Facebook Co-Found Gives Up US Citizenship for Tax Reasons

It became news today or at least to me that Facebook co-founder Eduardo Saverin who was born in Brazil has renounced his US citizenship.  Saverin who now resides in Singapore and who moved to the US as a young boy and attended Harvard with other Facebook front man and co-founder Mark Zuckerberg.  


The reason for the renouncement?  Taxes of course.  Saverin who settled with Facebook after being essentially forced out stands to make nearly $4 billion with the upcoming Facebook IPO.  Saverin as you may or may not know was the guy behind bankrolling Facebook in that Harvard dorm room.

According to this Forbes article

• Americans who expatriate after 2008 are still subject to certain reporting and tax requirements under our tax laws. Those laws apply if any of certain criteria are met. In Saverin’s case, he would be subject to the expatriation tax because his net worth is $2 million or more on the date he expatriated (one of the three criteria than can make you subject to the tax).
• "The basic rule is that, for purposes of the tax, any assets that you leave the country with are treated as though you had sold them on the date before you leave. Any gain which would have occurred had you actually sold those assets are subject to tax (with some exceptions).
• So Saverin doesn’t get a free pass. His assets are still subject to tax. Lucky for Saverin, however, the value of his assets pre-IPO are still considerably less than the value of his assets post-IPO. And by lucky, I mean absolutely planned.