Americans are renouncing their citizenship in record numbers
Few would describe the year 2020 as the best of times for the United States. But for a growing number of Americans, the situation has become so intolerable they have cut their ties with the country altogether.
According to a recent survey of government data, 5816 Americans renounced their citizenship in the first six months of 2020. That is more than a ten-fold increase from the last six months of 2019, when 444 citizens gave up their passports.
The surge in renunciations during the first half of 2020 also breaks a record set in 2016 when 5,409 Americans gave up their citizenship over the course of the year. And it already outstrips the record level of renunciations that occurred in 2016 when 5,409 people in the United States turned in their passports.
The new data, which was compiled by Bambridge Accountants and drawn from the Federal Register, does not provide reasons for why the list of former citizens—everyone from Jose Abaya to Stefan Zwicky—gave up their passports.
But based on past years, federal tax rules likely explain many of the renunciations. Unlike nearly every other country, the U.S. levies tax based on nationality rather than residence—meaning many Americans abroad are forced to file with the IRS (and in some cases pay tax) even if they haven’t live stateside for years.
That burden, however, is no different from what it has been in the last several years—suggesting the recent surge in people renouncing their U.S. citizenship has been caused by other reasons, such as the pandemic or political turmoil.
For those tempted to give up their U.S. citizenship in favor of another passport, the process is not simple—or cheap. In order to cut ties with Uncle Sam, would-be expatriates must pay a $2,350 departure fee. And as Fortune earlier reported, Americans must also pay any back taxes they owe the IRS before they can renounce their citizenship.