San Diego’s symphony hall, the Jacobs Music Center, is reopening this weekend after extensive refurbishment with Mahler’s second symphony.
As an unusual prelude to the ribbon cutting, music director Rafael Payare took the oath of US citizenship.
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Great. The IRS inducts another hapless recruit into the US tax system.
US citizens are required to report earnings wherever they live in the world. It’s called “citizen-based taxation”. It’s very controversial & it’s the reason why US citizens who live outside the US are renouncing their US citizenship in droves.
Always amazed to see foreigners clamoring for US citizenship like it’s some kind of prize.
Welcome to citizen-based taxation, Mr. Payere. Whereever you go in the world, whereeveer you earn your income, you now have to report it to the US govt. Enhorabuena. The IRS now owns you.
I suspect that he was well aware of his obligation in becoming a new tax paying citizen. But then just maybe he realizes that sharing in citizenship in the United States is worth much more than just money.
I doubt he’s aware. It’s not just about paying US taxes, it’s about having to declare your earnings to the US no matter where you live or work.
Native-born US citizens who move abroad are invariably caught by surprise with this law. The only other country in the world which has citizen-based taxation is a small 3rd world country in Africa: Eretria.
Brits might better understand the implications with the example of Harry & Meghan. Because Meghan is a US citizen, all of her income, including that which she receives with her husband must be reported in full detail to the IRS, even though that income may be UK-based. US law is requiring that Harry & Meghan’s UK income, as royals, be publicly disclosed to the IRS. Can you now see the US’s overreach & the problems it causes?
Children of US citizens, who may have never set foot in the US – “Accidental Americans” – are also required to declare all foreign earnings to the US govt.
Did Dudamel become a US citizen? No. Yannick? No. There’s a reason for that. Mr. Payere should have thought this through a little more carefully, IMO.
And US passports, incidentally, are far from the most powerful in the world. They are way down on the list internationally.
As a musician with dual citizenship I can tell you that the US has better taxation than many other European countries. Plus, if you create a corporation you can avoid social security tax and have many other benefits. On top of that, the U.S. has agreement with many counties so you don’t have to pay double tax. So I’m not sure why you think things are bad here. Ask some Danish conductors how they feel about their taxes of almost 50 percent tax and draconian rules for deductions. I remember a friend (huge conductor) asked me once to sign the dinner receipt he wanted to pay so he can prove it was a business expense. They all say that they would have loved to be Americans.
You’re completely missing the point.
The criticism is not about the US tax rate, which yes, is much more favorable than many EU countries. Nor are we talking about SSA tax. The problem is the CITIZEN-BASED TAXATION system which the US uses. I encourage you to read about it. Establishing a corporation is not going to spare you from that. You’re out in left field there.
Citizen-based taxation is extremely controversial, the US is nearly unique in the world for applying it & it’s an over-reach by the US govt. Any US citizen who works abroad discovers this. As do the foreign-born children of any US citizen – the “accidental americans”.
Go to any US expat page & read about the droves of US citizens working abroad who are renouncing. Have a look at the lawsuits out of France from the very angry & well-organized accidental americans there.
Explain to the US citizen who has simply inherited a parent’s US citizenship by birth & has never set foot in the US why they have to pay the US a large tax on a home they sell in the EU when neither they or the house have anything to do with the US. That’s citizen-based taxation.
If you have Danish conductor friends who would love to be US citizens in order to be permanently encumbered by citizen based taxation, they must have REALLY bad tax accountants.
If you don’t want the consequences of being a US citizen, then renounce the benefits. You’re more than welcome to become a citizen elsewhere if you find it so onerous.
Anson, this is exactly what is happening! It’s my point here!
I am a dual citizen & have not renounced. I took advantage of the “streamlined” system the IRS offered a while ago to back-declare 6 yrs. worth of foreign earnings & avoid punishment. The IRS finally offered this as a solution because so many US expats had no idea they were supposed to declare foreign earnings to the IRS. They were threatening everyone with taking away their US passports, shutting bank accounts, seizure of assets. The law is called FATCA – it was implemented in the 90’s & it’s caused havoc for US expat citizens around the world.
So we all – down to the lowest earning expats – had to shell out several thousand dollars to hire international tax preparers to to declare back earnings to the IRS. Fortunately, I did this & complied rather than renouncing. But I follow the news on this matter closely.
US citizens who live & work outside of the US are renouncing in droves. Accidental Americans (children born to US citizens abroad who inherit US citizenship & find themselves unwittingly burdened by US tax requirements) are trying desperately to renounce US citizenship. In France, Accidental Americans have won a critical lawsuit against the US govt. about this. The US typically makes it exorbitantly expensive and bureaucratically difficult to renounce US citizenship. During COVID, they halted all renunciations, forcing people to remain beholden to the US tax system in countries around the world for several more years.
The IRS is trying to monitor large companies & businesses who try to go overseas to do business to avoid US taxes with these laws. In the process they caught all the low earning US expats – music & English teachers, orch players & spouses of foreign citizens – in the net. This is the downside of US citizenship. Mr. Payere has blindly thrown himself into the mix.
It’s pretty naive to think that US citizenship is some kind of prize. Why some people persist in believing it eludes me.
What’s with the Dudamel clone hair?