Citizenship Taxation

Abstract

The United States is the only country that taxes its citizens’ worldwide income, even when those citizens live indefinitely abroad. This Article critically evaluates the traditional equity, efficiency, and administrability arguments for taxing nonresident citizens. It also raises new arguments against citizenship taxation, including that it puts the United States at a disadvantage when competing with other countries for highly skilled migrants.

Keywords: citizenship, immigration, taxation, benefits theory, ability to pay, FATCA, FBAR

JEL Classification: H24, H26, K34