Americans abroad build global business ties, but citizenship-based taxation builds barriers

“No citizen should have to choose between their national identity and their ability to invest, save and build a secure future.”

— Clayton Whitener, a U.S. citizen in Switzerland

Dear Congress,

Americans abroad help build global business ties, strengthen commercial relationships and represent the United States around the world. Yet citizenship-based taxation can turn that international life into a financial disadvantage, with costly compliance requirements, investment restrictions and barriers to ordinary financial services.

I am writing as a U.S. citizen living in Switzerland with longstanding ties to Georgia who has spent most of his life living and working internationally.

Global work, U.S. tax barriers

Born in Saudi Arabia, I lived in Augusta, Georgia for two years until I was 8 years old, and have since lived and worked in Germany, India and Switzerland. Today, I work as an International Key Account Manager, managing global customer relationships and supporting international business growth.

Throughout my career, I have traveled to nearly 70 countries and experienced firsthand the value of international engagement. Americans abroad promote U.S. business interests, strengthen commercial ties and serve as informal ambassadors for our country around the world.

Like every Swiss resident, I pay taxes where I live and work. Yet, as an American abroad, I am also required to comply with a second, highly complex tax and reporting system based solely on my citizenship. While tax treaties may reduce direct double taxation, they do not eliminate the significant compliance costs, reporting burdens and investment restrictions that Americans overseas face.

Routine investments become complicated

Every year, I spend thousands of dollars on specialized tax preparation simply to remain compliant. More importantly, my U.S. citizenship limits my ability to invest and plan for the future. Many investment products available to my colleagues and neighbors are either inaccessible or subject to unfavorable U.S. tax treatment. Opportunities that are routine for others become costly and complicated for me.

The burden is not only financial. Americans abroad are often viewed as compliance risks by banks and financial institutions because of FATCA and related regulations. As a result, ordinary financial decisions can become unnecessarily difficult.

I am proud to be an American. However, citizenship-based taxation is sustainable only as long as I can continue to absorb the growing costs and restrictions associated with it. At some point, many Americans abroad are forced to ask a question they should never have to ask: Is maintaining U.S. citizenship worth the burden?

No citizen should have to choose between their national identity and their ability to invest, save and build a secure future.

I respectfully urge Congress to support residence-based taxation for Americans abroad. The United States should encourage its citizens to live, work and build relationships around the world, not penalize them for doing so.

Americans abroad are not asking for special treatment. We are asking for a system that recognizes where we live, where we work and where we already pay taxes.

Sincerely,

Clayton Whitener in Switzerland