Report Indicates Wealthy Chinese to Emigrate to US

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Many foreigners crave United States citizenship even though it comes with corresponding obligations and responsibilities (i.e., think about tax compliance). CBS News previously wrote about pregnant women from foreign countries coming to the United States to give birth. 60 Minutes devoted a segment on this phenomenon, and now it appears as though it is not just pregnant women who seek US citizenship for their unborn children (see CBS story here.)

Hurun, a wealth research firm that focuses on China, issued its newest report on January 16, 2014 (see here.) The report, which was the subject of a CNBC story on January 17, 2014, is noteworthy for the fact that it indicates Chinese millionaires are planning to leave China and their favorite destination is the United States (see link to CNBC here.)

The report indicates that 64 percent of the Chinese millionaires plan to leave China, and 1/3 of the super rich, those with at least $16 million, have already emigrated. CNBC cites unnamed analysts for the proposition that many of the Chinese are emigrating to protect illicit profits, specifically, those that may have been earned through corruption.

Without discussing the propriety of the belief, the analysts appear to think that by these wealthy Chinese families having assets outside of China, it will make it more difficult for the Chinese government to recover such assets. Notwithstanding, the United States and China are parties to a bilateral income tax treaty. As a result, as of January 1, 2013, U.S. banks were required to report interest earned by accountholders who reside abroad. Thus, the Chinese government would appear to be entitled to information on any deposits.  Furthermore, if it is shown that these funds were procured through tax evasion, I would suspect that the United States would demonstrate the same level of cooperation with China that they expect from foreign countries.

- See more at: http://www.hklaw.com/TaxBlog/Report-Indicates-Wealthy-Chinese-to-Emigrate-to-US-01-22-2014/#sthash.du3GooN5.dpuf

Many foreigners crave United States citizenship even though it comes with corresponding obligations and responsibilities (i.e., think about tax compliance). CBS News previously wrote about pregnant women from foreign countries coming to the United States to give birth. 60 Minutes devoted a segment on this phenomenon, and now it appears as though it is not just pregnant women who seek US citizenship for their unborn children (see CBS story here.)

Hurun, a wealth research firm that focuses on China, issued its newest report on January 16, 2014 (see here.) The report, which was the subject of a CNBC story on January 17, 2014, is noteworthy for the fact that it indicates Chinese millionaires are planning to leave China and their favorite destination is the United States (see link to CNBC here.)

The report indicates that 64 percent of the Chinese millionaires plan to leave China, and 1/3 of the super rich, those with at least $16 million, have already emigrated. CNBC cites unnamed analysts for the proposition that many of the Chinese are emigrating to protect illicit profits, specifically, those that may have been earned through corruption.

Without discussing the propriety of the belief, the analysts appear to think that by these wealthy Chinese families having assets outside of China, it will make it more difficult for the Chinese government to recover such assets. Notwithstanding, the United States and China are parties to a bilateral income tax treaty. As a result, as of January 1, 2013, U.S. banks were required to report interest earned by accountholders who reside abroad. Thus, the Chinese government would appear to be entitled to information on any deposits.  Furthermore, if it is shown that these funds were procured through tax evasion, I would suspect that the United States would demonstrate the same level of cooperation with China that they expect from foreign countries.

Topics:  Banking Sector, China, Citizenship, Income Tax Treaty, Income Taxes, Reporting Requirements

Published In: Immigration Updates, International Trade Updates, Tax Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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