Statement for the Record in House Ways and Means Committee Hearing with IRS CEO

In addition to working directly with Rep. LaHood and Sen. Young on their joint Residence-Based Taxation for Americans Abroad Act, Tax Fairness for Americans Abroad is always looking for opportunities to remind others in Congress of of our cause. In this context, we recently submitted a written statement for the record in a House Ways and Means Committee hearing with the chief executive officer of the Internal Revenue Service. Here’s what we told them.

The Honorable Jason Smith

Chairman

Committee on Ways and Means

U.S. House of Representatives

1011 Longworth House Office Building

Washington, DC 20515

Sent via email

 Dear Chairman Smith,

Thank you for the opportunity to submit written testimony with respect to the Committee’s March 4, 2026 hearing with Internal Revenue Service Chief Executive Officer, Frank J. Bisignano. I am submitting this testimony today as the Executive Director of Tax Fairness for Americans Abroad (TFFAA). TFFAA represents the millions of U.S. citizens who live outside the United States and who struggle every year with the unfair, extraterritorial U.S. taxation system and related financial reporting obligations. We are Americans, but the system today effectively makes us second-class citizens. As the leading non‑partisan organization fighting for tax fairness for Americans living abroad, we urge you to include in any upcoming tax legislation a lasting solution to end the double taxation of Americans abroad.

As we have shared with the Committee previously, Congress must address the unfair taxation that Americans living abroad face due to the United States’ outdated and punitive citizenship‑based taxation system. On the campaign trail, President Trump recognized that our plight is a serious issue and pledged to end the double taxation of Americans abroad. Members on both sides of the aisle have likewise been working to solve this issue for many years. We believe this bipartisan priority can and should be included in the next available tax package.

Severe and unique burdens

I especially want to highlight the recent findings of the National Taxpayer Advocate (NTA) in her 2025 Annual Report to Congress, which dedicates an entire section to documenting the severe and unique burdens that Americans abroad face. The NTA unequivocally confirms that U.S. citizens abroad confront extraordinary compliance challenges and systemic inequities stemming directly from citizenship-based taxation and overlapping international reporting regimes.

The NTA’s report includes a number of important findings with respect to Americans living and working abroad:

• U.S. citizens abroad face duplicative, inconsistent, and punitive international information reporting, including Foreign Bank Account Report (FBAR), Foreign Account Tax Compliance Act (FATCA), passive foreign investment company (PFIC) rules, and reporting for foreign pensions and trusts. The potential penalties are draconian and can be life‑altering even when no U.S. tax is owed.

• The IRS offers virtually no meaningful service access abroad—no walk‑in centers, no VITA/TCE assistance, no foreign‑accessible payment/refund systems, and online tools that often do not work for taxpayers with foreign addresses.

• The IRS’ identity‑verification systems, online accounts, and automated tools frequently exclude overseas taxpayers, causing Americans abroad to be locked out of services routinely available to taxpayers in the United States.

• Many Americans abroad face high tax and reporting compliance costs, financial barriers to basic banking or retirement planning, and in some cases feel forced to renounce U.S. citizenship to live normal financial lives.

Structural reform needed

While the report suggests some administrative improvements, even the NTA acknowledges that these are limited by the constraints of the current system. We appreciate and endorse the NTA’s recommendations, but we continue to call on Congress to enact much needed structural reform. The NTA’s recommendations would address key symptoms rather than the cause. As long as the United States maintain citizenship-based taxation, these problems will persist.

The United States is the only democratic country in the world that subjects its citizens to taxation no matter where they live around the world. Americans living abroad face a lifetime of double tax filing obligations, high compliance costs, financial discrimination, and sometimes outright double taxation simply by virtue of being American. The NTA’s report provides the most detailed and authoritative documentation to date of how profoundly unworkable the current system is for Americans abroad. But it also shows clearly that there is no administrative fix capable of resolving the structural problems created by citizenship‑based taxation.

More than a year ago, our organization developed and shared a detailed proposal for a transition to residence‑based taxation. We were encouraged when Rep. Darin LaHood (R‑IL) introduced the Residence-Based Taxation for Americans Abroad Act (H.R. 10468), which mirrors that proposal. Rep. LaHood’s bill includes prudent guardrails, bipartisan appeal, and a framework that aligns with international norms while protecting the U.S. tax base. We are further encouraged that Rep. LaHood and Sen. Todd Young (R-IN) are working to perfect the legislation and reintroduce it for the 119th Congress.

Patches vs. addressing root causes

Given the NTA’s findings, the need for RBT is more compelling than ever. The administrative patches the NTA recommends are important, but they cannot repair the underlying problem. Only RBT will:

·       End double taxation

·       End double filing of tax returns and declarations

·       Eliminate duplicative foreign account reporting

·       Reduce IRS burden on American taxpayers

·       Support mobility for American workers and businesses to represent American business in the global economy

·       Restore fairness and dignity to millions of law-abiding Americans abroad

·       Align the United States with every other developed nation

Chairman Smith, we are committed to working with you and the members of the committee, as well as the President and the Senate, to end this injustice for Americans living abroad. We urge you and the committee to seize the next available opportunity to pass an RBT bill and fulfill the President’s pledge to end the double taxation of Americans abroad.

TFFAA stands ready to assist with any effort to end this longstanding injustice.

Sincerely,

Brandon Mitchener

Executive Director

Tax Fairness for Americans Abroad