Goldburd | Goldburd McCone LLP

For nationwide tax guidance, call:
212-302-9400 or toll-free at 844-653-2873.

Goldburd | Goldburd McCone LLP

For nationwide tax guidance, call: 212-302-9400 or toll-free at 844-653-2873.

Serving Individual And Corporate Tax Clients Nationwide From Our New York, New Jersey, Florida And California Offices

Steven Goldburd and Benjamin A Goldburd

Since 1983, our tax firm has skillfully represented individuals and corporations across the United States and around the globe from our offices in New York, New Jersey, California and Florida.

Two thoughts before giving up U.S. citizenship to save on taxes

On Behalf of | Feb 21, 2020 | Firm News

Tax obligations in the United States are going through constant change. Just last year the Tax Cuts and Jobs Act (TCJA) led to major tax reform that impacted citizens throughout the country. States are looking to make changes to help navigate these new laws and some citizens have simply had enough. This can lead to serious discussions about leaving the country and calling another home in an effort to reduce or simplify tax obligations.

Before making the change, consider the following:

Consideration #1: Take a moment to review interest.

It may seem like an obvious consideration, but make sure you are interested in living in another country before renouncing citizenship to the United States. Although you may reduce or even eliminate tax obligations by becoming a citizen in another country, would you really be happy with the trade off?

Take these two examples: Canada and they Cayman Islands. Canada may seem like a welcoming place to live, but you may not get the tax savings you were hoping to get by switching citizenship to our neighbor in the north. On the flip side, moving to a warm, island location like the Caymans may translate to tax savings but can make other aspects of life difficult. As discussed in a recent post by Forbes, a passport from a Cayman Island citizen does not hold as much weight as one from the United States. As such, the move could thwart future travel options.

Consideration #2: Take even more time to put together a plan.

Getting established as a citizen of another country is not always an easy prospect. Some countries require those who wish to become citizens to first reside within the country for a certain period of time while others require a specific reason, such as moving to be with a foreign-born spouse.

It is also important to make a full move. Many countries, including the United States, will tax income earned in the country even if regardless of where the income earner calls home. A failure to take all potential tax revenues into consideration before starting the move could result in future tax controversy. Those who are interested in such a move can mitigate this risk by discussing their options with tax professionals. The attorneys at Goldburd McCone have experience with international taxes and can provide guidance on these matters.