Renouncing American citizenship used to be free, and not much talked about, until 2010 – the year when the new regulation known as the Foreign Account Tax Compliance Act (FATCA) was signed into law. That year the fee for renouncing was set at $450. In 2014, this was hiked by 422 percent, to $2,350.
The numbers of those giving up their US citizenship only became a topic of interest after the numbers of those renouncing began to increase after 2010 due to FATCA - which came into force in 2014.
FATCA basically mandates stiff penalties for “foreign financial institutions” (FFIs) that fail to report to the US authorities the bank account details, including assets, of any of their clients who happen to be US citizens or Green Card holders.
But its unintended (and massive) side effect was to cause many non-US financial institutions around the world to suddenly refuse to accept American clients at all – even if they were living in the country in which these institutions were (and are) located, and had held accounts with these institutions for decades.
And yet again, Some Moneyghoul's Greed Fucks It Up For Everyone