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Table of Contents
The problems with Citizenship Based Taxation are covered throughout this wiki. Under US tax law, US citizens and green card holders are US tax residents regardless of where they actually live. This creates a situation where US tax-residents who physically reside outside the US are treated as tax-resident by two (or more) countries simultaneously and must navigate both sets of tax rules simultaneously. This introductory paragraph needs to be expanded.
While specific provisions are covered elsewhere, this page covers general problems that result from Citizenship Based Taxation. Topics covered are:
- Compliance Issues
- Enforcement Issues
- add other areas for this page
This section should include discussion of cost and difficulty of compliance, such as any hard statistics on average compliance costs, difficulty finding professional help, inadequacy of IRS support for international taxpayers (e.g. closure of international offices).
This section is about issues around how the IRS enforces Citizenship Based Taxation on international individual taxpayers.
Here's a good early article by Jack Townsend about the bait and switch tactics in OVDP http://federaltaxcrimes.blogspot.com.au/2011/06/taxpayer-advocate-criticizes-irs.html
Offshore Enforcement Programs
Details about OVDP, OVDI, Streamlined
Taxpayer Advocate Reports
Each year the Taxpayer Advocate submits two reports to Congress on the major tax compliance/enforcement issues facing US taxpayers. International taxpayers (US expats) have been mentioned in several of the recent reports:
30 June 2011 - Fiscal Year 2012 Objectives(pdf): on page 23 “IRS's inconsistency and failure to follow its published guidance damaged its credibility with practitioners involved in the Offshore Voluntary Disclosure Program.”