Two very good articles from Amber Hildebrandt of CBC.
Article 1 – Introducing FATCA
#FATCA facts: What Canadians need to know about new U.S. tax law http://t.co/fOP2hnCPo5 – Decent article from CBC that conveys the danger!
— U.S. Citizen Abroad (@USCitizenAbroad) January 13, 2014
The article referenced in the above tweet, by Amber Hildebrandt, is good because it IS NOT focused on U.S. citizens in Canada. The focus is more on Canada and Canadians! This is a welcome relief and an indication that, slowly the media is beginning to realize what FATCA really is.
Excerpts include:
Who is affected by this law?
The short answer is almost every Canadian. It is expected to cost banks substantial amounts of money to implement the systems required to find residents with U.S. connections, costs the banks may well pass along to all their clients.
Some estimate it could cost $100 million for each financial institution.
Those directly affected by the law include dual citizens, Canadians with Green Cards and some snowbirds who spend considerable time in the U.S.
Article 2 – The Absurdity of Citizenship-based taxation
Ms Hildebrandt has also written a more specific article on the effects of U.S. extraterritorial taxation.
Disabled Canadian among 'accidental Americans' caught in U.S. tax quagmire http://t.co/clo75KVsNk
— Amber Hildebrandt (@cbcamber) January 13, 2014
Excerpts include:
A Calgary woman’s developmentally disabled son is caught in a U.S. tax quagmire that she fears may cost him the money she spent years setting aside for his financial future.
“He’s entrapped,” said Carol Tapanila, the 70-year-old mother. “There’s no way out. He is entrapped into U.S. citizenship.”
Her 40-year-old son was born in a Calgary hospital, but automatically received U.S. citizenship because both his parents were American. That simple fact may soon create financial woes for the Tapanila family.
Starting in July, a new U.S. tax law, the Foreign Account Tax Compliance Act (FATCA), goes into effect. It requires banks around the world to sift through client accounts to find anyone with U.S. connections and send that information to the U.S. Internal Revenue Service.
- Canadian banks to be compelled to share clients’ info with U.S.
- FATCA under fire from tax experts and Canadians
The law is aimed at Americans who are hiding offshore accounts, but the information sharing is likely to unearth many unsuspecting Canadians with U.S. citizenship, like Tapanila’s son, who didn’t realize they were required to file U.S. taxes.
Tax law expert Allison Christians calls the Tapanila case “ridiculous” and a “classic example of why the law is unjust.”
The law “was intended to find rich American tax cheats hiding out in Switzerland,” said Christians, who teaches tax law at McGill University, but it “will now punish poor, disabled Americans living in other countries, who are only American by birth.”
These so-called “accidental Americans” also include an Ottawa woman who was born in the U.S. to Canadian parents and moved back north at one year of age.
This woman, who asked to remain anonymous, said her husband is livid that their joint account information will soon be shared with U.S. tax authorities.
Both fear that FATCA will reveal her U.S. citizenship and saddle them with hefty penalties for failing to file U.S. tax returns that will eat into their retirement savings.
“It’s stressful. I think about this every day,” said the woman. “It’s like a big weight over your head that never really goes away, and I’m starting to wonder when and if it’s ever going to go away?”
Listen to CBC radio news, every hour on the hour. Hat tip to Badger.
My daughter-in-law in Toronto sent me an email this morning that Metromorning on CBC Toronto will be airing the story, but so far it isn’t on the Metromorning website (last time I checked anyway).
… that’s CBC Radio (One, I think) not TV … in Toronto, at least so far. I wonder if the National on TV will be covering this tonight or, dare we hope, the At Issue Panel at some point?
any link to the news story on the radio would be appreciated. It is beginning to look like the 13th is a lucky day when it comes to FATCA awareness breakthroughs… Multiple stories print and radio media. Still need TV, but you take what you get and run with it. Nice gift as payment for a lot of hard work by Brockers!
@Just Me
I can’t find any podcasts for news here, but maybe you’d have better luck (skill):
https://soundcloud.com/cbc-radio-one
@bubblebustin, my spouse poked me when he heard the word FATCA. Our brains now respond whenever we hear it – even if semi-conscious. I was worried that it was on the CBC news as an announcement that Canada has/had given in and signed us away via an IGA. We know from the Credit Union newsletters http://webcache.googleusercontent.com/search?q=cache:mi8aXA_ozuQJ:www.cucentral.ca/_layouts/download.aspx%3FSourceUrl%3Dhttp://www.cucentral.ca/Connections/Connections%2520Dec%25202013%2520FATCA%2520FINAL.pdf+&cd=3&hl=en&ct=clnk&gl=ca&client=firefox-a http://www.cucentral.ca/Connections/FATCA%20Final.pdf http://www.cucentral.ca/Connections/FATCA%20Anxiety%20Increasing%20FINAL.pdf a while back, that though the banks are being apprised behind the scenes all the way, Flaherty, Harper and the rest of our very own federal government – (who is supposed to be transparent and accountable to ALL Canadian citizens and Canadian accountholders (the true owners of the legal local savings in question) and Canadian voters and Canadian taxpayers) may hold back public confirmation or announcement of an IGA until weeks afterwards ( presumably so that accountholders don’t bolt?).
The stories don’t underscore that not only will ALL Canadian accountholders pay more in banking fees, but: ALL Canadian citizens and Canadian accountholders (the true owners of the legal local savings in question) and Canadian voters and Canadian taxpayers will pay in higher taxes to have the CRA constantly collecting, remitting and updating information on millions of accounts and automatically sending the data on to the IRS and US Treasury. And the information is NOT just the account interest it collects for Canadian taxation – it is ALL the balances, withdrawals, deposits, transactions, etc.
What lucky private corporate interest will get the plum contract to design and implement all that discriminatory Charter-abridging Constitution-conflicting extraterritorial reporting to a foreign government = the US – at a wasteful astronomical and useless cost to Canadian taxpayers? No doubt CGI is available – since no longer working on either Ontario’s e-health project http://www.theglobeandmail.com/news/national/ehealth-ontario-cancels-462-million-diabetes-registry-contract/article4552573/ , and being removed from the Obamacare site work http://www.theglobeandmail.com/report-on-business/international-business/us-business/washington-to-replace-cgi-on-troubled-obamacare-website-report/article16279965/ http://www.montrealgazette.com/business/technocite/Accenture+wins+Obamacare+contract+after+snafus/9380188/story.html .
Opportunities to comment on the online stories and add info that is missing and the Canadian public needs to know.
And I don’t see why we can’t give only our first names if calling in to CBC and commenting on the Matt Galloway interview this morning with Gwen http://www.cbc.ca/metromorning/contact/
@Badger
I once had a banker tell me that the cost for his bank to implement FATCA would be a ’rounding error’ , but it wouldn’t do anything for the bank’s image to let that be widely known, would it? Not to mention that all of these costs are tax deductible in Canada.
bubblebustin, re; “..but it wouldn’t do anything for the bank’s image to let that be widely known, would it?…
They already have an image problem.
We can choose NOT to use a BANK. We can choose a credit union instead and urge others to do the same – even under a FATCA IGA.
FATCA FACTS — yes! And even though it’s just the facts it takes a very Canadian centric viewpoint. This is very good. Three big hi fives to CBC today for 2 good articles and a radio interview.
Basic FATCA information was mentioned in the local news portion (6:30 a.m., 7:30 am. at least) of Ontario Morning which is broadcast from London and covers Ontario not covered by Toronto, Ottawa and Northern Ontario stations.
Huffington Post Canada also published the main CBC article.
Great articles. Finally, the media is getting it.
? why do readers believe credit unions are exempt?
Credit unions are provincially regulated, which adds a whole other layer of complication.
(In Manitoba, we might see an interesting test of the NDP’s opposition to FATCA, as the NDP government there would have to pass enabling legislation.)
@broken man, I think Quebec might be an obstacle too. It could be an issue of sovereignty, and they do have a unique tax relationship with the federal government.
@SAMUEL S.
See these newsletters from Credit Union Central of Canada. The World Council of Credit Unions has been fighting FATCA on the basis that credit unions are local and serve only residents, they are not international like banks can be. The smaller ones MAY (posited but not proven) end up being exempted somewhat because they are seen as posing only a small to zero risk of aiding and abetting US tax evasion. They serve only local members. There is no certainty to be had right now.
Plus in my opinion, the CBA members worked against their accountholders by lobbying secretly behind the scenes to push the Federal government and Finance Ministry to sign ON to a FATCA IGA and abandoned their initial protests against it. In my view, then they decided that it was better to foist as much cost and liability onto the backs of the federal government, ALL Canadian taxpayers to pay to implement it, and ALL accountholders to pay for the necessary and ongoing IT and administration of FATCA forever and ever. I don’t want to reward those I see as eager and willing collaborators who actively promoted the signing of a FATCA IGA. Credit Unions may be forced to comply, but were not willing FATCA lobbyists in my opinion.
Just the way I see it.
Here is what I read about credit unions in Canada;
http://www.cucentral.ca/Connections/FATCA%20Anxiety%20Increasing%20FINAL.pdf.
https://www.google.ca/search?q=%22credit+union+central%22+connections+fatca&ie=utf-8&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&gws_rd=cr&ei=w2TVUurJKoG-qwHq1YD4DQ#q=%22credit+union+central%22+AND+connections+AND+fatca&rls=org.mozilla:en-US:official
Here is pushback from US credit unions and the World Council of Credit Unions support the Republican National Committee call for the repeal of FATCA. …”The World Council of Credit Unions supports the adoption of the draft RNC resolution. “We share the concern that FATCA, if left in place, will impose billions of dollars of compliance costs on credit unions and other financial institutions annually,” said World Council President/CEO Brian Branch….”… from http://www.cuna.org/Stay-Informed/News-Now/Washington/Call-for-FATCA-Repeal-Could-Gain-Momentum/
I see no such equivalent call from the CBA or the IIAC in Canada. They keep insisting it is like ‘protesting against winter’…… and urging we surrender and bend over.
@Badger and BubbleBustin
Yesterday you wrote of rounding errors. I looked it up and go this.
http://www.declineoftheempire.com/2012/02/a-rounding-error-for-banks.html
You are so right Badger…It does not do for the banks image, eh?
@Bubblebustin
was that banker one of the ones in the CBA conference in November?
@northernstar
Good find. Rounding errors can add up!
@All
FATCA rising in Canadian Media
Here is Alison Christian and Marco G. Latest on their blog.
http://taxpol.blogspot.ca/2014/01/fatca-rising-in-canadian-media.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed:+TaxSocietyCulture+(Tax,+Society+%26amp;+Culture)
@Northernstar…
If you don’t mind, I think I will put your comment over on the post by U.S.Citizenabroad that has Allison’s name in the headline. 🙂
http://isaacbrocksociety.ca/2014/01/13/allison-christians-cbc-interview-on-fatca-and-u-s-citizenship-based-taxation/comment-page-1/#comment-980372
@Just Me.
No Problem. put in my comment by all means.
The comments on the CBC piece (the one with calgary411) are over 2000 now. WOW!
Teehee, Em!
I check once in awhile, but only read and respond to the last 10 or so now. I see our very well informed Tdott’s over there enlightening people, so I won’t bother. Maybe we should take shifts 🙂
For new readers of this blog:
We know that it is possible and perhaps anticipated that the Harper government’s Ministry of Finance may plan to sign on to a FATCA IGA and delay any public notice. We know for certain that they do not intend any parliamentary or public debate. This is the only public notice they have given http://www.fin.gc.ca/treaties-conventions/notices/unitedstates-etatsunis-eng.asp – and it appeared quietly and stealthily 2012-11-08 in a place no average Canadian citizen, taxpayer and voter would have thought to look – (except that thankfully ) one of us was!
Everyone, feel free to bombard the Ministry of Finance with your comments and oppostion to FATCA (I like to call it the FEED AMERICA by TAXING CANADIAN ASSETS act, or FUND AMERICA: TAKE CANADIAN ASSETS act):
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
RE:
“Negotiation of an Information Exchange Agreement with the United States” (FATCA)
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
For further information contact:
Kevin Shoom
Business Income Tax Division
613-992-2980
ALSO,
cc to your MP http://www.parl.gc.ca/MembersOfParliament/MainMPsCompleteList.aspx and any other MP you can think of,
including the NDP Shadow Cabinet’s Murray Rankin http://murrayrankin.ndp.ca/more-contact http://www.ndp.ca/shadow-cabinet ,
Green Party Leader Elizabeth May http://www.greenparty.ca/contact ,
and
Liberal Party Scott Brison and Ted Hsu
They have all been asking questions and pointing fingers at FATCA – particularly the very early efforts by the NDP (MP Mai http://hoangmai.ndp.ca/ (Questions in Parliament http://openparliament.ca/debates/2012/3/14/hoang-mai-1/ ) plus joint letter from the NDP BC Caucus and efforts by other individual NDP MPs across Canada http://andysundberg.weebly.com/1/post/2012/04/canadian-mp-trying-to-help-expats-fight-fatca.html ) and Green Party Elizabeth May – who proactively got the FOI for the letter from Constitutional scholar and lawyer Peter Hogg to the Finance Ministry and posted it for all to see on the Greens website http://www.greenparty.ca/media-release/2013-03-13/implementation-fatca-likely-unconstitutional-says-leading-constitutional-ex . Lately, there are the efforts of Liberals Ted Hsu http://www.tedhsu.ca/contact.html (Kingston) and Scott Brison http://www.brison.ca/contact.asp . There were also objections to the aggressive extraterritorial US incursions by MP Ralph Goodale http://openparliament.ca/debates/2011/9/30/ralph-goodale-1/only/ .
This is not an exhaustive list, as some are no longer MPs (ex. the excellent Denise Savoie who stepped down for health reasons, but who wrote to Obama in protest http://isaacbrocksociety.ca/2012/04/23/letter-from-mp-denise-savoie-to-president-obama-4-2/ and who had a great FATCA section on her website http://andysundberg.weebly.com/1/post/2012/04/canadian-mp-trying-to-help-expats-fight-fatca.html ).
You can search this site to see more information about who asked questions in Parliament re FATCA, FBAR, and other related queries about US taxes and what was said. For example:
http://openparliament.ca/search/?q=fatca
http://openparliament.ca/search/?q=fbar
http://openparliament.ca/search/?q=IRS+AND+canadians+AND+tax*
@Badger…
That is a good summary of action for Canadians to take.
Just a suggestion: I would make it a separate post, and also links to the Isaac Brock pages for a better reading of the questions that Scott Brison and Ted Hsu have submitted but NOT GOTTEN ANSWERED!
yesterday was my 3rd attempt to get an answer from my Conservative mp. this e mail had a link to the cbc.ca website and story
yup….3 emails and nothing but crickets from him and he certainly knows who i am as we have sat in the same small room for a couple of different meetings and had photo ops together.
very disapointing to not even get a yup got your e mail and will look into it more……
@Just Me, I guess it is (past) time for me to learn how to do that!