Renunciation of US citizenship

My April 7 visit to the US consulate

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Today I visited the US Consulate in Toronto to inform them that I had committed an act which had caused me to relinquish my US citizenship.  They made me fill out seven pages of paperwork (which I had done in advance–DS-4079 and DS 4081), swear with my right hand raised that I had read and understood the consequences of my actions, and then I signed the paperwork in front of a consular officer, who then put the seal of the Consulate General of the United States on each signature page.

How I was treated

The main person that I dealt with Mrs. A. was very polite; she too is Canadian, and so there was zero recrimination for the act I had committed–but she did her job, and made sure that I knew what I was doing.  The consular officer, a certain Ms. J.H.F., also was polite.  At first Mrs. A. suggested that I must come in for a second visit, but when I insisted that I had already committed an expatriating act, she agreed that I was only at the consulate to inform them of that fait accompli and that there would be no need to return.  The expatriating act took place on 28th of February, and she recognized that I was no longer an American citizen according to USC 1481 .

$450 renunciation fee [UPDATE: Please note, I did in fact receive my CLN without paying $450]

I can’t yet say, as I suggested in an earlier post, that the $450 fee would not apply to someone who had committed a prior relinquishing act.  It is clear however that “renunciation” and “relinquishment” are two completely different acts in the understanding of the United States Department of the State and their US Consulates General around the world.  Mrs. A. explained that my paperwork would be sent to Washington for examination.  This could take a great deal of time.  Meanwhile, she provided me with sealed copies of all the paperwork.  She said that when the Certificate of Loss of Nationality (CLN) would be approved, she would contact me and I could pick it up after it arrives but I would have to pay any fee that might apply.  She didn’t think that the $450 fee would apply but she wasn’t sure.  So I am not in the clear.  However, the Toronto US Consulate General says that fee is applicable at the time of taking the oath of renuciation.  Singapore too.  The Hamilton Consulate General says the fee is applicable at the time of picking up the CLN, and renuciationguide.com says that fee technically applies to the processing of the necessary paperwork.  In any case, if I’ve made the relinquishing act, owning a Certificate of Loss of Citizenship may not be necessary, provided the State Department recognizes my loss of citizenship.  I’d be like Scarecrow, brains but no diploma.

My written statement

I provided a written statement which I signed in front of the consular officer and which she stamped and sealed.  The text of that statement is as follows:

I have lived in Canada most of my adult life.  I have married a Canadian.  After so many years in Canada it became clear that I have a great attachment to Canada, to my Canadian friends, to my Canadian wife and her family, and to my church community in Canada.  I felt that it was therefore necessary to become a Canadian citizen so that I may become a full member of this great and wonderful country and its people.  Therefore, I applied for Canadian citizenship in 2010, and I also had, even at that time, the intention of relinquishing my US citizenship.  For in taking my pledge to the Queen of Canada, Elizabeth II, on February 28, 2011, I realized that it would be absurd for me to be of divided loyalty.  My duty to the Queen and to the Dominion of Canada precludes me from maintaining citizenship in the United States of America, since when one country calls me to serve, dual citizenship could potentially create a conflict of interest.  To avoid all such conflicts, I have decided with my full volition and all my heart, to relinquish my United States citizenship once and for all, realizing that it is an irrevocable act.

The right of expatriation

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Thanks to a reader comment I was able to find an excellent resource for expatriating from the United States:  http://renunciationguide.com .  The website is by US expatriates who wish to extend the wisdom of their experience to others who are contemplating the voluntary loss of their US citizenship.  In addition, they provided some interesting research on the history of expatriation in the United States.

According to renunciationguide.com, the United States is only one of two countries that requires not only residents but citizens living abroad to pay income taxes.  The only other country is Eritrea, which has made it a practice to harass loved ones in your country until you pay up.  The authors write:

Interestingly, a Canadian court in Toronto ruled in 2007 that the imposition of the 2% tax on its citizens abroad was illegal and that a dual Canadian-Eritrean citizen should be paid back the money he had given.

So in becoming a Canadian citizen on Monday, I will also hope that the Canadian government would protect me, if necessary, from the tax regime of the IRS, which may attempt to tax my Canadian sources of income, and if I were to die, to tax my inheritance in such a way as would strip my wife’s rights as a Canadian citizen to inherit her husband’s property (nearly all my assets are Canadian based).

Renunicationguide.com, however, asks the question if there is a right of expatriation in the US Constitution:  “It’s not there. And it’s not in the Declaration of Independence, either.”  Now here I have to differ.  Consider these lines:

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

So begins the Declaration of Independence.  Now in asserting the right of the people of the 13 colonies to expatriate from England, the Declaration of Independence sets an important precedent that makes it clear that liberty is a God-given right and that to be able to loose oneself from the shackles of government which constrict that liberty is the right of the people.  It is therefore not explicitly stated, but the precedent of declaring independence from the King of England would justify any individual who in the course of seeking life, liberty and the pursuit of happiness wished to be released from obligation to his native country; everyone has that right, given to him not by the Congress nor by the country of his choosing, but by the Creator Himself.

Thus, the right of expatriation, while not explicitly argued for by the founding documents of the US, is nevertheless a premise enshrined in the Declaration of the Independence.

Renunciation of US citizenship: On avoiding the new $450 renunciation fee (update 2)

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UPDATE:  Please note that my belief in this post, that by indicating that I’d relinquished my US citizenship by becoming a Canadian citizen, I could avoid the $450 renunciation fee panned out, and I received the CLN without paying).

I’ve been pretty upset that it would cost me $450 to renounce my citizenship now that the US consulate in Toronto has instituted a fee.  But today I was looking at the various government websites:  Consider this website from the US state department and its explanation of how to renounce US citizenship:

Section 349(a) of the Immigration and Nationality Act (8 U.S.C. 1481) governs how a U.S. citizen shall lose U.S. nationality. Section 349(a) states:

A person who is a national of the United States whether, by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality:(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense.

Now perhaps it would interest readers to know that this government website is not telling the whole story: The U.S.C. 1481 lists several other ways that a natural born US citizen may lose their citizenship. Here is the full text (emphasis mine):

§ 1481. Loss of nationality by native-born or naturalized citizen; voluntary action; burden of proof; presumptions

(a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality—

(1) obtaining naturalization in a foreign state upon his own application or upon an application filed by a duly authorized agent, after having attained the age of eighteen years; or
(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years; or
(3) entering, or serving in, the armed forces of a foreign state if

(A) such armed forces are engaged in hostilities against the United States, or
(B) such persons serve as a commissioned or non-commissioned officer; or
(4)

(A) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years if he has or acquires the nationality of such foreign state; or
(B) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years for which office, post, or employment an oath, affirmation, or declaration of allegiance is required; or
(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or
(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense; or
(7) committing any act of treason against, or attempting by force to overthrow, or bearing arms against, the United States, violating or conspiring to violate any of the provisions of section 2383 of title 18, or willfully performing any act in violation of section 2385 of title 18, or violating section 2384 of title 18 by engaging in a conspiracy to overthrow, put down, or to destroy by force the Government of the United States, or to levy war against them, if and when he is convicted thereof by a court martial or by a court of competent jurisdiction.
(b) Whenever the loss of United States nationality is put in issue in any action or proceeding commenced on or after September 26, 1961 under, or by virtue of, the provisions of this chapter or any other Act, the burden shall be upon the person or party claiming that such loss occurred, to establish such claim by a preponderance of the evidence. Any person who commits or performs, or who has committed or performed, any act of expatriation under the provisions of this chapter or any other Act shall be presumed to have done so voluntarily, but such presumption may be rebutted upon a showing, by a preponderance of the evidence, that the act or acts committed or performed were not done voluntarily.
On Monday, February 28, 2010, I will complete the naturalization process of applying for Canadian citizenship, having attained 18 years of age.  I did this application with the intention of relinquishing my US citizenship. I will then take the following oath of allegiance to the Queen Elizabeth and her heirs:
I swear or affirm that I will be faithful and bear true allegiance to her Majesty Queen of Elizabeth the Second, Queen of Canada, Her Heirs and Successors, and that I will faithfully observe the laws of Canada and fulfill my duties a Canadian Citizen.
I will therefore have committed the first two acts listed of a possible seven which make it clear that I am no longer an American citizen.  No oath before a consular authority is necessary according to the current statute.  As evidence of this act, I will create a video tape before swearing that my intention in taking the oath of Canadian citizenship is to relinquish my American citizenship.
UPDATE 1:  the following website deals with this manner of relinquishing citizenship and says that the presumption is that the person taking on citizenship in another country is not doing so to relinquish his US citizenship.  However, there is a procedure to indicate to the State Department, as in my case, the intention is to lose citizenship:
An individual who has performed any of the acts made potentially expatriating by statute who wishes to lose U.S. citizenship may do so by affirming in writing to a U.S. consular officer that the act was performed with an intent to relinquish U.S. citizenship. Of course, a person always has the option of seeking to formally renounce U.S. citizenship abroad in accordance with Section 349 (a) (5) INA.
This website thus verifies that the act of taking the oath of citizenship in Canada, if done with the intent of relinquishing US citizenship, counts as one of the seven ways of losing one’s US citizenship according to USC 1481.
Update 2:  Today a consular officer called me from the US consulate in Toronto.  She confirmed what I’ve said in this post, that relinquishing US citizenship and renouncing US citizenship are two different processes that are treated in a different manner by the consulate (including the fee structure).

The New Berlin Wall II : New fee for those wishing to renounce US citizenship

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One year ago, I announced that I had applied for Canadian citizenship with intention of renouncing my American citizenship.  I wrote that the US has tried to erect a Berlin Wall to keep American citizens from expatriating:

Since 2008, the US has placed particular restrictions on wealthy people who wish to expatriate.  If I were to own 2 million in assets or if my average net income tax over the last five years were $139,000 , I would be a “covered expatriate” upon renouncing my citizenship.  The law penalizes these individuals with exorbitant expatriation tax that boggles the mind.  Why?  To keep them in the USA.  So it is a Berlin Wall designed to keep people from leaving the US.

Now the US government has piled another bunch of useless rubble against that Berlin Wall.  I read in the US Consulate in Toronto’s website the following (emphasis mine):

Renunciation: We accept applications to renounce U.S. citizenship and forward them to Washington DC for a decision, which takes several months. This process CANNOT be expedited. You may contact us by mail, fax or email to request information and proper forms. Once you are ready to renounce, you must make a special appointment by emailing us … and proposing a date at least two weeks in advance. All renunciation appointments are at 10:30 a.m. We will respond and confirm the date and time of your appointment or propose a new date depending on staff and appointment availability. Note that there is now a US $450 fee to renounce U.S. citizenship, payable at the time the renunciant takes the Oath of Renunciation from the consular officer inside the Consulate.

Well, this is embarrassing isn’t it?  The US prides itself in being the best country in the world, the one where everyone and his brother wants to live.  But now they will just add one more insult to injury to their citizens living overseas: in order to escape the jurisdiction of the US, escaping citizens must pay $450.  Well, from the standpoint of fleeing the greediest government in the world, that will soon become desperate for revenue because of hyperinflation, it’s probably a small price to pay.

In any case, my citizenship application to Canada was accepted, I took the citizenship test Wednesday February 16, and I have been invited to a citizenship ceremony next Monday, on February 28.  I’ll be contacting the US Consulate in Toronto tomorrow.  Au revoir.

The New Berlin Wall: Heroes Earnings Assistance and Relief Tax Act 2008

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Yesterday I sent my application for Canadian citizenship via registered mail to the Sydney, Ontario, Processing Centre.  An American citizen from birth, I’ve lived outside the USA, first as a student then as a permanent resident of Canada, since 1986.  I’ve never really felt that I needed Canadian citizenship.  My reason for applying now is that it is inconvenient being an American living in Canada.  So before my citizenship ceremony in a year or so, I will be renouncing my US citizenship.  Likely, for a few days while awaiting the ceremony, I will be a stateless person. [actually, I became a Canadian on February 28, 2011, and informed the US Consulate in Toronto of my relinquishment on April 7, 2011]

The United States is the only country in the world that requires that all its residents and all its citizens, even if living abroad, pay tax, though there is an earned income exemption of $70,000 [over 90,000 today] and foreign tax, dollar per dollar, credit.  The threshold for filing is ridiculously low.  As a married person filing a separate return, I must file if I make more than $2000; this despite the knowledge that as a resident of Canada, it is difficult to imagine very many scenarios where I might be liable for tax, since the rate here is higher than in the USA, particularly for lower income earners.  But it is a hassle to file every year, and it creates a lot of anxiety for me.  Last year, my accountant forgot a certain form and he was sick when I was required to send the amendment, and so I had to do it myself and that created a huge headache.

So I am not going to renounce my citizenship because I owe tax.  I am liable to the IRS for nothing.  I am doing it first of all because I am tired of filing a frivolous return to the IRS each year; frivolous because I owe nothing, and cannot possibly owe anything living here in Canada.

But there is another even more important reason which I call the “New Berlin Wall”.  Since 2008, the US has placed particular restrictions on wealthy people who wish to expatriate.  If I were to own 2 million in assets or if my average net income tax liability over the last five years were $139,000 , I would be a “covered expatriate” upon renouncing my citizenship.  The law penalizes these individuals with exorbitant expatriation tax that boggles the mind.  Why?  To keep them in the USA.  So it is a Berlin Wall designed to keep people from leaving the US.

I am long way from being a covered expatriate.  But with the devaluation of the dollar due to hyperinflation, I foresee being there soon.  Therefore, I’ve decided to leave before the law applies to me; because it was much easier to leave East Berlin before the Wall was built.

Oh and by the way, Go Canada Go!!!

[corrections, 20 April 2011]