Some 97% of a cross-section of American expatriates surveyed by the overseas arm of the Democratic party in January and early February report that they have "serious problems addressing their U.S. tax filing obligations" every year.
This was among a number of findings that turned up in the Democrats Abroad's research that many expats are hopeful will catch the eye of Washington lawmakers, who, these expats say, have yet to acknowledge the scale of the problems America's estimated 9 million citizens who live outside of the U.S. are struggling with.
Other findings of the Democrats Abroad's research include the fact that 55% of those who participated in the survey said they rely on "tax return professionals" to prepare their U.S. tax filings for them. Some 61% of these reported they pay more than US$500 for their annual tax filing services – "at least twice what U.S.-based Americans spend on average", the Democrats Abroad researchers noted.
And 34% reported that they're spending on average more than US$1,000 every year for help with their U.S. tax returns.
In a summary of the findings, which are contained in a 42-page report currently available to read and download online, the Democrats Abroad said the research was undertaken in order "to describe the Americans abroad community, and the genuine financial and personal challenges they face due to U.S. tax, financial account reporting, banking, securities and other laws, many of which were developed without due consideration for the impact they would have on non-resident citizens."
"We will use the findings to profile the Americans abroad community to lawmakers and regulators in discussions aimed at persuading them to enact reforms to laws and regulations that place an unfair and undo burden on Americans abroad," Democrats Abroad Taxation Task Force chair Carmelan Polce said, in a statement on the Democrats Abroad's website.
"We hope the data is useful to all those advocating on behalf of the Americans abroad community."
The research was carried out online between Jan. 21 and Feb. 2, and ultimately drew responses from some 9,885 individuals living in 123 countries across six continents, who in total represented all 50 U.S. states.
Among the report's other findings:
- Almost one in three of those surveyed, or 30.7%, said they had been refused products or services by foreign financial institutions; 24.5% reported having been denied retirement savings or investment products
- More than one in four, or 27.6%, said they had been refused U.S. investment/brokerage products by U.S.-based institutions, and 15.2% said they'd been denied U.S. retirement savings products by U.S.-based companies
- One in six of those surveyed who currently receive U.S. Social Security benefits say their benefits are reduced due to something known as the Windfall Elimination Provision, which cuts such benefits by as much as 40%
- Around 2% of those surveyed said they would be negatively-impacted by elements of President Trump's so-called Tax Cuts and Jobs Act, which introduces harsh new taxes on overseas businesses owned by expats that some say will result in their businesses no longer being viable
Some 669 of those surveyed said they self-identified as "accidental Americans" – or around 2.5% of all the survey participants – of which group more than 50% said they would be interested in renouncing their citizenships if it could be done for "a reasonable cost and effort."
In addition to data, the report – entitled "Tax Filing from Abroad: Research on non-resident Americans and U.S. taxation" – also contains comments made by some of the research participants, which, the Democrats Abroad researchers noted, added "context and feeling to the data."
One such participant, described as "a Texas voter living in Australia," is quoted as having told the researchers: "Americans abroad should be huge advocates for America and American business. Instead, the U.S. government makes it difficult to save for retirement, puts onerous reporting requirements on that mean most foreign (and in some cases U.S.) entities won't hire you if signatory authority is required.
"I know of at least one large U.S. tech firm that has simply stopped hiring Americans abroad – too difficult and expensive for both the company and the employee. I'm watching two friends try to figure out how to comply with the GILTI tax without completely destroying their small businesses.
"How is any of that good for American business, or employment of Americans?"
To read and download the Democrats Abroad's report, which the organization said is the fourth in a series of major research projects, click here.
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