The New York Times had an interesting article online today about how more and more people are giving up their citizenship. It did not surprise me that many give up their citizenship to save money on income taxes. However, I was surprised to learn that the Patriot Act is also partly to blame.
Apparently, the Patriot Act makes it very difficult for citizens to maintain bank accounts in the United States if they have lived overseas for a long time because the Patriot Act requires a United States residence. Since overseas residents cannot provide a US address, they are being treated the same as terrorists and the banks are closing the accounts.
In the short term, giving up your citizenship may make things easier, but remember, there can be serious income tax and inheritance tax ramifications to giving up your citizenship.
