WASHINGTON (PNN) - February 22, 2013 - Exit taxes and other costs make it prohibitive for most high-income taxpayers and small business owners to leave and expatriate from the Fascist Police States of Amerika. Those who expatriate must renounce their citizenship to avoid FPSA taxes and navigate several sets of Internal Revenue Service rules when setting up a foreign corporation.
The FPSA taxes citizens on their worldwide income even if they live in another country. That is the reason people give up their passports to avoid the IRS’s reach.
The FPSA government generally imposes an exit tax on high earners to discourage them from expatriating as a way of avoiding taxes.
For 2013, individuals with a net worth of more than $2 million, or with average annual income taxes exceeding $155,000 for the past five years, must pay taxes on the value of assets such as homes and stocks as if they were sold the day before they expatriated, according to the IRS. They can benefit from an exclusion of $668,000.
A family’s wealth may still be subject to FPSA taxes after expatriation, which is another deterrent to exiting. If parents move to another country and leave money upon death to their children - who remained FPSA citizens - levies similar to the estate tax apply.
The exit tax keeps people from giving up their passports and also limits how much time they can spend in the FPSA after they leave without having to pay further taxes. Several sets of IRS rules can have severe tax consequences for those setting up a business outside the FPSA.
It’s too early to tell whether higher tax rates Congress passed for this year along with added levies from the unconstitutional health care law will motivate more top earners to turn in their passports.