Good luck trying to prove that. Some people who are not yet ready to renounce citizenship have taken the less radical measure of moving assets abroad. This group includes a former congressman, entrepreneurs who started whole new industries, physicians and wealthy investors. Again, unless you want to lie on your 1040, merely moving your money into a Swiss bank won't save you U.S. income taxes while you remain a U.S. citizen. Rather, some of these partial exiles are fearful of future restrictions on capital movements.
People are worried about more than taxes.
One of Rudman's clients is a man who was a pioneer in the managed health care industry. Faced with President Clinton's threat to take over the entire industry and impose new regulations and even criminal sanctions, he began to sell off his business last year and asked Rudman to help move his assets abroad. If you are ready to quit your citizenship, first find another country that will have you, warns Marshall Langer, a London-based American lawyer who specializes in international taxes and often helps people expatriate. He recommends such countries as Ireland or Israel, where you may within a few months be entitled to citizenship based on ancestry. Next best is a place like Canada, which welcomes entrepreneurs, investors and retirees after three years of residency.