“Random Americans” lose their account

Europeans who were born in America or who have an American parent are often taxable there too – and most of the time they do not know it. That is now becoming a problem.

If you have an American background, you are often liable to pay taxes there too - even though you are German.

Vot have no idea that they are subject to tax in the United States: people who have always lived in Germany but one of the parents is American; perhaps a soldier stationed in Germany after World War II. Or people who were born during a brief parent’s stay in the United States. Such people are called “Chance Americans.” They often don’t even have an American passport. But for years they have had trouble with their bank in Europe. This stress is now increasing again significantly, observes Daan Durlacher, who founded the organization American Overseas in the Netherlands, which helps Americans living in Europe with tax issues. People from Germany whose bank has threatened to be completely expelled within a few weeks also contact him every day.

So far it has mainly been about securities customers. In 2010, the United States passed the Foreign Account Tax Compliance Act (Fatca). It obliges all American taxpayers to report their foreign bank details to the American tax authorities. However, many people living in Europe are not even aware that they are Americans and are therefore also subject to tax in the United States regardless of where they live. In order to combat this (often unconscious) tax evasion, the United States later concluded agreements with European states. According to this, German banks and savings banks have had to report every customer with tax liability in America since July 2014.