[quote] a baby is born on US soil, but then the parents go back to their native country shortly afterward. The child grows up in that country and never again enters the US. Would he/she still be required to pay American taxes?
R7, such people are called "Accidental Americans". And it seems they're totally screwed as far as taxes go. Here's a 2018 news story about a poor French-American guy who's paid $61k in legal fees alone (!) to resolve this SNAFU fucked-up situation:
[quote] 'Accidental Americans' living abroad fight tax bill from Uncle Sam. [bold]Born in the U.S., they might have never lived in the United States as adults but now they are required to pay back taxes[/bold] — and claiming it's unfair.
[quote] Tom Wallis was born here and has spent his entire life in France, but it turns out that the 40-year-old entrepreneur from Grenoble owes tens of thousands of dollars in taxes to the United States. Wallis' mother was French, but he holds U.S. citizenship through his American father. He had previously visited his father's family in the U.S., but other than that he says he has no real connection to the country.
[quote] But 3 years ago, Wallis found out he was still subject to U.S. tax law. He is one of potentially thousands of "accidental Americans" around the world — U.S. citizens who neither live in the country nor have any real ties to the United States. Under a citizenship-based taxation system in place in the United States, people like Wallis are subject to U.S. taxes on their global income, no matter where they live.
[quote] Wallis hired lawyers to fill out the necessary paperwork to try to comply with the U.S. tax authority, but when his legal fees reached over $61,000 (50,000 euros), he says he had to stop the process. "It was too much," he said. [bold]His lawyers told him he would owe $115,000 in U.S. taxes after he sold his business in 2013, even though he had paid a tax on the sale in France. He says he won't pay ... "There is no way," Wallis said, ... "I can't accept it ... I think it's a robbery. I won't pay. Even if I have to go to jail, I won't pay it for sure because it's too unfair."
[quote] There has been a growing movement by "accidental Americans," particularly in France, to try to get U.S. authorities to realize the burden their American citizenship is adding to their lives. Many are hoping that French President Emmanuel Macron will raise the issue during his state visit to the U.S. this week.
[quote] [bold]Unlike other advanced nations, the United States enforces a tax system based on citizenship rather than residency.[/bold] In 2010, Congress enacted the Foreign Account Tax Compliance Act, also known as FATCA, to crack down on tax evasion by Americans with financial assets abroad after a Swiss bank scandal showed U.S. taxpayers hid millions of dollars overseas. [bold]The law requires foreign banks to report about financial accounts held by U.S. citizens to the Internal Revenue Service (IRS) in the United States. As a result, many "accidental Americans" learned they may owe taxes in the United States after getting contacted by the banks in their home countries.[/bold]
[quote] Fabien Lehagre, 33, a commercial manager, found himself in that exact situation. Born in Mountain View, California, in 1984 to a French father and a Singaporean-American mother, Lehagre was 2 when his parents divorced and he and his father moved to France. In 2014, his French bank contacted him asking for his U.S. tax identification number. Thinking it was a mistake, Lehagre ignored the request despite repeated warnings. [bold]The requests didn't stop. He did some research and discovered that he was also an "accidental American" and could face a looming tax bill from the United States. Lehagre, who doesn't speak English, says although he has only lived in the United States for a short time as a toddler, never studied there, voted or paid taxes, he was being "forced into the administrative system that obliges [him] to fill out forms, pay a lawyer and have [his] bank accounts scrutinized."[/bold]