On May 30, 2013 Accidental post the following comment:
Accidental says
May 30, 2013 at 8:01 pmI read that the Eritreans had formed a group and retained the services of a human rights lawyer. Why don’t we co-ordinate as many foreign Americans as we can, spanning, say, 30 cities worldwide? We’ll need a lawyer in each city, and probably a constitutional lawyer in the US to co-ordinate the case. When we’re ready, we co-ordinate the service of 30 class action law suits at 30 embassies simultaneously. We should all challenge the ‘Saving Clause’ in the bilateral tax treaty, without which the taxing authority where we live would have precedence over the IRS; Cruel and unusual FBAR punishment; citizenship based taxation, taxation without representation etc. It seems fraught with jurisdictional and diplomatic issues, but we could at least explore the idea.
Maybe even better. Let’s try to put 1000 of us together. We all contribute according to our means, but that should give us America’s best human rights lawyer, all the way to the supreme court if need be. File in DC and make sure we’re all there for the trial. It’s not just for ourselves, it’s for all the Accidental American’s who’ll be meeting the IRS via FATCA, but most importantly, for our kids, present and future, who stand to inherit a most unfortunate ‘gene’, unless we tend to it now.
It’s time to get started. I note the following comment on June 25, 2013 from Marie:
Attn:Brockers
This afternoon I put a call into the CRA to request some info on Canada’s existing treaty with the US. They forwarded me to Competent Authority, the division of the CRA that deals with tax treaties. They are in Ottawa and can be reached at 613-957-2071. I spoke to a representative that had a great deal of info on the matter. I called with some general questions, she gave me info on the “Agreement”. Here is what she confirmed for me.
First off, the Ministry of Finance had some concerns about s.15 of the Charter of Rights and Freedoms. They concluded that Fatca reporting does not contradict or conflict with the charter.
1. FATCA is a reality. The agreement will be signed this summer. Info will be available on the CRA website beginning in September 2013.
2. All US persons in Canada are considered US residents for tax purposes according to the US, based on that, Canada considers us US residents as well.
3. Beginning in 2014, Canadian financial institutions will begin identifying US persons to report to the CRA. CRA will report individuals with bank account #’s balances, etc. to the IRS.
4. All bank accounts over $50K will be reported.
5. Registered account such as RRSP’s, RIF’s, TFSA’s and RESP’s are exempt (she did not mention RDSP’s)
6. If your bank account is held jointly with a non-US person, it gets reported as well.
7.CRA’s first wave of reporting to the IRS will take place in April 2015 and will cover 2013 and 2014. After that, balances will be reported once per year in September.
8. CLN/renounciation/relinquishment does not get you off the hook for taxation for 10 years. Your balances will continue to get reported for 10 years after issue of CLN.She recommended that I get my hands on a copy of “A Tax Guide for Citizens in Canada” by Carswell.
There are many more questions that I would like to ask her. I encourage everyone seeking answers to call the CRA for information.
This means the time has come to organize the following legal actions:
1. Class action FATCA lawsuit – A “representative plaintiff” is required. This must be a “tax compliant” (who else would do this) U.S. person who has been “outed by a bank”. I know several tax compliant U.S. persons. One of them might be persuaded to act in this capactiy.
2. Complaints to provincial human rights tribunals – discrimination based on citizenship, national origin, etc.
3. Complaint to those at the UN responsible for the administration of the Universal Declaration of Human Rights
We are going to need some central coordination of these things.
I am going to try to transfer subsequent comments to Marie’s comment (as per your request). So, I have (at least for the moment) put all subsequent comments in one long comment. The idea (as per Em) is to try to create a new thread out of this important information. I would note that some of the information that Marie received is clearly incorrect (there is no obligation to pay taxes after one ceases to be a U.S. person). Nevertheless, the gist is significant.
It will be very interesting to see where Congress goes on the question of citizenship-based taxation. I have long been of the opinion that the US will have to move to RBT in order to get FATCA. I still would renounce though. Who in their right mind would want to be caught up in the fear of this any longer than necessary.
By the way, for those who have become lover of Canada in the last couple of years:
The Government of Canada, at the request of the banks, is getting ready to cooperate with the IRS to destroy you.
As USXCanada always says:
Look out for yourself and your family first (in English).
On a practical level I think you can mitigate a lot of the effects of this by using a number of bank accounts at different banks to keep your balances low. Also, RRSPs are not reported. You should get rid of the TFSAs and carefully consider how to deal with the mutual fund issues. You do have time to organize your lives and we have time to organize the lawsuits.
But, taking the lead from “accidental” – It’s time!
Damn!
Being stateless is starting to look real good now. :^/
@Marie, thanks for getting back to us, and for reporting on your conversation. The CRA employee seems to be mistaken about quite a number of points. Dumb and dumber. If this is what Canada is going to do for the United States, we don’t have a country any more.
I encourage another Brocker to call Competent Authority and confirm the information. Just to verify whether this girl was out to lunch.
Oh what a Happy Canada Day Weekend we’re all going to have!
@all, I’ve spoken to Marie and I believe that her comment accurately reflects the conversation that she had with the CRA representative. I encourage others to phone and to see if they can verify these details from the same office. 613-957-2071
I want also to mention that I went to the patriotic BBQ that the MP, Peter Kent, had in Thornhill on Sunday. Ironically, it was a patriotic BBQ, since it seems that the Tories are about to do the anti-War of 1812, 200 years later, and just hand the keys to Canada to the United States. I told my wife this morning that I should have just moved to Grand Cayman. But now I am thinking that Depardieu and Snowden have it right: Russia may be the place to go to escape this tyranny.
Ironically, when I tried to speak with Mr. Kent about the issue of US persons in Canada and the IGA, a bystander identifying himself as visitor from the United States (and a big supporter of the Tories in Canada!!!!) monopolized all the time I could have had to speak to Mr. Kent, and afterwards I felt like saying that he should just go back to the US and that I wanted to talk to my MP who represents my riding. I will be writing to Mr. Kent, and hope to try to arrange a meeting with him.
Well, I continue to love Canada and am really not surprised. What else do you do when you are living next door to a behemoth? Not that I wouldn’t have loved to see Harper pull a Putin and laugh in Obama’s face, but let’s be real, Stevie ain’t packing balls like that.
Ten years after the fact? Can someone clarify what would happen if a former USP simply closed existing accounts after renouncing/relinquishing and simply opened new ones? Would those be reported? Given the US’s rather dismal history with private data collecting, ten years is a long time to trust them with your account info – especially when you are no longer obligated to file taxes – and there is no mention of whether or not the data (or the reporting of it) will be purged after ten years or that the reporting will actually cease.
If someone does file a class action, I would be more than happy to participate. The way I see this, I am screwed and the USG will always be able to look at anything it wants regarding my finances (just as it did when I lived there) but there is no reason my child should have to live this when she reaches adulthood – because if I understand this correctly, she might already be on their radar with the ten year bullshit attached to any savings account she might open once she reaches her teens but is still considered too young to renounce.
Whether FATCA can be legally challenged or not wouldn’t make it any less repugnant to any self-respecting Canadian. Bring it on.
I´ve had it. Ready for action in South America (afraid to reveal country and sick of being afraid). Let´s get organized.
bubblebustin, you don’t know if something can be legally challenged until you challenge it. Just because the Feds say this doesn’t violate the Charter, doesn’t make it so.
As Henry Kissenger once said (and I am paraphrasing a bit) “there is a difference between illegal and unconstitutional”. For example, the Defense of Marriage Act, which the SCOTUS struck down today has been legal but it’s not constitutional. All sorts of perfect legal rules have endured in this or that state for long periods of time before someone challenged them against the constitution, which trumps all.
Harper may want FATCA to be legal but the Supreme Court of Canada might not see it that way when weighed against the Charter. Even if we could get just parts of the IGA ruled out that would be a victory.
@Yoga Girl
Great point. Mine was that it will surely fail in the court of public opinion, if not eventually the court of law.
It is all just plain maliciousness on the part of some very juvenile and self absorbed people who have more power than wisdom. There is no right thinking person who would believe that it is fair to have to report and pay taxes on economic activity that is conducted in one country to the government of another country solely on the basis of one’s birth. It is outright slavery. There is absolutely no benefit to any US person to have to do this.
It is pure evil.
@Petros, that some FATCA with Canada will happen is consistent with the already posted May 14 statement of the VP Financial Policy of the Credit Union of Canada that “Canadian government officials …are telling us…that …some FATCA requirements will be effective January 1, 2014.” I have tried to reach this fellow by phone for confirmation for one week now without success.
http://www.cucentral.ca/Connections/FATCA%20Anxiety%20Increasing%20FINAL.pdf
Is the requirement, if confirmed, to disclose financial accounts for ten years post-renouncing good forward-thinking by IRS? This is my question:
@Shadow Raider or other IRS experts, I understand your point about paying only the exit tax (if required) after renouncing.
But is there a statute of limitations on IRS 8854? I have always wondered about the uncertain finality of this particular form.
Let’s say that three years or seven years after filing 8854 $51k or $500k appears in one of my accounts disclosed, without my permission, by my bank to IRS.
Do present IRS regulations allow an audit at these later times on the accuracy of my 8854 because IRS suspects, because of the new deposit, that I failed to declare all assets at time of 8854 filing?
Can they audit my 8854 when I am 95…?
Thank you for bringing this up..
“and carefully consider how to deal with the mutual fund issues”
Anyone has an idea of what the options would be just to remain on the safe side. Even with a canadian mutual funds the content is bound to include US “toxic!!!” assets…What instructions would you give your financial planner…GIC’s @ 0%. …!? and when?
Oh..! I tried the number and can only get the recording to leave a message. pressing the 0 key will bring you to another recording and 0 again will move it to another…why don’t they (CRA) post the information themselves will I ask them…maybe if they get enoug message. They will probably have to clear it with PCO first by now..!
@YogaGirl, FATCA is not law in Canada–so Harper can’t see at as legal anything. It was not passed in Ottawa but in Washington. An IGA may have the force of law once signed, but only because our government would be committing a great betrayal. This is being foisted upon the Canadian people by a foreign government and by traitors in office and by a bureaucracy (CRA) that doesn’t understand the first thing about the rule of law.
Still don’t know how the Canadian government can support the law of another country when that law contradicts our own, specifically citizenship based taxation, without it threatening our own identity as a nation. Maybe the Canadian government knows something we don’t know regarding that…
I’m with YogaGirl on this. Canada is only a middle power living next to a hyperpower full of madmen that can invade a sovereign nation on a whim, and will chase people all over the planet simply because they dared tell us the truth. We’re only kidding ourselves to think that they could do anything other than sign the IGA. It was literally an offer they couldn’t refuse, and if the government wasn’t going to sign, then the banks were prepared to sign it themselves. I’ve closed the joint account I had with my wife several months back in anticipation of this action, because deep down, I knew FATCA would happen.
Our only protection is to renounce and have the CLN in our hands.
My girl at Competent Authority got back to me this morning. Her position is Tax Analyst. She said that the 10 year reporting rule would only be on US sourced income. She clarified that the “Agreement” is not set in stone, but pretty close. She said that once it is signed, it will need to go to Parliament for approval. I asked if it could get turned down or modified at that point, she said possible but unlikely. She said that her associate received some calls re the same issue this morning and asked if I shared the info. I said i might have told one or two people.
@ Marie
“I might have told one or two people”.
Well that made me laugh at least. I’m still working on an e-mail to my MP but I keep having to revise it to keep it toned down enough to prevent a knock on the door by the Thought Police (the TPs).
@Marie
It is SHE who let the cat out of the bag, not you. Shall we nickname her “snowdon” hereon in?
er, “nickname” that is.
@ bubblebustin
Snowdon? I can deal with being snowed on but this feels more like an avalanche. BTW, it appears Edward Snowden might be in Iceland now. I’ve thought about moving to Iceland but their language is one of the most difficult ones to learn. Iceland has stood up the bankster bullies of the world and even had the guts to send some US FBI (spy) agents out of the country. I wish Canada had the courage of that little country but it’s all save the banks and skewer the people here.
http://www.theinquirer.net/inquirer/news/2277146/nsa-whistleblower-edward-snowden-flies-to-iceland
I think I spoke to the person who spoke to Marie’s person. I phoned the number which Marie gave. I received a recording that the voice mailbox was full and I could not leave a message.
I then called another number on Competent Authority’s website for policy for legislative policy, tax treaties. The confirmed I should be speaking with Competent Authority and said they would pass my message on to one of the officers.
Within a half hour, I had a call back from Blair. Here is what I posted about that conversation at Maple Sandbox:
I had a return call from Competent Authority about 30 minutes after I spoke with Jessica.
Blair, the officer I spoke with, said the “Government of Canada is negotiating with the US federal government relating to FATCA, but those negotiations are ongoing.”
I explained to him what another individual was told. Blair said “We at CRA are administrators. If Canada enacts a law, we’re going to administer it , but right now there is no law, so we’re not administering anything.”
Blair was not able to explain the information which Marie said she received from another employee. He said he would follow up with his colleagues.
He stressed CRA does not set tax policy. He acknowledged my concerns about FATCA, but said Department of Finance and Parliament is responsible for any law there may or may not be relating to FATCA.
Blair said he had “no knowledge” of any constitutional decisions relating to this. He said that is “Something the Parliament of Canada will have to consider.”
Again, he stressed CRA “has no role” in setting policy. He also said if there is an IGA, CRA “will have to react at that time. Whether or not it is legal or constitutional is not in our court…We just administer the laws the Parliament of Canada wants us to administer.”
Blair said he and CRA are “very aware of FATCA” and are “obviously monitoring FATCA”, as well as “global developments relating to FATCA and other changes between governments.”
Blair concluded by stressing “Finance Canada are the negotiators. Canada Revenue Agency is not negotiating. We can only respond to marching orders when or if we get them.”
It sounds like Marie may have received inaccurate information from a source at CRA similar to that which Tiger and I received from someone in the Privacy Commissioner’s office last year. The information we received from a junior level employee was completely contrary to that which we received when we followed up with the Privacy Commissioner in a further letter.
As Tim mentioned, a Director at the Commissioner’s office called me to provide accurate information and also issued a strong apology for the incorrect information which was provided.
I think we all need to take a deep breath. We don’t yet know what will be in an IGA.
The information provided this morning confirms what Tim has said. Nothing can happen until there is a change in Canadian law. Both Joe Arvay and Abby Deshman say we don’t have grounds for legal action until (or if!) that happens.
In the meantime, Joe remains “on standby” if we decide to take legal action in the courts.
It is clear we need to remain vigilant in fighting this. Remember the quote Victoria posted some time ago:
“If you think you are too small to make a difference, try sleeping with a mosquito.” (Dali Lama)
A mosquito’s buzz can keep you awake all night. It can draw blood. It carries deadly disease.
If one small mosquito can do all that, think what a huge swarm of us can do. They may try to kill us off with pesticide, but mosquitoes grow resistant to pesticide.
Keep swarming!
Thanks, Blaze, for following up and communicating. We all need to stay in tune. Accurate communication from our Canadian government is so important. It is good that they are aware and are also aware of our concerns and our swarming!
@Marie, that’s a relief that it has to go through Parliament. That will give us an opportunity to become politically active and to speak to our MPs. Perhaps we could persuade our politicians to get a pair, like the Swiss.
Ten years of reporting on US-source income? Not a problem: close your existing accounts and move to a bank and open up your account as a non-US person. Stop trading and investing in US markets. Sell the condo. Get your assets out of the US.
If there is a class action lawsuit over FATCA, I will certainly be interested in joining. We’ve got to defend our rights somehow.
Thank you guys for keeping us well informed on the issues. I just wish that there was more that I could do to help.