Increasing Costs of Renouncing U.S. Citizenship

On September 12, 2014, the U.S. Department of State will increase the fee for renouncing U.S. ctiizenship by more than 100%. The fee, which was earlier $450.00, will be now $2,350.00.

The Department of State derives the general authority to set the Administrative Processing of Formal Renunciation of U.S. Citizenship fee from the general user charges statute, 31 U.S.C. § 9701. See, e.g., 31 U.S.C. § 9701(b)(2)(A) (“The head of each agency . . . may prescribe regulations establishing the charge for a service or thing of value provided by the agency . . . based on . . . the costs to the government.”). The Fiscal Year 2012 Cost of Service Model update reflected that documenting a U.S. citizen’s renunciation of citizenship is extremely costly, requiring U.S. consular officers overseas to spend substantial amounts of time to accept, process, and adjudicate cases. For example, consular officers must confirm that the potential renunciant fully understands and intends the consequences of renunciation, including losing the right to reside in the United States without documentation as an alien. This fee was first introduced in 2010 and was initially set below true cost. The fee is now reflective of the true cost of providing this service.

Increasingly, many U.S. citizens have renounced their citizeship to avoid paying U.S. taxes on their worldwide income. The process for renunciation is, however, lengthy and time consuming. The policy idea behind increasing the costs of renunciation is to reflect the true costs that U.S. consulates face to execute the process, and to ensure that the U.S. citizen wishing to renounce his or her citizenship truly understands the rights he or she will give up.

Feel free to call us at 919-932-4593 or email us at if you have any questions regarding this update.

#renouncingcitizenship #feeforrenouncingcitizenship #uscitizenship #uscitizenship

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