I hope that they don’t fear us at Isaac Brock Society and put us in a parallel category with the “Sovereign Citizen” and “Freeman” movements because the only thing we want is to pay our taxes in, and only in, the countries where we live. We don’t claim to be immune from the law (our local laws in the countries where we live apply to us) we just claim that US jurisdiction does not apply to us abroad! Most of us live in sovereign nations that are independant from the US.
Here is a 60 Minutes show about Sovereign Citizens. They say the Feds consider them domestic terror threats. Again, I would hope they realize that minnows, ostriches and other of us abroad at are not the same. We are sensible people who obey the laws where we live, pay taxes where we live, vote, etc.
@Surya and others.
I wonder how many immigrants to the US in their zeal to be naturalized or receive a green card read the fine print regarding reporting of world-wide income, or if it’s even brought up anytime in the process(?) I’m sure many would think twice about the world’s most coveted citizenship if they were fully aware of the requirement. I’ve visited a few Fb groups that encourage immigration to the US and mentioned it. I’ve gotten a few responses wanting more information. Another thought I have is to write to all members of congress who were born in other countries in an effort to foster empathy. There’s less than a dozen, one is from Canada, but from his bio, I think he would rather forget he was born in lesser America (tongue firmly implanted in cheek here).
@Surya, and @all, I am interested in finding additional information about :”IRS in mid 90s actively discouraged filing taxes, when there is no tax due. That was what my CPA told me and confirmed by IRS, when I called 1-800 helpline.”
I am just wondering if we could find something that further documents that shift – from ‘actively discouraging’ to now – since many of those affected by this probably had (then and now) NO or minimal US tax due or owing. Especially those in higher tax countries and those in places with mutual tax treaties. I realize only now (as of media reports in fall 2011) that the ‘tax’ filing was distinct from bank account reporting (FBARs).
It also occurs to me that if all of us ‘abroad’ had filed for the 2008 tax year (and perhaps in earlier years with similar programs?) some would have qualified for those stimulus refunds (@ $300. US per individual in 2008?), or other refunds? http://www.irs.gov/newsroom/article/0,,id=179181,00.html . I don’t know if there have been equivalent offers over the years.
So, I am wondering if there would be a way to estimate that rather than costing the US tax money by not filing – all of us filing from now on would actually be more expensive for the IRS? I know that it is rigged so that there are many deductions and credits that we can never qualify for, but even so, what is the actual cost of ‘compliant’ filers from abroad – from now on – assuming (big assumption I know, given complexity) no penalty debts incurred? Probably anything that would show that we then qualified for actual refunds would then be blocked by Congress -similar to the repeated calls for the FEIE to be repealed.
Again, this is where the IRS refusal to divulge whatever ‘facts?’ they have, or develop any legitimate and robust cost/benefit analysis to support their claim that pursuing/persecuting US individuals ‘abroad’ will result in recovering massive tax owed makes their claims suspect.
I believe the IRS and cross border accountants also did that as far back as the early 80s. I had a “dual citizen” friend tell me last week that when she and her husband became citizens of Canada in 1980, they continued to file U.S. returns for a couple of years, there was no tax owing and they were told (by a cross border acct), there was no obligation to file as long as the returns were going to show a nil amt owing. They stopped filing, the husband has been deceased for at least 6 years and the wife is still not filing.
Nina Olson of TAS accused the IRS for not getting the word out, they can not only be accused of that, but also of getting the WRONG word out! They must be taken to task on this. Anyone with accounts of the IRS, or any within the US government telling them that they weren’t required to file should contact the Tax Advocate’s office and let them know.
@ badger: It is hard to get proof for things happened more than 15 years ago. I don’t think our conversation was recorded, even If I were to written down number and name of IRS agent. For example, I read somewhere that an old CPA received a warning letter from IRS for filing too many nil returns for many of his clients. If you search on internet you can find many such examples, mostly from 80s and 90s.
May be it was not official policy but that was the attitude then. Even I have the recorded response I don’t think it can help. I can’t afford to hire a lawyer and pay him US$500/hour to fight a case? I can’t even afford to travel to the USA and stay their, even if a lawyer takes up this case for free. This already taken a big toll on my work performance.
It is much cheaper to file returns and get refund. I am sure my filings will be expensive to IRS, because some one must manually verify each tax refund. The IRS ignored TAD. The IRS ignored ACA request for data under freedom of information act. Those are violation of laws. Many of us believe that FBAR is unconstitutional, but we cannot afford to take IRS to court. The IRS can ignore tax filing part and impose FBAR penalties (by saying ignorance is not an excuse).
thank you @surya and @tiger; I had heard accounts myself of cross-border preparers telling clients that they didn’t need to file when the tax owed was nil, just hadn’t heard about the other twist: “CPA received a warning letter from IRS for filing too many nil returns for many of his clients. If you search on internet you can find many such examples, mostly from 80s and 90s.”
@surya, I appreciate that it was long ago, and that is wouldn’t help with an actual case now – wasn’t asking for proof. Just had never ever heard about the warning letters for filing nil returns – and found it very very interesting. I will try to look around for an example myself.
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