During 2012 US citizenship and, more particularly, the tax consequences of US citizenship became a major source of anxiety for US citizens living in Canada. Widespread reports in the media of increased US enforcement of tax and financial account reporting obligations of US citizens living outside the United States created considerable anxiety. They also spurred numerous inquiries about US citizenship.
Who is or is not a US citizen is certainly important because the United States is the only country in the world to tax based on citizenship. Thus, US citizens residing outside the United States are subject to US income tax on their worldwide income even if they are also subject to tax on that income in the country in which they reside. US citizenship taxation extends to estate taxes, too.
This article discusses the spectrum of US citizenship law, from the very clear position of anyone born in the United States to the less clear positions of those who were born outside the United States when one or both parents are US citizens.
Birthright Citizenship – The Absolutely Clear Case
All persons born in the United States are citizens. It does not matter if their mothers were in the US legally (as tourists, for example) or illegally or whether the children were taken out of the United States the day they were born. It bears repeating: all persons born in the US are automatically citizens. This is the absolute citizenship situation.
Birthright citizenship originated with the Fourteenth Amendment to the US Constitution. Section 1, known as “the Citizenship Clause”, reads as follows:
All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
Thus, since ratification of the Fourteenth Amendment on July 9, 1868, any person born in the United States is a citizen of the United States. Congress cannot limit or impair the citizenship of persons born in the US. In effect, US citizenship is not “consensual” for anyone born within its borders. Citizenship is conferred simply by the fact of birth in the United States and in Puerto Rico, the US Virgin Islands, Guam, and the Republic of Panama.
Birthright Citizenship – The Qualified Cases
The US Congress does have authority to determine the US citizenship of persons born outside the United States to US citizen parents.
Section 301 of The Immigration and Nationality Act of 1952, as amended, (“INA”) defines who “shall be nationals and citizens of the United States at birth”. Subsection (a) simply repeats the words of Section 1 of the Fourteenth Amendment without the reference to naturalization. Subsection (b) contains a specific provision which extends citizenship to “a person born in the United States to a member of an Indian, Eskimo, Aleutian or other aboriginal tribe” without depriving such persons of their rights to tribal or other property. Interestingly, these two subsections refer to “a person born in the United States” and do not include reference to “persons born in its outlying possessions”. That phrase, which also does not appear in Section 1 of the Fourteenth Amendment, does appear in other subsections of Section 301 to define persons who are considered to be US citizens at birth.
Section 301(c) covers “a person born outside of the United States and its outlying possessions of parents both of whom are citizens of the United States and one of whom had a residence in the United States or one of its possessions, prior to the birth of such person.” This begins a series of provisions that limit the scope of “citizenship at birth” within the overall concept of jus sanguinis. In this case, even if both of a child’s parents are US citizens, but neither one of them “had a residence” in the United States prior to the child’s birth, their children are not US citizens at birth.
As a practical matter, children born outside the United States and the other territories listed in the INA to US citizen parents are supposed to obtain a Consular Report of Birth Abroad (“CROBA”), a light blue certificate which usually serves in lieu of a local birth certificate and is considered a basic US citizenship document. US citizen parents should file for a CROBA as soon as possible after their child’s birth. A CROBA cannot be issued to a person eighteen years old or older.
Earlier this year the Department of State revoked CROBA’s issued to three children born in Israel to two US citizen parents. The facts of the case established that neither of the parents had lived in the United States. The father had never even visited the US. The mother had come twice on vacation when she was ten and sixteen, each time for approximately a month, and for ten days when she was twenty-two to attend a family function. The Consulate General in Jerusalem interpreted “residence” in Section 301(c) to mean “physical presence”.
The sole issue considered by the Department of State upon appeal of the revocations was whether the mother’s visits to the US constituted residence within the meaning of INA 301(c). The Department determined that Congress used “residence” without setting a time limit on the basis that “the nature of residence presupposes the sort of relationship to that place that mere physical presence does not.” Id., p. 2. The decision went on to point out that INA Section 101(a)(33) defines “residence” as a person’s “place of general abode [meaning] his principal actual dwelling place in fact, without regard to intent.” Id., p. 2. Based on the evidence presented, the Department found that the mother’s visits to the United States did not constitute “residence” and upheld the revocations.
Thus, as of now, the Department of State has limited the scope of birthright citizenship under INA Section 301(c) to the children of US citizens who can demonstrate that they established a residence in the United States prior to the birth of their children. The length of residence appears not to matter, but the character of whatever time is spent in the United States must meet the indicia of a permanent place of abode. This would suggest at least a period of several months, probably exceeding six, during which the US citizen has a permanent abode in the United States. Certainly, attending a US college for a year would qualify as would any reasonable period of employment or study, even if for less than a year.
Section 301(d) and (e) confer birthright citizenship on persons born outside the United States “and its outlying possessions”, if one of their parents is a US citizen who has been “physically present” in the United States or one of its outlying possessions for a continuous period of one year prior to the child’s birth. The only difference between the subsections is that (d) refers to the other parent as a “national, but not a citizen of the United States.” Subsection 301(e) is silent on the status of the other parent.
Section 301(g) grants birthright citizenship to persons born “outside the geographical limits” of the US and its outlying possessions “of parents one of whom is an alien, and the other a citizen of the United States who, prior to the birth of such persons, was physically present in the US or its outlying possessions for a period or periods totaling not less than five years, at least two of which were after attaining the age of fourteen years.”
In these instances the test is not residence but physical presence qualified by the requirement that the period that must be at least an uninterrupted period of at least one year. This, of course, is an objective test compared to that set out in Section 301(c), particularly as now interpreted by the Department of State.
In effect, the fact that a person is born outside the United States and its outlying possessions even to two US citizen parents removes the absoluteness of US citizenship that birth in the US creates. US citizen parents have to take specified steps to ensure that their children gain US citizenship by obtaining CROBA from a US Consulate before the children reach eighteen. Failure to obtain CROBA does not deprive the child of US citizenship, it simply makes the process of obtaining a US passport or certificate of citizenship more time consuming.
The foregoing discussion of US citizenship is intended to cover persons who reside outside the United States and are uncertain about their US citizenship status. Essentially, those who were born in the United States are citizens. Those who were born outside the United States to one or two US citizen parents are certainly entitled to US citizenship assuming they or their parents can prove the requisite “residence” or “physical presence” required by the INA provision applicable to their situation.
All persons who are United States citizens remain US citizens unless they take a conscious act to relinquish or renounce it. INA Section 349(a) provides that a US citizen shall lose his US citizenship if he voluntarily performs a specified expatriating act with the intention of relinquishing his US citizenship. Expatriating acts enumerated in the section include obtaining naturalization in a foreign country and taking an oath of allegiance to a foreign country after attaining the age of eighteen years.
Over the years the US Supreme Court has struck down as unconstitutional a number of the acts that Congress considered “expatriating”. The cases culminated in the US Supreme Court’s decision in Vance v. Terrazas, 444 U.S. 252 (1980) which essentially held that a US citizen could not inadvertently lose his US citizenship unless it was proved by a preponderance of the evidence that he intended to do so when he committed an expatriating act.
The Court held that in establishing loss of citizenship, the Government must prove intent to surrender US citizenship, not just the voluntary commission of an expatriating act, such as swearing allegiance to a foreign nation. It affirmed that Congress does not have any general power to take away US citizenship without the citizen’s assent, but does have the power to set the standard of proof and that the specific standard in [now] INA Section 349(b) does not violate either the Fourteenth or Fifth Amendments.
It is difficult to understand that ‘assent’ to loss of citizenship would mean anything less than an intent to relinquish citizenship, whether the intent is expressed in words or is found as a fair inference from proved conduct. . . . . the intent of the Fourteenth Amendment, among other things, was to define citizenship; and as interpreted in Afroyim [citing Afroyim v. Rusk, 387 U.S. 253 (1967)], that definition cannot coexist with a congressional power to specify acts that work a renunciation of citizenship even absent an intent to renounce. In the last analysis, expatriation depends on the will of the citizen rather than on the will of Congress and its assessment of his conduct. Emphasis supplied.
Vance v. Terrazas at 260.
Citing Afroyim Justice White writing for the Court pointed out that the Court’s decisions in Afroyim and Nishikawa v. Dulles, 356 U.S. 129 (1958) were written or concurred in by Justice Black who said that “the question whether citizenship has been voluntarily relinquished is to be determined on the facts of each case and that Congress could provide rules of evidence for such proceedings.”
In sum, we hold that in proving expatriation, an expatriating act and intent to relinquish citizenship must be proved by a preponderance of the evidence. We also hold that when one of the statutory expatriating acts is proved, it is constitutional to presume it to have been a voluntary act until and unless proved otherwise by the actor.
Vance v. Terrazas at 270.
Title 22 of the Code of Federal Regulations (“CFR”) provides guidance on the loss of nationality. The Department of State has adopted an administrative presumption that an individual who takes an oath of allegiance or obtains naturalization in a foreign country intends to retain his US citizenship. However, when an individual affirmatively asserts that he committed an expatriating act with the intent to relinquish his US citizenship, he will lose his citizenship. This provision is certainly in line with settled law as enunciated by Terrazas. It adds a presumption in favor of retention of US citizenship to replace the contrary presumption that existed prior to Afroyim.
US Citizenship Taxation
Every US citizen is required to file an annual tax return with the Internal Revenue Service regardless of where he or she resides and to report his or her worldwide income. Every US citizen is also required to file annually Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (“FBAR”) if the aggregate high balance in all such accounts exceeds $10,000 at any time during a calendar year. There are no exceptions.
Persons born in the United States, whether or not they are also Canadian citizens or citizens of another country, cannot escape US taxation as long as they remain US citizens. Even if they do not have a US passport, their place of birth will appear in their non-US passport. On the other hand, persons born outside the United States to one or two US citizen parents may have options depending upon whether or not their parents registered their birth abroad by obtaining a CROBA. If their parents obtained a CROBA, their US citizenship has been recorded even if they have not used it to obtain a US passport or US social security number. If their parents did not obtain a CROBA and they have done nothing to assert US citizenship, as a practical matter their US citizenship is not “visible” simply by reference to their passport or other generally accepted identification documents.
Although INA Section 301 uses the term “shall be” citizens for anyone who falls within its enumerated subsections, it is not clear that the US government could “impose” US citizenship on someone born outside the United States whose parents did not (and does not himself or herself) choose to assert it.
*Mr. Flott is a member of the Bars of the District of Columbia, the State of Maryland and the Commonwealth of Virginia. He graduated from OsgoodeHallLawSchool in 1973 and was admitted to practice in Ontario in March, 1975. He obtained an LL.M. from GeorgeWashingtonUniversityLawSchool in Washington, DC in 1987.
Technically, the US is not the only country to tax based on citizenship. Eritrea imposes a special 2% tax on its citizens living abroad which is not imposed on its citizens in Eritrea. Eritrea does not tax its non-resident citizens on their worldwide income while the US does. The rest of the world uses residence as the basis for taxing inhabitants. The US also taxes permanent residents and those who are deemed “substantially present” in the United States on their worldwide income.
This article does not address citizenship obtained by naturalization. Persons who are naturalized in the United States have elected to seek US citizenship knowing that they are not entitled to it except by formal application and the swearing of an oath of allegiance to the United States. Those entitled US citizenship by birth do not take an oath of allegiance as their citizenship derives from the place of their birth or their US heritage.
The US Supreme Court in United States v. Wong Kim Ark, 169 U.S. 649 (1898), ruled that virtually everyone born in the United States is a U.S. citizen. The decision established the Court’s defining interpretation of Section 1 of the Fourteenth Amendment. Wong Kim Ark, who had been born in San Francisco in 1871 to Chinese parents, was denied re-entry to the United States after a trip to China based on the so-called Chinese Exclusion laws, which restricted Chinese immigration and prohibited Chinese immigrants from becoming naturalized US citizens. He challenged the government’s refusal to recognize his citizenship. The US Supreme Court, deciding in his favor, held that the citizenship clause in the Fourteenth Amendment encompassed essentially everyone born in the U.S.—even the U.S.-born children of foreigners—and could not be limited in its effect by an act of Congress. The case settled the disagreement over the meaning of the phrase in Section 1, namely, “and subject to the jurisdiction thereof”. The Court concluded that the phrase referred to being required to obey US law. Using this interpretation the language granted US citizenship to all children born on American soil (a concept known as jus soli). The Court’s dissenters concluded that the phase meant not being subject to any foreign power, i.e., not being a citizen of another country by way of jus sanguinis (citizenship derived from a parent). The minority objected that the majority’s interpretation would confer citizenship on “the children of foreigners, happening to be born to them while passing through the country”, which is precisely what it did. The jus soli principle enunciated by the Supreme Court in the Wong Kim Ark case has never been seriously questioned. See Statement of Walter Dellinger, Assistant Attorney General, Office of Legal Counsel, before the Subcommittees on Immigration and Claims and on the Constitution of the House Committee on the Judiciary, December 13, 1995. The US also has incorporated jus sanguinis principles into its citizenship laws as will be described later.
Alaska and Hawaii were not part of the United States when the Immigration and Nationality Act of 1952 (Pub.L. 82-414, 66 Stat. 163), also known as the McCarran–Walter Act (the “INA”) was enacted on June 27, 1952. Section 304 granted US citizenship to persons born in Alaska on or after March 30, 1867. Section 305 granted it to persons born in Hawaii on or after August 12, 1898.
Citizenship was granted to persons born in Puerto Rico after April 11, 1899; to persons born in the US Virgin Islands after January 17, 1917; and to persons born in Guam after April 11, 1899 if they resided in Guam or other territory under US sovereignty on August 1, 1950; and to persons born in the former Canal Zone or in the Republic of Panama between February 26, 1904 and October 1, 1979 if either parent at the time of the child’s birth was a citizen of the United States or if either parent at the time of the child’s birth was a citizen of the United States employed by the Government of the United States on official orders. See INA Sections 302, 306, 307, and 303 respectively.
The INA is codified under Title 8, Aliens and Nationality, of the US Code. Section 301 of the INA is codified as 8 USC 1401 and so on. Before the INA was enacted, a variety of statutes governed immigration to the US but they were not organized within one body of text. The INA was the first major overhaul of US immigration laws since the late 1800’s and replaced all prior immigration laws. Passage of the Fourteenth Amendment and the Supreme Court’s decision in the Wong Kim Ark case limited the role Congress could play in determining US citizenship of persons born in the United States. As can be seen, Congress did extend the scope of citizenship by birth to persons born outside the United States proper by legislation.
The term “national” is not synonymous with “citizen”. Section 308 extends nationality without citizenship to persons who are born in one of two US possessions (American Samoa and SwainsIsland) or through descent from a person born in one of those two possessions. Guam, Puerto Rico and the US Virgin Islands fell into the same category until granted full citizenship by Congress (see INA Sections 302, 306, and 307). People who are US nationals may live and work in the United States without restriction, but cannot vote or hold elective office. They may apply for citizenship under the same rules as resident aliens.
See http://travel.state.gov/law/family_issues/birth/birth_593.html (last visited 2013/01/03) for a description of the CROBA (Form FS-240) process.
In the Matter of the Revocation of Consular Reports of Birth Abroad Issued to X, Y & Z, Final Administrative Decision of the United States Department of State Pursuant to 22 CFR 51,74, issued February 9, 2012 by the Deputy Assistant Secretary for Passport Services.
The full text of the decision can be found on LexisNexis Communities, Immigration Law Community, under CRBA.
Section 301(f) provides birthright citizenship to persons “of unknown parentage found in the United States while under the age of five, until shown, prior to attaining . . twenty-one . . , not to have been born in the United States.” In effect, an infant orphan found in the United States without documentation of his/her parentage will become a US citizen when he or she reaches twenty-one unless before then someone comes forth with proof that he or she was not born in the US.
Unlike the time periods referenced in Section 301(d) and (e) which must be continuous, the periods referenced in Section 301(g) do not have to be continuous. In fact, the periods of physical presence in the US can be interrupted by periods of residence outside the US as long as they are less than twelve months each. The section goes on to allow periods of honorable service in US Armed Forces, employment with the US government or an international organization with certain restrictions or while the US citizen parent was an unmarried dependant of a person who qualifies on the basis of service in the US Armed Forces, employment with the US government or qualifying international organization to be included in the measurement of the physical presence required to meet the terms of the subsection. Section 301(h) grants birthright citizenship to persons born before noon (EST) on May 24, 1934 outside the United States to an alien father and a US citizen mother who prior to the birth of the child, resided in the United States. One would suspect the interpretation of residence used in the application of Section 301(c) would also apply to the limited number of cases covered by this provision.
There are other provisions of the INA that address the citizenship of people who reside in the US, such as the Child Citizenship Act of 2000 (Pub. L. No. 106-395, 114 Stat. 1631 (October 30, 2000), but they are not relevant to this article.
INA 349(a)(1)-(2), 8 USC §1481.
Vance v. Terrazas, 444 U.S. 252 (1980). See Lexis-Nexis print of opinion at 3.
Id. at 266.
22 CFR §50.40.
22 CFR §50.40(a).
There are minimum income thresholds below which are return is not required. These are generally so low that almost all persons will exceed them.