Expat Survey Reveals Expats Are Unified, but Disagree with US Political Direction
Greenback Expat Tax Services’ 2018 US expat opinion survey probed the opinions of more than 3,800 expats, and their responses may surprise you. The annual survey asked questions that showed some consistent trends in expats’ views on taxes, but also posed questions that dug deeper into their current political satisfaction – or lack thereof.
Expats have consistently expressed that they should not owe yearly taxes or be required to report annually on their foreign bank accounts. This year, 67% of expats felt they should not be required to file taxes – a one percent rise over last year. Of the expats surveyed, 51% did not owe taxes, 29% did, 13% received a refund, and 7% did not file.
Though the majority of expats do not have to pay taxes, annual reporting requirements can still feel unbearable. Foreign Bank Account Reporting (FBAR) and the Foreign Account Tax Compliance Act (FATCA) are two such reporting requirements that come as a surprise to some expats and can complicate their banking transactions. 6% of expats surveyed did not know what FBAR was, and 21% were unaware of FATCA. However, FATCA continues to affect over a third of expats (37%) in ways that range from causing trouble finding a local bank to work with, to ending access to business bank accounts because the company does not want its balances reported to the IRS.
The difficulties caused by the tax filing and account reporting requirements lead many to consider citizenship renunciation. In 2018, 4% of expats plan to renounce their citizenship. Additionally, 17% are seriously considering renouncing their US citizenship. 43% are not currently considering renunciation but would not rule it out. The first quarter 2018 citizenship renunciation numbers were nearly double the fourth quarter of 2017, according to our survey data, 38% of those considering renunciation are doing it because of the tax burden imposed on US citizens.
Expats are not only dissatisfied with their tax filing requirements, but also with their representation in the US government. More than 86% of expats feel their interests are not well represented and would like to see changes, particularly as related to their taxes. When asked what single tax issue the government should address first, over half (57%) said they would like to see the repeal of citizenship-based taxation.
Just under 20% wished for a simplification of the tax filing process, and over 5% said the government should increase the Foreign Earned Income Exclusion and other deductions and credits to lower the expat tax burden.
Low awareness of IRS amnesty programs continues to be a trend. Unfortunately, the results of the survey indicate that 46.5% of US expats have not heard of the Streamlined Filing Procedures – an amnesty program that allows certain expats to catch up on their taxes without facing penalties.
This year, the survey also tapped into expats’ feelings on American social issues, which have been at the forefront of global news. The issue currently most important to expats was gun control, according to 38% of those surveyed. Healthcare reform received 34% of expat votes, and immigration reform was ranked third most important, being chosen by only 14%. 3% selected that each of these three issues was equally important, and 11% wrote in other answers.
On the top two social issues, expats agreed emphatically. 96% of those who were most interested in gun control want more regulations, and 88% either agreed or strongly agreed that the US government should guarantee healthcare for its citizens. However, expats were divided on the issue of immigration, with 50.7% either agreeing or strongly agreeing that the government should do more about illegal immigration.
Over nine million US expats live abroad, and their message is clear: they are taxpayers, they are Americans, and they would like more say in the direction of the US government.
Greenback Expat Tax Services makes life better for Americans living abroad by taking away the anxiety and hassle surrounding US expat taxes. Greenback understands that filing US taxes while overseas can be daunting, it doesn't have to be that way. Greenback's expat-expert CPAs and IRS Enrolled Agents help expats navigate a complex system in a way that makes sense for their individual situation. Contact us at firstname.lastname@example.org. You can also visit us at http://www.greenbacktaxservices.com.