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Financial Planning > Tax Planning > Tax Reform

Advocacy Group Wants Hearings on Nonresident Tax Matters

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American Citizens Abroad has launched an online campaign designed to press lawmakers to hold hearings this fall on the “wide range of tax compliance issues” for Americans overseas, namely the Tax Fairness for Americans Abroad Act, or HR 7358.

The online write-in campaign, Tax Fairness for Americans Abroad: An Idea Worth Fighting For! , guarantees users that their messages will be delivered to congressional offices, including those of the powerful tax-writing House Ways & Means Committee, ACA said.

HR 7358 would, among other things, exclude a qualified nonresident citizen’s foreign income from gross income. In announcing the online campaign, ACA said that it has “long advocated for the adoption of residency-based taxation,” or RBT, and in 2016 developed a basic approach for RBT.

In 2017, ACA’s sister organization, ACA Global Foundation (ACAGF) funded revenue estimates for ACA’s approach to RBT.

“ACA’s work on the subject was instrumental in helping offices working on tax reform,” notably Rep. George Holding, R-NC, who in December of 2018, introduced the Tax Fairness for Americans Abroad Act.

The online campaign “reflects what the founding fathers of America fought for, and won, the battle for tax fairness. Americans overseas want the same,” said Jonathan Lachowitz, ACA’s chairman, in a statement.

The online petition platform “will be used for future campaigns as well,” added Marylouise Serrato, ACA’s executive director.

According to the Internal Revenue Service, United States citizens residing overseas must pay taxes; however, they may be entitled to foreign-earned income exclusions; the maximum exclusion in 2019 is  $105,900 per taxpayer, for instance. Also, taxpayers may exclude some housing expenses that exceed 16% of this maximum with limits.


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