Ask your questions about FATCA.
This discussion has been continued here: FATCA Discussion Thread (Ask your questions) Part Two
Ask your questions about FATCA.
This discussion has been continued here: FATCA Discussion Thread (Ask your questions) Part Two
Be advised if you are considering adopting a child from the US. This is close to home for me as I have a close relative who adopted a child from the US:
Important Information for Canadians Who Have Adopted a Child From the USA
http://www.sunriseadoption.com/adoptive_parents/news/important_information_canadians_who_have_adopted_a_child_from_usa
Steven Mopsick’s and his “reliable source” Latest, with excellent comments and questions from Just Me, Anonymous and Blaze!!!!!
http://mopsicktaxlaw.blogspot.ca/2012/12/offshore-voluntary-disclosures-update.html#comment-form
@Calgary and Bubblebustin.
Thanks for those articles.
Regarding this story.. JBA Pushes For Inter-Governmental Agreement On FATCA
I just sent an email to the address at the bottom…
Gentlemen:
Read your recent story with interest. I understand that financial institutions have a tendency to run to governments looking for salvation from a Draconian U.S. extra-territorial over reach, rather than putting some efforts into pushing back against a BAD U.S. law themselves.
They see this as in their self interest, but they delude themselves and the Jamaican taxpayer with this cry for an FATCA IGA.
I have to ask, where is their concern for the thousand and thousands of Jamaicans who are what the U.S. now calls “US persons” who really should not be included in this broad based invasion of many peoples privacy and human rights.
Are they just willing to throw them under the bus, if they can get some privileged exemption in an IGA that still will not save them the huge administrative costs of compliance that they think it might?
Don’t you have organizations like the Canadian Civil Liberties Association, who have recently expressed their concern about FATCA in this recent letter.
Where are the forums for public discussion about what the US is trying to do? Maybe you should watch and model what the Canadians are doing. I am sure very few Jamaicans really understand the wide impacts of this over-the-top FATCA effort.
FATCA is a snub of international negotiating protocol, as it is NOT a mutually agreed Tax Treaty ratified by both countries legislators.
It is just a Cram Down from the International Revenue Service, with only minor changes allowed on the margins for some special exempted financial institution.
And, while you will have to change your Constitution and laws to get it approved, it is not going to get the same “advise and consent” attention in America’s Senate. The Treasury Technocrats are pulling a fast one by slipping an Executive agreement under the radar with no vote required to impose a faux reciprocity provision on U.S. Banks.
It would be one thing, if the IRS was limiting its search to just U.S. Citizens resident in America, but instead, they are on a world wide hunt for U.S. Persons living in Jamaica. That is probably a higher percentage of your population than you first think. Can you afford all that collateral damage?
This is fundamentally a wrong headed and immoral taxation practice, that is unique to America. It is essentially reaching into your Treasury to extract revenue from ordinary middle or lower class Jamaican citizens who for reasons of dual citizenship, accidental birth, marriage or past jobs in America, now find themselves so designated as U.S. tax chattel, even though they do not live in America.
What a lousy way for a bankrupt county to raise money for their homeland deficits.
Even if your Citizens are not “U.S. Persons”, they will still bear the higher banking fee costs for your financial institutions to comply. You don’t see anything in those IGAs offering to front up the cost of compliance out of the U.S. Treasury, do you?
Does your sovereignty have no pride or limits on the amount of US financial aggression that you will allow?
At some point, you have to learn to say no, to the Hegemon. And, don’t you think for a minute you will get anything like real reciprocity in the IGA that the JBA wants your government to sign up to. It won’t happen, no matter what this little executive agreement says. This is not an pineapple to pineapple agreement.
If you did not see this recent address to a Caribbean Conference, I think it merits your attention, and should get equal coverage as the JBA cries for a faux government FATCA IGA bailout! 🙂
Sincerely,
@Just Me,
Excellent, excellent questions for poor little Jamaica. I hope they took note of your warnings. Doesn’t it just make your stomach churn?
Great job, Just me
I’m busily sending the US adoption article to every adoption service in the US I can easily find on the internet, suggesting they make an effort to have FATCA repealed.
@bubblebustin,
And great job by you — that’s quite an endeavour, sending the US adoption article to every adoption agency in the US.
The site http://www.rainbowkids.com/countries/CountryGuideLines.aspx?id=89 has a link:
“To contact all agencies placing children from USA with just one form, click here,: which takes you to http://www.rainbowkids.com/contactwizard/contactwizardmain.aspx?coid=89“
@calgary
well, I don’t know about every adoption agency, but at least a few of the majors should know about the latent defect of citizenship based taxation that US children have when being adopted out. It’s sad, but I think that if prospective parents know about this, many would pass US children over…
PS thanks for the link!
@bubblebustin, this is also a SAMS issue. If non-US citizens, with no taxable status vis a vis the US adopts a US child – who brings the US taxable person burden into a non-US household, the adoptive parents are then responsible – for reporting on the child’s behalf. So no RESPs for that child – because of the accounting and US tax burden. No TFSAs for that child – same reason. And, when the adoptive parents get old, the US born child will have problems if they are named Power of Attorney for Finances, or acts as their executor or inheriting from non-USpersons – because the US person child will have to declare those non-US accounts along with their personal ones on their FBARs, and perhaps FATCA form, and probably 3520s if the parents had anything that the IRS calls “foreign trusts”.
This disadvantages both the prospective non-US parent, and the US status adoptee.
Surely Congress, Treasury and the IRS would not say that they think that “protecting the integrity of the US tax base”, and of US extraterritorial citizenship based tax and financial reporting is more important than finding good homes for US status children? Or would they? Maybe the Taxpayer Advocate should ask them. I also think that there was a US tax credit or something similar, to help with adoption costs, but I doubt they’d let someone abroad claim it.
Great letter to the Jamaican JBA, @Just Me.
@Calgary and Bubblebustin. and Badger,
Well that was just a short effort between gardening chores and then a quick cut an paste here. I wished I would have looked at it, and edited for spacing, as I see all the paragraph spacing disappeared. However, it had stopped raining, so had to get back to the lawn before dark. I doubt anyone in Jamaica will take note of it, but it felt good to give them another perspective, after that typical FCC type message. “We must comply. Bail us Out. Collateral damage be damned.”
and @bubblebustin, good idea about the adoption agencies. I am sure they have never considered the citizenship taxation issue, and why would they? Before 2009, when all sanity vanished in this offshore jihad, no one would have even thought of it.
FATCA has finally hit the UK mainstream press, with this article in The Independent. The content is pretty well written and nicely critical of FATCA. It’s unfortunate that the copywriter could not resist spinning the article’s title line.
http://www.independent.co.uk/news/business/analysis-and-features/why-americas-fatca-might-spell-disaster-for-britains-fatcats-8387007.html
Gotta like this one: Court Pursues IRS for Ratting Out Americans to the Japanese.
The Court of Appeals for the Ninth Circuit (the appeals court for the Western U.S.) is looking at the IRS conviction from the United States District Court for the District of Arizona. Below, the Court explains the anti-ratting law.
“Tax returns and tax return information must be kept confidential, unless a statutory exception applies. 26 U.S.C. § 6103. Section 6103 “was enacted in response to the use of tax return information for political purposes revealed during Watergate.” Rueckert v. IRS, 775 F.2d 208, 210 (7th Cir. 1985).
“To add teeth to this statutory protection for taxpayers, Congress created a civil action against the government for an IRS employee’s knowing or negligent unauthorized disclosure of a taxpayer’s “return information.” 26 U.S.C. § 7431. The action must be brought within two years after the date the unauthorized disclosure is discovered. § 7431(d).”
http://www.intltaxcounselors.com/blog/?p=13143&goback=%2Egde_3731046_member_193169742
@badger, @bubblebustin,
“Surely Congress, Treasury and the IRS would not say that they think that “protecting the integrity of the US tax base”, and of US extraterritorial citizenship based tax and financial reporting is more important than finding good homes for US status children? Or would they?”
Tongue firmly in cheek, I see, badger. We all know there is
very littleNO morality within Congress, Treasury and the IRS.Yes, this should be another SAMS issue. The unsuspecting Canadian (or other adoptive parents of these children) = additional collateral damage.
I’m hoping that the link I’ve sent the the many adoption agencies within the US will set off alarm bells and motivate them to contact their government themselves. More puppies and kittens fall to the IRS. At this point, I’m throwing as much as I can in every direction I can. I saw a news segment of Global TV BC this morning about the construction jobs fair in Indio, California where BC is recruiting American workers to work in BC. I wrote a quick letter to one of the organizers, The Canada California Business Council and asked if they are informing potential recruits about ongoing tax filing obligations to the IRS when working in Canada. It may not be a legal obligation to do so, but surely many US workers will feel blindsided and entrapped upon finding out later, just as adoption agencies should warn potential parents of the perils of adopting a US child from outside the US.
@bubblebustin,
I sent a quick note to Roy Berg yesterday. He has authored an excellent piece that needs to be accessible.
@all,
About one year ago, my youngest son and his wife contacted the two major International Adoption Agencys in the Vancouver area. Both agencies told them that at that time, the major source of children they placed in homes in B.C. were from the United States. The written material that my son and daughter-in-law received from the agencies, (and also on the website of one of the agencies), addressed the tax filing obligations and U.S. citizenship issues.
At the time they showed me the material, I had not had my OMG moment and in fact, even then, I did not think all of this would have an effect on me.
@Tiger
It’s good to know that adoption agencies are informing potential clients of this aspect of US adoptions. I wonder how long they’ve been disclosing this ‘defect’ and if it has effected adoption rates of American children. May I ask, did the agency spin it in any way to mitigate the responsibility? Did it concern your son and daughter-in-law to the degree that they would hesitate to adopt from the US?
I just got a response back from a US adoption agency (emphasis mine):
Thank you for contacting AdoptUSKids. And congratulations to your family on growing through adoption previously! AdoptUSKids does not participate in any lobbying activities or try to influence legislation. If you have any questions about AdoptUSKids or how to adopt children from U.S. foster care, please let me know at info@adoptuskids.org or at 888.200.4005 x24.
Sincerely,
Elizabeth Brescia
AdoptUSKids
Wow, AdoptUSKids won’t try to effect US legislation that’s harmful to their own adoptees. I guess caveat emptor applies here too!
@bubblebustin,
The world has gone mad. It is truly disgusting, but I guess no one, including the adoption agencies and those trying to adopt, has any idea of what US citizenship in another country means for that child. It must be a benefit, right?
@Bubblebustin,
Both agencies just gave the information in a factual manner, stressing the responsibility. Did not mention any things like RESP – no tax facts. The agency in North Vancouver (SUNRISE ADOPTION AGENCY) did have it on their website. One interesting thing that my kids were told at the other Vancouver Agency (CHOICES) – this was in a meeting – was that although most of the placed children were coming from the U.S., availability had slowed considerably. The reason they gave for that was that the U.S. was a recent signatory to the Hague Convention on Adoption. That convention has the requirement that every effort must be made to place the children in their own culture, environment etc. Most of the American children available are from the black community and therefore, there needs to be an attempt to place them within that community.
As far as my kids being concerned re the tax issue, that had no affect. They just so wanted a baby. BTW – last Wednesday my daughter-in-law had our little ‘miracle baby’, a boy. So thoughts of adoption are definitely on the back burner.
@calgary411
I couldn’t help but respond:
“Dear Elizabeth,
Thank you for your response. It’s unfortunate that this legislation, FATCA, once enacted will likely reduce the number of American children being adopted by families outside of the US, and that your organization will do nothing at a grass roots level to prevent this from occurring.
Regards, *”
I was tempted to go on asking her how she could ever look into the eyes of those children knowing that she has done nothing to prevent this from happening, but thought that would be overly dramatic.
@tiger
CONGRATULATIONS to you and your family! You must be over the moon.
I’ve been reading about the Hague Convention and adoption. I suppose it would now be nearly impossible to tell what specifically is slowing down US adoptions in Canada, but between that and FATCA its may just become a trickle.
The adoption thing is just awful but it got me thinking. Does the US expect USP children to file taxes and FBARs even if they don’t approach any thresholds? Adults are expected to file taxes even if they don’t approach the US minimum for filing, but does that apply to minors? I haven’t been able to google up anything on it. And would having no tax trail be an issue for a child who relinquishes as soon as he/she is old enough? I wouldn’t think so but anymore, it’s hard to know just what the “rules” actually are.
@Bubblebustin
Thank you. I am over the moon. I keep cooking to take food over as an excuse to see him. I think they have caught onto me.
I just checked the website of both agencies. It is interesting, Sunrise Adoption Agency now gives on their website a very detailed article regarding the tax consequences – much more detailed than what was on the site last year or even earlier this year. I could not find any mention of taxes on the site of Choices. I hope for the sake of the families who might be going through the process with Choices, that all of this is spelled out for them.
@tiger
Sunrise’s notice is what I actually originally posted on this thread. Good to see they are taking this seriously. I imagine they are dealing with many Canadians who adopted from the US and have to issue a warning. This is an absolutely disastrous consequence of citizenship based taxation.