Yes, I know this is a duplicate call of a previous posting on IBS by Shadow Raider. But thought I would update and draw attention to this from the ACA website:
Submitting Comments on Tax Reform
Please support ACA’s residence-based taxation (RBT) proposal by submitting comments to the Ways and Means Committee.
The Ways and Means Committee, is actively developing a comprehensive tax reform proposal. Chairman Camp and Ranking Member Levin have created 11 bi-partisan tax reform working groups. They have called on stakeholders and professionals to submit tax reform proposals and suggestions – before April 15, 2013.
You can make your voice heard by writing to the Ways & Means Committees and sending submissions to: tax.reform@mail.house.gov (see submission details from Ways & Means below)
ACA has submitted its comments in support of its proposal Residency-based taxation (RBT) . The ACA proposal would eliminate the serious difficulties that Americans overseas face due to the toxic combination of citizenship-based taxation, FBAR filing requirements and FATCA legislation. Americans abroad would be taxed by the US the same way they tax non-resident aliens – essentially through withholding taxes on US source income revenue such as dividends, rents, royalties, etc. Americans abroad would once again have access to foreign financial institutions and would not be subject to filing the 1040 and FBAR or FATCA reporting.
You may send your own suggestions and thoughts for tax reform or you may use a pre-formatted letter that supports the ACA position on taxation (see attached) and also allows you to include personal comments or insert a testimonial (see our letter here).
Details for the Submission of Written Comments to the Tax Reform Working Groups
1. Any person(s) and/or organization(s) wishing to submit comments can emailtax.reform@mail.house.gov.
2. In the subject line of the email, please indicate “Comments: (name of) Tax Reform Working Group” (note: be sure to specify the name of the working group in the subject line – e.g., Energy Tax Reform Working Group).
3. Attach your submission as a Word document.
4. In addition to the Word document attachment, please include in the body of the email a contact name, physical address, phone number and email address.
5. For questions, or if you encounter technical problems, please call (202) 225-3625 or (202) 225-1721
On behalf of all Americans abroad, thank you for your support for RBT. This is a once in a lifetime opportunity to have your say in D.C.
(March 2013)
Additional Note from Just Me:
I strongly urge all of us who have been so active in our vocal and blogging opposition to FATCA to use this opportunity to also write to this commission to call for the Repeal of FATCA as part of any reform effort.
This may be in the category of stating the obvious, but while we have to make our point strongly, it needs to be in such a way so it does not insult those reading it or they will reject it.
I hate to admit it, but you have to remember your audience when talking to these Congressional House Representatives. You have to come across as a credible and thoughtful concerned citizen, or ex-citizen as the case may be. It is better not to be too hyperbolic, which means, I will not call it the FATCA FATWA, Offshore Jihad, WOOTE (War On Offshore Tax Evasion) or refer to it as ‘Carpet Bombing the Globe’ in my submission! LOL Even I will be a little more restrained and PC, as they say.
I understand that this is NOT something that all who read and comment here will care to do. I get that. But for those of us who can, and or so inclined, we should accept this open invitation for comments.
In the opinion of many who have been lobbying Congress for many years, this submission is a once in a lifetime opportunity. My understanding of the efforts on the Hill in the February Over Seas Week, the group of sister organizations, ACA, AARO and FAWCO, did get strong indications that many in Congress are anxious and receptive to real tax reform, and not just some more exemptions or loopholes on the margins.
Everything I read, tells me that Chairman of House Ways and Means, Representative David Camp is serious in wanting to get a real reform effort out this year. H.R.1 designation is being saved for this effort. We hope that he has some bi-partisan partners in the Senate. They already have their own draft and are just waiting for Camp to come forth first, as required in the law.
Bottomline, partisan politics aside, they all know that the tax code is a total mess, and frankly a creation of their own making. It has been said, and more cynically true than we may want to admit, the tax code exists as a funding mechanism for politicians’ reelection. It will be very hard for them to vote against special interest lobbying and the restructuring of special provisions which has helped fund their campaigns for years.
However, the stars may be aligning just right, and there is a possibility for big changes, even a historic one. Dropping FATCA would NOT even be that big of a change in the context of revisions being envisioned. Pulling the plug on this not fully functioning fiasco shouldn’t be all that hard to do. So far it has only generated costs and created chaos for Americans and financial institutions overseas. It is draining Treasury and IRS resources that in this time of sequester. Time and energy could be better spent shoring up defenses against homeland tax evasion and identity theft. That would have a higher ROI than this massive ideological mission for a global GATCA which has very little revenue return for the effort while threatening great harm to the world’s economy.
Give it a shot!
Those AICPA papers are a MUST READ, see for instance the discussion throughout of the increasing trend for the IRS to view the assertion of penalties, and the size of the penalties imposed AS A REVENUE GENERATING MECHANISM;
…….”we believe the real message is that the IRS views penalties as a revenue source, that a cost – benefit analysis is performed around whether or not to assert penalties, and that only penalties that have high dollar amounts attached to them are worth enforcing. This view leads not to a policy based on the deterrent value of penalties, but rather a policy that says that penalties most likely to be imposed should be high because the cost of asserting and defending them will be offset by the proceeds of the penalty. “…… http://www.aicpa.org/Advocacy/Tax/TaxLegislationPolicy/DownloadableDocuments/AICPA-report-civil-tax-penalty-reform-2013.pdf Page 5
There are many other good excerpts, but for expediency sake (and because of formatting problems with cut and paste) I haven’t provided others here.
Thanks so much for all of this, badger.
I am just getting ready to go to a province-wide (in person and by internet) information session for cuts to services received through Persons with Developmental Disabilities (PDD) in Alberta.
The reason I am the Holder of a Registered Disability Savings Plan (RDSP) for my adult son with developmental disabilities is my needed peace of mind that there will be something there to sustain my son when I am gone and when or if there is no longer funding available for anyone with the misfortune to have a “disability”, whatever that may be, whether from birth or caused by some brain injury. The RDSP I hold for him is the foreign trust that I must report to the IRS on 3520 and 3520A. Quite frankly, I don’t want the IRS to have one penny of anything I am putting away for the future support of my son — OR OTHERS LIKE HIM — nor the cost of administration, year after year after year to prove to the IRS that no tax is owing.
It makes, to me, NO SENSE. My son is a born-in Canada, no benefits from the USA Canadian. Take your gift of US citizenship back — I don’t want it for my son — thank you very much. It is a never-ending burden to our family and many others — whose energies should go for more important needs.
We learned previously that the State Department more than covers its costs through user fees. This is called “fee for service”. I wonder if the IRS have an objective to cover their costs through user fines. That would be “fine for service”.
@Edelweiss, as posted today by Lawyers.com, the IRS favors “fee for no service”:
‘Accidental’ Americans Still Owe Income Tax – Lawyers.com Blog (blog)
http://blogs.lawyers.com/2013/04/accidental-americans-owe-tax/
The fines are for the bonuses that enable the IRS folks to give their kids Ferraris for Christmas.
@Badger
“The AICPA asked Congress to address the following issues:
• The trend away from voluntary compliance as the primary purpose of civil tax penalties;
• The lack of clear standards in some penalties;
• The fact that some penalties are disproportionate both in amount and severity;
• The fact that some penalties are overly broad, deter remedial and other good conduct, and punish innocent conduct;
• The trend toward strict liability;
• An erosion of basic procedural due process;
• Inconsistencies between penalty standards and the role of tax professionals;
• The increase in automated assessment of penalties that can lead to unwarranted assessments;
• The need for better coordination and oversight of penalty administration;
• The bias in favor of asserting penalties;
• The need to improve IRS guidance and training; and
• The need for the IRS to increase its efforts to educate taxpayers and tax professionals.”
Isn’t that the definition of ‘Draconian’? Draco prescribed death for may offences, but when laws leave a citizen little choice but to renounce, isn’t renunciation a ‘death’ of sorts?
@calgary411, good luck. It must feel sometimes as if you, your son and others who share the same situation are under constant assault from those who would cut benefits and tax the most vulnerable. It is hard enough to try to provide our children with the best quality of life possible, but then, to have to counteract the injurious actions of our own government, plus the US, is just too much.
Calgary 411, I cannot imagine your frustration in trying to deal with this situation, and apologies if you have already tried this or if you feel that my suggestion would not help:
My thinking is that FATCA will certainly be approved in Canada. However, I do feel that the Ministry of Finance etc. might possibly negotiate some terms of different tax agreements between Canada and US, at the time of FATCA, that could be beneficial to US persons in Canada.
US taxing on a Canadian RDSP has to be at or near the top of all harms caused by US IRS that violate the spirit of the Canada-US tax treaty.
This might not help, but I would respond to the MOF request (below) for input on FATCA by explaining your specific situation and requesting that, as part of the FATCA negotiations, the tax treaty be amended to exclude “IRS taxing” of Canada RDSPs. Once the FATCA agreement is established by year end, US loses all incentive for negotiation.
“NEGOTIATION OF AN INFORMATION EXCHANGE AGREEMENT WITH THE UNITED STATES
November 8, 2012
Negotiations are being held between Canada and the United States on an agreement to improve cross-border tax compliance through enhanced information exchange under the Canada-United States Tax Convention, including information exchange in support of the provisions enacted by the United States commonly known as the Foreign Account Tax Compliance Act (FATCA).
The purpose of this bulletin is to inform persons whose interests are affected by the provisions of FATCA that the Government is actively seeking a solution to issues raised by such provisions. The Government of Canada has received input from many individuals and groups in relation to the implications of FATCA.
Persons wishing to offer additional comments concerning the negotiations may send their views to:
Department of Finance
17th Floor, East Tower
140 O’Connor Street
Ottawa, Canada
K1A 0G5”
@Calgary411
I believe you’re on a first name basis with Kevin Shoom?
@bubblebustin, re; ….”but when laws leave a citizen little choice but to renounce, isn’t renunciation a ‘death’ of sorts?”…
Definitely. When I read the AICPA papers, I thought of many of those here. For example, markpinetree, whose complaints to his Senator or Congressman resulted in that letter from the IRS Counsel which basically said that in terms of his plight – caught up painfully in the irreconciliable conflicts between the system of taxation in his actual home country of permanent residence, and the US – his only option was to renounce.
When Congress, Treasury and the IRS impose layered, draconian, revenue generating penalties on those ‘abroad’, and obdurately refuse to examine or remediate the subsequent draconian state of affairs, we can only assume that they accept that there will be a ‘death’ of sorts – the demise of those living outside the US – whether through penalizing us out of existence, double taxing us, or by driving us to renounce or into a state of depression and anxiety that impairs our ability to have any normal life.
You mention Draco, of whom, Wikipedia says; “The death penalty was the punishment for even minor offences. Concerning the liberal use of the death penalty in the Draconic code, Plutarch states: “It was a lot for himself, when asked why he had fixed the punishment of death for most offences, answered that he considered these lesser crimes to deserve it, and he had no greater punishment for more important ones.”[3]”
So it is with us. The FBAR and FATCA plus the 3520/3520A, and all the rest of the penalties designed for those who merely are living a normal life – many as citizens of non-US countries, is truly ‘draconian’ in design, scope, and effect.
It will be the death of the American diaspora ‘abroad’. It is already delivering a deathblow to any possibility of keeping our birthright US citizenship.
@badger
You put the BAD in badger.
thanks @bubblebustin. The American badger is Taxidea taxus and am inspired by my cousin Mellivora capensis.
Coincidentally, regarding Draco, US extraterritorial taxation requiring us to renounce US citizenship and the subsequent demise of the American diaspora ‘abroad’.
See re American Badgers;
“….Conservation status
In May 2000, the Canadian Species at Risk Act listed both the Taxidea taxus jacksoni and the T. t. jeffersonii subspecies as an endangered species in Canada.[25] The California Department of Fish and Game designated the American badger as a California species of special concern.[26]
……”
however, we have do have family worldwide;
“Distribution
Badgers are found in much of North America, Ireland, Great Britain[11] and most of Europe as far as southern Scandinavia.[12] They live as far east as Japan and China. The Javan ferret-badger lives in Indonesia,[13] and the Bornean ferret-badger lives in Malaysia.[13] The honey badger is found in most of sub-Saharan Africa, the Arabian Desert, southern Levant, Turkmenistan, and India.[13]” http://en.wikipedia.org/wiki/Badger
@Badger
I use the name ‘honey badger’ on some blogs! I suspected there may be some kind of kinship other than IBS 😉
If I am figuring the time differences correctly, you have about 4 hours left to still send in a submission to the House Ways and Means committee on Tax Reform.
I just called them from NZ, and talked to a young aide. (they are always young!) He said they were slammed, but were working to get all submissions up on their web site. If you submitted one, and you don’t see it up there by tomorrow, he said to call back and they will find and post it. The number is (202) 225-3625
I was like many, was a procrastinator. Thought I could do something simple, and just incorporate by reference, ACA submissions and Roger Conklins comments. However, in usual fashion, I got a bit wordy and with lots of spaces, it ended up 11 pages. Hopefully it is a readable narrative, but I would bet that the best hope I have is that it gets skimmed, or added to the pile of those opposed to Citizenship taxation.
There was a good Bloomberg article about Dave Camp and his effort at tax reform which I referenced in my submission. I think this guy is serious in his attempts, and maybe, just maybe, in spite of comments by one aide quoted in The Hill, (I referenced that too) our submissions will make a difference. Hope springs eternal.
So, you doubters out there (and you have good reasons for your skepticism) you still have time to just take a copy of ACA’s model letters and send them in. 🙂 The more the better.
@Just Me
Thank you, thank you for that number. I posted mine the week before last and it hasn’t gone up yet. I even submitted it a second time last week. The last postings were the 10th, so as you say they must be slammed.
@ badger
I love how AICPA addresses the problem with penalties but I wonder if they have ever addressed the trouble with the tax code being too bloated and too complex for mere mortals to do their own taxes without the aid of CPAs? It would be advantageous for CPAs if the tax code remained complex to assure a thriving tax preparation, counselling and compliance industry, yet the penalties reduced to keep their clients happy. As for their fees, well they probably think they are worth every penny. I would like to see the human endeavour directed at producing actual benefits to mankind instead of the current predicament where a military destroys lives and countries and a host of professionals shuffle paper which signifies nothing. And don’t forget the new booming business of surveillance … what a waste! — end of rant (directed only at the State of Affairs)
@ Just Me
I will read each and every one of those 11 pages when they pop up on the Ways and Means site. Thank you for doing it.
I had a submission that did not get posted—it was apparently too much of an analogy story rather than a real information sheet. I revised, resubmitted, and it was posted. There are filters. Review the submission, guess what they didn’t like, fix, resend. I am working on Another now
@bubblebustin and badger — That’s Bad in a really good kind of way!!
@IRSCompliantForever,
I have made layers of comments and I will, this afternoon, work on this one. Thanks very much!
@Mark Twain
I know other very technical ones (from ACA directors) without a lot of narrative (analogy story) didn’t get posted either, and I think it is just that they are behind. They are resubmitting too and calling. I would call the number if yours is not showing up. I got mine in a midnight on the 14th, so don’t expect to see it until tomorrow at the earliest, and I may call again. I think that, Frankly, the ACA effort to focus attention on this process created a lot more than they expected. Slammed, as they say. That The Hill story also helped…
My submission was posted quite early, and never came up til after I amended it.
I just did a little time travel back to April 1995 on usxcanada’s site — interesting.
http://usxcanada.wordpress.com/1995/04/
Refers to this article …
http://www.nytimes.com/1995/04/12/us/some-of-rich-find-a-passport-lost-is-a-fortune-gained.html?pagewanted=all&src=pm
De Witt combines description of legislative efforts to close “a loophole in the tax law” with accounts of multimillionaires who have benefited from abandoning their US citizenship.
Then skip ahead 10 years at usxcanada to find …
New law effective 4 June 2004 closes a loophole that had allowed wealthy individuals to get an IRS “ruling confirming they had left the U.S. for nontax reasons.”
“Half the 270 people who applied between 1997 and July 2002 got favorable rulings and only 11 got unfavorable ones. The rest got “neutral” rulings, which allowed them to proceed as if they didn’t owe the tax.”
@Mark Twain
Just remember, it is young mostly unpaid aides running this operation, so I wouldn’t read too much into why it wasn’t posted. I doubt that there is a lot of reading going on yet.
BTW, I started my submission out, with clear statements of what I was proposing, 1, 2, 3, 4, and then followed with the narrative associated with each one. Hopefully, if they open it, that is what they will see…
That said, Rogers was not that way, and was quite long winded and dense (long paragraphs) and it got posted. So I am not sure there is any method to the madness on why some items didn’t get posted, other than they probably split the task between aides, and someone dropped the ball.
BTW, I called them twice, at the number I listed, and they answered on the first ring each time! They were nice polite young men. I also passed on my appreciation for what Rep Dave Camp is attempting to do.
I said this in my submission….
Doesn’t look like they posted mine. But, no worries. It’s their loss, not mine. 🙂
I just made a submission but kept it short and sweet. 🙂
SwissPinoy.. Call them! :)(202) 225-3625