Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
Please note that the guidelines for this discussion are published here.
Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
Please note that the guidelines for this discussion are published here.
@Don Pomodoro
Actually the Swedes never asked me to renounce my American citizenship. I have also read articles about the law changing in 2002, but unless my memory fails me completely, there were no problems for me at that time.
Not sure how the banks here are going to react. Mostly rumours one hears now. But I acknowledge things could get tough for me. My decision was based on a desire for freedom of movement in the states.
Congratulations on your CLN, since that is what you wanted.
Congratulations Don on getting your CLN!
Big congratulations on this thread too, Don Pomodoro. I’ll update the Renounce and Relinquish database (likely tomorrow). What is the date of your CLN?
Thanks for the info — happy for you!!!!
@Travis
That’s interesting – Maybe it was just on the books but unenforced? Anyway, as long as you know what you might be getting into and the pros outweigh the cons for you, then of course you should do what works best for you. Hopefully you can plan for what comes next better than some of us have been able to with the information now available.
@Calgary
Thanks! Its dated 16 August. I actually got a call last week to go to consulate, but only could manage to get over there today.
@Travis, well unless you’re planning on doing a lot more travel to US why not stick with the visa waiver system you already use? Does it cause more problems for you to use it? I wouldn’t be too quick to reapply for US citizenship.
@Don – congratulations. Make a copy and get it framed!
I’m still trying to decide, being totally non-complaint on the tax side, whether to get that done first and then go through renunciation, renounce and sort tax out after, or do both at the same time. Does it make any difference which way it’s done?
Medea – One random thought on sequencing, provoked by your question. And I can’t recall ever having seen this point made. If you renounce, the clock will start ticking on filing the paper to become tax compliant. If for some reason the paper is not timely filed, a lack of the Form 8854 could lead to your being deemed one of those automatic “covered” expatriations?
@Medea, USX, generally I think that the order should be (1) relinquish as soon as possbile (meaning waiting to get a foreign citizenship); (2) if relinquishment is not possible, renounce as soon as possible. Why? This stops the tax liability issues cold and in their tracks. The rest of the paperwork, has to be done in any case (except FBAR if you are in Canada–i.e., both your ass and your assets). But having renounced, one has usually a long time to prepare the paperwork. It takes months to receive the CLN in any case (in my case over a year).
@Petros – The second citizenship isn’t a problem as I hold British nationality as well and have since birth as both my parents were British. It’s the tax compliance that concerns me more due to the twitchiness of the Swiss banks re US citizenship, but if I get started on the renunciation and also start finding out what I’ll need to do to be tax compliant then hopefully I’ll be in a position to show them that I’m on the way out and please don’t close our accounts. With Bern increasing staff to deal with renunciations it should mean the paperwork gets into the system a bit quicker than it has been. Don’t know how soon people renouncing here are getting their CLN’s sent through.
@usxcanada – Luckily I think I fall in the exemption category for the covered expat side of things so hopefully that won’t cause me any problems. Still, I’ll contact a US tax attorney here and see what he has to say.
The Swiss “Beobachter” (Observer) is consumer-advice oriented publication. Its August 15, 2012 issue includes an article called “Dual-Citizens: how to get rid of the American passport?”. It possibly shows the extent to which the issue of toxic US citizenship has become known in Switzerland:
http://www.beobachter.ch/justiz-behoerde/auslaender/artikel/doppelbuerger_wie-den-amerikanischen-pass-loswerden/
@Innocente. The Beobachter provides a good summary, though doesn’t take into account the possibility of relinquishment. Also, it doesn’t mention the $450 fee, FBAR or FATCA. We should see if we can Simon Xavier Keller to write for Isaac Brock too (aber auf englisch).
DS-4079 (13.e.) asks if you file US returns. There must be many people who have never filed except recently. Some of them have reported here that they explained on the form that they filed now only to avoid problems and because of the publicity (not to assert a US connection), and that their recent filing did not prevent their request for relinquishment from being approved. To follow the form properly I suppose you have to tick “yes” in such a case (even though that question seems to be asking about regular ongoing filing, where a “no” would make more sense). Any comments on this, or suggestions on wording the explanation, would be appreciated.
@hoskin
I could be wrong here but I believe Question 13 is used to determine whether or not you have had ties to the US which could mean you have to renounce not relinquish. If you read the many threads here on renunciation vs relinquishment, I believe you will see that filing tax returns would in many cases result in the relinquishment being denied.
One place you could read about this is to read the story of calgary411, who on the advice of a cross-border tax lawyer started to file tax returns. She now must renounce.
@ Hoskin, From what a few people have been told that at their consulate meetings regarding 13(e), if you filed recently in the belief that you were “wrapping things up” so-to-speak, that should not taint a relinquishment. So far, no one has reported otherwise.
I think the theory is that if your only US tax filing was done recently, it was not done to participate in citizenship, but simply to close the books with IRS. (The IRS actually does consider termination of citizenship to occur when the consulate is notified, not when it actually happened, definitely so post-1994; regarding pre-1994, people have interpreted it both ways.)
A rather minor point, to be very literal, the case law seems to be concerned with
people using the benefits of citizenship after allegedly relinquishing it. One can perhaps consider that filing a tax form is no benefit.
Thirdly, whether relinquishment occurred is evaluated on the “balance of probabilities” with no one factor being determinative.
So, if you were just wrapping things up with IRS, basically filing as part of formalising your relinquishment, you could mention that in question 13(e), and if that’s all, it sounds like the balance falls in favour of relinquishment.
If for some reason, a consul does not feel a person actually relinquished, it seems they tell them and let them renounce right then and there.
Sorry for double-posting. I posted this elsewhere on the site but this looks to be the more appropriate thread.
I was born in the US to Canadian parents in 1954. We moved back to
Canada in 1966 when I was 12. I have a Canadian certificate of “Canadian
Citizen Born Abroad”. I’m now 58. I’ve never worked in the US, never
filed any US tax form, never had a US passport. My Canadian passport of
course says I was born in the US. As a kid, I remember my mother saying I
was a dual citizen up to a certain age. I remember going to the US
consulate here in Calgary in the early 70′s. I was somewhere between 18
and 22 or so. I went to ask if I was a dual citizen and what advantage
there was to it. As I recall, I was told dual citizenship didn’t really
exist and that I wasn’t an American citizen.
I have no idea where I fit into all this IRS/FATCA/FUBAR business. Of course, I want no part of it.
Should I go to the US consul in Calgary and ask questions? I like the
idea of some certificate declaring that I’m not a US citizen and have
no obligations to any US department. Does the process of relinquishing
apply to me?
I’ve spent my whole adult life believing I’m only a Canadian!
*What am I? That’s an easy one. You are canadian. Don’t do anything to change that. Don’t wake the sleeping bear. Do nothing. You don’t have to.
Does anyone know if kids (under 12) need a US passport if they are travelling to the US? The kids are Canadian citizens, born outside of the US, but travelling with a US citizen parent. They are technically US citizens but don’t have any paperwork to prove it. They have never lived in the US, never had any sort of US documentation. Can they travel on their Canadian passports?
A related question: if these kids do not want US citizenship, do they have to do anything proactive to renounce it? Or is it sufficient to not claim it? My understanding is that the consulate won’t let them renounce at their age.
Thanks.
WhatamI: The consulate told you that you weren’t really an American. That’s brilliant. I’d like to see that in writing from the State Department. First, don’t ever allow the US to say you are a US citizen and never apply for a US passport. That’s the first and foremost. You are a citizen of Canada, and you have right to claim that citizenship as alone explaining who you owe taxes to. As for the legal matter, I’d like to bring this up as a new thread and see if anyone can come up with a supporting document for kind of scenario. Thanks for the comment.
Pingback: The Isaac Brock Society - What am I? Born in the US but the US consulate told me in 1970s that I am not an American
An FYI for those readers who weren’t born duals (US plus another citizenship – ex. Canadian), and haven’t applied for Canadian citizen status: according to the Canadian Citizenship and Immigration site: the “total processing time” for “routine
applications” (“From receipt of your application to citizenship
ceremony”) is now listed on the CIC site as 21
months, up from the 19 months cited in fall 2011 to just recently
(August 2012?)
http://www.cic.gc.ca/english/information/times/canada/cit-processing.asp
. The Citizenship and Immigration Canada site (see prior link) says
“Processing times are based on how long it took to process 80 percent
of all cases between April 1, 2011 to March 31, 2012″.
I had been wondering if the CIC was seeing an uptick in citizenship applications in Canada from those deemed ‘US persons’ who hadn’t yet become duals, but who now are aware of the US perfidy in the treatment of those deemed to be ‘US taxable persons’.
USC PRs in Canada who are applying for Canadian citizenship may find this board useful (in some ways it’s the logical bookend of the IBS):
http://www.immigration.ca/forum/forum_topics.asp?FID=3&title=canadian-citizenship
Canada, unfortunately, has one of the most sluggish citizenship processes in the Western world, in terms of making a decision about the applicant – the Australians are apparently much brisker.
I have a question for those who have recently gone through the process of obtaining a CLN that is (or will be) backdated to a date earlier than 1994. I have carefully read through all of the posts regarding IRS filing, and it seems to be the consensus that people who fall into this category (including myself – my CLN date is early 1980s) do not need to file the 8854 form (or the associated 5 years annual returns) – although I would feel better if there was an official ruling / statement on this.
My question is this: Do we still need to send a notification letter to the IRS, as was requested on form DS-4081? Has anyone done this or plan to do this? Have people received replies back from the IRS? The only specific opinion on this topic came from the discussion thread
http://isaacbrocksociety.ca/2011/12/16/did-you-relinquish-before-february-6-1995-then-you-did-not-have-to-inform-the-state-department/
where it was expressed that we should send a notification letter: “As a result, it appears that we have no requirement to provide any IRS-specific forms or statements to the IRS, including form 8854! It would appear that a simple notification letter from us (notarized and duplicated, I would suggest) indicating that the Department of State has processed and issued a CLN showing a relinquishment date prior to February 6, 1994 should suffice. ”
Any thoughts, comments?
*
@ex-American
Like you, I am confused as to how to proceed after relinquishment. I too have an expatriation date in the far distant past (over 40 years) and would like to believe that the IRS will ignore me. However I’m not entirely convinced and as far as I know, no one on Brock has yet gone far enough in the procedure to test out this theory. As far as I can see the IRS never informs anyone that they are off the hook, whether they file the taxes, FBAR’s etc. etc. or not.
You might also want to take a look at the June 19, 2012 posting “Please read this post if your expatriation date is before 2004” and the comments by Michael J. Miller.
Also the following question was posed to Stephen Mopsick, a former “tax vet” with the IRS on “Stephen Mopsick Blogspot” on Feb. 17
.
1) Regarding the exit tax – submitting Form 8854 will not be required ” if the individual establishes to the satisfaction of the Secretary of the Treasury that the individual’s loss of US citizenship occurred before Feb. 6, 1994″. In your opinion, will the IRS accept this and not require submission of form 8854 and/or back tax returns and FBAR’s once an individual has obtained a backdated CLN? A lot of people are depending on this clause, including possibly myself, and I find it worrying because –
2) Nowhere in the instructions for form 8854 is this 1994 date mentioned and if indeed it is valid it would affect a lot of people. It seems underhanded to sweep these people who expatriated before 1994 into the exit tax regime without telling them all the facts. It is unreasonable to expect individuals to either comb through tax law themselves or hire a professional to do it for them. Surely, if this Section is valid, the IRS should make that clear in their instructions.
Links are:
http://codes.lp.findlaw.com/uscode/26/A/1/N/II/A/877/notes
Under Effective date of 1996 amendment – (3) special rule (B)
http://www.unclefed.com/Tax-Bulls/1997/Not97-19.pdf
Under Section X, and
http://www.gpo.gov/fdsys/pkg/USCODE-2010-title26/pdf/USCODE-2010-title26-subtitleA-chap1-subchapN-partII-subpartA-sec877A.pdf
Under Effective date of 1996 amendment 511(g) (3)(B)
His answer can be found under the posting of “Mentality of Modor” Feb. 20 at 8:37 p.m. and 8:57 p.m.
I also wonder whether, if a person is in a position to “gift” some money and/or property to your non-American spouse, it might be possible to file 8854 and get yourself in under the $650,000 deductible before the exit tax kicks in. As I understand it, you can give away up to $1,000,000 (and $5,000,000 this year) in your lifetime. Personally, I don’t have anywhere near a million to gift to anyone! Hope you find some crumbs of help in here somewhere.
hijacked, I recommend you look here. It’s really simple and easy to read.
http://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax/INF12036.html
By the way, this is in the section where it says WHAT ISN”T classified as a gift.
Gifts to a spouse who is a U.S. citizen. Gifts to
foreign spouses are subject to an annual limit of $136,000 in 2011. This
amount is indexed for inflation and can change each year.
Given the way that the US is, I wasn’t shocked very much that they discriminate against foreign spouses. Basically you’re penalised to an extent for marrying a “foreigner”.
*Ex and hijacked. You seem to think the IRS has the interest and resources to go after anyone with a CLN. They don’t. Forget about it. Rejoice that you are free and move on.
Hijacked, if you gift the money, and want to play by their rules, you are supposed to file a gift tax return. Not worth it. No need.
@Ex and hijacked
I believe Cornwalliscal’s statement above is correct. They do not have the resources to go after those of us who ‘relinquished’ decades ago and have now applied for our CLN. I do not remember which post it was, but quite some time ago, Steven Mopsick (30 year IRS Vet) said exactly that. They have bigger fish to fry with the resources they have.