updated 6:21 PM CEST, Sep 22, 2020

U.S. gov't publishes near-record list of quarterly renunciants' names in spite of Covid-19 lockdown

The U.S. government on Thursday published its second-largest-ever quarterly list of names of Americans who have renounced their citizenships – in spite of the fact that the processing of renunciations by U.S. consulates and embassies around the world has all but ceased, according to U.S. citizenship renunciation experts, who help dual citizens looking to give up their U.S. passports, and in some cases Green Cards, to do so.

The 2,406 names on the most recent list, which may be seen on the Federal Register's website, is certain, they say, to consist mainly of a backlog of names that has built up in previous quarters.

The largest-ever quarterly list of names is the one that was published on May 8, which contained the names of the 2,907 individuals whom the IRS said had "chosen to expatriate" during the first quarter of 2020. (To see a table featuring quarterly renunciation data back to 2016, scroll down.) 

The most recent list in theory contains the names of those whose renunciations took place between April and June – in other words, during the peak of the global lockdown period. 

One former American whose renunciation became official in December, 2018, told the American Expat Financial News Journal today that she has yet to see her name appear on the quarterly register, even though "it should have been included in the Q4 2018 count". (The phenomenon of names taking months if not years to appear on the list was highlighted last year after a Sri Lankan presidential candidate questioned why his name wasn't on the Q2 list last year.) It finally appeared in May, on the 2020 Q1 list.

Toronto-based renunciation facilitator John Richardson said that the last of his clients to formally complete their renunciation did so "the third week of March", and that since then, "existing appointments have been cancelled, and no new ones are being scheduled". 

Lockdown coinciding
with renunciation demand 

As reported here last week, the ability of Americans who hold other passports to renounce their American citizenship has effectively been on hold around the world for months, as a result of the Covid-19 pandemic lockdown, even as demand for renunciations is at what one renunciation expert called “an all-time high”.

Most of those looking to renounce cite the costs and hassles involved with maintaining a U.S. citizenship while living abroad, particularly the requirement to file a tax return every year and potentially to owe tax to the U.S., in addition to the taxes they already pay to the government where they live.

Experts who specialize in helping Americans to renounce say that U.S. citizenship renunciations-processing has been resumed in a few countries, or is scheduled to be soon, but that it remains impossible in most other jurisdictions, where, they note, it's not considered as much of a priority as certain other consular services, such as passport renewals.

Alexander Marino, director of U.S. tax law and co-leader of the U.S. Tax Practice of Calgary, Canada-based Moodys Tax Law LLP, said Moodys' current understanding is that one country where U.S. renunciation processing is taking place is New Zealand, which is known for having handled the Covid crisis better than most other jurisdictions.

Among the groups most frustrated by what Richardson refers to as "this de facto imprisonment of Americans who are being prevented from leaving" are the so-called accidental Americans – as those who were either born in the U.S. and moved abroad soon afterwards, or in some cases, individuals who never lived in the U.S. at all, but whom the U.S. considers to be American citizens because one or both of their parents were American.

Fabien Lehagre, founder and president of the Paris-based Association des Américains Accidentels  (Accidental Americans' Association, or AAA), said today that he could "confirm that in Paris, all appointments are suspended", and that he understood this to be the case in Marseille as well.

Likewise, in the Netherlands – where accidental Americans have been a particular focus since last year of banks that have been insisting they must obtain U.S. Social Security Numbers, for which such accidentals would need to formally enter the U.S. tax compliance net by becoming citizens, if they are to keep or open a Dutch bank account – Americans Overseas' founder Daan Durlacher said the list of those waiting to renounce "is now up to 200". Americans Overseas assists Americans with tax and citizenship issues in addition to campaigning on expat issues.

Dutch accidental Americans are therefore seen to be at a particular disadvantage by the suspension of services at the U.S. embassy and consulate there. This is because even if they are keen to take advantage of a renunciation program the U.S. government introduced last year for what it called "certain expatriates" – a sub-group of the accidental American category, who have less than US$2m in net worth and who have never filed a U.S. tax return – they cannot do so without being able to access the U.S. government's overseas services. 

'CLN Processing Center, Canada: No
date for resumption of routine services'

Recent correspondence from Canada's Certificate of Loss of Nationality Processing Center to an unidentified, would-be citizenship renunciant in Canada, a copy of which was shared with the AXFNJ, reveals a sense of the state of operations there.

After explaining that all the necessary renunciation documents need to be fully completed and submitted before any interview appointments will be scheduled, it goes on to add that it could "take several weeks/months to process your request", during which time "the Certificate of Loss of Nationality Processing Center will not reply to follow-up emails asking for wait times". And it goes on in this vein, before finally admitting that the CLN Processing Center won't be carrying out any Loss of Nationality services "until further notice".

"If you have submitted all required documentation as attachments to your email, you will be contacted by email or phone to schedule an interview appointment.

"Please be advised that appointments are in high demand; your appointment will be scheduled in the order in which your completed requested was submitted."

Those who find they need to reschedule, the letter adds, will find this "will likely result in substantial delays, as appointments are scheduled several months in advance". 

"The health and safety of those who work at and visit the Embassy and Consulates is our highest priority.

"In response to the global pandemic Covid-19, and in line with the Canadian government’s call to increase social distancing, the CLN Processing Center has suspended Loss of Nationality services until further notice.

"We will resume routine services as soon as possible but are unable to provide a specific date at this time.

"Please be advised that at this time, appointments through the end of July have already been canceled, and we have yet to determine if further cancelations are to be made.

"Canceled appointments will be rescheduled prior to scheduling new appointments from the current queue when we eventually resume with this service.

"Please note that we have suspended scheduling and rescheduling for the foreseeable future, and will resume when we have returned to normal routine operations.

"It will take several months to recover from the backlog, however your place in the queue remains unchanged.

"We regret any inconvenience caused by the suspension of this service, and appreciate your support for our efforts to safeguard U.S. facilities and prevent the further spread of Covid-19 in Canada." 

Questions about renunciation 
data not new

As this and other media organizations have reported previously, the apparent disconnect between the quarterly renunciation names list published by the Treasury and the number of those actually giving up their citizenships isn't new to those in the business of helping Americans to renounce, or to officials. In September, 2015, the Wall Street Journal detailed how research by U.S. attorney Andrew Mitchel had revealed significant discrepancies between the numbers of "Certificates of Loss of Nationality applied for or issued" and the data that the Treasury department was posting for comparable periods of time. 

"Mr. Mitchel contends that the IRS is failing to count people relinquishing their Green Cards – 18,000 between 2008 and 2012 – and argues that the IRS's renunciation tallies should at least include relinquishments by long-term Green Card holders," the WSJ article reports. Mitchel's findings were picked up by other journalists at the time, including Forbes contributor Robert Wood, in a piece headlined "IRS And FBI Track Americans Who Renounce Citizenship. Why is FBI List Longer?"U.S