As of January 1, 2013, the US will require that each citizen reports their global assets and earnings to the Internal Revenue Service, regardless of where they live, how long they have lived there or whether any money is owed. Foreign financial institutions will also be required to disclose such information of any American clients they may have.

"Over the last six months, we have received a 22 per cent increase in the number of inquiries from American expatriates around the world who tell us that they are considering the drastic step of switching their homeland citizenship to that of their adopted countries," Nigel Green said today.

"This sense of anxiety is compounded by the fact that a growing number of Americans are being left stranded by their foreign financial institutions as all banks and wealth management firms will also have to declare the assets of their American clients - and this process is perceived as too costly and burdensome, meaning many are refusing to deal with US citizens." For example, some Americans are being rejected by foreign firms for jobs which would require signatory authority, as those accounts would also be subject to FATCA, he noted.

“The majority of these US expats are being prompted to consider this due to the complexity of the reporting process to the IRS, plus the threats of heavy penalties, including for previous, inadvertent non-compliance." 

In July the deVere Group claimed a 65 per cent surge in professional financial inquiries over the previous three months due to the looming arrival of the new US tax compliance rules. Meanwhile, last year alone nearly 1,800 Americans officially renounced their US citizenship - six times more than in 2008, the global IFA said.