Some new Canadian dual citizens — particularly those who move to Canada permanently — eventually decide that maintaining US citizenship is more trouble than it's worth. The annual cross-border tax filings, the FBAR and FATCA reports, the limited investment options because of PFIC and TFSA complications, the $2,350 USD fee just to make it stop: at some point the math flips, and renunciation makes sense.
This guide walks through the practical mechanics of renouncing US citizenship as a recently-Canadian dual citizen. It's not a recommendation either way — for most people, dual status is fine forever — but if you're considering renunciation, the decision deserves to be made with eyes open.
For the eligibility rules that made you Canadian in the first place, see Canada citizenship by descent 2026 — who qualifies under the new law. For the tax-paperwork side of dual status that's often the trigger for renunciation, see US-Canada dual citizenship taxes — FBAR, Form 8938, T1 filings.
The basic mechanics
US citizenship is renounced through the State Department, not the IRS. The process is:
- You schedule an appointment at a US Embassy or Consulate abroad (you cannot renounce inside the US).
- You attend the appointment in person, hand over your US passport, sign Form DS-4079 (Request for Determination of Possible Loss of US Citizenship) and Form DS-4080 (Oath of Renunciation), and pay the $2,350 USD fee.
- The State Department reviews your case and, assuming you're not a fugitive from US justice or facing other complications, issues a Certificate of Loss of Nationality (CLN) within 3–8 months.
- From the date the CLN is issued (backdated to the oath date), you are no longer a US citizen.
The renunciation is irrevocable. There is no path back to US citizenship after CLN issuance except naturalisation, which would require establishing US permanent residence and waiting the standard 5 years.
The $2,350 fee
The renunciation fee was raised from $450 to $2,350 in 2014 and has stayed there since. The State Department's rationale was the administrative cost of processing renunciations (which had quadrupled in the previous decade as more Americans abroad renounced). The fee is among the highest in the world for renunciation; most countries charge $50–$500 equivalent or nothing.
It's a flat fee — same whether your assets are $50K or $50M. It is not refundable if the renunciation is denied (which is rare). It's paid in USD at the consulate via credit card or wire transfer.
Where to renounce
Any US Embassy or Consulate that handles American Citizen Services accepts renunciation appointments. For a recently-Canadian dual citizen living in Canada, the options are:
- US Embassy Ottawa — main mission. Longest wait times (currently around 7–9 months for renunciation appointments).
- US Consulate Toronto — high volume. Wait times around 5–7 months.
- US Consulate Vancouver — Western Canada coverage. Wait times around 4–6 months.
- US Consulate Calgary, Halifax, Montreal, Quebec City — smaller posts, sometimes shorter waits.
Wait times have lengthened significantly since the December 2025 citizenship reform, as more US-Canadian duals consider renunciation. Schedule the appointment well in advance.
You can also renounce at a US consulate in any other country. Some people travel to renounce in countries with shorter waits — Switzerland, Singapore, Hong Kong. The renunciation works the same regardless of which consulate you use.
The interview
The consulate appointment is typically two visits:
First visit (administrative):
- Review of your DS-4079 form
- Discussion of why you're renouncing (a "free, voluntary, and informed" act is required — the consular officer wants to confirm you understand the consequences)
- Verification of your second citizenship (the State Department won't process a renunciation that leaves you stateless)
- Payment of the fee
Second visit (oath):
- You sign Form DS-4080 in the presence of the consular officer
- You take the Oath of Renunciation aloud
- You surrender your US passport (cancelled, returned to you with the corner clipped as a souvenir)
Some consulates do this in a single combined appointment; others split it. The total in-person time is 30 minutes to 2 hours.
The consular officer is not there to talk you out of it. They are confirming you understand. As long as you're competent, voluntary, and have another citizenship, the renunciation proceeds.
The exit tax (covered expatriate test)
This is the part that can be expensive.
US tax law imposes an "exit tax" on "covered expatriates" who renounce. You're a covered expatriate if, on the day before renunciation, you meet any of:
- Income test — average annual US income tax for the prior 5 years exceeded $190,000 USD (inflation-adjusted; 2026 figure is around $210,000)
- Net worth test — total net worth exceeds $2,000,000 USD
- Compliance test — you can't certify 5 years of US tax filing compliance under penalties of perjury
If you meet any of these, the exit tax is calculated as: a deemed sale of all your worldwide assets at fair market value on the day before renunciation. Unrealised gains above $866,000 USD (2026 exclusion) are taxed at long-term capital gains rates (currently 20% federal, plus state tax for some former US-state residents).
For someone with $5M in unrealised gains in a stock portfolio, the exit tax on the $5M − $866,000 = $4.134M is around $826,800 in federal tax, payable in a single year.
There's also an inheritance impact: gifts and bequests from a covered expatriate to US persons are subject to a special tax at the US recipient's top marginal rate. Most descendants don't think about this; estate planners do.
Who is not a covered expatriate
Most descent-by-discovery dual citizens are not covered expatriates. The descent rule doesn't itself make you wealthy. Specifically, you're not a covered expatriate if:
- Your assets are under $2M
- Your average US income tax for the past 5 years is under $210K
- You're current on US tax filings
For someone who became Canadian under the 2025 reform without changing their financial life, the exit tax is typically $0. They renounce, pay the $2,350 fee, file the final-year tax return marked "exit," and that's it.
The exit return (Form 8854)
The final US tax return covers the period from January 1 of the year of renunciation through the date of renunciation. Filed in April of the following year.
Additionally, anyone renouncing files Form 8854 (Initial and Annual Expatriation Statement). This is where the covered-expatriate test is formally documented and the exit tax (if any) calculated.
Form 8854 must be filed even if no tax is owed. Not filing carries a $10,000 USD penalty.
After the exit return is filed, the US has no further claim on your income, assets, or estate. You become a foreign person from the US tax perspective, treated like any other non-US tax resident — US-source income still potentially taxable at source, but worldwide income no longer reportable.
What you give up
The honest list:
- US passport — no more visa-free travel under the US passport. The Canadian passport is one of the world's strongest (visa-free to 187 countries) so the practical impact is small for most destinations.
- Right to live in the US — you become a foreign national. To live in the US for more than 6 months/year, you'd need a US visa. Renunciation can be a problem for people who later want to retire to a US-Sun Belt state.
- Social Security — you keep what you've already earned. Future benefits continue to be paid even after renunciation. The Totalization Agreement still applies.
- US bank accounts — most US banks will close accounts of non-US citizens. You'd need to convert accounts to non-resident equivalents (limited) or close them before renouncing.
- Gun ownership in some states — non-citizens face restrictions on firearm purchases in some US states.
- Federal jobs — US federal government employment is closed to non-citizens.
- The right to vote in US elections — gone.
What you keep
- Property in the US — owning US real estate is fine for foreigners. You just pay US taxes on US-source rental income and capital gains.
- US investments — same. Brokerage accounts continue to work; some firms close non-US-resident accounts but many don't.
- Social Security earned — see above.
- Familial relationships — renunciation is a tax/legal status change, not an identity. Your family is still your family.
When renunciation makes sense
Common patterns:
- Dual citizen permanently relocated to Canada with significant assets in Canadian accounts — the FATCA reporting + PFIC complications on Canadian mutual funds + RRSP/TFSA paperwork makes US compliance painful for indefinite duration. Renouncing simplifies life.
- Dual citizen approaching retirement in Canada — Canadian retirement accounts are easier to manage as a Canadian-only citizen. The TFSA in particular becomes useful.
- Cross-border entrepreneur — owning a Canadian corporation as a US citizen triggers Form 5471 and PFIC complications. Renouncing simplifies the corporate structure.
- Long-term Canadian resident with no remaining US ties — if you haven't lived in the US in 20 years, the practical value of US citizenship is mostly sentimental.
When renunciation is a mistake
- Anyone planning to return to the US within 10 years. The visa system for non-US-citizens is much more restrictive than most assume.
- Anyone with US Social Security as their primary retirement income — while benefits continue, the foreign-resident filing requirements get more complex, not less.
- Anyone who hasn't done the cross-border tax math. A covered expatriate who renounces without planning ends up with a worse tax outcome than if they'd kept dual status.
- Anyone making the decision emotionally. Renunciation is irrevocable. The State Department checks for voluntary, informed consent specifically because they don't want renunciations driven by anger.
The waiting period
From appointment to CLN issuance is currently 6–12 months in 2026. During that period:
- You are still a US citizen (the CLN is not effective until the oath date, but only the State Department can confirm the oath was properly administered)
- You file US tax returns as a US citizen for the period before the oath, and as a non-resident for the period after
- You cannot un-renounce. Once you've taken the oath, the process is in motion.
The waiting period creates a planning window. Use it to:
- Transfer US bank accounts to Canadian banks (some banks won't open new accounts for non-residents)
- Sort out healthcare arrangements (Canadian Medicare doesn't cover US-incurred medical bills; consider travel insurance for any planned US trips)
- File the previous year's US taxes if not already done
- Confirm Social Security benefits will continue to be paid to your Canadian address
A note on cost-benefit
The all-in cost of renouncing for a non-covered-expatriate dual citizen:
- $2,350 USD State Department fee
- $1,500–$3,500 USD for cross-border accounting (final tax returns, Form 8854)
- $500–$1,500 USD for legal advice (most renunciations don't need a lawyer, but complex assets benefit from one)
- Travel costs to the consulate appointment if outside major cities
Total: $4,500–$7,500 USD as a non-covered expatriate.
The annual savings (in time and complexity, not necessarily dollars): no more US tax filings, no FBAR, no Form 8938, no FATCA disclosures to US-side institutions, no PFIC complications on Canadian investments. For someone who values simplicity, this is worth it within 3–5 years.
For a covered expatriate with significant unrealised gains, the exit tax can push the cost into seven figures. Plan accordingly.
What it doesn't change
You are still your family's family. You still have whatever cultural identity you had. The US-Canada border still works the same way for you (Canadian citizens enter the US visa-free for tourism up to 6 months at a time). Your US-born children can still claim US citizenship through you if they were born before renunciation.
The renunciation is a tax and legal status change. The rest of your life is the same.
Source: US Department of State renunciation procedures, the Internal Revenue Code section 877A (expatriation tax provisions), and IRS Form 8854 instructions. Fee and threshold figures current as of May 2026. None of this is legal or tax advice.
A small portion of this article — research support, fact-cross-checking, and copy-editing — was assisted by AI tooling. Editorial decisions, source verification, and final sign-off remain with our team. We cite primary sources from canada.ca for every factual claim.
