Pros and Cons of U.S. Citizenship

O

Obongo

Registered Users (C)
Hi,

I always thought it was a no-brainer that one should become a U.S.
citizen once they are eligible, particularly since my own country allows
dual-citizenship.

But, I'm interested in a list of pros and cons of U.S. citizenship, particularly
if you intend to live outside of the U.S. for the majority of your life.

Please add on.

Pros
----

1. Protect assets like social security, property against politicians who realize
that GC holder's can't vote.
2. Can return and work in the U.S. without having to go through INS dance
ever again.
3. Can retire in the U.S.
4. Children are automatically citizens giving them the opportunity to work
and study in the U.S.

Cons
-----

1. Need to file tax returns and pay some taxes to the U.S.
 
If you live and work in the country that has a tax treaty with United States and you make under a specific amount...you will get away with not paying federal tax (avoid dual tax) but you still have to file tax returns...
 
obongo said:
Cons
-----

1. Need to file tax returns and pay some taxes to the U.S.
Click to expand...

You have to do that anyhow. Obiviously, my assumption is that you are the permanent resident (PR) and that you want to keep this status. PR have the same "deal" here like USC. So, you can scrap this one.
 
PRO: If you are a green card holder there are certain tax ramifications that take effect if you die and leave your estate to your spouse. Green Card holders are not eligible for the spousal deduction. When you become a citizen you qualify for the spousal deduction.

CON: If you are a citizen your estate is fully taxed (estate tax).
 
dr_z said:
PRO: If you are a green card holder there are certain tax ramifications that take effect if you die and leave your estate to your spouse. Green Card holders are not eligible for the spousal deduction. When you become a citizen you qualify for the spousal deduction.

CON: If you are a citizen your estate is fully taxed (estate tax).
Click to expand...

Now, that's an interesting CON. I never thought about the estate tax,
but your right. Whether the assets are in the U.S. or not is moot, you'll
have to pay an estate tax.

Now, normally the estate tax won't effect common folk like us, but if they
don't keep on increasing the threshold to match inflation, then in 30 years
time we may get hit with it.
 
Right....also, most people don't understand the green card issue re the spousal deduction.

This is a major issue that most people have not thought of. If you don't know what I am talking about let me net it out for you.....

lets say that you and your wife are green card holders. One of you dies. Your assets transfer to the remaining spouse and then the remaining spouce has to pay tax on them right away. So, say you jointly own a house worth $300K. One of you dies. The remaining spouse will have to come up with the funds to pay tax on $150K (1/2 the value of the house) to the government.

If you are both citizens then this issue does not exist as the assets pass to the spouse tax free via the spousal deduction.

There are many work arounds to protect green card holders from the situation above. These involve going to see a tax or estate lawyer and placing your assets into a trust until you obtain citizenship.

DR_Z
 
dr_z said:
Right....also, most people don't understand the green card issue re the spousal deduction.

This is a major issue that most people have not thought of. If you don't know what I am talking about let me net it out for you.....

lets say that you and your wife are green card holders. One of you dies. Your assets transfer to the remaining spouse and then the remaining spouce has to pay tax on them right away. So, say you jointly own a house worth $300K. One of you dies. The remaining spouse will have to come up with the funds to pay tax on $150K (1/2 the value of the house) to the government.

If you are both citizens then this issue does not exist as the assets pass to the spouse tax free via the spousal deduction.

There are many work arounds to protect green card holders from the situation above. These involve going to see a tax or estate lawyer and placing your assets into a trust until you obtain citizenship.

DR_Z
Click to expand...

Thanks. Now your only talking about assets in the U.S. right?
If your just (sic) a GC holder then assets outside of the U.S. are
not liable for this type of taxation right?
 
Can you recommend good sites/forums with information about taxation for us citizens living abroad?

Thanks,
Stoil


harvydonald said:
If you live and work in the country that has a tax treaty with United States and you make under a specific amount...you will get away with not paying federal tax (avoid dual tax) but you still have to file tax returns...
Click to expand...
 
blahblah_gc said:
jury duty.

so much hazzling when attending it.

but with GC, no such problem.
Click to expand...

Good point. Jury duty is a pain since many employer's
dont respect it. A colleague went through it. $40 per day
is all you get and your work piles up while your away!

But so far, every that has been written has convinced
me that becoming a U.S. citizen is a no-brainer.
 
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us citizens are taxed based on worldwide income.

Most other countries do not tax you for foreign income.

This can be substantial if you derive much of your income overseas and you don't spend much time in the US.
 
money

When talking to my friends, i get the impression that many( if not most) of us
are here (in US) because we realize we can accumulate more
wealth here and give our kids a better chance at success.

may be it is an obvious point, but i did not see this listed as a pro..
 
qili said:
us citizens are taxed based on worldwide income.

Most other countries do not tax you for foreign income.

This can be substantial if you derive much of your income overseas and you don't spend much time in the US.
Click to expand...

I think it depends if your home country has a tax treaty with the U.S.
Mine does and it works like this.

If I reside in the US I must declare income
earnt world wide.
I must file a tax return in both countries.
I pay tax on income earned only in that country
and take a tax credit for for that paid tax in the other country.
But since the U.S. has so low tax rates it rarely happens.
 
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The biggest con of a u.s citizenship:

You get the feeling that you are the greatest in the world and you have the right to racially discriminate every other human being :D



Most important thing is u dont need a tourist visa for most of the countries.
 
sponsoring relatives

another pro is that as a citizen you can sponsor your relatives.

I am not sure(but curious to know) how many actually avail of this .
In my case, I doubt this will be of any use. Parents are usually
eligibile to receive GCs immediately but mine are not interested
in even visiting US ( having visited once a few years ago), let
alone stay here!

My brother and sister may be unwilling to put their plans on hold
for longer than a decade that it takes for getting their GCs :(
how long is the projected wait for sibilings? I assume that if
siblings get their GC it is for the entire family (if we did apply
for the entire family)? may be neice and nephews could benefit
from this.... just a thought.
 
military

US has had an all voluntary military for quite some time. Does any one
know when was the last time they had a draft?

Although there is intense speculaiton about a military draft every
time US is involved in a conflict, chances are that it will remain
a voluntary army.

also, if we are debating about pros and cons of citizenship versus
permanent residency, then is'nt it the case that both as a PR
and as a citizen you are REQUIRED to register with SSA. SO we
cant count this as a con of just citizenship. correct? For kids
who are born in US, ofcourse there is no choice in this matter.
 
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