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Should I give up my US citizenship?

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  1. #1

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    Lightbulb Should I give up my US citizenship?

    For the foreigners, expats, or those who immigrated to the US a long time ago but relocated back to HK permanently, here's a question I've been thinking about:

    Is it worth considering giving up your US citizenship, or is it a crazy idea?

    In my case, I moved to the states when I was young, but for the past few years I've relocated back to HK. I'm almost in my 30s, and my career is having a lot of potential here and I have good future prospects in the field I'm working in.
    Here are the reasons I've come up with:
    1) It's a hassle to file US taxes
    2) I have never worked in the US before, so I will never get any social security/benefits whatsoever. You can only get that if you work more than 10 years in the US. Is it worth paying taxes without getting anything in return?
    3) Being self-employed, I don't think I get any tax exclusions at all? (not even for the first $100k)
    4) It's very likely that I will start a business here, which means that I have to pay a huge amount of taxes to the US (not including HK tax yet).
    5) I don't plan on moving back to the US, but there's always the "what if" question. What if I plan to move back to the US after retirement? But there's probably plenty options if I plan to retire elsewhere (canada, australia, etc)

    The thought of giving up US citizenship seems kinda scary to me, but I see more pros than cons at this moment.
    However, I've always identified myself as an Asian-American. Losing my US citizenship may feel like I lost part of my identity?
    And for those who won't want to give up their own US citizenships, is it more of a "pride' kind of thing? What are your reasons?
    Please give me your thoughts, especially for those who are thinking about the same thing.
    Thanks!

    Last edited by greentealatte; 25-10-2015 at 03:21 PM.

  2. #2

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    Make the choice when you feel strong enough, both financially and mentally


  3. #3

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    Have you got a HK passport now?


  4. #4

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    If HK passport is your only other passport I would never do it! Wait another ten years or so and see where you are at then, emotionally and financially.

    Taxmyass likes this.

  5. #5

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    Quote Originally Posted by Mrs. Jones:
    If HK passport is your only other passport I would never do it! Wait another ten years or so and see where you are at then, emotionally and financially.

    But by then the IRS have their claws in deep.

  6. #6

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    Mar 2012
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    Even if you give up your US passport, you still have to file for the next few years no matter what. Plus you pay an exit tax.

    Morrison likes this.

  7. #7

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    I don't think it's necessarily about pride, I think it is more about being stuck here, in Hong Kong. Don't get me wrong, HK is a great place, but not to elderly people and I can't imagine walking with a cane or being in a wheelchair here in my later years. Plus, everything is quite costly. Whereas if you wanted to go to the US, your money goes a lot further. A lot of countries are cracking down on immigration and unless you have another passport lined up that can at least offer you a place to retire and be old, then I definitely would not give up my US passport.

    If you are living here, I imagine you have a partner or family. You could have them open a company in their name and pay you a salary. Hence you would be entitled to the 100k exemption annually.

    Taxmyass likes this.

  8. #8

    If you are going to make megabucks then giving up your US passport can be a wise financial move. I have a friend who gave up his based on the math alone. What held him back initially was the prospect of his children not enjoying citizenship when he has any and retirement. But he figured the extra money he can pocket for the next 35 years of his professional career will make up for all that.


  9. #9

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    A few thoughts:

    1. You are almost 30 and have never worked in the US?!
    2. If you are self-employed you should be paying self-employment tax which is basically the same as social security and Medicare tax.
    3. Even if you eventually qualify will SS and Medicare be there for you when you retire?
    4. As a self-employed person you are still eligible for the foreign earned income exclusion and housing deduction. Because if these your US income tax should be relatively low.
    5. What percent of your income goes towards annual US and HK taxes? Do not include provisional or estimated taxes when doing this calculation.
    6. If you are making USD $100,000 or less, except for self-employment tax, you should have no income tax. However, if your sole proprietorship has significant expenses, these could cut into your earned income exclusion.
    7. With income around $100,000 and paying no US income tax, you have time to consider your future. Also, you have been in HK for a few years and see a good future in your career at this time. How will you feel in 5 years? What about life beyond work? Will you be happy in the mid to long term?
    8. Do you have any family in the US that you want to visit regularly? Do you need to go to the US for work? Does the US have any reason to refuse you a visa once you expatriate?
    9. Do you have a passport from anywhere else other than Hong Kong?
    10. There are a number of US people that have been outside the US for a long time, have a good career, family and many other ties that keep them offshore. By now, they have a non-US/non-HK passport. They also have been paying very large amounts of US taxes all these years and now regret not giving up their US citizenship sooner.
    11. Bottom line - The decision needs to be weighed carefully. Consult with an attorney and/or tax consultant that specializes in this area.


  10. #10

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    And if it is about dividend income tax, you still pay that for dividends from US stocks, n matter what
    nationality you have


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