{"id":21349,"date":"2013-07-25T08:20:42","date_gmt":"2013-07-25T12:20:42","guid":{"rendered":"http:\/\/www.ino.com\/blog\/?p=21349"},"modified":"2013-07-24T16:52:16","modified_gmt":"2013-07-24T20:52:16","slug":"a-tight-tax-leash-constrains-americans","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2013\/07\/a-tight-tax-leash-constrains-americans\/","title":{"rendered":"A Tight Tax Leash Constrains Americans"},"content":{"rendered":"

By Nick Giambruno, Editor, International Man<\/span><\/h3>\n

Many readers are already well aware that the US government is essentially unique\u2014and not in a good way\u2014in how it treats its citizens living and working in foreign countries. No other country in the developed world imposes and effectively enforces as many burdens on its citizens abroad (and those who would do business with them) as does the US government.<\/p>\n

Whether it is filing and paying taxes to both a foreign government and the US government, the reporting of foreign financial assets (FBAR and Form 8938), or saddling foreign financial institutions with extra compliance costs for dealing with US citizens (FATCA), among others, the root cause of these burdens is a system of citizenship-based taxation (CBT)<\/strong>.<\/p>\n

The US is the only developed country in the world that enforces CBT.<\/strong><\/p>\n

The rest of the developed world uses residence-based taxation (RBT)<\/strong>, which means filing and paying taxes only in the country in which you reside, as opposed to the country of which you are a citizen.<\/p>\n

It is critical for Americans considering internationalization to understand the difference between CBT and RBT. This two-and-a-half-minute video does a good job of spelling it out.<\/p>\n