Liberty and justice for all United States persons abroad

The Isaac Brock Society

Posted on by Posted in Issues regarding US persons abroad 115 Comments

AtticusinCanada has written a nice little summary of her sufferings–I nominate it for the comment of the day award:

My whole life has changed because of this. I’ve felt immense grief that the only way to deal with and move on is to renounce. I always assumed if you were born some place you were entitled to that citizenship without any other need of proof. As long as you didn’t commit treason or some serious crime you were a citizen. I had never, once heard of an FBAR! I called the IRS many times over the years to make sure I still was within their rules and nobody every mentioned such a thing. Nobody mentioned when after 9/11 we were required to get a U.S. passport either. Some have said that it’s written on page 4 of the passport. Well, my vision is VERY bad even with glasses and I never even attempted to read those pages. I assumed if it was anything important I would have been told about it and barely glanced at the tiny,tiny print on those pages. Couldn’t someone have informed us when we landed here? In fact up until I had to get a U.S. passport I wasn’t too sure I was even a citizen there anymore sometimes since the person I spoke with when I landed at Buffalo insisted over and over that “You may lose your U.S. citizenship over this” So when I went for that passport in the back of my mind I was worried they might not give me one. When they did I mentioned the fact I’d been told I might lose my citizenship and the person there did say “No, you were misinformed.” I came here in 1980 so maybe the rules were different or something back then but, I only landed and had not taken citizenship.

The constant worry about money and fines, fees, penalties. The hours and hours lost trying to figure out the right paperwork, how to fill it out, who to trust or not and how in the bloody hell to pay for this “compliance” has made my rheumatoid arthritis flare up over and over when it was under control before. I have been in the hospital once with a terrible breathing problem they couldn’t get under control except for the use of steroids over a long period. I now think this was brought on by extreme stress. The situation was so bad at the hospital that I was questioned about extensive measures and did I want to be “revived” if things got worse. That situation also made my son’s illness worse since one of the things wrong with him is severe panic disorder and depression. He was there and had to witness the situation in the emergency room and hospital. I have no doubt in my mind at all that I was made sicker by worrying over this and fretting day in and day out. Loss of sleep, constantly trying to figure out “the right thing” only to find out that not even the IRS knows the “right thing” many times.

I found out about all this after the death of my mother and in the midst of dealing with a very difficult sibling. I wouldn’t have owed them a thing. In fact they owed me 600 dollars which I am afraid to claim. I still believe there are thousands of people who do not yet know about this at all!

I’ve had my tax forms prepared twice at quite an expense and I’m sure the paperwork is wrong and so have not sent it in. I have not done FBARS as I would need help with them and cannot afford it. My sons illness has flared really badly twice since I found out about this and some of his treatments are very expensive so any “extra” money I have goes to that. Not that we have any “extra” money!

How can anyone actually say how much they are affected by this since it just invades every area of your life. I haven’t been able to put this on the back burner and not worry about it even when something good is happening. As I said above I have one sibling who is a very, very difficult person and so telling my family I’m renouncing has been just peachy. That sibling will use this for the rest of my life to portray me as a “bad” person to other family members at every opportunity. So not only did it strain my marriage, it put me in the position of being a perpetual “black sheep” who will be “tolerated, pitied and disliked” an outsider, not “one of them” I’m so looking forward to having to deal with the dynamics that will go on once I have renounced. Some will know better but, others won’t.

Lately, this situation has lead to problems with my spouse because I haven’t renounced yet. It’s not that I don’t want to. I am terrified to go forward and file all that mess should a penalty be assigned to me. And tax payer advocate or not, I am just not in any physical shape right now to drag myself through such an ordeal. It’s GOT to be done but, this is such a catch 22!

This stupid witch hunt which people inside the U.S. think is going after the uber rich “off shoring” in “tax havens” has done more to harm low and middle income “targets” than anything I’ve seen them do down there in a long time. I have learned a hard lesson about what citizenship taxation is and what it means. I’m sickened by the comments I see on certain U.S. based articles. Is this who they really are?? Oddly, I think not. I think if it were happening to THEM they’d have a completely different opinion which makes them very selfish. The thing I am most angered about at the moment is that comment by President Obama last week that they are paying to fix their infrastructure by “repatriating taxes” First off that is a LIE, it’s NOT “taxes” It is fines and fees and penalties on paperwork nobody ever heard of outside the U.S. for the most part and they know it. If it were taxes it would even come close to being enough as according to American Citizens Abroad 82 percent of expats would owe zero taxes. Secondly, it told me that all this suffering was PLANNED. That they are NOT going to RBT and do not ever want to. That they know what they are doing and know no one inside the U.S. will care.

As some here have said it’s not the America we grew up in for those of us that did grow up there. Or maybe it is and we’re just now seeing how they operate with those that don’t live there. At any rate the feeling of betrayal and back stabbing runs deep. Like many of you I have spent decades here feeling I had to defend the U.S. at times and stand up for Americans because I felt many times they were all negatively portrayed and not all Americans are bad people. I had to deal with this daily since my mother in law was staunchly anti American. Coming to a new country and having to deal with her hurtful remarks was hard but, I DID win her over. Her and most people who got to know me well. I feel the U.S. is losing something they cannot get back. They can never make us back into good will ambassadors ever again. There was little justification for us to do that in many cases to begin with and now there will be none.

At any rate my main worry is keeping MY health up because my son needs me to be healthy. I can’t help him when he needs it if I go down too far. I’m just going to renounce, file what I can by sending it straight in and not going into any “program” as I do NOT trust ANY of their “programs” Why they would put families abroad who would not owe them a dime in taxes through this is beyond shocking to me. As Obama said they are going to rebuild their infrastructure by “repatriating taxes” NO it’s not “taxes” It is fines and fees and penalties on zero taxes owed in most cases. Who ever thought up such a plan and feels it is right is an immoral, vicious jerk.

I now believe there is no hope for them to resolve any of this with residency based taxation as the evidence and Obama’s comments show this was planned and is being done on purpose so why on earth would the let any minnows go and not penalize them?

115 thoughts on “Has your life been stolen from you by the IRS? Comment of the day”

  1. @kalc
    I hope you are right.
    @pacifica777
    Thank you for sharing your history and feelings.
    I can relate to much of what you wrote. My idiotic idealism also felt like you when I became a Canadian. I had hope that america was changing for the better at that time. It has not.
    My two b and e’s in early 90’s made me feel like you did with your fire experience. FATCA brought that feeling back. Violation. That is what I feel now.
    I will be looking forward to reading all the future comments on this post when I come back from my water holiday that I hope will replenish my soul, spirit and body, FATCA has taken its toll. It has taken the opposite effect of you, pacifica777 on me. I have gained 40 pounds. Once the fog of FATCA is lifted I know I will have better frame of mine. And kose that weight caused by fear and anger.
    @all
    Thank you for sharing your feelings and experiences and knowledge. It has helped me keep hope and keep my sanity.

  2. @Pacifica That was an awesome account of what you’ve had to suffer through, indeed quite gut-wrenching and seriously disturbing,

  3. @AtticusinCanada,

    Obviously there is no pain-free way out of this mess, but are you sure that renouncing is worth all the stress? Is it necessary for you to be able to travel to the USA?

  4. @Pacifica

    Your comment at 1:10 a.m http://isaacbrocksociety.ca/2013/08/14/has-your-life-been-stolen-from-you-by-the-irs-comment-of-the-day/comment-page-1/#comment-485415 is one of the most moving I have seen. I thank you for taking the time to compose it. Your integrating previous thoughts/comments reinforces what a hellish experience this has been and for how long.

    Interestingly, I think that your analogy to the arsonist and being caught in a burning building is an interesting one. You say:

    The worst thing that ever happened to me before this [being an alleged US person in 2011] was a fire 30 years ago. When this US mess started, I felt that it was “fifty or a hundred times worse” than the fire. As it drags on, I now feel that being trapped in a burning building was “a picnic in the park” compared to this US mess. And another thing, the US gov knows there’s a problem and they could help straighten out this mess, unlike the arsonist who was insane. I actually bore the arsonist no ill will, which turned out to be the best way to get on with my life. I would like to move on from this crisis the same way, but the US isn’t making it easy.

    I once commented on another thread:

    http://isaacbrocksociety.ca/2013/01/22/the-democrats-abroad-paradox-by-deckard1138/comment-page-1/#comment-154470

    Through ill advised legislation (which in most cases was not designed to target Americans Abroad) Congress left a lot of gasoline on the floor of a house occupied by Americans abroad. The current Democrats – (including Obama, Levin, Geithner) saw there was a lot of gas on the floor of the house of Americans Abroad. Recognizing this fact and opportunity, they then took some matches, lit a fire and torched the house of Americans Abroad leaving them to die. Again this is the current Democrat Party – not sure what part of this you don’t understand.

    The first time you “bore the arsonist” no ill will because he was insane. What about this group of arsonists? Are they insane? How does one move on with life without bearing these people ill will?

  5. While composing my last comment, I came across an amazing comment from Badger which really needs to be reproduced on this thread – this is one for the ages!

    http://isaacbrocksociety.ca/2013/01/22/the-democrats-abroad-paradox-by-deckard1138/comment-page-1/#comment-154286

    badger says
    January 22, 2013 at 11:54 am
    @Michael,

    It is hard to respond to you with any patience or forbearance. We have been hashing all this out for more than a year now, and some of us, like Roger Conklin, are longtime steadfast members of the ACA and other non-partisan international associations representing those deemed US citizens abroad – and through their testimony, we know that many of the things we’re angry about have their roots in decades past – and continue to be unjust decades later.

    But Obama and the Democrats have gone far, far beyond all the already existing – with the HIRE Act, and FATCA, and the manner in which they continue to criminalize us and through the manner their appointees choose to interpret, administer and enforce Treasury and IRS policies.

    The only ‘inclusiveness‘ we’ve experienced from the US in general, and
    Obama and the Democrats in particular is that we’re ‘included‘ in the
    broad general category of criminals, ‘tax cheats’ and shirkers ‘not
    paying our fair share’, and ‘hiding’ our ‘foreign’ bank accounts.

    This
    despite the full knowledge that many of us owe zero US tax. Many others
    are subjected to US tax on things that are not taxable (ex. principal residence,
    government registered savings plans) where we were actually born, or
    live and work – permanently. AND we have paid up our taxes where we live – in full. AND we pay other substantial taxes like our HST and GST and property taxes, that the IRS and US refuse to acknowledge and give us tax credits for. Many of us live and so pay taxes, in countries with a higher effective tax rate than the US.

    But despite having already paid one country’s tax bill in full, and generally owing no tax to the US, that is not sufficient. No, we must prove every year for life that we’re not criminals hiding ‘foreign’ assets – abroad. But, the catch is that ALL our accounts and assets are deemed ‘foreign’ – because we were born, and/or our permanent home is a ‘foreign’ country – outside the US. We must even report on our non-US employer’s accounts if we have a co-signatory power as part of our job. Or on our child’s local sports team fundraising account. Or our church if we’re a volunteer treasurer. And it goes much farther than that, but that is more than enough proof of US abuse and irrationality vis a vis those whose only ‘crime’ is being born and/or living a normal life outside the US.

    We’re forced to prove under the Bank
    Secrecy Act FBAR that we’re not terrorist funders, money launderers,
    drug lords, and criminal tax evaders – annually – forever and ever. That
    was a law very rarely used in the past, and in past practice, not applied to ordinary
    citizens on a proactively annual basis. But that is what governs the
    treatment of our legal local savings and accounts – only on the basis
    that they are ‘foreign’ – because they are outside the US. But, so are
    we – permanently, for life. We have no reason or opportunity to ‘hide’ anything where we live – because our accounts are all registered with our home country tax number and reported to the government here. We are automatically assessed and pay tax on it, now or when we earn anything on it. The banks issue notices to the tax agency automatically, and we must report it on our returns. But the US is not satisfied with the oversight of only the government where we live. Or to see those slips and those returns. No, that isn’t good enough. We are such criminals in waiting that we need the oversight of TWO governments – the one where we actually live, AND the US. And, we are all so immoral and so guilty, that fines and penalties must be all of huge size in multiples of ten thousand – assessed on legal post-tax accounts.

    I e-mailed my local Democrats Abroad about this – and got no reply. I attended a meeting – and listened to the lame and disingenuous claims that if we waited for an Obama and Democrat response until after the election, we’d surely be heard when a better time came, but that the election was the priority, and it was a bad time to raise our concerns.

    The US is persecuting us, and it has become very clear that things are only getting worse. We have no choice – the US is forcing us to renounce or relinquish if/and as soon as we can.

    And it is claiming our dual born children – who were born citizens of a non-US country, and have never set foot in the US. And also those deemed incompetent. They are effectively economic ‘taxable’ hostages – since they are not allowed to renounce, and we are not allowed to do it on their behalf. We are punished for contributing to their education savings plans, and they cannot get the grants that our home country would give them – because the US not only taxes it, it attaches punitive penalties and reporting to their very existence.

    We’re being savagely threatened and abused, and the Democrats are primarily to blame – currently they are at the helm, designing, implementing and steering so much of what we are presently suffering from. Obama appointed the “TurboTax did it” Geithner, and allowed him to stonewall the Taxpayer Advocate. Congress did not respond to her reports regarding the problems and injustices we are experiencing – which she flagged as of special concern. Geithner owed thousands, yet got off lightly – his tax omissions were deemed to be excusable – and he is a banker and worked for the IMF http://www.politifact.com/truth-o-meter/article/2009/jan/16/your-guide-geithner-tax-controversy/. Yet, an ordinary grandmother born and living ‘abroad’ where she is a Canadian citizen, who has already paid taxes to her home government in full – in Canada – with a little bank account in Canada, has to pay thousands in fees to satisfy the IRS that she owes zero – which is already obvious http://business.financialpost.com/2011/09/24/u-s-campaign-to-catch-tax-cheats-snaring-canadians/

    What good would ‘inclusiveness’ do us? I am non-partisan – I am not a member of any US party. At first I thought they just didn’t understand how we were effected. Then, I had to face the facts – that the US just wants our assets, and the assets of our children – though they were born abroad and only inherited the status via parentage. The US wants our entirely non-US created estates – and discriminates against the inheritance rights of our non-US spouses and children. The list of problems with the way the US treats us for extraterritorial citizenship-based tax and reporting burdens is too long to get into here.

    I now despise the US government and will shed my unwanted (and unsought) US citizenship status as soon as possible. It refuses to allow us any meaningful representation, cancelled any IRS services in our consulates and embassies. Provides no services to us abroad. Does nothing to make it simpler and easier to be and remain ‘in compliance’, and prevents us from having any normal banking and savings where we live. Deems all of our registered savings options to be ‘foreign trusts’. Refuses to make any same country exceptions. It interferes in all of our normal household financial planning with our non-US family, and seeks to gather revenues for the US domestic debt by any means possible – sucked out of us through penalties (ex. FBAR) that even the TAS has warned could possibly be open to a constitutional challenge (so disproportionate to the amounts in question, to be deemed ‘confiscatory’).

    IRS ‘education’ consists of threatening us in public statements, applying draconian laws and producing ever more complex and onerous reporting obligations – and adding new fines and penalties, eroding any protections re Statute of Limitations, etc.

    There are regular participants here who tended to be lifelong Democrats or most often Dem supporters, and who voted for Obama the first time. And some who would have voted for him in the last election. We tried to get our stateside representatives to respond on these issues – to no avail.

    But, Obama remained steadfastly silent on the issues we raised re FATCA, and problems we faced banking and saving local to where we live. While allowing all our legal, local, post-tax accounts to be treated by the US as if we were criminals. Though some of the roots of this came from the prior Republican administrations, Obama and the Democrats created the HIRE Act, and have continued to pile on the penalties and obligations – while not supporting Carolyn Maloney’s call for a Presidential Commission to look into our concerns.

    We were told that we had to wait until after the election to raise any concerns, that it was a bad time to be heard. And now, we’re after the election, and NOTHING. The Democrats even dropped those “abroad” as a ‘group of interest’ from their campaign platform from 2008 to the latest one – why? Obama pledged to be open to listen to our concerns. But then, NOTHING.

    Obama answered none of our letters and e-mails.

    We barely escaped paying the full Obamacare price – exempted at the last minute due to lobbying by ACA and others, but now find there is an adjunct tax to it – that is not exempt or offset by our tax treaty with the US, or our ‘foreign’ tax credits.

    I can’t swallow Joe Green’s (Democrats Abroad) recent claim that FATCA and the high cost of complying with the US tax and financial reporting laws for those ‘abroad’ is just the price we’ll have to continue to pay for the ‘privilege‘ of being US citizens.

  6. @Whitekat, yes it is absolutely necessary that I travel there. My siblings have a much harder time traveling here. One bil can’t fly due to breathing problems, my brother is almost never off work and my dad doesn’t fly anymore either. I would never see them again if I did not go there.

    @Pacifica, I am agreement with USCitizenAbroad, my god your comments are so moving. Reading what everyone has been through and is still dealing with, I can only shake my head. This is all so needless for them to be going this far and putting so many through such distress. Thank you for posting that. I feel honoured to have read it.

  8. @USCA, @Badger, that post is excellent! It lays it all out there! I’d love for the Globe reporter to see it! It so well sums up what is going on and that is not just a matter of “filing some papers” at all. Thank you posting it!

  9. @Money

    Leaving aside the specifics of your situation, what is your definition of:

    “worst case scenario”.

  10. It’s all the shifting sand that bothers me. My husband and I entered OVDI in good faith that we would be dealt with quickly and move on with our lives. 20 months and two additions years of tax returns later, we still haven’t resolved our issues with the IRS. Although I can appreciate that we may get a more favourable outcome with the wait, it is still an outcome worse that had we not been misled by the IRS into entering OVDI in the first place. What we thought would be an express lane to renunciation is a ditch filled with mud.

    Two words best describe how I feel right now: betrayed and ambushed.

  11. @northernstar – Regret I couldn’t get to the London meeting. Would love to know how it went.

    The journey to London is currently a daunting obstacle in my planning to renounce. A journey that I might once have made at the drop of a hat is going to take much preparation – all the more so when I can ill afford the cost of any mistakes. But I’m gradually putting the pieces into place….

    If I’m deeply honest, I guess this whole situation has left me a “coward”, where once I used to be a bold risk-taker – but for how long can one feel confident when one’s energies are all used on defensive measures against the huge hammer hanging over our heads, and almost every course of sensible action seems to come up against a dead end?

    A Big Thankyou to IBS and all of you who help us through this.

  12. Ignoring it might just work for a couple years, till….uh, something.
    But it all sure as heck makes it impossible to make a living. Can’t run, or even partially own a business if an individual must then report 700-1000 hrs of personal taxes back to US. That makes it pretty impossible to be a contractor which is pretty necessary in my line of work.
    Can’t move back to USA while still having “offshore accounts”, that’s a sure way to be an example on some lawyer’s webpage of huge offshore penalties..
    Can’t move to UK, can’t have any bank account there. Norway isn’t going to get any easier. UAE is the best place for oil jobs, and also the place where the IRS agents hang out looking for easy targets. Ditto Singapore.
    So, I guess its just best to have been made into a criminal tax evader by my best butty Barry.

  13. Perhaps I might give some practical advice: Think like a criminal! It shouldn’t be too hard since the US govt thinks you are one. A criminal knows he can be arrested by the police any time but does he let this get in the way of enjoying his life? Not at all. A criminal takes rational steps to avoid getting caught but he doesn’t obsess over it. Of course, this is hard if you’ve been a law-abiding citizen up to now but thinking like a criminal is much better for your mental health.

  16. Anybody has actually talked to a lawyer about extradition policy. Would the revenue rule prevent a problem for not filling USA taxes for a Canadian citizen resident and clean Canadian taxpayer.

  18. @money,

    I am not sure what the ‘revenue rule’ is that you are referring to, but I am personally not worried as a ‘clean Canadian’ about extradition due to my never having filed a US tax return in my life. That would be ridiculous. Wait, FATCA and CBT are also ridiculous, so never say never I guess.

    Seriously though, don’t go to the US, drop off the radar as a ‘US tax payer’ if you haven’t already, find a local credit union with assets under 175 mill, visit IBS frequently for moral support, and take Johnson’s advice.

  19. @money

    If you’re going to be damned as a criminal no matter what, then you may as well start thinking like one.

    If separating my joint accounts from my wife in order to protect her from the IRS makes me look like a criminal to the IRS, then fuck it. My first duty is to my marriage. Not my country.

  20. @USCA, thank you for finding and posting my comment. I am just happy to be able to contribute something useful here. IBS has helped me immensely.

    What reporters need to know as well – and to tell all the world; is that the irresponsible conduct and deliberate threats of the IRS and US, the insane complexity and unjust demands and draconian conditions attached to our “US taxable person” status, plus the incredible costs of legal and accounting professional fees, and all the other barriers to finding any effective remedy have come very close to literally stealing lives.

    I remember posts here that had us concerned that this would be the case. There have been some very dark nights and days. IBS has been literally a lifeline. It is unlikely that an individual will attest to that in the press using their real name but it is true. Some past threads here contain ample evidence of the singular depth of the fear, despair and anger experienced by readers and participants. And those are only the ones we know about because of the sharing here.

    The Taxpayer Advocate has received feedback on this issue via the SAMS as well – so the IRS continues to act willfully, punitively, and irresponsibly, with full knowledge of the potentially life threatening impact of what it is doing, and has done to us. US extraterritorial taxation and financial reporting laws and penalty structures threaten our very wellbeing, our security, and that of our non-US families.

    Canadian and other reporters also need to see the stark contrast between how the IRS and Treasury would treat a US resident with little or no US tax owing and legal local US-sited accounts vs. their punitive and unjust treatment of a similarly situated US-deemed ‘taxable person’ living in Canada or elsewhere on the planet, whose legal local accounts are held where they actually live, earn and already pay a full set of taxes – outside the US – but who hasn’t filed information reporting forms like the FBAR.

  22. The largest condom factory in the States burned down. President Obama was awakened at 4 am by the telephone.

    “Sorry to bother you at this hour, Sir, but there is an emergency! I’ve just received word that the Durex factory in Washington has burned to the ground. It is estimated that the entire USA supply of condoms will be used up by the end of the week.”

    Obama: “Oh damn! The economy will never be able to cope with all those unwanted babies. We’ll be ruined. We’ll have to ship some condoms in from Mexico ..”

    Telephone voice says, “Bad idea… The Mexicans will have a field day with this one. We’ll be a laughing stock.. What about Canada?”

    Obama: “Okay, I’ll call Stephen Harper and tell him we need five million condoms, ten inches long and three inches thick. That way, they’ll continue to respect us as Americans.”

    Three days later, a delighted President Obama ran out to open the first of the 10,000 boxes that had just arrived. He found it full of condoms, 10 inches long and 3 inches thick, exactly as requested… all colored with red maple leaves with small writing on each one:

    MADE IN CANADA – SIZE: SMALL

  24. @WhiteKat

    LMAO

    I’ve shared that condom factory story with my wife. Credted to you, of course. ;^)

  25. @mjh49783

    I can’t take credit either…found it in my email inbox this morning and thought this thread was a ‘good fit’.

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