Renouncing US citizenship is a formal legal process by which a US citizen voluntarily chooses to give up their citizenship. This action is irrevocable and involves several steps, including a personal appearance at a US embassy or consulate, completing the necessary paperwork, and taking an oath of renunciation.

Once this process is completed, the individual ceases to be a US citizen and loses all rights and privileges associated with US citizenship.
There are without question many benefits of holding US citizenship: the right to vote, unfettered entry and no US travel restrictions, access to the US job market, US government and consular protection while overseas. Given the irreversible nature of the process, these should all be factored into any decision to renounce US citizenship.

As such, renunciation is not a decision to be taken lightly, given the significant legal and financial implications. It requires thorough preparation and understanding of the consequences, which include potential immigration and tax obligations. You must also ensure you hold relevant dual citizenship before undertaking the process to avoid being deemed ‘stateless’.

In this guide, we explain what it means in immigration terms to renounce US citizenship, with details of the renunciation process you will need to follow to legally give up your US citizenship and passport.

Given what is at stake, prior to proceeding, it is recommended that you seek expert legal advice from specialists in immigration law and tax. NNU Immigration have extensive expertise in advising US citizens on the immigration implications of renunciation and guiding them through the legal process. We cannot however advise on the tax aspects.

 

Section A: Overview of Renunciation

 

Renouncing US citizenship is an irreversible process, requiring detailed consideration of many factors to determine if this is the best course of action for your needs.

Renunciation is also a lengthy, complex and costly process. It is not as simple as disposing of your US passport or letting your passport expire; rather, this process involves extensive paperwork, interviews and a fee.

Renouncing US citizenship is, therefore, a significant decision with potentially far-reaching ramifications. If you are thinking of renunciation, you should carefully weigh up the benefits and drawbacks before going ahead. It is also strongly advised that you consult with experienced US immigration and tax professionals to understand the consequences of renunciation.

 

1. What is Renunciation?

 

 

 

Renouncing US citizenship is a formal legal process where an individual voluntarily gives up their US nationality. This decision is irreversible, and you cannot change your mind and regain US citizenship at a later date.

The process of formally renouncing US citizenship is referred to as “expatriation”, which essentially means giving up all benefits granted to US citizens, including the right to vote in US elections, plus government protection and assistance should you need help while travelling overseas.

Giving up US citizenship also means losing access to federal jobs, being denied unrestricted travel into and out of the country, plus the loss of US citizenship for any children born outside the United States.

As such, renunciation involves legal, financial, and tax implications, including filing final tax returns and potentially paying an expatriation tax, and also impacts travel, residency, and eligibility for US government benefits.

 

2. Legal Basis of Renouncing US Citizenship

 

Section 349(a)(5) of the Immigration and Nationality Act (INA) details a US citizen’s right to renounce their citizenship by voluntarily making a formal renunciation of nationality before a US consular officer in a foreign state and by signing an Oath of Renunciation. US law requires that those wishing to renounce their citizenship must do so in person before a US consular or diplomatic officer while in a foreign country. This means that you cannot renounce your citizenship by mail, via a third party or while in the USA.

After submitting your request for renunciation, the DOS must officially determine whether to approve or deny that request after evaluating the facts and applicable law. If your request is approved and a Certificate of Loss of Nationality is issued in your name, that constitutes a final determination of loss of United States citizenship. However, if the DOS denies your request, you will still remain a US national, where loss of nationality is not automatic.

Importantly, unless you already possess a foreign nationality or you are assured of acquiring another nationality shortly after your renunciation, you would become stateless. This means that, in the absence of a second nationality, you would not be entitled to the protection of any government and may find it difficult, or even impossible, to travel as you would probably not be entitled to a passport from any country. Statelessness can also present severe hardships, where the ability to own or rent property, to work, to marry, to receive medical or other benefits, and to attend school can all potentially be affected.

 

3. Is Renunciation Reversible?

 

The act of renunciation is irrevocable and cannot be set aside, absent a successful administrative or judicial appeal.

An exception may also exist if someone renounces US citizenship before the age of 18; they may have that citizenship reinstated if they make that desire known to the US Department of State within six months of attaining the age of 18.

 

4. Renouncing US Citizenship for a Child

 

A parent may not renounce US citizenship on behalf of their minor children.

If a person under the age of 18 wishes to renounce US citizenship, they must convince the US diplomatic or consular officer that they fully understand the nature and consequences of the oath of renunciation, that they are not subject to duress or undue influence, and are voluntarily seeking to renounce their US citizenship.

 

5. De-Naturalization

 

It is also possible for naturalized American citizens to be denaturalized by the US Department of Justice (DOJ). This could be where someone has unlawfully obtained their citizenship status by fraudulent means. It could also be due to the commission of other offences, including, but not limited to, fraud against the US government, terrorism and war crimes.

 

Section B: Reasons for Renouncing US Citizenship

 

There are many legitimate reasons why Americans choose to renounce US citizenship.

 

1. Tax Considerations

Unlike most countries, the USA has citizen-based taxation, where citizens are taxed regardless of which country they live in or where their income is earned.

US laws require US taxpayers to report foreign-held assets to the Internal Revenue Service (IRS) and to pay “double” taxes, both in the US and abroad. This means US citizens are taxed on their worldwide income, irrespective of their country of residence.

For many expatriates, this can result in complex and burdensome tax obligations — including the reporting and filing duties accompanying them. This leads many Americans to opt to renounce their citizenship, not just because of the financial burden but because they find the tax compliance laws inconvenient and onerous. Put simply, renouncing US citizenship can simplify their tax obligations and eliminate the need to file US tax returns.

 

2. Dual Citizenship Issues

Managing dual citizenship can be complicated, especially if the other country of citizenship does not permit dual nationality or imposes its own set of legal and financial duties, resulting in conflicting obligations and loyalties, such as military service.

 

3. Privacy Concerns

US citizens are subject to stringent financial reporting requirements, including the Foreign Account Tax Compliance Act (FATCA). These regulations can feel invasive, prompting some individuals to renounce their citizenship to avoid these disclosures.

 

4. Political or Ideological Reasons

Some individuals may disagree with US government policies or feel that their personal beliefs are in conflict with being a US citizen, leading them to renounce their citizenship as a form of protest. This could include, for example, opposing a war that the United States is engaged in or objecting to a particular political party or elected government official.

 

5. Lifestyle and Convenience

For those who have lived abroad for many years and have no intention of returning to the US, maintaining US citizenship may seem unnecessary and cumbersome.

 

Section C: Eligibility to Renounce US Citizenship

 

To be eligible to renounce US citizenship, you must meet the following criteria:

 

1. Legal Capacity

You must have the legal capacity to renounce your citizenship. This means you must be at least 18 years old and possess full mental competence. If you are under 18 or have been declared legally incompetent, you cannot renounce your citizenship on your own.

 

2. Dual Nationality

You must already possess citizenship of another country or be in the process of obtaining it. The US does not allow individuals to become stateless through renunciation, so you must demonstrate that you will hold another nationality after renouncing US citizenship.

 

3. Voluntary Act

The decision to renounce your citizenship must be voluntary. You must not be coerced or forced into renouncing your citizenship, and you will need to declare this intention in front of a US consular officer.

 

4. Physical Presence

You must appear in person at a US embassy or consulate outside the United States. Renunciation cannot be done remotely or within US borders.

 

5. Understanding of Consequences

You must fully understand the consequences of renouncing your US citizenship, including the loss of all rights and privileges associated with being a US citizen. This includes the right to reside and work in the US and the right to access US consular protection abroad.

 

Section D: Process to Renounce US Citizenship

 

 

 

By virtue of section 349(a)(5) of the INA, a person wishing to give up or renounce their US citizenship must voluntarily, and with intent to renounce their citizenship, appear in person before a US diplomatic or consular officer in a foreign country, typically at a US Embassy or Consulate, and sign an oath of renunciation. Once this is completed, the US Department of State will issue a Certificate of Loss of Nationality.

The specific renunciation process and timings may vary depending on the US Embassy or Consulate where the oath of renunciation takes place, so it will be important to follow any instructions provided.

Renunciations abroad that do not meet the prescribed conditions will have no legal effect. You cannot proceed by mail, electronically, through an agent or third party, or while in the United States.

The following is a guide to the general steps to take to renounce your US citizenship:

 

Step 1: Understand the Requirements

Renouncing US citizenship is a serious decision that involves meeting specific eligibility criteria and preparing necessary documents. It is crucial to fully understand these requirements to ensure a smooth and successful renunciation process. This step involves verifying your eligibility and gathering all required documentation before proceeding to schedule an appointment with a US embassy or consulate.

 

Step 2: Supporting Documents

To proceed with the renunciation process, you will need to gather and prepare the following documents:

 

Document/Requirement	Description
Proof of US Citizenship	This can include your US passport, birth certificate, Certificate of Naturalization, or Certificate of Citizenship. These documents will be used to verify your identity and citizenship status.
Foreign Passport	If you hold another nationality, you will need to provide your foreign passport as proof of your dual citizenship.
Completed Forms	You will need to complete several forms, including the DS-4079 (Request for Determination of Possible Loss of United States Citizenship) and DS-4081 (Statement of Understanding Concerning Renunciation).
Evidence of Other Nationality	If you do not currently hold a foreign passport, you must provide evidence that you have obtained or are in the process of obtaining citizenship in another country. This could include a certificate of naturalization or a letter from the foreign government.
Financial Information	You may be required to provide information regarding your financial status, particularly if you are subject to the expatriation tax. This can include recent tax returns and other financial documents.
Application Fee Payment	Be prepared to pay the renunciation fee at the time of your appointment. Check with the specific US embassy or consulate for the current fee amount and accepted payment methods.

 

Step 3: Schedule an Appointment with a US Embassy or Consulate

Once you have verified your eligibility and gathered the necessary documents, the next step in renouncing your US citizenship is to schedule an appointment with a US embassy or consulate. Renunciation must be performed in person outside the United States. Find your nearest US embassy or consulate on the US State Department’s official website.

US embassies and consulates can be busy, and appointment slots may fill up quickly. It is advisable to schedule your appointment as soon as you are ready to avoid long waiting periods.

 

Step 4: Attend the Renunciation Appointment

This step involves a personal appearance where you will sign a number of documents, take an oath of renunciation and undergo an interview with a consular officer.

Ensure you arrive early on the date of your appointment to account for security screening, similar to airport procedures.

After passing through security, check-in at the reception desk. Inform the staff that you are there for a renunciation appointment. You may be asked to provide confirmation of your appointment and identification.

When called, you will meet with a consular officer who will guide you through the renunciation process and ask you questions to ensure that your decision to renounce US citizenship is voluntary and well-informed. Some common questions include:

 

a. Why do you want to renounce your US citizenship?

Be prepared to explain your reasons clearly and honestly. This helps the consular officer understand your motivations.

 

b. Do you understand the consequences of renouncing your US citizenship?

You will need to demonstrate that you are fully aware of the legal, financial, and social implications of renunciation.

 

c. Do you have citizenship or will you obtain citizenship of another country?

The officer needs to ensure that you will not become stateless after renunciation.

 

d. Are you making this decision voluntarily?

Confirm that you are not being coerced or influenced by external pressures.

 

e. Are you aware of the potential tax obligations associated with renunciation?

Understand that renouncing citizenship does not absolve you of previous tax obligations to the US government.

 

f. Do you understand that renunciation is irrevocable?

Acknowledge that once the renunciation is complete, it cannot be undone.

The consular officer will also review your documents to ensure they are complete and accurate, and you will be required to sign several forms, including the DS-4079 (Request for Determination of Possible Loss of United States Citizenship) and DS-4081 (Statement of Understanding Concerning the Consequences and Ramifications of Renunciation of US Citizenship). Some embassies or consulates may take your fingerprints and photos for their records.

In some cases, you may be required to undergo two interviews, where many consulates require that you return for a second interview, either as a cooling-off period and/or to provide the consular officer with the opportunity to review your paperwork. However, different consulates may handle this process differently, depending on which country the expatriation takes place.

You may then take an oath of renunciation, officially declaring your intention to give up your US citizenship.

The consular officer will inform you about the estimated processing time for receiving your Certificate of Loss of Nationality (CLN), which confirms that you have officially renounced your US citizenship.

 

Step 5: Pay the Renunciation Fee

During your appointment, you will also need to pay the renunciation fee.

The fee to renounce US citizenship is set at $2,350, which includes processing the renunciation application, conducting the interview and verifying documents and issuing the Certificate of Loss of Nationality. The fee is non-refundable.

Ensure you have the correct payment method as specified by the embassy or consulate.

 

Step 6: Application Processing

The processing time for your renunciation can vary, but it typically takes several months.

After your renunciation appointment, the consular officer will forward your documents and forms to the US Department of State in Washington, DC, for review and approval. This initial review can take a few weeks.

The US Department of State will review your case to ensure that all legal requirements have been met and that your renunciation was conducted properly. This process can take several months, depending on the volume of applications and the complexity of your case.

Once your renunciation is approved, the Department of State will issue your Certificate of Loss of Nationality (CLN). The certificate will be sent back to the US embassy or consulate where you completed your renunciation, and they will notify you when it is ready for collection.

You will be notified by the US embassy or consulate when your CLN is ready to be picked up. In some cases, the CLN may be mailed directly to you if you have made prior arrangements for this.

 

Step 7: Receive Your Certificate of Loss of Nationality

The final step in the process of renouncing your US citizenship is receiving your Certificate of Loss of Nationality (CLN). The CLN serves as the official confirmation that you are no longer a US citizen.

The Certificate of Loss of Nationality expatriation, or Certificate of Loss, is created on Form DS-4080, which is the form you sign before a consular officer. A renunciation of United States nationality or citizenship is effective only upon approval by the DOS, but once approved, the loss of citizenship occurs as of the date the oath was taken. If your request is subsequently approved by the DOS, your certificate will reflect the date on which you took the Oath of Renunciation as the effective date of expatriation.

In addition to Form DS-4080, you will also be asked to sign Form DS-4081. This is a written statement of understanding concerning the consequences and ramifications of renunciation or relinquishment of US nationality and will include a signed attestation from the consular officer that the irrevocable nature of the act of renunciation has been explained to you.

 

Section E: Post-Renunciation Checklist

 

After receiving your Certificate of Loss of Nationality, there are several follow-up actions you should take to reflect your new status:

 

1. Update Legal Documents

Update any legal documents, such as wills, trusts, and powers of attorney, to reflect your new citizenship status. This may involve notifying financial institutions, government agencies, and other relevant parties.

 

2. Tax Obligations

Ensure that you have fulfilled all your tax obligations with the US Internal Revenue Service (IRS). You may need to file a final tax return as a US citizen, including the expatriation tax (if applicable). It is advisable to consult a tax professional experienced in expatriation matters to ensure compliance.

 

3. Social Security and Benefits

If you were receiving US Social Security benefits, notify the Social Security Administration (SSA) of your renunciation. Depending on your new country of residence and any existing treaties, you may still be eligible for certain benefits.

 

4. Travel Considerations

As a former US citizen, you will now need to adhere to the visa requirements of the United States for future visits. Apply for a visa or use the Visa Waiver Program (if eligible) for any travel plans to the US.

 

5. Notify Relevant Authorities

Inform the authorities in your country of residence about your change in citizenship status. This may involve updating your residency permits, national identification documents, and other legal records.

 

6. Retain Your CLN

Keep your Certificate of Loss of Nationality in a safe and accessible place. This document is essential for proving your renunciation and your new citizenship status. You may need to present it in various legal or financial situations.

Our US renunciation specialists can advise on the actions to take to help ensure that all necessary actions have been taken and that you are fully compliant with both countries’ laws.

 

Section F: Costs and Fees of Renouncing US Citizenship

 

Renouncing US citizenship involves several costs and fees, making it essential to understand the financial implications before beginning the process. In addition to the renunciation application fee, you should be prepared for various additional expenses, including legal fees and travel costs.

 

1. Application Fee

 

The primary cost associated with renouncing US citizenship is the application fee, which is currently set at $2,350. This fee is required by the US Department of State and covers the administrative costs of processing your renunciation application and issuing the Certificate of Loss of Nationality (CLN). It is a non-refundable fee and must be paid at the time of your renunciation appointment at a US embassy or consulate.

 

2. Additional Costs

 

Beyond the application fee, there are several additional costs that you may incur during the renunciation process:

 

a. Tax Obligations: You may be subject to the expatriation tax, also known as the exit tax, if you meet certain criteria related to your net worth and average annual income tax liability. This tax can be substantial, and you may need to file a final US tax return along with Form 8854 (Initial and Annual Expatriation Statement).

b. Documentation Fees: There may be costs associated with obtaining or certifying documents required for the renunciation process, such as birth certificates, passports, and evidence of foreign citizenship.

c. Postal and Courier Fees: If you need to mail documents or receive your CLN via courier, these costs can add up, especially for international shipping.

 

3. Travel Expenses

 

Travel expenses are a significant consideration, as you must appear in person at a US embassy or consulate outside the United States to renounce your citizenship. These costs can include:

 

a. Airfare: The cost of flights to the nearest US embassy or consulate offering renunciation services can vary greatly based on your location and travel class. International flights can range from a few hundred to several thousand dollars.

b. Accommodation: Depending on the embassy or consulate’s location and the duration of your stay, you may need to budget for hotel accommodations. Costs will vary based on the city and the level of comfort you require.

c. Local Transportation: Include costs for local transportation such as taxis, rental cars, or public transit to and from the embassy or consulate.

d. Meals and Incidentals: Budget for meals and incidental expenses during your trip.

e. Travel Insurance: Consider purchasing travel insurance to cover any unforeseen circumstances or emergencies during your trip.

 

Section G: Impact of Renouncing US Citizenship

 

If you’re considering giving up your US citizenship, it will be important to understand the implications. Renouncing US citizenship is a decision with significant legal and financial consequences, affecting various aspects of your life, from tax obligations to social security benefits and estate planning.

In some cases, renunciation of US citizenship may not have the desired effect on your US obligations.

For example, renouncing your US citizenship may have no effect on any military service or certain US tax obligations. Some high-income US citizens may owe a form of exit tax when renouncing their citizenship, officially referred to by the IRS as “expatriation tax”. Expert advice should always be sought here, as you may be giving up your rights and privileges as a US citizen without gaining any real financial benefit from so doing.

Further, the act of renunciation will not allow you to avoid possible prosecution for crimes that you may have committed or may commit in the future that violate United States law. You can still be deported to the United States in some non-citizen status.

You will also not be permitted to escape the repayment of financial obligations, including child support payments, previously incurred in the United States or incurred as a United States citizen abroad.

It is recommended to consult with legal and tax professionals who specialize in expatriation to deal with these complexities and ensure that your decision is well-informed and your interests are protected.

 

1. Tax Obligations

 

One of the most complex areas affected by renouncing US citizenship is taxation. US citizens are taxed on their worldwide income, and this obligation continues even after renunciation, subject to certain conditions. You are required to file a final tax return covering the period from January 1st of the renunciation year up to the date of renunciation. This includes reporting all income earned during this period and paying any taxes due.

Along with your final tax return, you must file Form 8854 (Initial and Annual Expatriation Statement). This form provides the IRS with information about your assets and income to determine if you are subject to the expatriation tax.

 

a. Expatriation Tax

The expatriation tax, often referred to as the exit tax, applies to certain individuals who renounce their US citizenship. You may be subject to this tax if you meet any of the following criteria:

 

i. Net Worth Test: If your net worth is $2 million or more on the date of expatriation, you are subject to the expatriation tax.

ii. Tax Liability Test: If your average annual net income tax liability for the five years preceding the date of expatriation exceeds a specified threshold (adjusted annually for inflation), you are subject to the expatriation tax.

iii. Compliance Test: If you fail to certify on Form 8854 that you have complied with all US federal tax obligations for the five years preceding the date of expatriation, you are subject to the expatriation tax.

 

The expatriation tax treats your worldwide assets as if they were sold for their fair market value on the day before your expatriation date, potentially resulting in a substantial tax liability. Planning and professional advice are essential to manage this effectively.

 

b. Filing Final Tax Returns

In addition to the expatriation tax, you must ensure that all your previous tax obligations are settled. You must file a final income tax return for the year of renunciation, reporting all income up to the date of renunciation, and if you lived in a state with state income taxes, ensure that all state tax obligations are fulfilled.

You also need to be fully compliant with all US tax laws for the five years preceding your renunciation. This includes filing all required tax returns and paying any due taxes.

 

2. Social Security and Benefits

 

Renouncing US citizenship can affect your eligibility for social security benefits. If you have paid into the US Social Security system, you may still be eligible for benefits. However, the rules can vary depending on your new country of residence and any existing social security agreements between the US and that country.

Payments to non-citizens residing outside the US may be subject to restrictions or additional withholding taxes. Ensure you understand how these rules apply to you.

US Medicare benefits are typically only available within the United States. Renouncing US citizenship may affect your eligibility for Medicare services.

 

3. Effect on Estate Planning

 

Renouncing US citizenship has significant implications for estate planning. As a non-citizen, your US-situated assets may still be subject to US estate tax. The exemption amounts and tax rates can differ significantly from those for US citizens.

Gifts made by former US citizens may be subject to US gift tax, depending on the nature and location of the assets and the residency of the recipient.

If you have established foreign trusts, these may be affected by your change in citizenship status, potentially altering the tax treatment of trust distributions.

Your new country of citizenship may have different succession laws that could affect your estate planning. It’s essential to review and possibly revise your estate plan to ensure it complies with local laws and achieves your intended outcomes.

 

4. US Residency

 

Any person claiming loss of US nationality must renounce all the rights and privileges associated with that nationality, including the right to live in the United States.

The US government maintains a federal register of individuals who have renounced their American citizenship, where once you renounce citizenship, you will be formally losing the right to reside in the United States without documentation as a foreign citizen. This means that you will need a suitable visa to live in the United States once again.

 

5. US Travel

 

Once a person has renounced US citizenship, they will be subject to US immigration and nationality law just as any non-US citizen would be.
This means that to gain entry into the US, the person will need to obtain a US visa or demonstrate they are eligible for admission into the US pursuant to the Visa Waiver Program.

If you are visiting the United States, depending on your nationality, you may also need a visitor visa or be able to show that you are eligible for travel under the Visa Waiver Program (VWP).

Those who are ineligible for entry into the US for prior convictions for certain offenses (even if the conviction occurred while they were a US citizen) will need to obtain a waiver of inadmissibility prior to entry into the United States.

If you are denied authorization for visa-free travel under the VWP, or you are unable to qualify for a US visa, you could be permanently prohibited from entering the United States. It is also worth noting that if the Department of Homeland Security (DHS) determines that the motivation for requesting a Certificate of Loss of Nationality was to avoid paying US taxes, you may be found inadmissible to the United States under INA 212(a)(10)(E).

 

Section H: Relinquish or Renunicate?

 

 

 

 

Under United States law, a native-born or naturalized citizen can lose their US nationality by committing a statutory act of expatriation as defined under section 349 of the INA by voluntarily performing the act with the intention of relinquishing their citizenship.

While renouncing US citizenship is the formal, legal process of giving up US nationality, ‘relinquishing’ refers to a native-born or naturalized US citizen losing their citizenship by voluntarily performing specific expatriating acts with the intention of ‘relinquishing’ citizenship. These acts include:

 

a. Obtaining naturalization in or taking an oath of allegiance to a foreign state after the age of 18;

b. Entering or service in the armed forces of a foreign state engaged in hostilities against the US or serving in any foreign army as a commissioned or non-commissioned officer;

c. Accepting, serving in or performing duties of any office, post or employment of a foreign government;

d. Making a formal renunciation of US citizenship before a diplomatic or consular officer on a US Department of State form or making a formal written renunciation whenever the US is in a state of war or

e. Committing an act of treason against or attempting by force to overthrow or bear arms against the US.

 

Therefore, an individual who has relinquished their citizenship may choose in time to renounce in formal and permanent recognition of their non-US status.

Importantly, relinquishment of US nationality by performing certain potentially expatriating acts, which include taking the Oath of Renunciation, voluntarily and with the intention of relinquishing citizenship, is a personal right which can never be exercised on your behalf.

 

Section I: Pros and Cons of Renouncing US Citizenship

 

Renouncing US citizenship is a significant decision that comes with various advantages and disadvantages. While it can simplify your financial and regulatory burdens, it also entails losing certain protections and privileges associated with being a US citizen. While the pros and cons will vary by each individual’s circumstances and preferences, some of the general considerations include:

 

1. Pros

As a US citizen, you are taxed on your worldwide income regardless of where you live. Renouncing your citizenship frees you from this obligation, meaning you will no longer need to file US tax returns or comply with the complex tax reporting requirements associated with foreign income.

The Foreign Account Tax Compliance Act (FATCA) requires US citizens to report foreign financial assets if they exceed certain thresholds. Renouncing citizenship removes the necessity to comply with FATCA, reducing paperwork and potential penalties.

Depending on your financial situation and the tax policies of your new country of residence, you might experience tax savings. Some countries have lower tax rates or more favorable tax regimes for residents and non-citizens.

US citizens are subject to extensive financial reporting requirements, including FBAR (Foreign Bank Account Report) and FATCA. Renouncing citizenship can enhance your financial privacy by relieving you from these reporting obligations.

You will no longer be subject to US-specific regulations that may affect your business or personal activities abroad. This can simplify your compliance requirements and reduce administrative burdens.

Renouncing US citizenship can provide greater flexibility in estate planning, especially if you are subject to more favorable estate and gift tax laws in your new country of citizenship.

 

2. Cons

As a US citizen, you are entitled to assistance from US embassies and consulates while traveling abroad. Renouncing your citizenship means you will no longer have access to this support, which can be critical in emergencies or legal matters.

Renouncing citizenship means losing benefits such as the right to vote in US elections, access to federal student aid, and certain social security benefits that may be restricted for non-citizens.

If you have minor children who are US citizens, renouncing your citizenship may complicate their ability to claim certain benefits or protections provided by the US government.

As a former US citizen, you will need to apply for a visa or use the Visa Waiver Program (if eligible) to visit the United States. This can add complexity and uncertainty to future travel plans.

If you plan to live in a country that does not allow dual citizenship or has stringent immigration policies, renouncing US citizenship might impact your ability to reside there permanently.

Renouncing US citizenship may affect your ability to hold dual or multiple citizenships. Some countries have specific rules regarding renunciation and acquisition of new citizenships, which could limit your options.

Moving to a new country after renouncing US citizenship may expose you to different tax and legal systems. It is important to understand these changes and how they may affect your personal and financial situation.

 

Section J: Summary

 

Renouncing US citizenship is a formal process where an individual voluntarily gives up their US nationality. As an irreversible process, it involves significant legal and financial considerations. Applicants must meet specific eligibility criteria, including being at least 18 years old, holding citizenship in another country, and fully understanding the consequences of renunciation.

One of the primary motivations for renouncing US citizenship is to avoid the global taxation obligations imposed on US citizens, regardless of where they reside. However, this decision can present risks, making professional tax guidance highly advisable.

Renouncing citizenship also means losing the protections and benefits provided by the US government, including consular assistance and the right to live and work in the United States. Travel to the US may require a visa, and the ability to access US-based social security benefits could be affected.

Careful consideration of these risks and thorough planning are essential before deciding to renounce US citizenship, as the consequences are long-lasting and cannot be undone.

 

Section K: Need Assistance?

 

NNU Immigration are specialists across all areas of US nationality and immigration, including renunciation of US citizenship.

Renouncing your US citizenship is a formal, legal and most importantly, irreversible act. It is a process to consider carefully.

If you believe you may wish to pursue this path, please contact us for a comprehensive review of your circumstances and a detailed discussion about strategy, procedures, timing, and costs. We can talk you through the immigration implications and renunciation process, including preparing and submitting the required documentation and liaising with the embassy on your behalf. We can also identify and resolve potential issues relating to your application, and advise on travel to the United States post-loss of US nationality.

For advice with your renunciation application, contact us.

Please note we do not offer tax advice.

 

Section L: Renounce US Citizenship FAQs

 

What does it mean to renounce US citizenship?
Renouncing US citizenship is a formal process by which an individual voluntarily gives up their US nationality. This involves appearing in person at a US embassy or consulate, completing necessary paperwork, and taking an oath of renunciation. Once completed, the individual ceases to be a US citizen and loses all rights and privileges associated with US citizenship.

 

Why do people choose to renounce their US citizenship?
People renounce US citizenship for various reasons, including to avoid worldwide taxation, simplify their financial and legal obligations, privacy concerns related to financial disclosures, political or ideological reasons, and issues with dual citizenship.

 

What are the eligibility criteria for renouncing US citizenship?
To renounce US citizenship, you must be at least 18 years old, have full mental capacity, and hold citizenship in another country or be in the process of obtaining it. The process must be done voluntarily and in person at a US embassy or consulate outside the United States.

 

What documents are needed to renounce US citizenship?
Necessary documents include proof of US citizenship (such as a US passport, birth certificate, or Certificate of Naturalization), a foreign passport, completed forms (DS-4079 and DS-4081), and evidence of other nationality. You will also need to pay the renunciation fee.

 

How much does it cost to renounce US citizenship?
The renunciation fee is $2,350. Additional costs may include legal fees, travel expenses, tax obligations, and documentation fees.

 

What is the expatriation tax?
The expatriation tax, or exit tax, applies to certain individuals who renounce their US citizenship and meet specific criteria related to net worth or average annual income tax liability. It treats your worldwide assets as if they were sold for their fair market value on the day before expatriation, potentially resulting in a significant tax liability.

 

Will I still owe US taxes after renouncing my citizenship?
You are required to file a final US tax return covering the period up to the date of renunciation and pay any due taxes. Additionally, if subject to the expatriation tax, you must comply with its requirements. Future income earned after renunciation will generally not be subject to US taxes.

 

Can I reverse my decision after renouncing US citizenship?
Renouncing US citizenship is generally irrevocable. Once completed, it cannot be undone. It is important to fully understand the implications and consequences before proceeding with renunciation.

 

What happens to my social security benefits if I renounce my US citizenship?
You may still be eligible for social security benefits if you have paid into the system. However, the rules for receiving benefits as a non-citizen living abroad can vary, and payments may be subject to restrictions or additional withholding taxes.

 

How does renunciation affect my family members?
If you have minor children who are US citizens, renouncing your citizenship may impact their ability to claim certain benefits or protections provided by the US government. Each family member must independently decide and complete the renunciation process if they wish to renounce their citizenship.

 

Can I travel to the US after renouncing my citizenship?
Yes, but you will need to apply for a visa or use the Visa Waiver Program (if eligible) to enter the United States. Renouncing citizenship means you will be subject to the same entry requirements as other foreign nationals.

 

What should I do with my US passport after renouncing my citizenship?
Your US passport will be canceled as part of the renunciation process. You must surrender your US passport during your renunciation appointment at the US embassy or consulate.

 

How long does it take to receive the Certificate of Loss of Nationality?
The processing time for the Certificate of Loss of Nationality (CLN) can take several months. The US Department of State reviews each case, and you will be notified when your CLN is ready for collection or delivery.

 

Do I need to be a dual national to renounce US citizenship?
Anyone intending to renounce US citizenship should be aware that, unless you already possess a foreign nationality, you may be rendered stateless and, thus, lack the protection of any government.

 

Will renouncing US citizenship affect my ability to hold dual citizenship?
Renouncing US citizenship may affect your ability to hold dual or multiple citizenships, depending on the laws of your new country of citizenship. Some countries have specific rules regarding dual citizenship, so it is essential to understand these before renouncing your US citizenship.

 

Section M: Glossary

 

Term	Definition
Certificate of Loss of Nationality (CLN)	A document issued by the US Department of State that officially confirms the loss of US citizenship following the renunciation process.
Dual Citizenship	The status of being a citizen of two countries simultaneously, subject to the laws and obligations of both nations.
Expatriation	The process of renouncing one’s citizenship or nationality, often involving relocation to another country.
Expatriation Tax	Also known as the exit tax, this is a tax imposed on certain individuals who renounce US citizenship, based on their net worth or average annual income tax liability.
FATCA (Foreign Account Tax Compliance Act)	A US law requiring US citizens, including those living abroad, to report their foreign financial accounts and assets if they exceed certain thresholds.
FBAR (Foreign Bank Account Report)	A report required by the US Treasury for US citizens with foreign financial accounts exceeding $10,000 at any time during the calendar year.
Form 8854	The IRS form titled “Initial and Annual Expatriation Statement” that expatriating individuals must file to certify compliance with US tax obligations and report their assets and liabilities.
Net Worth Test	A criterion for the expatriation tax, applying to individuals with a net worth of $2 million or more on the date of expatriation.
Tax Liability Test	A criterion for the expatriation tax, applying to individuals with an average annual net income tax liability exceeding a specific threshold over the past five years.
Social Security Benefits	Payments made to eligible retirees, disabled individuals, and their dependents, based on their earnings history in the US.
Visa Waiver Program (VWP)	A program allowing citizens of participating countries to travel to the United States for tourism or business for up to 90 days without obtaining a visa.
Legal Capacity	The ability of an individual to understand and make legal decisions, including renouncing citizenship, generally requiring the individual to be at least 18 years old and mentally competent.
Final Tax Return	The last US income tax return filed by an individual, covering the period from January 1st of the renunciation year up to the date of renunciation.
Oath of Renunciation	A formal declaration made by an individual during the renunciation process, stating their voluntary decision to relinquish US citizenship.
Compliance Test	A requirement for the expatriation tax, where individuals must certify they have met all US federal tax obligations for the five years prior to renunciation.
Renunciation Appointment	A mandatory in-person meeting at a US embassy or consulate where the renunciation process is completed, including document signing and taking the Oath of Renunciation.

 

Section N: Additional Resources

 

US Department of State: Renunciation of US Nationality
https://travel.state.gov/content/travel/en/legal/travel-legal-considerations/us-citizenship/Renunciation-US-Nationality.html
Provides official guidelines and detailed information on the process, legal requirements, and necessary forms for renouncing US citizenship.

 

US Internal Revenue Service (IRS): Expatriation Tax
https://www.irs.gov/individuals/international-taxpayers/expatriation-tax
Offers detailed information about the expatriation tax, including eligibility criteria, calculation methods, and necessary tax forms.

 

Social Security Administration (SSA): Benefits for Non-Citizens
https://www.ssa.gov/people/immigrants/
Explains how renouncing US citizenship affects eligibility for social security benefits and provides guidance for non-citizens receiving or applying for benefits.

 

American Citizens Abroad (ACA)
https://www.americansabroad.org/
A non-profit organization offering resources, advocacy, and advice for Americans living abroad, including information on the implications of renouncing US citizenship.