how that would be really tough as an American abroad, when you are not getting the other benefits of taxes (defence, police, roads, schools etc)

 

[Altair]

I can see how that would be really tough as an American abroad, when you are not getting the other benefits of taxes (defence, police, roads, schools etc)

You get the honour of being a US citizen....and also still remain entitled to the US pension, well the differential between the local pension and what you get from the US.

 

[johnsluk]

My wife is American and living here and makes sure her taxes are filed every year. Thankfully she hasnt gotten a letter from her Aus bank for her to give them all her details to satisfy the American government. We know of a lot of American expats that havent filed in years and I could see a lot of people getting worried about this. We have a daughter who now has her American passport and citizenship and will also have the pleasure of telling the US government how much she earns when shes of age. We will leave it to her to decide if she keeps citizenship or not...although by then it'll probably cost $10K by then

 

[BettyB]

Is it legal to take your passport in Australia for the same reasons?

 

[Mal]

Is it legal to take your passport in Australia for the same reasons?

Sometimes yes. Court order will see your passport seized, and there are a myriad of other reasons that could see you being stopped at the border leaving the country.

 

[Deleted member 6404]

Sometimes yes. Court order will see your passport seized, and there are a myriad of other reasons that could see you being stopped at the border leaving the country.

Makes even more sense to have another passport from another counrty.

 

[Deleted member 6404]

You get the honour of being a US citizen....and also still remain entitled to the US pension, well the differential between the local pension and what you get from the US.

As for the pension they don't have any, I read some where there's not enough in the kitty for that, probably will be just a pipe dream in the not to distant future for US citizens.

 

[Isochronous]

The best way to financial freedom and riches is to renounce your US citizenship.

 

[wandering_fred]

The best way to financial freedom and riches is to renounce your US citizenship.

A little short sighted when your pension is paid in/from the USA...

More interesting is what would Australia do (if anything) if the USA filed a tax lien and cancelled your USA passport (assuming dual citizen)?

Happy wandering

Fred

 

[Altair]

Makes even more sense to have another passport from another counrty.

IIRC in some circumstances this could cause a lot of problems as well. If naturalised and you subsequently take another citizenship, or join the armed forces of another country you are supposed to lose your US citizenship....Australia is similar.
Regardless the US had requirements for IRS filing since the beginning of the IRS? It is not new however the steps taken in recent years against non-resident US citizens has become much tougher and lead to record numbers of people renouncing their citizenship or trying to drop out of the net.

 

[Boca68]

Makes even more sense to have another passport from another counrty.

Not always possible for many. And, I believe some countries dont' allow dual nationalities.

Although, I did once hear (not sure if its totally true) that if you are lucky enough to be Northern Irish of the Jewish faith, then its possible to hold 4 passports. (UK, Irish, USA and Israeli). Not sure if Belfast has a big Jewish population though? Anyway, off topic, sorry!

Back on topic, I believe the same situation applies here, that due to debts , government or personal, your passport can be confiscated.

 

[Moopere]

The US is the only system in the world where they tax based on citizenship as well, eg if you are a US citizen living out of the US for more than 186 days you are still required to file a tax return and liable to pay income tax if the differential between resident country income tax and the US income tax is in the US favour.

I thought we had a similar system? Or is the difference that ours you still need to be nominally 'resident' in Australia even if working overseas for presumably short(ish) periods of time??? So, for example, I had formed the idea that if you went on a working holiday to the UK for say a year, but were still an Aussie resident (and not a UK resident) then you'd be expected to report and pay tax on your earnings in the UK ... or the differential at least.