397 thoughts on “The Canada United States FATCA Intergovernmental Agreement”
@Petros
@Cerium398
Does anything in the IGA obligate or allow financial insitutions to demand birthplace info on previously existing low-value accounts <$50000 ?
Subsection 162(6) of the Income Tax Act
The fine is $100 they cannot keeping sending in a new request. If you refuse first time.
I was just wondering if the IGA has actually influenced anyone to change their strategy? Many on us clearly don’t have anything in out bank files to indicate “U.S. person” status so it would be impossible for banks to identify us. The main concern before the IGA seemed to be that banks would close out accounts if they did find out, but the IGA seems to prevent that. So, given all of this…is there any urgent reason now to comply with FATCA (at least for those Canadians who do not plan to set foot in the U.S. again)? Still so confused about what to do next.
I think it’s great that RRSP’s and other savings vehicles are going to be exempt. At least that’s one win for Canada.
My big concern is not so much with personal accounts since you can arrange your life so that the banks never bother you.
I’m very concerned about accidental Americans who are rising in the ranks of the companies they work for, especially those who work in small companies and may soon become say the President of the company who has signing authority on a very large account belonging to his employer who is a wholly Canadian owned company.
This loophole could mean that accidental Americans can’t accept high level promotions because it will put their employer in the sights of the IRS.
I really had hoped that the Canadian government would have worked out an easy solution for long time Canadian citizens to show that they had meant to relinquish their US citizenship when they became Canadians. I’m still hoping against hope that’s still possible in the near future. My husband became a Canadian citizen in 1980 and had assumed he lost his US citizenship. In fact, the whole reason he became a Canadian was to lose US citizenship. Back then it was a given that becoming Canadian meant you were no longer an American.
I made sure non-excluded cash accounts are below $50,000. Can rest easy. I have an accent. Do not have to worry about anybody even bothering to ask now.
Just posted this on the FATCA questions thread:
Desjardins, Canada’s largest credit union, now has an FAQ on FATCA for its members:
Some important points:
1. No regrets, no Sorry we have to do this
2. No mention of account balance thresholds
3. They threaten to close accounts of those who refuse to furnish info
I just used their online info request form to find out whether they intend to ask for US person info on all preexisting accounts. or whether they will be using the 50000 threshold.
@omgheesstillanamerican I don’t think your husband is still American. If he swore an oath of allegiance to the Queen and it was before 1995, then he’s relinquished and can get a CLN. He can go to the freedom of information page at the government of Canada and request his citizenship file for $5. Then he has all the ammo he needs for a CLN.
@Nick I would just continue to make the plans you have been to protect yourself. I plan to move to a small CU but really only to give the capitulating traitorous banks the finger even with them not having any knowledge about my US status.
Canada became the latest nation this week to ink a deal with the United States Treasury regarding FATCA, the Foreign Account Tax Compliance Act. There are privacy advocates and constitutional scholars in every country that object to FATCA but nowhere have folks been more vocal in their opposition than in Canada.
From Credit Union Central of Canada (NOTE: lack of concern for members of the credit unions):
TORONTO, February 5, 2014 — Today, the Canadian government released the long-awaited Intergovernmental Agreement (IGA) that sheds new light on the obligations of Canadian financial institutions, including credit unions, under the American Foreign Account Tax Compliance Act (FATCA). http://www.fin.gc.ca/n14/14-018-eng.asp
Credit Union Central of Canada (Canadian Central) has been working for more than two years with Department of Finance and Canada Revenue Agency (CRA) officials, alongside other national financial services trade associations, to ensure that the IGA addresses some of the circumstances and needs of Canadian financial institutions, especially small locally based financial institutions such as credit unions. We are pleased that the IGA contains relief from compliance obligations for Canadian credit unions with assets less than $175 million US and reduced compliance for those credit unions with at least 98 per cent of deposits by value held by residents of Canada.
To supplement the IGA, CRA will issue a “Guidance” document for financial institutions within the few weeks. This will be a key document to assist credit unions to understand their compliance and reporting obligations. CRA will also issue consumer information relating to FATCA prior to July 1, 2014. Draft legislation to implement the terms of the IGA and Explanatory Notes was also released later today. http://www.fin.gc.ca/drleg-apl/2014/can-us-eu-0214-eng.asp
Canadian Central is reviewing the IGA and draft legislation and will prepare a summary of key provisions for credit unions. Webinars will also be scheduled. To find FATCA information for credit unions, please see Canadian Central’s FATCA webpage (member login required): http://www.cucentral.ca/r.aspx?ID=c2vn
Inquiries about today’s announcement may be referred to David Phillips at phillipsd@cucentral.com
@OMG; It’s good to see you posting. I missed you.
GwEvil: If I recall correctly from OMG’s posts long ago, her husband was a minor when he became a Canadian citizen in 1980. There are complications minors even though he has lived since then as Canadian only.
@Em: Looks like Credit Unions are drinking the FATCA Kool-Aid too.
From Brian’s article
“The penalty for not filing FBARs can be huge; up to the greater of $100,000 or 50% of the highest historical account balance per account.
Although the IRS routinely imposes those high penalties…”
More fear mongering.
@blaze & omg ok yes that changes things >:(
@noone I used to get scared hearing that sort of thing, but now I just say “too bad” in the words of George HW Bush “not gon doit”. They can send me all the threatening letters they want and I’ll make a collage to hang on my wall.
@GwEvil
Glad your sense of humour is still in tact 🙂
I missed you too Blaze. You have a great memory. Yes my husband was 16 at the time he became a Canadian citizen. That’s one of the reasons we want to remain below the radar just in case it makes a difference. Also he had a legal name change right after he became a Canadian which makes things even a little bit more complicated.
The reason he became a Canadian at 16 instead of waiting to turn 18 is because his mother was concerned that Reagan was a lunatic war monger and would draft her boys into the army. I don’t believe they ever had a draft but she was afraid of it. She died of cancer shortly after he and his 17 year old brother became Canadians. At least she died in peace knowing they’d never fight a war for the Americans.
Also, I believe my husband and his brother may have been born as dual citizens since their mother was a Canadian before she went down to live in the US. Their father was US only and he never lived in Canada (they divorced and she returned to Canada with her boys).
@GwEvil
I heartily wish that all of us could do your route of making an “objet d’art” of IRS correspondence…… and I am counting the days until I retire as a “pure” UK citizen and hoping when USG DO finally get round to publishing my name in the Federal Register they commit a spelling booboo so I don’t show up too high in internet searcheS!!
we are with our Canadian bros and sisters in the FATCA “no”‘hood …I just like to wait for the day when Petros or someone sends us all a link where we can contribute a mite of money to the Rights Charter challenge that we in the UK really really reallly hope you make…..
keep up the good fight. watch the US tourist, investment and trade numbers go south and consulates start to get overwhelmed with renunciation appointments …….. not least of all my grief is a once glorious country losing a lifeline coz its overseas nationals cant wait to flee
did anyone see Steven Mopsick’s latest post? ok he is still apologist for CBT but what struck me was the genuine sense of regret at the aggressive pursuit of nonsensical laws and the step change that he acknowledges -there is no consent of the governed, it is coercion against which Victoria Ferauge rightly identifies the only remedy- the ” weak person’s weapon”-renunciation
@Petit Suisse
There seems to be language in the IGA that allows Banks to go under the $50,000 de-minimis limit, if Canada allows such an election.
Will the Banks make that election? BMO, for example, has over 9 million customers. Are they going to send everyone a form asking to affirm or deny US Personhood?
The Customer File has the fields which can potentially capture US Indica; I’m sure someone has developed a program that will sift through the database and return potential US Persons. It will then most likely be up to some Compliance group in a back office to contact the account holder and confirm or deny US Person status.
@Nick
Those who are under the $50,000 limit are fine; or those who find themselves in the category of “Low-Value Account” ($50,000 to under $1,000,000)
the bank only is supposed to search the Electronic Customer File. If there is no US Indica, they leave you alone. Once US Indica appears, then they start asking questions.
Those that are over $1,000,000 who are “High-Value Account”, have much more difficulty in hiding. In addition to the electronic search, the Bank also searches the hard copy of the Customer File. Also, if you are that rich you have a Relationship Manager or Financial Advisor at your bank; if that person knows you are an American, they are obligated to report it.
Even though I have no electronic indica, decided to make sure I am below $50,000 threshold. Thank God for being married to a Canadian with a different surname.
@omgheesstillanamerican
When your husband was born in 1964, you needed a Canadian father to be declared a Canadian at birth (born abroad). However, the Canadian law was changed retroactively in 2009 to include mothers, so he can just apply for a certificate that says he was a Canadian since birth. It’s useful to have in case he ever decides to renounce and file taxes with the IRS. It’s also a wonderful keepsake from his long-passed mother. He would also be exempt from the two financial tests for determining covered-expat-ness.
Claiming relinquishment for a minor who obtained Canadian citizenship is difficult or impossible, even though hte old laws seem to indicate it was legally possible at the time. @Benedict Arnold Be Me tried last year but it was denied. Fortunately for him, he had worked for the BC Provincial government in the 70’s and the DoS accepted that as his relinquishing act.
Also, I believe my husband and his brother may have been born as dual citizens since their mother was a Canadian before she went down to live in the US. Their father was US only and he never lived in Canada (they divorced and she returned to Canada with her boys).
@OMG
Changes to the Citizenship Act in 2009 mean that your husband and his brother are Canadian citizens with an “effective date of citizenship” being their dates of birth. I’m in the same boat as your husband re being born in the US to a Canadian mother, non-Canadian father. Last year I applied for and received an updated Citizenship Certificate which shows my “effective date of citizenship” (that’s the phrase used on the Certificate) as being my DOB.
Our MP, Alex Atamanenko is having an informational meeting Tues Feb 11, I sent this letter to him through his assistant, Gail
Good Morning, Gail,
Thank you for Alex’s response. Regarding the public information session on Tues.
RE: ‘I want to stress that this is not a political forum on the issue; it is intended to provide factual information to individuals like yourself who simply don’t know what they have to do, how to do it, or if they have to do it. Alex is providing a panel of experts in US tax, US/ Canada immigration and investment & estate planning.’
If they have not been following the march of the ‘FATCA’ troops, people affected that attend the forum will likely learn the requirements to ‘comply’ with the laws imposed on them by the US. Personally, we have been researching for months, and the link below has been an invaluable source of current information and personal experience. My thanks to Debbie Affolter for the warning article in 2011? approx. in the newspaper, on ‘Uncle Sam wants You’. The side bar on the link is very informative and updated daily.
The Isaac Brock Society has a wealth of information from Expats/Duals, and accidental Americans who are trying to figure out what to do about the IGA. They are not the ‘wealthy offshore’ people the US was purported to be targeting. They are similar to ourselves, with modest resources. Some have saved for their senior years so as to not be a burden to their families and the welfare system. And now they find they may be decimated to the point of living on social assistance by 2017. This is no exaggeration, as the 2-pronged pirchfork is not only FATCA, but FBARS with their arbitrary backdated penalties in the $100’s of thousands. I know nothing about US tax laws, capital gains on principal residence, estate taxes, and so on. We will however, learn about them as soon as we become a US-owned Protectorate coming soon by the looks of it. The IGA is just the beginning.
My emotional meter goes from anger, to frustration, to despair, to tears. I get at most 4-5 hrs of sleep, so assume my health will suffer in the long term. The stress of no one in the Conservative Cnd government really caring how many affected people they throw under the bus, (damn the Charter of Rights and Freedoms, Privacy Laws, and protection under Cnd citizenship- besides the drain on Cnd resources). Was it that the banks and financial institutions were more important than the Cnd citizens and long-time residents, with the threat of 30% withholding impacting their astronomical profits? Looks like it.
Please relay this question to Alex: Why is there no protection in the Charter of Rights and Freedoms from this plunder, for me, a Canadian citizen spouse with no US connections except through marriage? All funds in our joint account are eligible for extortion by the IGA. There is no division of joint assets–no matter if the contribution to the joint account of the non-US spouse is up to 100%!
I appreciate Alex’s assistance.
This is NOT fear mongering, but a word of caution about the so called “Safe Harbor” on the $50K aggregate… I would NOT take comfort in that.
It has been said before on IBS, but let me repeat it…
When you think about the reporting requirements by the FFIs that have to design software systems, this is a pain in the ass to do.
What do they care if some U.S Person is over or under the $50K across multiple accounts and financial products which they have to aggregate?
If I were them, I would just say…”F it.”.. Is this a U.S. Person? Answer…Yes, Report them. End of story… Let the IRS or the CRA sort it out! It is NOT my problem to protect those under $50K!
The $50K threshold is NOT a requirement that they HAVE TO EXCLUDE THEM, it is just a requirement that if they are over the threshold they HAVE TO REPORT THEM.
Nothing says they can’t report ALL, that I read, and I stand to be corrected. I hope I am wrong!
Frankly, that is what I would do if I were the operations manager of the software team!
Also, this has been reported by Deloitte and Touche as what some FFIs are doing… And frankly from a practical matter why wouldn’t you?
So, stay cautious about what you think might happened as it relates to the $50K de minimus rule.
Looking at the FATCA agreement, every section that describes exemptions (such as the $50,000 threshold) begins with the words “Unless the Reporting Canadian Financial Institution elects otherwise…”.
Are you going to bank on that?
With regards to transferring non-registered funds (well over $50,000 in mutual funds) to a Canadian spouse here in Canada prior to July 1, 2014:
Does everyone agree that this is perfectly safe and that the funds will never be reported under FATCA?
Would this trigger a capital gain for the original owner? Or, do we have a gifting provision in Canada?
@OMG
so glad to hear from you. (I was nobledreamer.). Your situation is definitely tricky.I don’t know enough about that particular side of it but sure hope there’s going to be a little hole to slip through somewhere.
@always something says,
Your description of your “emotional meter” is painful to relive-as we all know how horrible this is to come to terms with. The only way I could make it stop was to get out. My Canadian-only spouse simply could not understand what I was worried about and assumed they would never find me. Though over time, I believe he came to understand it was HIS money that was at risk. He never really appreciated how difficult it was for me to renounce. Though I can’t think of any support that would have relieved the sleeplessness, endless anxiety, etc. Try to have some hope. You WILL get through this.
@Petros
@Cerium398
Does anything in the IGA obligate or allow financial insitutions to demand birthplace info on previously existing low-value accounts <$50000 ?
Subsection 162(6) of the Income Tax Act
The fine is $100 they cannot keeping sending in a new request. If you refuse first time.
I was just wondering if the IGA has actually influenced anyone to change their strategy? Many on us clearly don’t have anything in out bank files to indicate “U.S. person” status so it would be impossible for banks to identify us. The main concern before the IGA seemed to be that banks would close out accounts if they did find out, but the IGA seems to prevent that. So, given all of this…is there any urgent reason now to comply with FATCA (at least for those Canadians who do not plan to set foot in the U.S. again)? Still so confused about what to do next.
I think it’s great that RRSP’s and other savings vehicles are going to be exempt. At least that’s one win for Canada.
My big concern is not so much with personal accounts since you can arrange your life so that the banks never bother you.
I’m very concerned about accidental Americans who are rising in the ranks of the companies they work for, especially those who work in small companies and may soon become say the President of the company who has signing authority on a very large account belonging to his employer who is a wholly Canadian owned company.
This loophole could mean that accidental Americans can’t accept high level promotions because it will put their employer in the sights of the IRS.
I really had hoped that the Canadian government would have worked out an easy solution for long time Canadian citizens to show that they had meant to relinquish their US citizenship when they became Canadians. I’m still hoping against hope that’s still possible in the near future. My husband became a Canadian citizen in 1980 and had assumed he lost his US citizenship. In fact, the whole reason he became a Canadian was to lose US citizenship. Back then it was a given that becoming Canadian meant you were no longer an American.
I made sure non-excluded cash accounts are below $50,000. Can rest easy. I have an accent. Do not have to worry about anybody even bothering to ask now.
Just posted this on the FATCA questions thread:
Desjardins, Canada’s largest credit union, now has an FAQ on FATCA for its members:
https://www.desjardins.com/ca/FAQ/index.jsp?sectionId=2&sousCategorieId=129&categorieId=8
Some important points:
1. No regrets, no Sorry we have to do this
2. No mention of account balance thresholds
3. They threaten to close accounts of those who refuse to furnish info
I just used their online info request form to find out whether they intend to ask for US person info on all preexisting accounts. or whether they will be using the 50000 threshold.
@omgheesstillanamerican I don’t think your husband is still American. If he swore an oath of allegiance to the Queen and it was before 1995, then he’s relinquished and can get a CLN. He can go to the freedom of information page at the government of Canada and request his citizenship file for $5. Then he has all the ammo he needs for a CLN.
@Nick I would just continue to make the plans you have been to protect yourself. I plan to move to a small CU but really only to give the capitulating traitorous banks the finger even with them not having any knowledge about my US status.
@
Brian writing again…
United States Welcomes Canada’s Participation in FATCA – Uncertainty Remains, However
From Credit Union Central of Canada (NOTE: lack of concern for members of the credit unions):
TORONTO, February 5, 2014 — Today, the Canadian government released the long-awaited Intergovernmental Agreement (IGA) that sheds new light on the obligations of Canadian financial institutions, including credit unions, under the American Foreign Account Tax Compliance Act (FATCA). http://www.fin.gc.ca/n14/14-018-eng.asp
Credit Union Central of Canada (Canadian Central) has been working for more than two years with Department of Finance and Canada Revenue Agency (CRA) officials, alongside other national financial services trade associations, to ensure that the IGA addresses some of the circumstances and needs of Canadian financial institutions, especially small locally based financial institutions such as credit unions. We are pleased that the IGA contains relief from compliance obligations for Canadian credit unions with assets less than $175 million US and reduced compliance for those credit unions with at least 98 per cent of deposits by value held by residents of Canada.
To supplement the IGA, CRA will issue a “Guidance” document for financial institutions within the few weeks. This will be a key document to assist credit unions to understand their compliance and reporting obligations. CRA will also issue consumer information relating to FATCA prior to July 1, 2014. Draft legislation to implement the terms of the IGA and Explanatory Notes was also released later today. http://www.fin.gc.ca/drleg-apl/2014/can-us-eu-0214-eng.asp
Canadian Central is reviewing the IGA and draft legislation and will prepare a summary of key provisions for credit unions. Webinars will also be scheduled. To find FATCA information for credit unions, please see Canadian Central’s FATCA webpage (member login required): http://www.cucentral.ca/r.aspx?ID=c2vn
Inquiries about today’s announcement may be referred to David Phillips at phillipsd@cucentral.com
@OMG; It’s good to see you posting. I missed you.
GwEvil: If I recall correctly from OMG’s posts long ago, her husband was a minor when he became a Canadian citizen in 1980. There are complications minors even though he has lived since then as Canadian only.
@Em: Looks like Credit Unions are drinking the FATCA Kool-Aid too.
From Brian’s article
“The penalty for not filing FBARs can be huge; up to the greater of $100,000 or 50% of the highest historical account balance per account.
Although the IRS routinely imposes those high penalties…”
More fear mongering.
@blaze & omg ok yes that changes things >:(
@noone I used to get scared hearing that sort of thing, but now I just say “too bad” in the words of George HW Bush “not gon doit”. They can send me all the threatening letters they want and I’ll make a collage to hang on my wall.
@GwEvil
Glad your sense of humour is still in tact 🙂
I missed you too Blaze. You have a great memory. Yes my husband was 16 at the time he became a Canadian citizen. That’s one of the reasons we want to remain below the radar just in case it makes a difference. Also he had a legal name change right after he became a Canadian which makes things even a little bit more complicated.
The reason he became a Canadian at 16 instead of waiting to turn 18 is because his mother was concerned that Reagan was a lunatic war monger and would draft her boys into the army. I don’t believe they ever had a draft but she was afraid of it. She died of cancer shortly after he and his 17 year old brother became Canadians. At least she died in peace knowing they’d never fight a war for the Americans.
Also, I believe my husband and his brother may have been born as dual citizens since their mother was a Canadian before she went down to live in the US. Their father was US only and he never lived in Canada (they divorced and she returned to Canada with her boys).
@GwEvil
I heartily wish that all of us could do your route of making an “objet d’art” of IRS correspondence…… and I am counting the days until I retire as a “pure” UK citizen and hoping when USG DO finally get round to publishing my name in the Federal Register they commit a spelling booboo so I don’t show up too high in internet searcheS!!
we are with our Canadian bros and sisters in the FATCA “no”‘hood …I just like to wait for the day when Petros or someone sends us all a link where we can contribute a mite of money to the Rights Charter challenge that we in the UK really really reallly hope you make…..
keep up the good fight. watch the US tourist, investment and trade numbers go south and consulates start to get overwhelmed with renunciation appointments …….. not least of all my grief is a once glorious country losing a lifeline coz its overseas nationals cant wait to flee
did anyone see Steven Mopsick’s latest post? ok he is still apologist for CBT but what struck me was the genuine sense of regret at the aggressive pursuit of nonsensical laws and the step change that he acknowledges -there is no consent of the governed, it is coercion against which Victoria Ferauge rightly identifies the only remedy- the ” weak person’s weapon”-renunciation
@Petit Suisse
There seems to be language in the IGA that allows Banks to go under the $50,000 de-minimis limit, if Canada allows such an election.
Will the Banks make that election? BMO, for example, has over 9 million customers. Are they going to send everyone a form asking to affirm or deny US Personhood?
The Customer File has the fields which can potentially capture US Indica; I’m sure someone has developed a program that will sift through the database and return potential US Persons. It will then most likely be up to some Compliance group in a back office to contact the account holder and confirm or deny US Person status.
@Nick
Those who are under the $50,000 limit are fine; or those who find themselves in the category of “Low-Value Account” ($50,000 to under $1,000,000)
the bank only is supposed to search the Electronic Customer File. If there is no US Indica, they leave you alone. Once US Indica appears, then they start asking questions.
Those that are over $1,000,000 who are “High-Value Account”, have much more difficulty in hiding. In addition to the electronic search, the Bank also searches the hard copy of the Customer File. Also, if you are that rich you have a Relationship Manager or Financial Advisor at your bank; if that person knows you are an American, they are obligated to report it.
Even though I have no electronic indica, decided to make sure I am below $50,000 threshold. Thank God for being married to a Canadian with a different surname.
@omgheesstillanamerican
When your husband was born in 1964, you needed a Canadian father to be declared a Canadian at birth (born abroad). However, the Canadian law was changed retroactively in 2009 to include mothers, so he can just apply for a certificate that says he was a Canadian since birth. It’s useful to have in case he ever decides to renounce and file taxes with the IRS. It’s also a wonderful keepsake from his long-passed mother. He would also be exempt from the two financial tests for determining covered-expat-ness.
Claiming relinquishment for a minor who obtained Canadian citizenship is difficult or impossible, even though hte old laws seem to indicate it was legally possible at the time. @Benedict Arnold Be Me tried last year but it was denied. Fortunately for him, he had worked for the BC Provincial government in the 70’s and the DoS accepted that as his relinquishing act.
@OMG
Changes to the Citizenship Act in 2009 mean that your husband and his brother are Canadian citizens with an “effective date of citizenship” being their dates of birth. I’m in the same boat as your husband re being born in the US to a Canadian mother, non-Canadian father. Last year I applied for and received an updated Citizenship Certificate which shows my “effective date of citizenship” (that’s the phrase used on the Certificate) as being my DOB.
Our MP, Alex Atamanenko is having an informational meeting Tues Feb 11, I sent this letter to him through his assistant, Gail
Good Morning, Gail,
Thank you for Alex’s response. Regarding the public information session on Tues.
RE: ‘I want to stress that this is not a political forum on the issue; it is intended to provide factual information to individuals like yourself who simply don’t know what they have to do, how to do it, or if they have to do it. Alex is providing a panel of experts in US tax, US/ Canada immigration and investment & estate planning.’
If they have not been following the march of the ‘FATCA’ troops, people affected that attend the forum will likely learn the requirements to ‘comply’ with the laws imposed on them by the US. Personally, we have been researching for months, and the link below has been an invaluable source of current information and personal experience. My thanks to Debbie Affolter for the warning article in 2011? approx. in the newspaper, on ‘Uncle Sam wants You’. The side bar on the link is very informative and updated daily.
http://isaacbrocksociety.ca/2011/12/12/relinquish-dont-renounce-if-you-can/comment-page-9/#comment-989857
The Isaac Brock Society has a wealth of information from Expats/Duals, and accidental Americans who are trying to figure out what to do about the IGA. They are not the ‘wealthy offshore’ people the US was purported to be targeting. They are similar to ourselves, with modest resources. Some have saved for their senior years so as to not be a burden to their families and the welfare system. And now they find they may be decimated to the point of living on social assistance by 2017. This is no exaggeration, as the 2-pronged pirchfork is not only FATCA, but FBARS with their arbitrary backdated penalties in the $100’s of thousands. I know nothing about US tax laws, capital gains on principal residence, estate taxes, and so on. We will however, learn about them as soon as we become a US-owned Protectorate coming soon by the looks of it. The IGA is just the beginning.
My emotional meter goes from anger, to frustration, to despair, to tears. I get at most 4-5 hrs of sleep, so assume my health will suffer in the long term. The stress of no one in the Conservative Cnd government really caring how many affected people they throw under the bus, (damn the Charter of Rights and Freedoms, Privacy Laws, and protection under Cnd citizenship- besides the drain on Cnd resources). Was it that the banks and financial institutions were more important than the Cnd citizens and long-time residents, with the threat of 30% withholding impacting their astronomical profits? Looks like it.
Please relay this question to Alex: Why is there no protection in the Charter of Rights and Freedoms from this plunder, for me, a Canadian citizen spouse with no US connections except through marriage? All funds in our joint account are eligible for extortion by the IGA. There is no division of joint assets–no matter if the contribution to the joint account of the non-US spouse is up to 100%!
I appreciate Alex’s assistance.
This is NOT fear mongering, but a word of caution about the so called “Safe Harbor” on the $50K aggregate… I would NOT take comfort in that.
It has been said before on IBS, but let me repeat it…
When you think about the reporting requirements by the FFIs that have to design software systems, this is a pain in the ass to do.
What do they care if some U.S Person is over or under the $50K across multiple accounts and financial products which they have to aggregate?
If I were them, I would just say…”F it.”.. Is this a U.S. Person? Answer…Yes, Report them. End of story… Let the IRS or the CRA sort it out! It is NOT my problem to protect those under $50K!
The $50K threshold is NOT a requirement that they HAVE TO EXCLUDE THEM, it is just a requirement that if they are over the threshold they HAVE TO REPORT THEM.
Nothing says they can’t report ALL, that I read, and I stand to be corrected. I hope I am wrong!
Frankly, that is what I would do if I were the operations manager of the software team!
Also, this has been reported by Deloitte and Touche as what some FFIs are doing… And frankly from a practical matter why wouldn’t you?
http://www.fsitaxposts.com/2013/08/13/faq-ffis-planning-fatca-50000-de-minimis-rule/
So, stay cautious about what you think might happened as it relates to the $50K de minimus rule.
Looking at the FATCA agreement, every section that describes exemptions (such as the $50,000 threshold) begins with the words “Unless the Reporting Canadian Financial Institution elects otherwise…”.
Are you going to bank on that?
With regards to transferring non-registered funds (well over $50,000 in mutual funds) to a Canadian spouse here in Canada prior to July 1, 2014:
Does everyone agree that this is perfectly safe and that the funds will never be reported under FATCA?
Would this trigger a capital gain for the original owner? Or, do we have a gifting provision in Canada?
@OMG
so glad to hear from you. (I was nobledreamer.). Your situation is definitely tricky.I don’t know enough about that particular side of it but sure hope there’s going to be a little hole to slip through somewhere.
@always something says,
Your description of your “emotional meter” is painful to relive-as we all know how horrible this is to come to terms with. The only way I could make it stop was to get out. My Canadian-only spouse simply could not understand what I was worried about and assumed they would never find me. Though over time, I believe he came to understand it was HIS money that was at risk. He never really appreciated how difficult it was for me to renounce. Though I can’t think of any support that would have relieved the sleeplessness, endless anxiety, etc. Try to have some hope. You WILL get through this.