This just out from Steven Mopsick after a few week’s radio silence:
There is some interesting material in his post. Calling all Brockers, please hammer the Mopsick site with comments and spread the link around as well as the link to this thread here at IBS. Some quotes:
I will be chairing an international conference in Miami this week on FATCA compliance….
With the publication of the Final FATCA Regulations last week, we learn
the next big FATCA timeline date is July 15, 2013—the date the IRS is
opening its aptly called FATCA Registration Portal—the door to the
Byzantine world of compliance with the myriad duties of an IRS
If every foreign financial institution abroad with American customers
were to sign up on July 15 for their fair share of FATCA abuse, the IRS
FATCA Portal computers would pop their fuses [emphasis JDT]. Even the IRS realizes it
would be a daunting challenge to manage an ongoing reporting
relationship with every bank in the world and that it would be a lot
easier if the IRS could collect the data it wants on Americans from one
source in each country as opposed to thousands of banks all over the
But the reality is, for most countries, this is unlikely to happen in
time for the FATCA effective dates. Once they kick in, the IRS will have
no choice but follow the law and start demanding a 30% haircut from all
US source income flowing out of the United States, until each country
signs up. Until they do, both the impending FATCA effective dates and
the inaction or delays of foreign governments are in effect, leaving
foreign financial institutions no choice but to enter the Portal to
3. If there is uncertainty in a country about whether there is going to
be a bilateral deal, or whether the deal can be made on time, it would
not be hard to imagine that disgruntled shareholders of foreign
financial institutions might bring legal action against current bank
managers who sat on their hands while their government’s bilateral deal
fell through and the IRS started withholding. One could easily envision a
shareholder suit claiming damages in the amount of the 30% profits the
IRS was taking from funds foreign financial institution shareholders
thought was coming to them….
Thank you for recounting your experience, it must be terribly frustrating for you to watch something as catastrophic as what happened in 1976 about to repeat itself as US persons abroad are soon fated to go on the extinction list.
*@To All, believe me, I’m fully aware that I need to comes to terms with it all and be thick-skinned when necesswry. I am venting here as much as anything. I know I have to grit my teeth and get the job done ;). @Calgary, I agree about the situation with tax preparrres and @Roger how it must have been so exasperating with the obvious lack of common sense Congress demonstrated even with everything spelled out.
Bon voyage — that’s what counts for you right now! When you don’t feel strong in dealing with anyone who disses your decisions, think of the getting out of abusive relationships analogy. I hope you are so busy and have so much other stuff to discuss, things to do, places to go that you can just thoroughly enjoy what should be a wonderful visit with your family.
*Thanks, Calgary! It will do me good to switch off, if nothing else for a couple weeks ; )
*@ calgary411 ……. I do not begrude what I have to pay them to help me – for their education, knowledge and expertise. ………. unfortunately your statement couldn`t be more wrong in my case and in general I disagree 100% with the notion of your response .
@roger It is good that you bring up the storyof the Bechtel engineer again. This is the sort of story that really brings out the extremes of the double taxation system. What happened to that engineer? Did he get out before it was too late or did he return to the US after a lot of hard work with nothing to show for it but 50 grand of debt to the IRS? Did Bechtel have to funish an outrageous tax leveling payment to him? (Which would have been quite huge because it has to be increased to cover the tax implications of the tax leveling payment itself). Stories like this really piss me off. This is why nobody should accept double taxation, even if they are currently in an earned income situation with less than 97k. Even if one currently has no double tax burden because of the FEIE, what about others that are caught up in the catch-22 of the tax system? What about when one needs to draw welfare, unemployment, disability, or retirement abroad and finds that the double tax burden on the now unearned income make it impossible to meet one’s expenses? We should all think about that whatever our situation. It makes no sense and represents an enormous injustice that a country would effectively force someone to return to the US, or renounce to get out of such an impossible situation.
*@Jefferson D. Thomas, I really have no idea what happened to that engineer. I do recall that he had also been interviewed as part of a GAO study which had confirmed the facts of his situation that preceeded that hearing. That GAO study may well have been what triggered the hearing. Just gusessing, but I do recall other witnesses quoting fom that study. What I do know was that Congress subsequently delayed the effectice date of that 1976 legislation from January 1, 1976 to January 1 1977, after the due date for filing returns on 1976 income, so he was still covered by the prior law for 1976. I had already submitted my tax return in accordance with the 1976 Act and subsequently had to submit an amended return for my last year in Brazil which I did after Congress delayed its effecitve date. I had returned to the US by that time and I suppose that the engineer in Saudi Arabia likely had also done the same, so he would have escaped that tax guillotine as a result of the congressionaly delay retroactively delaying for one year its effective date.
At that time Saudi Ariabia had no income tax, so Americans working in Saudi Ariabia had no foreign tax to pay so likewise there was no foregin tax to create a tax credit to offset any of the US tax obligation. I do not know what Bechtel did, but the 1981 tax legislation abolished the Foreign Earned Income Exclusion and replaced it by various deductions for certain non-cash and cash allowances incident to the overseas employment. But with no FEIE it did not solve the problem of US citizens not being competetive for employment outside of the US, so that legislation did not stay in place very long either. US citizens abroad still had to pay US tax on their salaries whereas persosns from other countries paid no tax to any country so they could do well with much lower salaries than Americans. US compenies, like Bechtel, pulled out of that market. I suspect that Bechtel also abandoned that market which US companies had dominated. That was the engineering project and construction market where US tax laws priced them out of it.. As I recall US companies dropped from first to 7th place in that market very quickly and then totally withdrew from that market because US income taxes on their US person employees pushed their labor costs way out of sight.
*The system is broken and I think it needs to be scrapped….. I like to be treated just like $AAPL and $GOOG with regards to transfer pricing and corporate tax avoidance.
Sorry for the late reply…
To your question: Who are for you those “cheating Whales“ ??
At the time I was writing that, I was speaking to those rich Homeland Americans who were deliberately and willfully taking funds (ill gained or not) and depositing into secret “offshore” accounts to shelter it from discovery of the IRS. They were the ones engaging in UBS tax evasion schemes that were being marketed on U.S. shores.
@Mike There are so many constitutional and practical abuses that my conclusion is that the IRC and related are BROKEN and are null and void. Furthermore since 1924 and Cook v. Tait, no law has been passed by any duly elected Congress executing its duties in any bone fide semblance. Also, the IRS DOES NOT LEGALLY EXIST, because there is no duly elected President to appoint its officials, because there is no duly elected House of Representatives to certify election of the former, or even authorize the continued existence and funding of the International Reaming Service. (Article 1, Section 2, USCONST is not respected, no valid decennial census of ALL US Citizens has EVER been conducted to apportion the House).
A renunciation is practically worthless because there is NO DEPARTMENT OF STATE. So one is just dealing with the lackeys of usurpers whose masters just change their position (and their “laws” and “regulations”) at their own whim and do not respect any semblance of juridic order.
The “US Government” and especially the “IRS” can go get stuffed!
I have agents Calling me about oil work in Singapore, Algeria, Kuwait, Libya, Azerbajzan, NIgeria, Angola, and UAE. The jobs offer a “net” salary–ie, cash after tax. None of this work is attractive to a US person, knowing that it is difficult to get any receipt of any tax paid by the employer to the local govt , or there is no tax to the local govt and then the IRS takes it instead.
Now, on top of that, add that those same countries will be assembling my personal data—first in their banks, then onwards to their own country. GOsh, all of that makes that professional Life attractive for a US person.
* …. The “US Government” and especially the “IRS” can go get stuffed!……… I agree but please not with my money… 🙂 …..
Does anybody here have a clue or was in a similar situation regarding Term Life Insurance.
Purchased TLI as a “non US person“ living and working happily outside the US and paid annual premiums but received cash value at maturity during 1 of those those 5 years as a Greencard holder.
*@ Just Me….. thank you for your response …. I was asking this question because I just wanted to make a point regarding Minnows and Whales……. It has nothing to do with your AGI being $100K or $1Mio or your highest aggregate bank account balance … it is more about the individual facts being criminal or negligance . We all know ignorance in front of the law is no excuse and we all know that we failed to take our tax filing obligations seriously but the severity of the punishment must match the gravity of the crime – this is a basic principle of human rights and I am so sick and tiered of this reasonable cause discussion or what is willfull or not and I have not even started the discussion with my potential examiner .
* @Just Me…… your case is the perfect example of why I am saying the system is broken…
you went from $179K with the help from TSA down to $25K … is this a turkish bazar or the IRS ? We are here to serve the people, right ? No one in this can be trusted , not your CPA and definately not your blood sucking tax lawyer……your female examiner should have been fired or sued for gross misrepresentation and I am sure I can come up with a few other legal terms
* So far unfortunately no OVDI cases are in appeal , we know that the reason why there have been no known efforts to enforce FBAR maximums independent of the VD,OVDI,OVDP program is because the IRS justifiably fears that an aroused – conservative – court could wrest the FBAR “revenue enhancer” from its hands completely and for good. Using those famous words… “I have a dream….“ that I find > 100 like minded Minnows,Whales without criminal exposure to “invest“ 10K per person in a constitutional challenge on the following grounds :
1. privacy (weak) – Query whether Americans have any constitutional right to personal financial privacy vis-a-vis their government. 2. substantive due process (solid) – a statutory requirement that is not reasonably related to any legitimate state interest. 3. 8th Amendment – cruel and unusual punishment – (stronger) and I am sure there are more to be found.
Other than that part of my comment is completely out of context, it is my experience, I realize not yours and so many others’. I certainly needed competent professional help, not that I in any way agree that this should be necessary. My retirement savings were not intended for that use, but unlike so may others, I am lucky I had something to draw upon. What of the others who have nothing? I just want to get to the end of all of this, move on to more valuable use of the time I have left on this earth — and to make sure that I can leave something of my Canadian hard-earned and taxed assets to my kids, not the IRS. The immorality of it all is staggering.
* @ calgary411……….. agreed and hopefully you have many decades left on this earth 🙂
@Mike This is probably why the IRS plays the “we’ll criminally prosecute you” card so “you better spread your ********** for an OVDI (Obnoxious Venereal Disease Instrument or OVDP=P**** that’ll make your spouse divorce you) reaming”, even though DoJ is not likely to pursue even large minnow cases unless they decide to make an investment to make a scary example out of somebody.
If they were to try to do a bone fide resident abroad on criminal charges, I think it would only serve to increase activisim and pushback amoung the 6 million. Remember, the 3200% case, which I believe still had a criminal component on which the sentence was not yet handed down, was on a homelander. Mabe they realize the bad press and increased pushback they would get, or maybe they just wait for USPs bone fide resident abroad to return to the US to live or visit so that they can really get the heabeaus grabbus on them.
But maybe we need such a minnow case in order to go to the SCOTUS and/or high courts in a land of residence or even supernational regional courts such as in the EU. Perhaps there is a way to force such a case while being prepared with the army of lawyers that it would take. I have written the ACLU (only by email), they basically didn’t seem to be very concerned at all. Maybe somebody could try to write them again? Perhaps copy the CCLA letter that Abby Deschmann read into the record at the FATCA forum?
But in the case of you Canuks, perhaps somebody in the CCLA has the right to practice at the federal level in the US? I seemed to understand that Abby Deschmann had some sort of USP status (I don’t remember if it was citizenship or green card) and she studied law in the US? Correct me if I am wrong? But, even if so, this does not neccesarily mean that she sat for the bar let alone was admitted to practice in US federal court. There are plenty of people that study law but never even seek to practice in the US. But, perhaps the CCLA could coordinate the case from a research perspective and use another canadian lawyer(s) who is also admitted to practice in the US.
Food for thought.
*@Jefferson ……CCLA letter that Abby Deschmann read into the record at the FATCA forum?…… could you please share the link and your e-mail that I don`t write the same thing twice…. thank you
Here is the transcript and video of Abby’s talk
@Mike Here is a copy of the CCLA letter stored on Maple, I think there must be a copy of the PDF stored here at IBS as well: http://maplesandbox.ca/wp-content/uploads/2012/12/CCLA-Letter-2-Finance1.pdf
Here is the CCLA announcement on their website about the same: http://ccla.org/2012/12/04/ccla-registers-privacy-concerns-over-ongoing-canada-u-s-information-exchange-negotiations/
Copy of letter stored on CCLA site: http://ccla.org/wordpress/wp-content/uploads/2012/12/2012-12-04-Letter-to-Dpt-of-Finance.pdf
Also, here is direct link to Abby’s talk on Youtube FATCA Forum channel: http://www.youtube.com/watch?v=ij2I9dHWuUE
I don’t see why one shouldn’t copy these and back them up on the “local” storage of their own blogs as well, with blog articles proposing both the CCLA, Maple, IBS, and YouTube links as well as the local copies. This might increase the Google attention to these. Anyway all of these are indended to be public record and thus I see no issue with copying them and posting them everywhere.
I don’t see why, if one already have a wordpress account and a personal anti-FATBARDT blog, that one couldn’t also create a few other blogs with similar names pointing back to one’s main blog and IBS and Maple and just containing a few posts with a list of a few hundred IBS links and links to releavant documents elsewhere such as CCLA, Youtube FATCA Forum, ACA, etc. Perhaps a strategy to increase Google coverage, especially if you can somehow deactivate nofollow on your blogs.
Anyway, I am glad Mike that you have joined our forum and are participating regularly. Thanks, we need everyone we can get!
*@ ……I am on it 🙂
“You can take the man out of the IRS but never the IRS out of the man“
@Mike Well, that may be the case for Mopsick, but I am doing my best to keep the Obnoxious Venereal Disease Instrument (OVDI) a.k.a Obnoxious Venereal Disease Peck** (OVDP) out of my ***. When I say the IRS can go get stuffed, I didn’t mean with our money. Get stuffed is an somewhat more polite UK expression for f-off or shove-it-where-sun-don’t-shine, which is most certainly where they can put the OVDI and OVDP as well as FATBARDT in general.
*……….shove-it-where-sun-don’t-shine….. hilarious 🙂 I have not heard that expression yet and I lived in Cobham,Surrey for 6 years
btw. Obnoxious Venereal Disease Instrument (OVDI) a.k.a Obnoxious Venereal Disease Peck** (OVDP) good that you still have not lost your witty sense of humor