Thread: 3 million Americans a year fleeing the U.S.

It seems more people are awake and fleeing the IOUSA. The new Socialist Regime is chasing out the wealthy and relacing them with poor immigrants. The people who are wise enough to jump ship early will fare the best during this collapse.
Escape from America Continues by Bob Bauman

The article mentions the few areas on which Democrats and Republicans agree - imposition of the so-called "exit tax" and, as discussed elsewhere in this forum, the upcoming restrictions on wiring money out of the US. The Sovereign Society has been beating this drum for a long time, but will the masses hear it? I think most will ignore it, as we tend to do with assertions that tend to challenge our core beliefs.

US citizens receiving public aid (e.g., food stamps, public disability payments and other local community support) have no reason or ability to leave the US and will not generally seek to do so. This was discussed thoroughly in another thread regarding a $700 pensioner on food stamps and no discretionary spending whatsoever. He needs to stay in the US as no other country will pick up the financial burden he presents.

Persons of modest means, perhaps receiving a modest private pension, have the greatest advantage as they can more likely just "disappear" and stop filing US Income Tax Returns (although they may be risking continued Social Security payments?) without obtaining citizenship elsewhere and renouncing their US citizenship. In fact, due to their more limited financial means, few options will exist for them to obtain citizenship outside the US anyway. Thus, the "exit tax" will not affect them. This could be a huge number.

Persons of far greater financial means may leave, but their actions will be more closely scrutinized by the IRS. To do it "right", they will need to first establish citizenship elsewhere, which is not easy or inexpensive. Then, they process the "exit" tax they owe, which is basically an assumption by the IRS that you sold everything you own and thus must pay taxes on the gain, if any, resulting from this imaginary "sale" of assets. The other option is to just leave and ignore the IRS. Obviously, this paints a bright target on your back, with nowhere to hide. So, while this group has many more "citizenship" options, they are also the group the US most wants to keep.

I see no benefit in relenquishing the U.S. citizenship. The exit tax is prohibitive. Living abroad you will escape the littany of local, state and federal taxes that will be levied on everyone including the coming national VAT consumption tax. I agree that moving your after tax income and assets abroad is becoming more difficult. Educated people in the know understand what is transpiring and are taking the neccessary steps. I have been telling two friends a retired oil executive and a retiring Anethesiologist about Panama for 3 years. Until recently they had mild interest, they are planning a trip in May to Boquete and after having their wives watch Glenn Beck they are onboard also. These are people with education and money, not the ones any country needs to lose.

There is a nice home coming up for sale in Valle Excondido in Boquete. Not mine.

They are looking specifically at Valle Escondido. The golf course and other amenities appeal to them as well as the cool climate. They regret not having met Sam but appreciate what he accomplished there. They are also looking for opportunities in Panama for their adult children.

Originally Posted by fleeted

I see no benefit in relenquishing the U.S. citizenship. The exit tax is prohibitive. Living abroad you will escape the littany of local, state and federal taxes that will be levied on everyone including the coming national VAT consumption tax. I agree that moving your after tax income and assets abroad is becoming more difficult. Educated people in the know understand what is transpiring and are taking the neccessary steps. I have been telling two friends a retired oil executive and a retiring Anethesiologist about Panama for 3 years. Until recently they had mild interest, they are planning a trip in May to Boquete and after having their wives watch Glenn Beck they are onboard also. These are people with education and money, not the ones any country needs to lose.

I agree -- lot of noise given to renouncing citizenship but not necessary or worth the trouble for most folks. But, I believe it is smart to truly diversify oneself in a global perspective not just in the types of investments but in terms of where you invest and where you live. Giving yourself options down the road is always a good thing.

Your point about people trapped in the U.S. because they are dependant on govt assistance is valid. These people often consider themselves lucky and some have even gloated in my presence about how much their govt checks are. These people are narrow minded and don't realize they are now slaves to the master who issues the check and provides them with free govt housing and food stamps. As the economy continues it's downward spiral more and more people will find themselves on public assitance and unable to break free of it's hold. The people with private wealth who can create jobs are fleeing the new socialist regime. Three million people a year fleeing will start to add up and the govt will have to shut down the spigot. Expect new capital controls, regulations curtailing how long you can be out of the country for, or having to justify and recieve permission in advance prior to traveling abroad. This might seem way out there to some folks but these are common measures employed through out history to control population movements.

here is some more info on people fleeing the U.S. and how you can throw the dogs off your scent.
IRS Loses Bid - To Track Overseas Tax-Dodgers - Second Passport & Economic Citizenship

Originally Posted by fleeted

Your point about people trapped in the U.S. because they are dependant on govt assistance is valid. These people often consider themselves lucky and some have even gloated in my presence about how much their govt checks are. These people are narrow minded and don't realize they are now slaves to the master who issues the check and provides them with free govt housing and food stamps. As the economy continues it's downward spiral more and more people will find themselves on public assitance and unable to break free of it's hold. The people with private wealth who can create jobs are fleeing the new socialist regime. Three million people a year fleeing will start to add up and the govt will have to shut down the spigot. Expect new capital controls, regulations curtailing how long you can be out of the country for, or having to justify and recieve permission in advance prior to traveling abroad. This might seem way out there to some folks but these are common measures employed through out history to control population movements.

You keep mentioning the ppl fleeing the "new socialist regime". The article starts with "The latest news reports reconfirm a continuing trend we at the Sovereign Society have observed since our founding in 1997"

Now, i'n no expert on us politics, but have you guys had a "new socialist regime" for almost 15 years now?

However, what u say about the status of those people, or rather what the article points out, is very true. I remember in Holland they, few years ago, did a survey and found that 52% of ppl under 40 would like to leave the country. They won't all leave of course, but i alway said that the ones that actually will leave, will mainly be educated ppl, or at least ppl with a decent income. Not a good development for a country, even though at first sight less ppl would seem less stress on the system.

While I share the views of most in this thread, I disagree on the point of renouncing citizenship.

The thing I dont like about it is this... while many countries around the world will not share information for a civil matter, they will absolutely share financial information over criminal matters. If you do not relinquish citizenship, you're still legally obligated to file a yearly tax return and claim all income... basically report to big brother how much you're making. If not, you're commiting a crime.

While it is true that there is nothing spelled out in the constitution that says the federal govt has the right to tax you, try convincing the IRS of that. I'd say odds are high that will end badly. Ask Wesley Snipes.

So, as long as you're a US citizen, you're supposed to file an annual tax statement and pay any & all due taxes on personal income. If you dont, you can easily be labelled a criminal. The IRS makes a few calls and *boom*, frozen assets. Personally, I'd rather paint the target on myself and just make it official at the right time... and pay to walk away. Right now, as I'm reading it, the exit tax is on those worth $2M or more... I wont be anywhere near that. I'll have enough to live a western level, comfortable life, but it wont be $2M.

Within the next few years, I'll start making the moves to prepare as best I can... have my LLC's sold to offshore corps, choose a program & country and start the process for a second passport/citizenship, start setting up a new residence, etc. When the time is right, I'll make a clean break and walk away.

If things change course, I can still change my mind. I love what America once was. I did 10 years in the military. My father did 22 years in the military. I dont think anyone would say I'm anti-american. But it just disappoints me on a very profound level to think of what is happening to an amazing nation.

Originally Posted by janl

You keep mentioning the ppl fleeing the "new socialist regime". The article starts with "The latest news reports reconfirm a continuing trend we at the Sovereign Society have observed since our founding in 1997"

Now, i'n no expert on us politics, but have you guys had a "new socialist regime" for almost 15 years now?

However, what u say about the status of those people, or rather what the article points out, is very true. I remember in Holland they, few years ago, did a survey and found that 52% of ppl under 40 would like to leave the country. They won't all leave of course, but i alway said that the ones that actually will leave, will mainly be educated ppl, or at least ppl with a decent income. Not a good development for a country, even though at first sight less ppl would seem less stress on the system.

The U.S has been giving out the freebies for quite a while. The change with this new Socialist regime is the ramp up in Socialist spending. Progressive in chief Obama stated prior to election that is what he intended to do and the idiots elected him anyway. His predecessor Bush was also a huge progressive just like his father. The Obama regime has targeted people who work hard and are entreprenuers. People who have delayed gratification and took the risk of investing their money are now being targeted for their wealth. When the Progressives in Maryland placed a special tax on millionaires in 2009 their tax revenue actually fell as lots of millionaires simply moved out of the state. That is what is happening now on a national level. Thanks to the internet allot of people are learning they have options overseas. Eventually Socialist progressive regimes collapse under their own weight as revenues can't cover expenses. It is important for people to shield and protect their assets so when the smoke clears the rebuilding can occur. The article above does not address the number of people who will physically remain in the U.S. but send their assets abroad to protect them. Obama is causing an unprecedented expatriation of funds. He is now leading yet another war in the middle east spending billions more the U.S. does not have. He never wrapped up Iraq, Afghanistan, GITMO or any thing else. Obama's trillions in short sighted spending is hastening the collapse of the dollar. 90% of sheeple will pay and the 10% of people with money will protect it. Jan you were wise to have the forsight to move to Panama. You took a risk in doing so and I would guess will reap rewards based upon your willingness to to separate yourself from the herd.

Panama has a tiny population so steady immigration will change the demographic and eventually will lead to changes in the law. In 20 years citizenship will be easier and gringos might be voting. Look at how the hispanic population now controls the vote in the U.S. 25 years from now Panama will look allot different.

Originally Posted by CerebralPrimate

While I share the views of most in this thread, I disagree on the point of renouncing citizenship.

Within the next few years, I'll start making the moves to prepare as best I can... have my LLC's sold to offshore corps, choose a program & country and start the process for a second passport/citizenship, start setting up a new residence, etc. When the time is right, I'll make a clean break and walk away.

I'm not sure I'm following you - obtaining citizenship elsewhere and transferring assets to a foreign trust/corporation/foundation does not constitute a "clean break." Formal steps must be taken with the U.S. to end your citizenship (renouncing) and your attendent legal obligation to report income and pay taxes. Dual-citizenship means nothing to the U.S. in and of itself. Additionally, and until you do so, the identity and activity of all foreign entities you own or control are required to be reported to the IRS too (see Form 5471 and associated schedules).

Originally Posted by BalaBeacher

I'm not sure I'm following you - obtaining citizenship elsewhere and transferring assets to a foreign trust/corporation/foundation does not constitute a "clean break." Formal steps must be taken with the U.S. to end your citizenship (renouncing) and your attendent legal obligation to report income and pay taxes. Dual-citizenship means nothing to the U.S. in and of itself. Additionally, and until you do so, the identity and activity of all foreign entities you own or control are required to be reported to the IRS too (see Form 5471 and associated schedules).

Sorry, I felt the final step in the process I desribed was implied/obvious... first start to move assets offshore, then obtain second passport & citizenship, then give up present citizenship.

I just see a risk inherent in not formally making that break... yes, you can just sort of float out there off the radar if you dont renew your passport, but you are still legally obligated to file tax returns every year. If you dont, it would be very easy for big brother to label you a criminal and go after your assets. Whereas if you made that clean break, they no longer have any claim on you for taxes due.

Just the way I see it... your mileage may vary...

Btw Bala, are you involved in the upcoming Sovereign Society seminar in PC? I'm not going, but a friend is. I'll be there in the city, but staying elsewhere & doing other things during the day. Then he & I are going to go check things out in David/Boquete for 5 days, just to get a feel from the ground, meet locals and get their input, etc...

... looking forward to it!

As there are only 1000-2000 doing it every year there is probably a very good reason not to do it. For example:

1. The act of renunciation cannot be reversed.
2. They may not give you a visa to visit (unless you can prove that you did not do it for financial reasons).
3. You may give up your right to social security.
4. You may give up your right to other government retirement plans (esp military).
5. Other random harassment by the government.

Originally Posted by CerebralPrimate

Sorry, I felt the final step in the process I desribed was implied/obvious... first start to move assets offshore, then obtain second passport & citizenship, then give up present citizenship.

I just see a risk inherent in not formally making that break... yes, you can just sort of float out there off the radar if you dont renew your passport, but you are still legally obligated to file tax returns every year. If you dont, it would be very easy for big brother to label you a criminal and go after your assets. Whereas if you made that clean break, they no longer have any claim on you for taxes due.

Just the way I see it... your mileage may vary...

Originally Posted by CerebralPrimate

Sorry, I felt the final step in the process I desribed was implied/obvious... first start to move assets offshore, then obtain second passport & citizenship, then give up present citizenship.

I just see a risk inherent in not formally making that break... yes, you can just sort of float out there off the radar if you dont renew your passport, but you are still legally obligated to file tax returns every year. If you dont, it would be very easy for big brother to label you a criminal and go after your assets. Whereas if you made that clean break, they no longer have any claim on you for taxes due.

Just the way I see it... your mileage may vary...

I understand now. And, I certainly didn't mean my message to sound so preachy in reciting what the U.S. requires. Heck, don't get me wrong, I'm fine with folks falling off the radar! I'm fine if they want to file tax returns until they're dead. It's just good to know the rules so whatever decisions we make they are informed ones!

Originally Posted by CerebralPrimate

Btw Bala, are you involved in the upcoming Sovereign Society seminar in PC? I'm not going, but a friend is. I'll be there in the city, but staying elsewhere & doing other things during the day. Then he & I are going to go check things out in David/Boquete for 5 days, just to get a feel from the ground, meet locals and get their input, etc...

... looking forward to it!

No, I wasn't planning to go, but may be in town anyway and would love ot get together. Keep me informed on your plans. It sure is good for Panama that SS is having this conference here. Great hotel, and good topics and great opportunity for the attendees.

Originally Posted by EdBowers

As there are only 1000-2000 doing it every year there is probably a very good reason not to do it. For example:

1. The act of renunciation cannot be reversed.
2. They may not give you a visa to visit (unless you can prove that you did not do it for financial reasons).
3. You may give up your right to social security.
4. You may give up your right to other government retirement plans (esp military).
5. Other random harassment by the government.

I agree. Even doubling as it's supposedly done over the past few years is an insignificant number. It will be interesting to see how the numbers change over the years.

Just for kicks, consider that the top 1% of taxpayers pay something like 40% of the income taxes. The top 5% pay something like 60% of the income taxes. (I hope I'm close, cannot recall exact numbers I've read.) If Bill Gates renounced his citizenship, it would be like all the citizens of the state of Montana renouncing. The point is that IF a drip ever became a dribble, it's going to be at the top and these are the individuals most able to do so, having the greatest incentive to do so, and causing the biggest impact per individual than anyone else.

Originally Posted by EdBowers

As there are only 1000-2000 doing it every year there is probably a very good reason not to do it. For example:

1. The act of renunciation cannot be reversed.
2. They may not give you a visa to visit (unless you can prove that you did not do it for financial reasons).
3. You may give up your right to social security.
4. You may give up your right to other government retirement plans (esp military).
5. Other random harassment by the government.

I also felt 3M was high, but I dont doubt that more and more are doing it.

As for the above...

1. I wont want to reverse it. Its not something I take lightly, nor is it an impulse decision. And I still may not do it... there are a couple of years between here & there, so things can change.
2. They may not, but it's likely they will as long as I left on good terms and jumped through all the right hoops. I will still have business interests there.
3. I have serious doubts that Social Security will still be around in 22 years when I would finally be able to start drawing anything from it. Meanwhile, in the years between now & then, I'd be paying about $15K in taxes annually. Doesnt sound like a smart trade.
4. I dont have a military retirement coming because I only did 10 years.
5. Can you elaborate on that one?

Originally Posted by BalaBeacher

No, I wasn't planning to go, but may be in town anyway and would love ot get together. Keep me informed on your plans. It sure is good for Panama that SS is having this conference here. Great hotel, and good topics and great opportunity for the attendees.

Yeah, I am sure I'll thumb through my buddies' materials that he gets. I'm sure there's good info there. But I spend a lot of time researching on my own, so I know the visa programs, the relative costs, etc. I didnt feel I needed to go. But for someone who doesnt do a lot of research on their own, it's a good place to go for consolidated info.

He is looking at retiring around Boquete as well... just not quite as soon as I am... so, he's just starting to look into it all. We got to talking last Dec and I told him I wanted to go see it for myself, breathe the air, talk to folks living there... and he echo'd the same, so we decided to meet up in PC after his SS seminar and hit David/Boquete and the towns in between just to get a feel of the place first hand.

Originally Posted by CerebralPrimate

Yeah, I am sure I'll thumb through my buddies' materials that he gets. I'm sure there's good info there. But I spend a lot of time researching on my own, so I know the visa programs, the relative costs, etc. I didnt feel I needed to go. But for someone who doesnt do a lot of research on their own, it's a good place to go for consolidated info.

He is looking at retiring around Boquete as well... just not quite as soon as I am... so, he's just starting to look into it all. We got to talking last Dec and I told him I wanted to go see it for myself, breathe the air, talk to folks living there... and he echo'd the same, so we decided to meet up in PC after his SS seminar and hit David/Boquete and the towns in between just to get a feel of the place first hand.

I think the most important action for folks to consider even before they decide where they want to live is what to do with their savings and investments. Whether invested through an offshore trust or whatever, moving assets out of the US will not be getting easier in the future.

Originally Posted by CerebralPrimate

I also felt 3M was high, but I dont doubt that more and more are doing it.

As for the above...

1. I wont want to reverse it. Its not something I take lightly, nor is it an impulse decision. And I still may not do it... there are a couple of years between here & there, so things can change.
2. They may not, but it's likely they will as long as I left on good terms and jumped through all the right hoops. I will still have business interests there.
3. I have serious doubts that Social Security will still be around in 22 years when I would finally be able to start drawing anything from it. Meanwhile, in the years between now & then, I'd be paying about $15K in taxes annually. Doesnt sound like a smart trade.
4. I dont have a military retirement coming because I only did 10 years.
5. Can you elaborate on that one?

I think the 3,000,000 people fleeted mentioned are the number leaving the U.S., not necessarily renouncing citizenship. Instead, most will just "disappear."

A change of thought. Does anybody know if one has to continue to file tax returns to the state they moved away from if they do not live in a state (no address or any physical presence)? I live full time in Panama.

Probably the vast majority are undocumented workers. Hence the low number of citizenship renunciations (about 1500 per year).

The US population is growing by about 3 million per year regardless.

Originally Posted by BalaBeacher

I think the 3,000,000 people fleeted mentioned are the number leaving the U.S., not necessarily renouncing citizenship. Instead, most will just "disappear."

You need to file a part-year return for the time spent. If you dig deeply you will probably find that CA and MA have special rules since they are abusive tax collectors (CA does not even match federal depreciation rules).

Originally Posted by Panamaman

A change of thought. Does anybody know if one has to continue to file tax returns to the state they moved away from if they do not live in a state (no address or any physical presence)? I live full time in Panama.

Originally Posted by BalaBeacher

I agree. Even doubling as it's supposedly done over the past few years is an insignificant number. It will be interesting to see how the numbers change over the years.

Just for kicks, consider that the top 1% of taxpayers pay something like 40% of the income taxes. The top 5% pay something like 60% of the income taxes. (I hope I'm close, cannot recall exact numbers I've read.) If Bill Gates renounced his citizenship, it would be like all the citizens of the state of Montana renouncing. The point is that IF a drip ever became a dribble, it's going to be at the top and these are the individuals most able to do so, having the greatest incentive to do so, and causing the biggest impact per individual than anyone else.

Balabeacher this is an excellent point rarely raised thank you for bringing it to light. The wealthy are the ones fleeing because they hear from the govt constantly that they are the problem, they are the greedy ones. they are the ones who started the crisis. The wealthy people are the producers and used to be held out as an example of what an idea, hard work and risk taking could accomplish. Now in the new Socialist IOUSA they are undersiege and protecting what they have worked so hard for. I think the average upper middle class guy with just a few million will liquidate and move his assets and then drop off the radar. Renouncing citizenship does not makes as much sense for him. Again I believe you are correct in your assumptiom that a small percentage of people represent a huge amount of wealth.

Well, if you make 150-160,000 dollars right now I think you will figure things out. Social security payments make sense for a salary of 10,000 dollars on an average for 35 years.

Originally Posted by CerebralPrimate

3. I have serious doubts that Social Security will still be around in 22 years when I would finally be able to start drawing anything from it. Meanwhile, in the years between now & then, I'd be paying about $15K in taxes annually.

It makes more sense for people who make 75,000-105,000 dollars per year since they get the full income taxfree more or less. Anything over the top they can always make "arrangements" for. If you primarily invest on the US stockmarket it does not make any sense either with the W8 tax withholding.

Originally Posted by fleeted

I think the average upper middle class guy with just a few million will liquidate and move his assets and then drop off the radar. Renouncing citizenship does not makes as much sense for him.

Originally Posted by EdBowers

It makes more sense for people who make 75,000-105,000 dollars per year since they get the full income taxfree more or less. Anything over the top they can always make "arrangements" for. If you primarily invest on the US stockmarket it does not make any sense either with the W8 tax withholding.

It makes sense if the people earning 75,000-105,000 are not tied down to a job in the U.S. If leaving the U.S. costs them their lively hood they probably won't leave. If the money is made through investment income It makes perfect sense. Many people won't leave no matter what because where they are is home to them. They would rather lose everything than give up their emotional attachment to a city or country.