Record Number of Americans Gave Up US Citizenship in 2014

While the debate over undocumented immigrants in the US dominates the political landscape, a record number of Americans are pursuing the American Dream abroad.

According to the Treasury Department, around 3,415 Americans renounced their citizenship in 2014, up from 2,999 in 2013 and more than three times the number in 2012.

The reason is: FATCA provisions.

The Foreign Account Tax Compliance Act (FATCA) is a law, passed in March 2010 that requires American citizens and entities to report their foreign financial accounts and offshore assets and pay additional taxes such as withholding a 30% tax on income paid to a non-US person.

The law also requires foreign banks to report Americans with accounts over $50,000.  Non-compliant banks will be frozen out of US markets, so all banks are complying.

The Act was designed to catch wealthy tax cheats abroad but ended up leading Americans to give up their citizenship to preserve their assets.

So, where are these ambitious Americans moving to?

Most expats are going to Switzerland for the quality of life; China is home for the highest earning ones; 57% of them have found partners in Italy; and Canada is the most popular destination for retired Americans, according to an HSBC survey.