A reader submitted this letter to me (UPDATE: Late Loyalist has now renounced his United States citizenship):
Dear Mr. Flaherty
I’m one of those Canadians with dual US Citizenship. My family moved from Minnesota to Manitoba in 1975. I was 13 years old at that time. My Dad had been an unemployed teacher for the previous 4 years. As a last resort he decided to apply for a teaching job in Manitoba. After all Manitoba is lot like Minnesota right–well the snow and -40 maybe. Wouldn’t you know, he got the job right away. We drove to Winnipeg in a snowstorm and he had the job 20 minutes after we got there. He taught for another 15 years and retired in Dauphin. My parents left everything and the result was a better life. In 1980 all our family member became Canadians, no question.
Now I’m 50 years old. Canada has given me 6 years of post-secondary education, a great job and much more . My wife and I with our two daughters really enjoy Calgary and our community. My work is great, the schools are good and we even get to holiday in BC occasionally. We have a ‘good life’ and we’re very thankful for all our blessings that we have and we can share with others. You might say we live the middle class dream to some extent. But no one told me at age 13 I had to file US taxes and the FBAR. We got this news a week after getting back from our summer holiday in Minnesota this year. I had two weeks to learn all I could and chose to get into the OVDI. The result, a 20K+ lawyer fee from a Tax Lawyer/Accounting firm that handled my case just so I could pay a $1589.00 penalty to the IRS for not filing the FBAR and to be told I owed $0 US income tax. If this hasn’t made you angry yet read on.
The worst of this is that the FBAR penalty is calculated on the highest cumulative value for the 8 years from 2003 to 2010. This means that for 2010 that our joint chequing account equaled $31,775.00 at one single point. The value was based on a $20,000 inheritance from my ‘Canadian’ Wife’s ‘Canadian’ Father who farmed all his life in Manitoba. That’s it, most of the penalty is based on Canadian money that already had tax paid on in Canada. Because this $20,000 was deposited in our ‘joint’ account it had to be recorded on the FBAR. My wife finally gets it–she sees the IRS and the US Government for what they are and now she’s really angry. Our Federal Government, Parliament, needs to step-up and fight for Canadians like me. For me there is only one course of action, when I get my ‘closure letter’ from the IRS I’ll make my visit to the US consulate here in Calgary to start a process I should have started a long time ago.
Understand, I ask for nothing special from my ‘Canadian Federal Government’. I made a choice to get smart and certain legal advice and service. The firm that worked on my case has been great, no complaints. Even after I pay the bill, from the equity in my home, I know I have had outstanding service.
I apologize for the angry tone of this letter. It’s not my intent to attack any Canadians, all I’m looking for is action. Real, visible, no backing down, in your face action with the US Government and the IRS.
The Late Loyalist