Editor's note: As of January 2008, we have only been able to find this article archived in one place on the internet, so to preserve it, we now provide an archive of it here.

Excerpted: Forbes Magazine (Nov 18, 1996 v158, n12, p44(2))


And don't come back!

By Robert Lenzner

In August 1996 the Republicans pasted some anti-taxpatriate language into the
Health Insurance Portability & Accountability Act. This law now subjects
expatriates with a net worth of over $500,000 to taxation on their income
earned in the U.S. for ten years from the time they renounce their
citizenship, no matter where they live or whose flag they salute. But this is
a law without teeth. Any clever entrepreneur can live by borrowing against
assets rather than paying himself an income. Any good international tax lawyer

can move ownership of U.S. assets into a foreign corporation or trust, thus
making most taxpatriates' U.S.-sourced income vanish.

The latest effort to keep intrepid taxpatriates on the reservation was passed
with no fanfare in early October. A little-noticed provision of the Illegal
Immigration Reform & Immigrant Responsibility Act of 1996 says, in essence,
that Americans can still renounce their citizenship and flee to tax havens
like the Bahamas, Ireland and Switzerland. But if they do, they can't
necessarily come back to the U.S., not even to visit the grandkids or attend
their college reunions.

Under the new law, the taxpatriate—any expatriate for that matter—must apply
for a visa for every visit. The law states that the U.S. Attorney General may
prohibit the issuance of a visa to a former U.S. citizen if there are solid
grounds to believe that citizenship was renounced in order to avoid taxes.

In short, taxpatriates will now be treated as exiles without any visiting
rights, just like the illegal immigrants the U.S. wants to cut off.


We want to point out that at this point in time, the "don't come back" provision discussed in the above article has not yet been used against any US expat. However, that does not mean that the law is not valid. It is valid - just not yet enforced.

In fact, many laws on the books today have never been enforced. Just look at the thousands of US gun laws that have never been enforced. But at any time they want, the government may choose to begin enforcing any or all of those unenforced laws. It leaves one to wonder on what they are waiting. Perhaps, they are just waiting until they have a few more oppressive "unenforced" laws in place. Maybe not. But, who knows? It's certainly something to think about.

Copyright 2019 John Gaver
All rights reserved

See related articles and supporting documents:

1986-2008 IRS Collections Data by Income Category
Obama agenda drives record expatriation
Tick - Tick - Tick / The Economy Bomb
Tax Freedom Day Builds Case for FairTax
US Tax Freedom Day Clock Web Widget
UK Tax Freedom Day Clock Web Widget
US Tax Freedom Day Clock
US Tax Freedom Day Clock Widget (for Mac)
UK Tax Freedom Day Clock Widget (for Mac)
The Privacy Factor
More Attacks on the Wealthy
US Taxpatriates List
2000 Statistical Yearbook of the Immigration & Naturalization Service (6.2mb PDF)
2003 World Wealth Report (Press Release)
American Citizens Residing Abroad (US Bureau of Consular Affairs)
Health Insurance Portability & Accountability Act of 1996 (26 USC 877(a)(1))
Immigration Reform and Immigrant Responsibility Act of 1996 (8 USC 1182(a)(10)(E))
Heroes Earnings Assistance & Relief Tax Act (Public Law 110-245) (8 USC 1182(a)(10)(E))
The Economic Impact of Replacing Federal Income Taxes
      with a Sales Tax (CATO)
Fair Tax Act of 2011 (H.R. 25)
Americans for Fair Taxation
National Retail Sales Tax Alliance

Recommended Books:

The Rich Don't Pay Tax …Or Do They?
The Fair Tax Book
Fair Tax: The Truth
How to Hide Your A$$et$ and Disappear
Escape From America

See Expatriate sites:

The Sovereign Society
Escape Artist
Expat World
Second Passports

Contact your Congressman here.


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