Estimated world population as of Oct. 31, 2011 7 billion
Estimated population of the U.S. for 2012 313,281,000
Estimated number of U.S. citizens living abroad 6 million
Estimated costs to administer FATCA and chase those 6 million- billions of dollars forever. Net benefit to be derived at the best is most likely zero but is more than likely to be negative because the taxes collected are not likely to ever exceed the cost of FATCA compliance. Of course we will never know because the U.S. very conveniently refuses to establish any criteria for costs calculation.
You could add a third line –
Est US Citizens Living Abroad – 5,000,000 to 6,000,000
So…you’re asking 100% of the world to track down 0.08% of world population of US Citizens Abroad – it looks even more crazy.
Sorry….didn’t see your third line on the browser for some reason.
@john- actually it is even worse at 0.00897 of the world’s non-U.S. population. If you factor in the resident U.S. population then the number is .000857. Even U.S. resident citizens will unknowingly have to pay, most likely via capital outflows, for this in some way but their politicians are not telling them this truth.
To the United States, the costs are irrelevant, since the FFI’s will bear the cost of compliance.
Unless the FFIs say hey this is going to be expensive and ask the US to come up with $100 million for each major FFI to cover the costs.
Remember Emily McMahon suggested giving the FFIs a cut of the revenues the US collects. I think she said 25% for the FFI and 75% for the US. The FFI still comes out on the losing end with that kind of deal. It’s going to cost them $10 for every $1 they collect.
FATCA is badly conceived and can’t possibly work unless the world’s banks are complete idiots with deep pockets who are willing to allow themselves to be robbed by the US government.
Oh and how would a major (likely public) bank justify spending $100M to it’s shareholders for something that will have no benefit to them? Could shareholders sue the bank for wasting their money?
If someone has at least 1 share in a bank, why don’t they go to the next AGM and complain to the officers why $ millions are being wasted on FATCA and why should the shareholders help out the US Government.
Upwards of 6 million is probably a better estimate – see How Many Extraterritorial U.S. Citizens?
I posted this at the sad excuse of a lawyer’s blog at http://ataxingmatter.blogs.com/tax/2012/03/still-havent-filed-your-fbar-dont-wait-til-you-get-hit-with-forfeiture-like-this-alaska-plastic-surg.html#comment-6a00d8341cf2a753ef0163039a535b970d
I assume that when Russia, China, Pakistan, Eritrea, Lebanon, Zimbabwe, Korea (North and South) and India, among other nations, pass laws that all US-based financial institutions must inquire into their customers’ birthplaces and if such birthplace is any of these nations and the person does not produce a certificate of renunciation, the American banks will be required to send these bank records to these nations, you will still be speaking of “scofflaws” who are denying their responsibilities and enjoying “the best of both worlds.” Do you have ANY IDEA what the rest of the world makes of these American actions and laws? Really?
The large majority of those of us unfortunate to have been born in the USA and now living outside the USA would be dancing in the streets if the US subscribed to section 15 of the Declaration of Human Rights and allowed us to change her citizenship!
@usx – I don’t believe there are 6 million, especially if you consider only the people who were born in the US, not naturalised. After all, for people who were born abroad, but naturalised, saying that they have zero US connections is very easy. For someone who was “lucky” enough to have been born in the US, it’s much more difficult due to place or birth on your passport.
The biggest slap on the face is that I was reading over census data this morning. Illegal aliens are counted in the US census, but not us!! And yet they demand taxes from people like when I have already been sucked dry. Commmoon!
The US could have made this extremely easy: only profile people with 1 million+ in their accounts. It sure would have saved the banks and everyone else a lot of time and expense.
@geeez- Of course the easiest thing would have been to adopt a system of territorial taxation but the U.S. legislature never takes the straightest route between two points.
@Joe: Looks like Ms. Beale deleted one of your comments. What did it say?
@Petros, it had something to do with monkeys having the capabilities to become lawyers 🙂
I said that 99% of us living abroad owed no taxes. And her ignorance showed that if you put enough monkeys together eventually one of them would become a US law professor.
[the old “with enough monkeys using typewriters one would eventually type out the Encyclopedia Britannica”]!
She did refer to us Canadians as blackmailers so she had it coming.
I can´t understand… American Abroad don´t deposit money and make investment in “foreign” banks, They do it in their local banks where they are residing, working and earning money, They are not like Americans Living in the USA who deposit and hide money in foreign banks. These two Americans could not be lumped together. Besides Americans Abroad have income exclusion and tax credit for the income tax they pay in their country of residence. So what is the IRS going after?…The possible diferença in the taxes between the country of residence and the USA? All this effort for this? I would call it, to be very nice, harassment. A better word would be persecution…of Americans who chose to live abroad.
“So what is the IRS going after?”
They don’t like that you pay taxes to your country of residence. Knowing they can’t legally get you to pay the tax to them, they come up with $10,000 penalties simply for non-reporting your local bank account. Even the Mafia has more compassion than this.
@ markpinetree
Add to harassment and persecution the word rendition because that is what might happen to an unwitting and innocent extraterritorial U.S. citizen or “person” attempting to merely visit the USA. I was thinking this morning, oh no, we sent all of my husband’s FBARs by regular mail and all we have as proof of them is the penciled copies we keep for our own records. With FBARs and 1040s we never get an acknowledgement that they have been received.
So you guys are mad because under these regulations you can no longer hide your income’s that fall above the limit? Did you think you could evade taxes forever?
I understand that the income above the excluded income will have Tax Credit for the tax it pays in the country of residence. Am I wrong? If it is Self Employed Income, depending on the country you reside, you will pay Self Employment Tax in both countries. No, we did not think that we could “evade” taxes forever. What we did think is that like all citizens of other countries we should pay taxes in the country where we are living and working. I lived in the USA for 30 years and I never sent a Tax Return to my country of origin. Such is the case with all others who come from other countries to work in the USA.
And then why “evade” if some of our income is excluded and what is not get a tax credit for the taxes we pay in our country or residenc?. Evade for what? The problem is the harassment the amount of forms and forms and forms… and then like it was said above the penalties for our mistakes that are much higher than the penalties for Americans living in the USA. I am not the one saying this. The IRS Tax Payer Advocate has said that in her report 2011. Do you know what I think? We are five million plus. Potentially we could make a differece in a general election. All we need is to organiza ourselves.
How abou this as a concept – renounce your place of birth
and replace it with the capitol of the country you hold another passport. If the US insists on FATCA, give us dual citizens a way out.
@topthrillsteve
nobody here is evading taxes, Canadian taxes are substantially higher than US taxes, also we have consumption taxes for which we do not receive credit for.
We do not get any services from taxes paid to the US, DOS services are priced to cover the cost of providing those services.
Or they could stop acting like North Korea and give out CLNs to all those who legally renounced their US citizenship over the last 60 years by taking on the citizenship of their country of residence. Is it too much to ask that they be logical? We’re not coming back … deal with it.
@topthrillsteve
Why don’t you read some more of the posts on this site and then maybe you’ll understand that we are already paying taxes where we are living!! Add to that the fact that many of us are even paying more than if we were living in the US.
@topthrillsteve- I don’t know where you get the ideal that we were evading paying taxes. Wherever we live we do pay the taxes that are required by the land of our residence. It we don’t live in America or have any income from assets that are held in America then we owe nothing to America.
When America taxes its non resident citizens on incomes that are earned in the currency of another country then America is the tax criminal and the free loader.