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Technically, the placement of the apostrophe is correct: for possessives ending in “s” the apostrophe goes outside the word. But the problem here is awkwardness, not only because the possessive is a compound word (two words: United and States), but also because the possessive implies ownership as well as assignment (“my building” can mean “the building I own” or can mean “the building I work in”). The phrase “United States citizens” is of the latter kind, the possessive of assignment (compare, for example, the possessive of ownership, as in “United States coastline”). If the writer can rephrase the information to eliminate this ambiguity, the perplexing apostrophe can be eliminated: “citizens of the United States” or “citizens claiming U.S. citizenship…” When a noun modifies another noun (an appositive), the modification is often ambiguous (the Pennsylvania Turnpike tollbooth ticket taker”).
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