What’s he going to do to finance this? http://edition.cnn.com/2012/02/22/politics/obama-payroll-tax/index.html?hpt=hp_t3
Maybe try to do it on the backs of compliant US Persons Abroad by removing the Foreign Earned Income Exclusion: http://www.aca.ch/joomla/index.php?option=com_content&task=view&id=507&Itemid=46 and make it even harder (epecially in the case of compliant minnows) for families to pay their bills and exercise equal economic oppourtunity.
Friends at Isaac Brock (and anyone else who is concerned): please write to Tierney [Mass.] and the bill’s cosponsors (Steve Cohen [D-TN9], Keith Ellison [D-MN5], Raul Grijalva [D-AZ7], Jesse Jackson [D-IL2], Betty McCollum [D-MN4]) to tell them to remove this paragraph from the bill H.R.2495 Section 402. Please also write to your Congresspeople in any home state you might have (as well as the DC commissioner to Congress) and tell them to do the same. You may also want to write the two Senators for your state and tell them to block the bill if it comes to Senate for approval in its current state or containing any language that would remove the FEIE. Discussion and links to Congress follow:
If you can’t vote for any reason (no home state or renunciation/relinquishment but still attacked by IRS as a “US Person”, and/or don’t have a home state, you might want to write the entire delegation (Senate / House) for any state(s) you like and/or feel a connection with. In such a case you might want to emphasize that you are not counted in the Census in contravention of Article 1 Section 2 USConst, and hence deprived of full representation in Congress.
To find the email and street addresses for members of Congress, you can use these links:
House: https://writerep.house.gov/writerep/welcome.shtml
Senate : http://www.senate.gov/general/contact_information/senators_cfm.cfm
House Washington DC Rep, E. Holmes Norton https://forms.house.gov/norton/webforms/issue_subscribe.htm (her site claimes that her services are for “constituents from the District of Columbia only and will not accept messages from locations outside our area” ). However, as Internal Revenue Code 26USC (§ 7701) (39) treats United States persons abroad as residents of Washington D.C., I would begin any communication to her with a phrase like “I am indeed your constituent because [cite above statute]) For more discussion of the IRS “fictive DC residence” please see Petros’ article at: http://isaacbrocksociety.com/2012/01/03/do-united-states-persons-differ-substantially-from-residents-of-washington-d-c/
Every little bit helps.
@tiger: I think your suggestion makes sense for higher-income-tax countries like Canada, Sweden, Denmark, UK, Germany, France, etc. (beware the AMT though, if it is not in effect for the current tax year, it might be for back-filings– please anybody: research that if you want/have time because I am not clear on this as the IRS has never responded to any of my past filings in anything other than an obscure cryptogram). However IMHO the opinion of the tax-preparer that you mentionned (FTC rather than FEIE) does not help for lower tax countries where often the cost of living and excises and other fees, high VAT and local policy as well as local customs/cultural issues place additional financial and non-financial impediments in our path and burdens on our backs (over and above simple income tax) that are not compensated by the FTC (“Foreign Tax Credit”).
FEIE above = Foreign Earned Income Exclusion
@ Jefferson D. Tomas, and all; in solidarity, I’m sharing what I’ve written – to one Congressman (D) so far, see basic draft as excerpted below:
“Urgent re: H.R.2495 Sec. 402 – Bill amendment, repeal of Foreign Earned Income Exclusion”
…………….
“You will no doubt know how the paragraph below, repealing the FEIE will impact US ‘persons’ ‘abroad’. …….. US citizen/duals/’persons’ in Canada and elsewhere – and their dependents are already threatened by the current structure of FBAR obligations AND now FATCA.
US ‘persons’ ‘abroad’ are being thrown under the bus…..even the ‘Canadian (dual) grandmas’ , US Ambassador Jacobson assures us are under no threat from the IRS and the US government….
Repealing the FEIE ignores the true context of the lives of ordinary US ‘persons’ ‘abroad’. Here in Canada, we already pay all applicable taxes, and this country is not known to be a tax haven. There is an extended economic downturn. Employment is hard to find. If the FEIE is repealed, we will be facing taxation by two governments, and do not have sufficient income to do that.
Since citizens ‘abroad’ are not counted in the census; any statistics loosely thrown about by IRS Commissioner Shulman, or the sponsors of this paragragh re the FEIE, in support of addressing a supposed large ‘tax gap’ from ‘international taxpayers’ are entirely fictive, and have been inflated to support initiatives such as this one re the FEIE. I see that the sponsors of this latest effort are all Democrats, and that our president has also spoken in support of the bill in its entirety.
Frankly, although many of us cannot even register to vote (although I can), there is a rising number who have determined that they will use their vote in order to raise whatever (apparently mostly symbolic) voice we do have. I do not know how to prove to you that I am telling the truth, and that I am not just a ‘tax evader’ ‘shifting the burden’ to US residents, and ‘hiding’ my ‘undeclared’ ‘billions’ ‘offshore’, but I’d ask what are the odds that there is really such a substantial pot of untaxed assets, untapped – in Canada and other jurisdictions who have tax treaties with the US? How likely is it that the Canadian Minister for Finance, Jim Flaherty is mistaken when he asserts the same? Since Canada also needs to maximize tax revenues, it is very unlikely that they would not have already investigated the existence of such an epic pool of untapped assets bypassing the CRA.
Already, the provisions of FBAR and FATCA are presenting barriers to our everyday lives. For those looking for work – any workplace where we have to possess or use co-signing powers ( even on a tiny petty cash account) is made into an FBAR and FATCA problem, as we have to notify them that we will be obliged to report on their accounts along with our own personal ones. This means that it pushes us over the reporting thresholds and maximizes the base for any potential error penalty. It means that we must figure out how (or pay an expert) to report on an organizational account as well as our own. It would be unethical not to tell an employer that, but it is very unlikely that they would (or could) agree to let us give their account information to the IRS (and whoever they choose to share it with – since it is not tax return information, sharing is not restricted to the IRS).
If you are concerned for justice, and for fairness, you must help us to defeat this amendment, and speak to your colleagues – on both sides of the aisle, as well as to President Obama. There is no ‘Tax Equity’ and ‘Middle Class Fairness’ in this Act for us. No companies will find it affordable to deploy/employ US ‘persons’ abroad if this passes – and it will not bring jobs back ‘home’, since many of the US ‘persons’ here in Canada are seniors, ‘accidentals’, US citizens only by parentage, or duals or long term Canadian permanent residents, or even just Canadian citizens who have had some ties to the US (by marriage, by education, etc.) – it will not bring us back into the US, or transfer our Canadian sited jobs to US residents, but it will persecute all of us for having left – or for having been born outside the US to US parents. What is the point of that – unless cynically, it just looks good to the US public facing a recession, a huge budget deficit, and an upcoming election? In that case, we are just collateral damage – the sacrificial lambs…..
I hope you can see the urgency and the truth in what I am saying, and will share that as widely as possible.
Below, for reference, is information associated with the issue I am raising.
Sincerely Yours,
(US citizen, and registered voter).
@Tim as to your 8:52 above: rings true like the Geithner story (he had some tax issues as well, no?) or the Schulman story of [tax code too complicated, I hire an accountant]. Hypocrisie mes amis, hypocrisie. The rest of my response is less serious and requires some literary imagination to fathom:
Shrinking I am,
Very green and swampy I feel,
My brow furrows deepen do they,
My ears very long they get,
Pointy and wiggly become they,
Attack us darkly they do
The “adverse parties” in our noble quest
For liberty and justice for US persons abroad:
Disillusioned I am.
Sign-off today and break take,
I shall.
If the science fiction parody doesn’t work (which might have been diluted due to the free-poetic formatting), then perhaps Monty Python will help:
http://www.youtube.com/watch?v=FWBUl7oT9sA Imagine the scene that the gentle reader may superimpose/synthesize: IBS on the quest for the Holy Grail = end of double taxation/reporting; subsequent resumption of truth, liberty, and justice for all. The guy in the castle (no insult to modern-day French(wo)men) represents to me the parody of the majority of the ensemble of officials and legislators on Earth that blow off our righteous quest as nonsense. (I hope nobody catapults dead animals in my face for having asked for refuge).
I have taken the liberty of forwarding this on to Finance Minster J. Flaherty. I am convinced that nothing will be done on this front unless the other nations that stand take a firm stand on U.S. extraterritorial taxation.
I believe that removal of the FEIE is a fundamental contravention of the double taxation avoidance policy that is central to the U.S./Canada Tax Treaty and therefore represents U.S. unilateral abrogation of that treaty. As it already stands the U.S. has violated the treaty and if the FEIE is allowed to go so will everything else eventually disappear.
The U.S. politicians have once more shown themselves to be ignorant of economics and world political theory. They refuse to acknowledge that taxation of wealth that is generated in a denomination other than your own, is a violation of another nation’s economic sovereignty. It is therefore incumbent upon all other nations to make the U.S. understand this.
How much longer must the world suffer with this U.S. idiocy?
@all
Found this on the net today. Might be a good post?
http://www.forbes.com/sites/janetnovack/2012/02/10/blimey-irs-computers-dun-british-lord-for-13-million/
@Jefferson D. Thomas
Thank you for the kind words…You’ve hit the nail on the head really. I became almost “success-shy” for many years after due to this whole mess. I remember when I started a year of voluntary service a few years back that I thought it was wonderful that I was only going to earn 300 Euros a month, since it wouldn’t have to be reported to the IRS. What normal person would think that? I have done years worth of voluntary work, traineeships, internships, further study and so on, and a part of me wonders how much of this is down to simply being scared to look for a job due to having (in all honesty) little desire to start earning a lot of money since I am really scared of the sorts of penalties that the US throws around for mistakes or errors and wanted to simply do everything that I could to legally remain out of their net.
When I was fresh out of university I was the only one amongst my group who never actively looked for a full time job at first. I opted instead to do various training programmes that paid hardly anything but were excellent learning opportunities across the EU and I haven’t looked back – Its been a fantastic experience these last years and I’ve built up the perfect profile for what I always wanted to do and recently attained: a job at the EU level. If I hadn’t been a US citizen though I would probably have been working the same job who-knows-where the past 5 years and been busy building up my savings and never have had this experience.
In a strange way, my hesitation to really start to earn money and be successful due to having US citizenship has catapulted me into being better placed today for what I always wanted to do, since without the various internships that I have done I would not be where I am today. Thank you IRS, I guess… 🙂
@UnclTelll: Yes, please post that article as a separate thread. Blimey! The headline says it all. I hope Steven will soon return to the fold and tell us how the moral, intelligent, well educated Washington lawyers bungled that one!
@Don You are very gracious in “thanking” the IRS. I knew you were well cast as the Belgian Ambassador in War of 2012: The Movie
“The only thing necessary for evil to succeed is for good men to do nothing.”
– Edmund Burke