The US is the only developed nation that taxes its citizens on overseas income earned while they live abroad. This system is complicated, inefficient, and causes uncertainty for ordinary Americans living outside the US. Democrats Abroad favors Residency Based Taxation because it is a simpler, fairer, and more efficient system.
A litany of Internal Revenue Code provisions discriminate against Americans abroad because the impact on them was not or not fully considered prior to implementation. As a result, many low and middle income Americans living outside the U.S. have been double taxed on income they and their families rely on to make ends meet. Adding insult to injury, these ordinary, hard working Americans, even those that earn very little income, are burdened not only with increasingly complex and costly forms and filings, we are also obliged to submit reports on our foreign accounts and other financial assets. For these reason, Democrats Abroad has supported Residency Based Taxation since our inception. It has been a high priority in our Platforms and on Capitol Hill during our Congressional Door Knocks.
Now that Congress is planning to introduce a comprehensive tax reform package the time is right for all aggrieved non-resident Americans to raise their voices and be heard on this matter. Democrats Abroad advocates for a system of Residency Based Taxation that introduces fundamental, common-sense reform while protecting American values of fairness and responsibility.
To learn more about Residency Based Taxation and why Democrats Abroad supports it please refer to our Frequently Asked Questions.
The Democrats Abroad Taxation Task Force (TTF) was formed to a) research US tax policy as it affects Americans living outside the US and b) consider, develop and execute initiatives aimed at enacting reforms that resolve adverse impacts.
We believe the 115th Congress has an opportunity to enact common sense reforms that clarify and simplify filing and make the tax code fairer for all Americans. Our support for any tax reform – and certainly any package of reforms - will depend on how it aligns with our Democratic Party values.
We do not believe tax reform should be used to re-structure the federal government by starving programs that conservatives don’t like or that benefit indigent, elderly or otherwise vulnerable Americans.
We support reforms that help reduce inequality, boost opportunity and raise enough revenue, predominantly from those with the greatest ability to pay, to meet public needs.
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