A frequent contributor, Em, e-mailed her story to me.
I am Canadian (born in Canada). My husband is American (born in the USA) and became a Permanent Resident of Canada in 1996. We lived in the USA for 12 years after we got married in 1982. I was issued a green card that year which I never used — did not earn any wages in the USA — did not access any USA benefits — did not pay into Social Security and will not therefore be claiming it for myself in retirement. We came to Canada to visit my parents in the spring of 1994. My mother was taken to the hospital just hours before we arrived. Several weeks later she passed away but my father was not able to take care of himself and his home so I stayed to help.
I only got back to the USA on brief trips (a couple of weeks each) 3 times after that — all before the end of 1997. We had to winterize our house in the USA, bring belongings to Canada and prepare our USA house for sale (finalized in l997). I have not travelled into the USA in the past 15 years but my husband still makes frequent trips to the USA to visit his elderly mother. The years 1994 to 1997 were a particularly stressful time (my father also passed away) and the last thing on my mind was my green card status but it was a few years after I returned to Canada that I heard or read that if you did not keep your green card “active” when absent from the USA for a long period it would become null and void. All these years I have felt certain my green card was null and void. I put the card away — never used it — never realized I should have returned it and filled out a form of some kind. I just found my old green card recently and happened to discover that the IRS has a classification called “US person for taxation purposes”. Now this card has become kryptonite in my hands.
RE: USA tax filing … My husband and I have filed jointly all through the years (we included a note saying I am a Canadian citizen, formerly a resident alien of the USA) but now we’re thinking it might be best for him to file separately to allow me to be completely free of the system (I hope it’s possible). We didn’t really know how to untangle his income from mine so we just did what we thought was the right thing and declared both of our incomes on the 1040s so the numbers would match those on our Canadian returns. (We have always included a copy of our Notices of Assessment with our 1040s.) Like most couples, our accounts (merely chequing, saving and GIC), were all jointly held for many years but not so now as we decided a few years back to completely separate them with my husband having no signing authority over my individual accounts (not what we would like to do but we sensed it was better that way when we saw the change in the FBAR form).
RE: FBAR filing … My husband has always completed a FBAR with all of his individual and our joint accounts listed. I never did a FBAR for my individual accounts because I did not think I was “US person” of any kind since 1994 or at least 1997 (my last visit to the USA). Apparently the IRS considers me to still be a “US person for taxation purposes” because I still possess what I believed to be a null and void green card. I have never professed to be anything but a Canadian and I cannot afford to pay an “expert” to explain to me a safe way to disentangle me from this mess.
If I try to return my old green card at this late date to get an ALPRS (I-407) I think it might put up red flags and expose both my husband and myself to some “unknown unknowns” (audits?, penalties?, more intrusive forms?, IRS and/or Treasury Dept. harassment?). Whatever I do, I cannot jeopardize my husband’s ability to visit the USA to see his mother. (I decided years ago that I would never go to the USA for any reason.) Now FATCA hangs over our heads and yet another intrusive form (i.e. 8938) has arrived on the scene with penalties as severe as FBAR. We are in a Catch 22 despite our attempts to maintain IRS compliance. Meanwhile, the IRS continues to churn out complexities which are beyond all reason and ken and threatens everyone (including those who owe no tax) with bankrupting penalties. I simply want and believe I am entitled to complete freedom from the USA tax system. For now all I can do is tentatively trust the Canadian government to protect me from IRS penalties and hope some degree of sanity prevails in the USA regarding the large net the IRS casts out to catch the big offshore tax evaders (i.e. the “whales”) while entangling innocents living abroad (i.e. the “minnows”).
Note:
FBAR = Report of Foreign Bank and Financial Accounts
FATCA = Foreign Account Tax Compliance Act
ALPRS = Abandonment of Permanent Residence Status
Form 8938 = Statement of Foreign Financial Assets
@Em,
Congratulations to your husband and you! It sounds like a really lovely ceremony and day!
Awesome that the judge signed your husband’s intent to relinquish but not surprising to me because it’s my impression that more Canadians than not feel very strongly about the one citizenship only thing.
@Yoga Girl
Tell that to Thomas Mulcair 🙂
tdott, Mulcair is a weasel.
I passed on the congrats to my Canadian “boy”. He’s still grinning and says thanks.
Congrats @Em, and so glad the Officer agreed to sign the statement!
That’s wonderful news – congratulations!
I just thought I’d add one more observation about my husband’s citizenship ceremony yesterday. My hearing isn’t the greatest so I missed quite a bit of what the judge was saying in his speech. However I did hear him mention the war of 1812 and how the Americans were prevented from annexing Canada. I gave my husband a nudge and quietly said “Yay, Brock!”
@ badger & notamused
Thanks to both of you, too. My husband has already begun the second major step. He sent an e-mail to ACS Calgary requesting relinquishment forms and an appointment as soon as possible. He attached his “intent document”.
1812 was the only incidence of American encroachment. They just got sneakier ever after. In fact, I was reading something about Canadians during the 1960’s still fearing being absorbed into the hegemony to the south but I haven’t researched it yet.
The USG will never give up its hopes for expansion, imo, but hurray that your husband is now free!
@ Yoga Girl
He’s not free yet. He’s just beginning Step 2. He won’t be free until his final IRS forms are done. I too feel we’re every bit as threatened by MOB (Mordor Over the Border) as Canada was 200 years ago. i doubt the judge is aware of that but his mention of the War of 1812 reaffirmed to us that we were in the right place that day.
A Canadian as well that went down to USA in 1979.
Have you ever heard back from US. Do you know if the US has a relinquish clause for green card like for citizen? Threw out a green card 33 years ago I had lived in USA less then 1 year. I also heard green card was invalid 1 year after you left.
@ GeorgeIII
It has been almost 2 years since I returned my green card, along with the I-407 form. I had absolutely no response from USCIS, despite my subsequent inquiries regarding my I-407 status. I gave up trying. I was never sure how I had heard about the expiring of my green card but my husband recalled a border guard telling us that my card was no longer valid and if I ever wanted to live in the USA again I would have to reapply. (No matter, I knew I would never live there again.) There were no further instructions beyond that. As far as I know there is no renunciation or relinquishment equivalent for a green card holder. My biggest problem is that my SS number keeps me in the system forever and I do not even qualify to receive any SS. So a card I no longer hold gives me absolutely no “privilege” except US tax filing into eternity. Welcome GeorgeIII to the Kryptonite Club.
@Em
Em, Has the US government EVER made any kind of personalized and focused attempt to contact you regarding taxes supposedly owed? I am referring to the kind of frequent and persistent dunning you would get for an overdue payment on an auto loan or utility bill. Has the US made ANY kind of collection attempt regarding the supposed obligations associated with your former green card?
My understanding is that you are Canadian citizen from birth, who currently lives in Canada, and you have no US-based assets.
As such, it sounds like you are judgement-proof to US tax revenue claims. No Canadian court will enforce a US – or any other foreign states – tax claim against a Canadian citizen in Canada. The Canadian government cannot provide assistance in collection, because you have been a Canadian citizen from birth, and the CRA will not assist in collecting a US tax claim from any Canadian citizen, unless the claim predated their date of citizenship.
And I assume that you have a Canadian passport and birth certificate that shows a Canadian birthplace. So no bank anywhere would consider you anything other than Canadian, unless you were to deliberately show them the green card – which is impossible since you no longer have it!
I believe the reason that you have never heard anything after returning your green card is that they don’t have the capacity or motivation or even a clear process to contact you again. Why would they bother?
@ Skeptical
I haven’t checked this old thread since last year so I apologize for the looooong delay in replying.
NO, the IRS has not sent me a dreaded brown envelope … so far.
YES, I’m Canadian since birth, living in Canada, with no US assets (except an American husband waiting for his CLN to appear).
YES, I can safely answer any question a bank may have about where I was born BUT if, by way of “scope creep” (the interim OPC’s expression), they ask me if I have ever had a green card or was ever issued a SS number then it gets tricky.
My only worry (slight for now) is that the IRS has my SS number and they know where I live. They do not have any “exit paperwork” from me and I refuse to give them any because my exit was in 1994 and that’s that as far as I’m concerned. However, due to our naivete, both my husband and I have, in the past, provided the IRS with our Canadian SI numbers. We unnecessarily and foolishly sent copies of our Notices of Assessment in with previous 1040s (stopped doing that in recent years). The dual regimes of “total information awareness” and “automatic exchange of information” just keep marching on and on and for that reason I just don’t feel I can ever be free of some degree of uncertainty.
Declaring myself “safe from the IRS” would be like someone declaring themselves a “cancer survivor”. You just don’t tempt the god of jinxes that way.
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