Democrats Abroad welcomes the introduction of the Residence-Based Taxation for Americans Abroad Act from Congressman Darin LaHood (R-IL-16). Years of commitment and dedication by Democrats Abroad has laid important groundwork to raise awareness of American abroad tax issues. This year, the advocacy work of Democrats Abroad, Tax Fairness for Americans Abroad, and other organizations has led to the introduction of this Residency Based Tax (RBT) bill.
U.S. policy to combat overseas tax evasion has inadvertently caught low and middle income Americans who live abroad in its dragnet. Americans abroad face a myriad of tax and financial access discrimination including complicated tax returns, having to pay a tax professional and file a tax return when no US tax is due, and inability to save and invest for the future. Some US citizens even consider renouncing their citizenship to escape the burden.
To reduce this burden on Americans abroad and prevent them from having to confront this choice, Members of the Democrats Abroad Taxation Task Force developed an elective RBT policy a year and a half ago, with feedback from Congressional offices.
“I’m extremely proud of the role Democrats Abroad has played in elevating the issue of the unfair tax burdens faced by ordinary Americans abroad and proposing ways to address them. I am encouraged to see a bill introduced that reflects policy outcomes to addressing those burdens. We are ramping up our bipartisan Congressional outreach and laser focused on getting relief for Americans abroad next year,” said Rebecca Lammers, Chair of the Democrats Abroad Taxation Task Force.
Martha McDevitt-Pugh, Chair of Democrats Abroad said, “Democrats Abroad made significant contributions to develop policy that will address the tax and financial access issues faced by Americans abroad. The bill has guardrails to ensure it will not create loopholes for tax cheats. While this bill will not be up for a vote in the 2023-24 Congress, which concludes its business this week, we are hopeful that its provisions will inform tax legislation in 2025. We have heard from Democrats Abroad members that they want Residency Based Taxation. With this bill they would have that choice.”
For more information:
- Read the Democrats Abroad Taxation Task Force’s bill explainer here.
- Read the bill’s FAQs here.
- Give you feedback on the bill, introduced by Rep LaHood (R, IL-16) here.
- Attend the webinar next Mon, Dec 23 at 1pm ET RSVP here
- Read the bill text here.
- Read more about the extensive work of Democrats Abroad’s Taxation Task Force here.
- Join the Democrats Abroad Taxation Task Force mailing list here.