Meghan Markle’s Baby Could Face Tax Nightmare Because Of This American Rule

Meghan Markle and Prince Harry’s baby could face a tax nightmare.

The Duke and Duchess of Sussex's firstborn will arrive in 2019. However, the upcoming royal may have to pay U.S. taxes for the rest of his or her life due to an American rule.

At the time, Markle is still considered an American citizen since her U.K. citizenship application can take several years. More likely, she’s still an American citizen when she delivers her baby next year.

Due to this reason, Markle and Prince Harry may have to pay taxes. The Duke of Sussex’s main source of private wealth is his multi-million trust fund, which also pays for U.K. income tax.

According to Fabian Lehagre, President of the Accidental Americans Associations, the future royal will surely be subject to this tax because of the American Citizenship Based Taxation. But, there’s a way to stop the tax nightmare.

“The only way out for the future royal baby will be to give up American nationality when it reaches the age of majority,” Lehagre told Express. “In the meantime, thanks to the US Foreign Account Tax Compliance Act (FATCA), the US tax authorities will have access to banking information from the Royal Family.”

“Prince Harry will be impacted not because of the future baby but because of his wife who for the moment still has US citizenship,” the expert added. “She is therefore subject to the Citizenship Based Taxation and must declare her income and that of her husband.”

The Guidance notes to US citizens states, “You are generally taxed on income available to you, regardless of whether it is in your possession.”

According to royal aides, they are looking at a level of financial exposure that the royal family has never faced before. They also considered this incident as the “royal household’s worst nightmare.”

In related news, Prince Harry and Markle missed the Queen’s Diplomatic Corps Reception at Buckingham Palace on Tuesday. Prince William and Kate Middleton were present at the event.

The Duke and Duchess of Sussex were spotted at a carol service in support of Henry van Straubenzee Memorial Fund on the same evening. At the event, many noticed Markle’s big baby bump. This prompted some fans to speculate that the couple could be expecting twins.

“Only 5 months?! Meghan Markle is definitely having twins,” one fan tweeted.