This thread seeks to assemble a list of our jargon words, with definitions, examples, and links where appropriate. I don’t have much time to write all of the terms and definitions, so I propose we collaborate on it.
I know I proposed this before (with Petros and others if I remember correctly) and never got around to doing the work on it, but I think we still need to define our terms of argument (as Voltaire said… something like “Before you argue with me, define your terms.”)
As we are gathered here to discuss the same subjects week after week, it is only normal that we have our jargon, as we don’t always want to spell everything out. But a glossary would really help newcomers.
Please add whatever proposed jargon words and acronyms you want, and I will moderate and coordinate it as I am doing with the Press Release Thread.
Here are some to start, please add as many as you can, I’ll entertain any proposed suggestions to improve my below definitions:
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US Person Abroad(USP Abroad): US citizen or green-card holder who is a bone fide resident abroad. JDT to JDT: Modified a bit following Petros comment below, need to work on this one.
FATCA: Foreign Account Tax Compliance Act.
GATCA: A play of words on FATCA, referring to the eventual institution of a global FATCA-like bank reporting/exchange of information requirement.
DATCA: Domestic (in the USA) reporting and exchange of information about US-based bank accounts.
Minnows Abroad: Working and Middle-class people abroad who have less than 2 million in assets, and less than USD140K in potential annual tax burden . Targets of FBAR enforcement, even though they may have earned the majority of their savings abroad.
Whales: People with more than 2 million in assets and a potential annual income tax burden of more than USD140K.
Ostrich: People that are avoiding the OVDI, filing US 1040’s from abroad, and wish to ignore the issue of becoming “compliant”. (Full-Ostrich has been used as an intensifier).
_____BEGIN of @JohnNB contribution________
CLN: A Certificate of Loss of Nationality. This is US Department of State form 4083. It is what the State Department considers official documentation that a person is no longer a US citizen. (proposed by @JohnNB below)
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_____BEGIN of Watcher’s contribution_______
FBAR: Foreign Bank Account Report. Intrusive bank reporting form, required from “whales” and practically all “minnows”. Universally detested by all USPs overseas.
HIRE: Hiring Incentives to Restore Employment, 2010. Vehicle by which FATCA was snuck through congress unread.
HEART: Heroes Earnings Assistance and Relief Tax Act, 2008. Introduced soviet-style exit taxes for “whales”. Accomplished by hiding it inside a mom-and-apple-pie military benefits bill. Aka HEROES act.
Ex-PATRIOT: Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act. Proposed law taxing “whale” renunciants forever, and banning them from the country. Idiot brainchild of two senators apparently dumber than rocks.
QI: Qualified Intermediary. Turncoat non-US bank or financial institution that grasses its customers to the IRS.
FFI: Foreign (that is, non-US) Financial Institution. Also NFFI, NPFFI, and on and on and on.
GC: Green card. Toxic kryptonite (thanks, Em!). Now recommended against by many US immigration experts.
NRA: Non-resident alien. Coveted status for many dual-citizen USPs because of FATCA.
Covered expatriate: “whale” renunciant, covered by HEART. Can include GC holders, even though never citizens.
Specified expatriate: covered expatriate also hit by Ex-PATRIOT.
Recalcitrant: Anyone who objects to the IRS’s invasion into their private non-US financial affairs.
Renunciant: Lucky escapee.
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FBAR: Foreign Bank Account Report. Intrusive bank reporting form, required from “whales” and practically all “minnows”. Universally detested by all USPs overseas.
HIRE: Hiring Incentives to Restore Employment, 2010. Vehicle by which FATCA was snuck through congress unread.
HEART: Heroes Earnings Assistance and Relief Tax Act, 2008. Introduced soviet-style exit taxes for “whales”. Accomplished by hiding it inside a mom-and-apple-pie military benefits bill. Aka HEROES act.
Ex-PATRIOT: Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act. Proposed law taxing “whale” renunciants forever, and banning them from the country. Idiot brainchild of two senators apparently dumber than rocks.
QI: Qualified Intermediary. Turncoat non-US bank or financial institution that grasses its customers to the IRS.
FFI: Foreign (that is, non-US) Financial Institution. Also NFFI, NPFFI, and on and on and on.
GC: Green card. Toxic kryptonite (thanks, Em!). Now recommended against by many US immigration experts.
NRA: Non-resident alien. Coveted status for many dual-citizen USPs because of FATCA.
Covered expatriate: “whale” renunciant, covered by HEART. Can include GC holders, even though never citizens.
Specified expatriate: covered expatriate also hit by Ex-PATRIOT.
Recalcitrant: Anyone who objects to the IRS’s invasion into their private non-US financial affairs.
Renunciant: Lucky escapee.
Congress: 535 bozos.
@Watcher from JTD: I integrated your suggestions here at the start of the thread above, however we still may need to refine your glossary entries (as well as the ones that I myself seeded this thread with). For example, I agree with your definition of Congress on a personal level, but there might be some “Congresspeople” who understand us. Perhaps motivate futher your glossary entry with a study of the jargon word “congresscritters” “congresspeople” and how it has been used in IBS and IBS-friendly blogs. Thanks for your contribution, and to all that might contribute below if I don’t have the time to individually thank everyone.
CLN: A Certificate of Loss of Nationality. This is US Department of State form 4083. It is what the State Department considers official documentation that a person is no longer a US citizen. JDT: Thx, added above
US Person (USP): US citizen or green-card holder who is a bone fide resident abroad.
also includes accidental Americans who inherit USC from parent(s) and in some cases from a grandparent.
A US person is defined by Internal Revenue code and the definition you give is not quite correct. You are defining a “US person abroad”.
JDT: OK I started to update that term above, but how do we make the distinction beteween the IRS definition of USP and our usage of USP, USP Abroad (bone fide resident abroad or not?).
@JDT:
“US person” = Internal Revenue Code
“US person abroad” = large part of Isaac Brock constituency.
@Petros: we need to be a bit more precise. This is a work in progress, I would not be suprised if it takes us seraval weeks to establish a glossary or lexicon.
hall of fame: Reporters or writers of OpEds who clearly explain the issues faced by US persons caused by US citizenship based taxation
hall of shame: reports or writers of OpEds who do NOT understand the issues and assume all US persons abroad are tax evading whales
OpEd – Opinion editorial (as used here)
Ostrich – person who doesn’t want to recognize that they are affected by US citizenship based taxation (sometimes referred to as a turtle)
US Patriot – person who believes in the original ideals of the founding fathers, not necessarily a person who believes in the
policies of the current US government
Relinquishment – giving up citizenship based upon performing an act of expatriation
Renunciation – formally giving up citizenship by reciting and signing a formal oath in front of a consulate official
Expatriation – leaving your country of birth to make a life in another country, such as becoming a citizen, voting, etc
Expat – someone who has made a life in a country other than their original citizenship
Accidental American – someone who obtained the status of US citizen/person by being born in the US by parents temporarily in the US, or who has inherited citizenship from parents through the US citizenship laws.
Brocker – us. Peaceful resisters of the US’s model of citizenship based taxation and its associated ramifications.
OVDI, OVDP – Offshore voluntary disclosure initiative or program.IRS’s trap designed to relieve US persons of the bulk of their
retirement savings in penalties for being unaware they had to file reports.
Expatriating Act: (reposted from Petros Dec 2011)
a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality—
(1) obtaining naturalization in a foreign state upon his own application or upon an application filed by a duly authorized agent, after having attained the age of eighteen years; or
(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years; or
(3) entering, or serving in, the armed forces of a foreign state if
(A) such armed forces are engaged in hostilities against the United States, or
(B) such persons serve as a commissioned or non-commissioned officer; or
(4)
(A) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years if he has or acquires the nationality of such foreign state; or
(B) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years for which office, post, or employment an oath, affirmation, or declaration of allegiance is required; or
(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or
(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense; or
(7) committing any act of treason against, or attempting by force to overthrow, or bearing arms against, the United States, violating or conspiring to violate any of the provisions of section 2383 of title 18, or willfully performing any act in violation of section 2385 of title 18, or violating section 2384 of title 18 by engaging in a conspiracy to overthrow, put down, or to destroy by force the Government of the United States, or to levy war against them, if and when he is convicted thereof by a court martial or by a court of competent jurisdiction.
(b) Whenever the loss of United States nationality is put in issue in any action or proceeding commenced on or after September 26, 1961 under, or by virtue of, the provisions of this chapter or any other Act, the burden shall be upon the person or party claiming that such loss occurred, to establish such claim by a preponderance of the evidence. Any person who commits or performs, or who has committed or performed, any act of expatriation under the provisions of this chapter or any other Act shall be presumed to have done so voluntarily, but such presumption may be rebutted upon a showing, by a preponderance of the evidence, that the act or acts committed or performed were not done voluntarily.
Date Notes:
Law changed in 1986 so that performing the expatriating act is no longer sufficient for loss of nationality. From that date forward the act must be done with the *intent* to relinquish US citizenship.
Law changed in 1995 so that the date of loss of citizenship is not the date of the expatriating act but the date the State Department is *informed* of the act.
@all, esp. JDT: Thanks for creating this thread. Eventually, on the new blog, we will compile a list and create a page with all the definitions, and that page will be prominently featured.
Here’s my contribution …
ALPRS (form I-407) – Abandonment of Legal Permanent Residence Status: green-carders equivalent of the CLN
@petros I really think that we need to keep this blog going during any transition period, even if frequent posters need to post twice for a few weeks. And even after the migration is finished, i…b…s.com should not be deleted, just dormant with a redirection to the new site.
Great addition Jefferson…., for both the slang and the jargon of the financial industry. Have added a few others, plus official FATCA terms. (some are duplicate of what others have provided.)
GAAP Generally Accepted Accounting Principles. A widely accepted set of rules, conventions, standards, and procedures for reporting financial information, as established by the Financial Accounting Standards Board.
KYC Know Your Client: The activities of customer due diligence that financial institutions and other regulated companies must perform to identify their clients and ascertain relevant information pertinent to doing financial business with them in accordance with the Bank Regulation that governs them.
AML Anti Money Laundering is a term mainly used in the financial and legal industries to describe the legal controls that require financial institutions and other regulated entities to prevent or report
money laundering activities.
IGA Inter Government Agreements. Financial industry slang, (I think) to describe agreements between governments for tax data exchange like the proposed 5 nation FATCA pact would be an IGA.
de minimis An abbreviated form of the Latin Maxim de minimis non curat lex, “the law cares not for small things.” A legal doctrine by which a court refuses to consider trifling matters.
FEIE Foreign Earned Income Exclusion (IRS form 2555)
Bad FFI A non participating FFI (NPFFI)
CFC Controlled Foreign Corporation
Chapter 4 Chapter 4 of Subtitle A of the Internal revenue Code contains the FATCA legislation
Chapter 4 withholding Refers to the 30% FATCA withholding
CFC Controlled Foreign Corporation
CIP Customer Identification Program
Deemed Compliant FFI Local banks, local FFI members of PFFIs and certain investment vehicles may be Deemed Compliant by the IRS for FATCA if they satisfy certain criteria
ECI Effectively Connected Income
EIN Employer Identification Numbers
Excepted NFFE A class of NFEEs that are outside of the scope for FATCA. They include publically traded non-US companies, foreign governments, international organisations, foreign central banks
FATCA Foreign Account Tax Compliance Act. Refers to Chapter 4 of the US Internal Revenue Code, which was enacted by the Hiring Incentives to Restore employment (HIRE) Act on March 18, 2010. FATCA requires non-US foreign financial institutions (FFIs) and non-US non-financial entities (NFFEs) to identify and disclose their US account holders and members. Should they fail to do this, they will become subject to a new 30% US withholding tax with respect to any payment of US source income and proceeds from the sale of equity or debt instruments of US issuers (i.e. withholdable payments).
FDAP Income which is Fixed or Determinable, Annual or Periodical derived from gains, profits, and income, and includes payments such as interest (including original issue discount), dividends, rents, salaries, wages, premiums, and annuities
FFI Foreign Financial Institution – any FI which is not located in the USA
FFI Agreement The agreement between the FFI and the IRS that requires the FFI to identify US accounts and to report financial information on US accounts to the IRS
FI Financial Institution – any entity that (i) accepts deposits in the ordinary course of a banking or similar business, (ii) holds financial assets for the account of others as a substantial portion of its business, or (iii) is engaged (or holding itself out as being engaged) primarily in the business of investing, reinvesting, or trading securities, partnership interests, commodities or similar financial instruments
Foreign Person A non-US Person
FWP Foreign Withholding Partnership
FWT Foreign Withholding Trusts
HIRE Act Hiring Incentives to Restore Employment; FATCA was enacted as part of HIRE
Indicia A US legal term meaning indication. In the context of FATCA, indicia refer to evidence or indications that an account holder might be a US person
NFFE Non-Financial Foreign Entity – a foreign entity that is not a financial institution, usually a corporation or company
NPFFI A Non-Participating FFI – an FFI that is not a participating FFI, or a Deemed Compliant FFI or otherwise excluded from the application of FATCA. Sometimes called a Bad FFI
NQI Non Qualifying Intermediary
Passthru Payment Any Withholdable Payment or other payment to the extent attributable to a Withholdable Payment
PFFI Participating FFI – an FFI that has entered into 1471(b) agreement with the IRS under FATCA
PFIC Passive Foreign Investment Company
PPP Passthru Payment Percentage – the ratio of a PFFI’s US to total assets
Pre-existing account Any financial account held prior to the date the FFI’s agreement with the IRS comes into force
QFFI A Qualifying FFI is one which has entered an agreement with the IRS under FATCA. Essentially the same as a PFFI
QI Qualified Intermediary
Recalcitrant Account Holder An account holder who fails to comply with reasonable requests for information in accordance with IRS mandated verification and due diligence procedures to identify US Accounts, to provide a name, address and TIN or fails to provide a bank secrecy waiver upon request
Specified US Person A US citizen or resident alien, privately owned US Corporation or US Owned Foreign Entity
Substantial US Owner A US owner that has a more than 10% interest in an NFFE
TIN Taxpayer Identification Number
US Account A financial account held by a specified US person or by an entity that, directly or indirectly, has one or more “substantial” U.S. owners
US Indicia Data which is indicative of an account holder being a US Account, for example US place of birth, US passport, green card, US address, substantial US presence, regular payments to or from a USFI
US Owned Foreign Entity A foreign entity which has one or more Substantial US Owners
US Person For FATCA it is an account holder who is a US citizen or taxpayer. Includes US entities and other qualifying persons such as Green Card holders
USFI US Financial Institution – a Broker or Dealer, Investment Fund, Investment Adviser, Bank, Trust Companies based in the USA
TAS Tax Advocacy Service An office inside the IRS, established by Congress, to advocate for Tax Payer issues and represent them in cases of IRS abuse
TAD Tax Advocate Directive. An Directive by the head of the TAS to a specific office or Division within the IRS requiring them to take action on certain matters. It apparently can be appealed up to the IRS Commissioner’s office, and as we have seen with the TAD related to FAQ35, the can refuse to respond publicly. Only 6 issued in the 10 year history of the TAS.
TAO Tax Advocate Order. An order by the TAS Case Officer, to an examiner, on behalf of a Tax payer to produce records and explain actions.
Many on this list supplied were taken from here… http://bit.ly/MnM4vI
What about IRM? Just Me mentions it sometimes … I think it’s a manual or something.
IRM is the Internal Revenue Manual. The guide for IRS Examiners. If one is to be examined, you want to understand what rules they are operating under, and knowing the FBAR portion is essential if you are to beat them at their game!
and then I forgot my most important one…
LCUs. Life Credit Units (time) we waste away on these all these stupid Congressional and IRS requirements. The older we get, the less we have in the bank. Use those LCUs wisely. In the future it might look like this…
http://youtu.be/efNzhEKm3w4
@ Just Me
Yes definitely, LCUs should be on the list. That one sunk into my brain long before IRM. That trailer is scary. 🙁
thanks for your work @Jefferson T. will be useful to many – especially new readers.
@Em It is kind of an interesting movie, concept wise. Wouldn’t make my top 10, but I did find it a good enough for in-flight entertainment winging across the Pacific.
More jargon…
PTF -Publicly Traded Fund
MOUs -Memorandum of Understanding
2nd class citizens: US persons living and working abroad who because of citizenship based US taxation are unable to enjoy all of the tax benefits of other citizens (1st class), benefits to others in the country where they reside as well as those residing in the US.
Excited States of America: A North American country that is hell bent on making itself a pain to the rest of the world.
Old thread; has this been picked up elsewhere? A glossary would be amazing! I’m constantly having to look up words/acronyms that I come across here (although it’s getting better).