For generations, U.S. citizenship has been regarded as one of the world’s most coveted legal statuses. Millions of immigrants have spent years navigating lengthy immigration processes, overcoming legal hurdles, and pursuing the American dream in hopes of becoming U.S. citizens. Today, however, a different trend is emerging. Every year, thousands of Americans are voluntarily giving up their U.S. citizenship.
The reasons extend far beyond politics. Experts say the growing trend is largely driven by complex tax regulations, financial burdens, the realities of living abroad, and the desire to embrace a new national identity. According to immigration and tax specialists, the number of people renouncing their citizenship has reached its highest level in recent years.
According to the U.S. Internal Revenue Service (IRS), a total of 4,889 Americans formally renounced their U.S. citizenship in 2025—the highest annual figure in the past five years. Analysts believe the number will continue to rise in 2026. International advisory firms estimate that more than 40,000 Americans living overseas are currently at various stages of the citizenship renunciation process.
One of them is 34-year-old Erin Klatt, who has lived in New Zealand since leaving the United States in 2016. Nearly a decade later, she officially gave up her U.S. citizenship.
“I never felt deeply connected to the United States,” Klatt said. “The political climate, combined with being subject to U.S. tax rules while living abroad, ultimately led me to this decision. I have absolutely no regrets.”
While political dissatisfaction often makes headlines, experts say financial considerations are the primary driving force behind most renunciations.
The United States is one of only a handful of countries that taxes its citizens based on citizenship rather than residency. That means American citizens may have ongoing U.S. tax reporting obligations regardless of where they live. Those requirements became significantly more stringent after the implementation of the Foreign Account Tax Compliance Act (FATCA).
The consequences have been substantial for many Americans living overseas. Numerous European banks have become reluctant to open or maintain accounts for U.S. citizens—including so-called “accidental Americans,” people who acquired U.S. citizenship by birth but have spent little or no time living in the country. For many, obtaining mortgages, building retirement savings, or making investments has become increasingly complicated.
The process of renouncing citizenship has also become more accessible. This year, the U.S. State Department reduced the renunciation fee from $2,350 to $450—an approximately 80 percent decrease. Immigration professionals say applications have increased significantly since the fee reduction.
Despite the lower cost, renouncing U.S. citizenship remains a lengthy and irreversible legal process. Applicants must first obtain citizenship in another country, submit five years of tax filings, appear in person at a U.S. embassy or consulate to take an oath of renunciation, and complete extensive legal documentation. Individuals with assets exceeding $2 million may also be subject to additional tax obligations, commonly known as the “exit tax.”
Immigration attorneys caution that the decision should never be taken lightly. Once U.S. citizenship is renounced, former citizens generally must obtain a visa to enter the United States, and approval is not guaranteed. For that reason, legal experts advise against making such a life-changing decision based solely on temporary political frustration or short-term financial considerations.
Dan Darlacher, co-founder of Americans Overseas, believes people should carefully weigh their options before giving up their citizenship.
“If you’re still a U.S. citizen, you still have the right to vote,” he said. “That’s a right worth using to help shape the country’s future.”
U.S. citizenship remains one of the world’s most valuable legal identities. Yet for many Americans living abroad, the financial and legal responsibilities associated with maintaining that citizenship have become increasingly burdensome. As global mobility grows and international tax rules become more complex, what was once considered the ultimate dream has, for a growing number of Americans, become a difficult—but practical—decision to leave behind.
