Noncompliant US taxpayers living abroad are getting nervous. If an informant seeking a hefty IRS reward, or FATCA doesn’t rat them out first, then the State Department will. This can happen when the noncompliant taxpayer renews his US passport.
Traditionally, the functions of the US Treasury and the Department of State were completely separate. However, we are seeing a continued erosion of this distinction as troubling economic times continue. The US passport renewal form mandates that the applicant supply his Social Security Number (SSN) if he has one. http://www.state.gov/documents/organization/79960.pdf
Read more here:
1. Do not renew Passport.
2. Move funds into a Credit Union.
3. Do not cross border.
IRS will be kept busy with those renewing their US Passports for the foreseeable future.
@ Joe Smith
1. Check
2. Check
3. Will try to minimize, but cannot avoid completely, will use Canadian passport and play dumb.
It’s another tool for them to enforce their citizenship based taxation scheme, as you can’t get a passport otherwise. It’s also a backdoor way to make exiles out of people, and to leave them in an impossible situation with help from FATCA.
If you’re a US citizen, then you’re liable to the IRS no matter what, but without a passport, you’re left with the tax obligation without even a means to go home, plus no way to even get a bank account in an increasing number of countries. Other countries may see no choice but to deal with the US at this very moment, but we get to be pariahs because of US policies. If you’re in my situation, renouncing is just a no-brainer. But, if you’re a dual national since birth, and you’re learning about these obligations now, it will be a substantial cost burden to formally cut ties with the US. Also, you can certainly be at some risk of arrest at the border if the IRS gets wise and thinks you’re an ostrich, and you tip your hand by applying for a passport. No wonder why people hide!
This has been in the passport process for years…seems now they are just starting to take advantage of it.
If I was a dual at birth, then I’d be taking Joe Smith’s advice.
I am a dual citizen by a lot of different ways,grandparents,father,husband etc,I was born in Canada lived and worked here for 57 years,in 1989 took out Us passport, didnt know about all the problems down the road. Worked in Us part time for 10 years,I am now a 75 and a widow and receive small amount of US social security.
I have filed US taxes since the time I received an income from there until about 6 years ago when I was told by HR Block I didnt have to. I always claim my US income on my Canadian tax form.
This US tax thing worries me a great deal and not sure what I should do,dont have the funds to pay fines etc. Would be grateful for any help
Thank you
This is just another scare story planted by a lawyer trying to drum up business. The SSN requirement has been there for some time. The recent National Taxpayer Advocate report recommended that the IRS use this data to send “Did you know you should be filing?” letters to those whose SSNs don’t appear among the compliant. This suggests that not much is being done with this information, at least for now. In fact, I’ve never seen a post from any non-filing non-US resident USC who has been contacted out of the blue by the IRS. So hold the paranoia, ostriches!
@Jane Mow
Your Canadian Passport says “Born in Canada”. You are home free.
Interestingly I learned about this from a “Homelander” who was doing a passport renewal.
This applies to all passport renewals – homelanders and U.S. citizens abroad. Some considerations here:
1. This will clearly make it harder and harder to leave the country. There is no (in so far as I am aware) right to leave the United States.
2. If U.S. citizens have a constitutional right to enter the U.S., and a U.S. passport is required to enter the U.S. (which under the current law is the case), this may unduly burden any right to enter.
So the impact of this (which is in its infancy) will impact U.S. citizens abroad and homelanders differently. Either way entering or leaving the U.S. will now be dependent on tax compliance.
Since it is impossible for many U.S. citizens abroad to come into compliance (the costs are simply too high), more and more citizens abroad will simply NOT renew their passports and live as exiles. Clearly they must become citizens of the countries in which the reside.
I don’t understand how the U.S. can treat its citizens this way.
Leaders turn on their citizens all of the time. It always starts out be separating out some of them for persecution by means of a propanda type campaign that criminalizes their existence and ultimately ends in their death, imprisonment, exile, and/or despoilation of their property rights.
Move along folks, nothing to see here.
IRS just issued the final regulations on the $500 fine you get for not supplying your SSN with a passport application. They ignored almost all comments (including the one requesting more details about what constitutes “reasonable cause” for not including an SSN) and went ahead with what they planned in the first place. They also found a loophole to get around the Taxpayer Bill of Rights and make sure that the new regulations are effective immediately and not from the start of next year.
https://www.federalregister.gov/articles/2014/07/18/2014-16944/td-9674-filed-071714-at-845-am-publication-date-7182014-information-reporting-by-passport-applicants
More proof of mobility controls over the people it claims as serfs.
Here is a stupid question…. how does the IRS have the authority to do this? Is this not like an immigration issue? I am sorry but I am not that familar with the works of the US gov’t… Here is a better question… why aren’t there more lawsuits for the IRS overstepping their authority?
https://twitter.com/FATCA_Fallout/status/489802767939018752
#youknowyoureanAmericanwhen when the #IRS fines you for not filing out the @StateDept passport application form right. @FearDept
Lets face it, The State Department has probably just accepted the political reality that in this administration it is subservient to U.S. Treasury and the IRS.