For the third year in a row, a record number of U.S. citizens and green card holders renounced their citizenship and gave up their green cards in 2015, according to data released by the Treasury Department.
A record-breaking 4,279 people gave up their citizenship or long-term residency in 2015, compared to 3,415 people who called it quits the previous year, reported The Wall Street Journal.
The IRS publishes a list of individuals who renounced on a quarterly basis, and the latest released Friday includes the names of 1,058 citizens and permanent residents who relinquished their passports from September to December. The real overall number is likely much higher, according to Forbes.
While there isn't a single explanation for the rising numbers, many people are believed to renounce to avoid stricter tax policies, while others do so for political, legal or familial reasons.
The number of renunciations has soared since the 2010 implementation of the Foreign Accounts Tax Compliance Act (FATCA), which cracks down on foreign banks and their U.S. customers who use dual residency to hide money offshore. The banks are now required to report to the IRS income information for their U.S. customers or face penalties.
Since the passing of FATCA, the U.S. has collected more than $13.5 billion in taxes and penalties from banks and U.S. taxpayers that failed to comply.
"An increasing number of Americans appear to believe that having a U.S. passport or long-term residency isn't worth the hassle and cost of complying with U.S. tax laws," Andrew Mitchel, an international lawyer, told the WSJ.
The U.S. is the only country in the world, other than the African nation of Eritrea, to impose taxes on income earned abroad, which results in many of the 7 million Americans living overseas being taxed twice. Expats must also comply with strict income- and wealth-reporting requirements and face harsh financial and criminal penalties for choosing not to do so – anywhere from $2,000 to $70,000, according to The Washington Times.
