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In the event of a truly accidental American the IRS never finds out. You’re an Italian businessman, you’ve never applied for a US passport, your parents travel insurance paid for your birth (or they skipped town and never paid), you travel to the US solely on your Italian passport if you ever do so and are welcomed as a foreigner. If Customs sees your ‘place of birth’ as the US, they won’t care, and in the very unlikely event they do, the businessman tells them his parents were diplomats or soldiers or UN. They will not ask for proof. The IRS isn’t going to track down hospital records in Philadelphia from 50 years ago to deduce that there might be an American somewhere in the world who didn’t pay taxes.
Most ‘accidental Americans’ are not accidental at all. There’s a huge growth industry of third world PMCs flying to the US to give birth so their kids get citizenship.
Boris Johnson got into trouble at JFK for travelling to the US on a British passport listing a US place of birth. (US citizens are legally required to arrive and depart the US on their US passports), and the IRS attempted to collect capital gains tax on the sale of his London home. (It isn't clear if he paid or not). And the tax treaty between the US and the UK requires banks to freak out if they see a British passport with a US place of birth as part of customer due diligence. So I don't think being an accidental American is as safe as that.
I’m afraid that according to Boris’ own article on that 2006 incident, helpfully scanned here he was asked if he had previously held a US passport (and he answered yes). In fact, this was explicitly the question the agent asked him. He had also written many times about being a US citizen in articles one presume could be easily found on Google even back then.
A very different situation from the Italian in Count’s comment.
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This is a fairly strong claim, is there any evidence for it happening at industrial scale? There are interesting left-wing arguments that could be made if its true but you would need evidence that its more than just a conspiracy theory.
I've personally seen it and read news articles about it. Example. It may not be a huge in scale, but it is not nothing.
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I believe the typical case of a genuinely accidental American that causes problems is when someone isn't born in the US but has citizenship from their parents, which the IRS likely would discover.
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