Last updated: Feb 19, 2019
DA members' biggest issues currently include two voting issues, and then taxation and social security issues. In particular, we can almost guarantee that a speaker will be asked their views on Residency Based Taxation (RBT) vs Citizens Based Taxation (CBT), and also on FATCA (see below for more info on both).
Positive numbers and notes to be aware of. In 2018, Democrats Abroad members came out and voted at an 800% higher rate than they did in 2014. In an election season where 1 in 25 races was decided by a margin of less than 1% across the country, that margin was very often decided by votes from abroad. In the last few years votes from abroad have made the difference in state-wide elections in FL, NC and MN. These are all crucial states on the path to the White House in 2020.
- Residency based taxatation vs Citizens based taxation: In short, countries that follow RBT require citizens to pay taxes in the country where they earn the income. Citizenship based taxation requires citizens to pay taxes to their citizenship country as well as to the country where they earn income. Every country in the world except the US and Eritrea follows an RBT system. I've attached a pdf with more information about it.
- The FATCA Effect: Denial of ordinary financial products and services. Foreign financial account reporting requirements (FATCA) motivate foreign financial institutions in our countries of residence to withhold financial products and services. Further there are are compliance challenges inherent in mandatory electronic filing of FBARs and serious financial information security concerns.
- Voting Issues: Discriminatory practices affecting voters abroad and their ability to cast their ballots. While federal legislation provides some protection for overseas voters, this legislation does not go far enough to counter the challenges states set up to limit voting from abroad. In 2018 several states made their voter websites inaccessible to voters attempting to view them from abroad (through IP blocking). As an example, Pennsylvania voters abroad were expected to use a VPN to download their ballots from the PA election site. When that requirement proved impossible for the majority of voters abroad, PA adjusted their requirements, but implemented additional steps which were complicated and confusing for their voters, resulting in a decrease of returned ballots. In other states voters were blocked from seeing instructions, obtaining contact information about their local election offices or using other online voting tools because of similar accessibility issues.
- Voting Issues: US Postal Service return to sender. During the general election cycle hundreds of postal mailed ballots and other voting materials were erroneously returned to voters from abroad by the USPS. As of this time, the USPS is unable to explain why this material was returned to sender. This issue affected voters across many states, including Alabama.
- Double taxation of business profits. Provisions in the 2018 Tax Cuts and Jobs Act that imposes two new “transition taxes” on Americans abroad who are individual shareholders in Controlled Foreign Corporations. Small to medium sized business owners find themselves in an existential crises, burdened by both the Repatriation Tax and GILTI Tax and unable to take advantage of the offsets afforded to corporate owners of Controlled Foreign Corporations. Many will be forced to close their businesses.
- Double taxation of many types of income. The Internal Revenue Code does not recognise pensions paid out of non-U.S. retirement accounts and so treats that income as ordinary unearned income, fully taxable at the marginal rate. Similarly, the Code also treats non-US supplied social welfare payments to unemployed, elderly, disabled or indigent Americans as ordinary unearned income. Social welfare payments are sized at a level adequate to sustain the recipient but become inadequate for survival if the recipient must also pay U.S. tax on them.
- Denial of full Social Security benefits: The Windfall Eliminations Provision (WEP) denies Americans abroad with pensions earned in their country of residence part of their duly earned Social Security pension.
- Denial of access to Medicare benefits and the Affordable Care Act. Americans retirees living abroad cannot use their Medicare benefits for care received in their countries of residence. Americans living abroad are not eligible to purchase health insurance on the ACA exchanges.
- Numerous barriers to investing and saving for the future, created by statutory bans on investing in U.S. mutual funds without a U.S. residential address and punitive tax treatment of non-US investment and saving vehicles classed as Passive Foreign Investment Companies.
- Insufficient consular support and access. Americans abroad are not considered or consulted when changes to consular services and costs are proposed. Americans abroad often struggle to obtain routine consular services such as notarization or passport renewal.
- Freedom of movement. Americans abroad face undue restrictions in returning, or simply traveling, to the U.S. with their foreign-citizen spouses, partners, and family members. Expanded scrutiny of applicant feature such as age, education, health, etc is discriminatory and will result in greater family separation.
- Transmission of citizenship. The right for Americans abroad to transmit their citizenship to their children born abroad is severely restricted and unfair in its application to specific instances. As a result, each year several thousand children of Americans abroad are denied U.S. citizenship, and some are born "stateless," that is, without any nationality or citizenship.
Who we are:
Democrats Abroad is the state Democratic party for overseas Americans
We represent the 7.5 million eligible voters overseas (out of 9 million total). That’s a larger population than all but 11 US states.
We have approximately 150k members in over 190 countries around the world, and 45 active country committees.
We are the largest Americans abroad organization in the world.
We provide members with tools to help them stand up for democracy in America, through voter registration trainings, regularly published actions, events and marches, and a friendly community of like minded American citizens living abroad.
During election years, our focus is to get out the vote and advocate for overseas American issues, through our own members, outreach volunteers, and resources like votefromabroad.org which helps every American overseas request and receive their ballot.