397 thoughts on “The Canada United States FATCA Intergovernmental Agreement”
@always something says,
I feel you. {{{hugs}}}
@ Trishia says
I shed more tears reading your heartfelt sympathy. We are trying not to research methodically, not make an impulsive choice as to how to get out from the noose. I need more discipline to breathe deeply, take a 15min walk along the river park, limit online time, and find 3 things a day for which to be grateful. IB site my 1st grateful item every day.
In our case, it was my Dual husband who was, hey, ‘chill out’- no worries, we don’t have enough for them to bother with us. Now he’s online 8 hrs a day! My initial feeling in 2011 when I first heard about FATCA was sick in the pit of my stomach. In the past, it has always proved true in my case, not hysteria. We have grown children who were all born in Canada, fortunately, but still are planning to meet with them to let them know what we know. Relinquishment application has some questions that I feel will jeopardize my children.
If not for stumbling onto Isacc Brock, we would be floundering and more paranoid than we are. Knowledge is power for sure, Thank You IB. My husband got citizenship in 1994, so am requesting his Citizenship File from Cnd Freedom of Info site as something to help.
@OMG
Here’s the link to Citizenship Canada, for establishing citizenship by descent:
I was thrilled to learn I am a Canadian at birth last year, even though I naturalized in 1996 🙂
More reason to be in a credit union. They will not go out of their way to screw you.
Yes, I was told I would have to pay a capital gains. Well worth it!
@ bubblebustin says
‘I was thrilled to learn I am a Canadian at birth last year, even though I naturalized in 1996 :-)’
you naturalized to be a US citizen in ’96? otherwise I’m confused. Would this impact children registered before 18 yrs, under a US – born parent? Would they be ‘naturalized’ ?
@bubblebustin. Thanks, I’ve bookmarked it. This site is so full of great facts. It’s grown alot since back when I was a regular here. I had to take a break to avoid having a nervous breakdown … too much information sometimes. Speaking of nervous breakdowns, I have to go to Walmart to submit my new Ativan refills. See ya.
@always something
Canada’s Citizenship Act changed in 2009, after I took the oath of Canadian citizenship in 1996, allowing me to retroactively claim Canadian citizenship at birth.
@omgheesstillanamerican
You should definitely read my report in the Consulate Report.
As WhatAmI mentioned, I fought for the rule that a NATURALIZED minor prior to 1986 automatically lost his US Citizenship if he neither took an US Oath by age 21 nor took up permanent US residence by age 25…This was the INA 1952 law in effect prior to 1986. However, I was only one voice (and I did have a backup Government employment Act). Though I may have rattled them, I didn’t succeed at making a difference since they offered to issue a backdated CLN so long as I could prove a start date with the BC Government (which I did)…However, I stand by my personal reasoning, that the laws were in effect and I was 28 when they eliminated the parent rule, thereby re-instating my US Citizenship when in fact I had already relinquished automatically by virtue of never taking the US Oath by age 21 nor taking up permanent residence by age 25 (therefore, Naturalization as a minor was completed as per the rules in effect)…I believe this is an area of the INA rules that should be investigated by competent LAW departments as the rule of IPSO FACTO should apply and the 1986 changes should have been prospective (as with the age 18 reduction rule).
(For a simple comparison, did the legalization of marijuana in Washington State in 2012 mean that all criminal acts of possession prior to 2012 should be abolished from the criminal records? if not? then why would the rules of 1986 be any different? Why should they be retroactive?)
@OMG
You’re welcome. Sorry to hear you’re needing Ativan. Be careful, it can be highly addictive. As this situation grows less and less tolerable, I want more and more to say what Atticus said – wake me when it’s over.
@bubblebustin
If adult children were born in Canada, use a Cnd passport, how can they be impacted? what is the risk to them?
@bubblebusti
Sorry, not thinking straight. our children were registered and got dual status before 18. Never got a US passport, always use their Cnd passport. I am more worried for them as their life is midstream
@bubblebustin: I hope the Ativan comment is OMG’s wit coming though.
That’s what I enjoyed the most about her. I have quoted her several times. I remember in the early days she said the US wanted to declare anyone who had ever French kissed an American to be a “US person.”
@Joe Smith
I can just imagine the enormous # of ex-pat dollar that must be moving out of the banks these past few days and into CU’s! Then, some of it out again in smaller packages, to be re-parked in even safer homes until this shit is resolved. Bound to be quickly noticed by the banksters I would think.
Population of 35M, 1/35th trying to protect themselves against an Elephant gone haywire — the mind boggles.
@bubblebustin, thanks for your concern. I’m on a very low daily dosage of Ativan. I only take a half milligram at night and a half milligram in the morning. I’ve been on the same dosage for several years now and it does help.
I’ve found the antidepressant I’m on is much more helpful with the anxiety even though it’s making me fat and my cholesterol has shot up making it necessary for me to now be on cholesterol meds.
I’m also under the regular care of a psychiatrist. Thank God for Canada’s healthcare system. Maybe the government of Canada should send a bill to the US government for all the increased healthcare needed here due to FATCA!
@always something
It might seem that your children would be able to fly under the radar, but who knows how far the US will go to smoke us out? They are after all USC’s, unless they performed a relinquishing act since they were registered (I believe, I’m not an expert in this area). Do they know what being a USC entails? This is such a mess, that Americans who might have once been proud of their citizenship now cower in fear of being discovered. Is this what the US really wants for itself? Staggering. What’s next, speech lessons to learn how to ditch the American accent?
I was reading something today about how $500 million has left Texas banks thanks to FATCA. Wouldn’t it be amazing after putting us all through this hell if the Americans repealed FATCA for their own good?
Just imagine all the South American drug money that’s been sitting safely in the banks of the southern states. Now that Canada is no longer resisting, the people who put their money in American banks are going to start to panic and move their money out.
@OMG
I hate that this is happening to you and so many others, when with a stoke of a pen this could all go away (a move to RBT, like the US should do in order to be a civilized country). Instead it gets much more complicated where we have tax compliance specialists telling us “COMPLY, COMPLY, COMPLY” and now our MP’s telling us that the IGA Canada just signed will allow us to avoid our responsibilities as US taxpayers. This is a brief twitter exchange between me and Allison Christians on this new development:
me: some MP’s telling their dual constituents that #IGA carve-outs get them off IRS hook. “Good deal for USP’s”
Allison:if by ‘off the hook’ you mean ‘able to evade US taxes,’ I agree, but isn’t that what FATCA is supposed to prevent.
me: Yes! MP’s are encouraging US tax evasion or trying to smooth over having sold us down river. Both bad!
Allison: unless there is an MOU that would treat these accounts like RRSPs (you must report but can elect deferral)…
Has anyone seen any evidence of an MOU?
Speaking of sending governments bills, you might find this amusing:
There’s a Vancouver band that’s sent the US military a bill for the unauthorized use of their music as an instrument of torture.
WhatAmI. A spouse can transfer unlimited amounts to his/her better half. There are no gift taxes. The adjusted cost base for capital gains purposes carries forward. I.E. there is no deemed disposition.
However there are attribution rules designed to prevent income splitting. Even though this is the reverse of income splitting, earnings from the transferred funds are supposed to be attributed back to the donor for tax purposes. Then, earnings on the earnings are not attributed. The accounting gets complicated.
@OMG
I feel for you as well
@bubblebustin
My youngest son was 9 (who 2 years ago said when I warned him about FATCA–‘There must be some Charter Rights that would be trampled on’ !), the others were teens. I’m sure they don’t know what being a USC entails. I plan to get them to meet us this wkd and discuss what we know. We thought we were doing them a good turn to give them future options. Now it has turned into a landmine.
Hi, OMG. Good to see you back and sorry to know you have been struggling with all of this as so many of us are! Hope you stay around. You have a lot to offer and we have the support for each other here that we all need.
In a statement, the bankers’ groups said the rules are a “sweeping change” in the way the government treats individuals wanting to invest in the United States.
The rules have already resulted in the outflow of $500 million from the Texas banking system, Eric Sandberg, president of the Texas Bankers Association, said in the statement.
FATCA has come under heavy attack from libertarians and congressional Republicans, who have criticized it as government overreach and an invasion of financial privacy.
The Republican National Committee last month called for its repeal, saying it would create a costly layer of bureaucracy, cause capital flight and hurt the U.S. economy.
@KalC
So, the fund units can be transferred “in kind” to her account without actually having to sell them?
Since she works and I don’t, I’d much rather claim the income instead of it being claimed by her, so any attribution rules applied would be good for us in this case.
@always something. I renounced last Sept in Vancouver but I stupidly registered my 3 kids at the US consulate (this is before Bush invaded Iraq). The have a SSN! That is the only US indica. Also, I guess I am not a “US person for tax purposes” forevermore. There could be a loophole though if the parent is non-USA but the kids are (my wife is Canadian at least). My kids are quite naive about FATCA etc., I think when you are young you think you are invincible. We have had many dinner discussions and they are totally aware (they are 17-22) but they just don’t think it can apply to them. I am not filing their taxes to USA, only to Canada (I do their taxes).
@bb: have you found a place yet in Vancouver? If that room in your condo building is unavailable or not large enough, I can look around tomorrow.
WhatAmI. Not all advisors, especially entry level ones, know the rules.
Google ‘transfer of capital property to spouse’.
If you don’t mind the capital gains hit you can elect to transfer at fair market value. This makes accounting much simpler.
@always something says,
I feel you. {{{hugs}}}
@ Trishia says
I shed more tears reading your heartfelt sympathy. We are trying not to research methodically, not make an impulsive choice as to how to get out from the noose. I need more discipline to breathe deeply, take a 15min walk along the river park, limit online time, and find 3 things a day for which to be grateful. IB site my 1st grateful item every day.
In our case, it was my Dual husband who was, hey, ‘chill out’- no worries, we don’t have enough for them to bother with us. Now he’s online 8 hrs a day! My initial feeling in 2011 when I first heard about FATCA was sick in the pit of my stomach. In the past, it has always proved true in my case, not hysteria. We have grown children who were all born in Canada, fortunately, but still are planning to meet with them to let them know what we know. Relinquishment application has some questions that I feel will jeopardize my children.
If not for stumbling onto Isacc Brock, we would be floundering and more paranoid than we are. Knowledge is power for sure, Thank You IB. My husband got citizenship in 1994, so am requesting his Citizenship File from Cnd Freedom of Info site as something to help.
@OMG
Here’s the link to Citizenship Canada, for establishing citizenship by descent:
http://www.cic.gc.ca/english/citizenship/rules_2009.asp
I was thrilled to learn I am a Canadian at birth last year, even though I naturalized in 1996 🙂
More reason to be in a credit union. They will not go out of their way to screw you.
Yes, I was told I would have to pay a capital gains. Well worth it!
@ bubblebustin says
‘I was thrilled to learn I am a Canadian at birth last year, even though I naturalized in 1996 :-)’
you naturalized to be a US citizen in ’96? otherwise I’m confused. Would this impact children registered before 18 yrs, under a US – born parent? Would they be ‘naturalized’ ?
@bubblebustin. Thanks, I’ve bookmarked it. This site is so full of great facts. It’s grown alot since back when I was a regular here. I had to take a break to avoid having a nervous breakdown … too much information sometimes. Speaking of nervous breakdowns, I have to go to Walmart to submit my new Ativan refills. See ya.
@always something
Canada’s Citizenship Act changed in 2009, after I took the oath of Canadian citizenship in 1996, allowing me to retroactively claim Canadian citizenship at birth.
@omgheesstillanamerican
You should definitely read my report in the Consulate Report.
As WhatAmI mentioned, I fought for the rule that a NATURALIZED minor prior to 1986 automatically lost his US Citizenship if he neither took an US Oath by age 21 nor took up permanent US residence by age 25…This was the INA 1952 law in effect prior to 1986. However, I was only one voice (and I did have a backup Government employment Act). Though I may have rattled them, I didn’t succeed at making a difference since they offered to issue a backdated CLN so long as I could prove a start date with the BC Government (which I did)…However, I stand by my personal reasoning, that the laws were in effect and I was 28 when they eliminated the parent rule, thereby re-instating my US Citizenship when in fact I had already relinquished automatically by virtue of never taking the US Oath by age 21 nor taking up permanent residence by age 25 (therefore, Naturalization as a minor was completed as per the rules in effect)…I believe this is an area of the INA rules that should be investigated by competent LAW departments as the rule of IPSO FACTO should apply and the 1986 changes should have been prospective (as with the age 18 reduction rule).
(For a simple comparison, did the legalization of marijuana in Washington State in 2012 mean that all criminal acts of possession prior to 2012 should be abolished from the criminal records? if not? then why would the rules of 1986 be any different? Why should they be retroactive?)
@OMG
You’re welcome. Sorry to hear you’re needing Ativan. Be careful, it can be highly addictive. As this situation grows less and less tolerable, I want more and more to say what Atticus said – wake me when it’s over.
@bubblebustin
If adult children were born in Canada, use a Cnd passport, how can they be impacted? what is the risk to them?
@bubblebusti
Sorry, not thinking straight. our children were registered and got dual status before 18. Never got a US passport, always use their Cnd passport. I am more worried for them as their life is midstream
@bubblebustin: I hope the Ativan comment is OMG’s wit coming though.
That’s what I enjoyed the most about her. I have quoted her several times. I remember in the early days she said the US wanted to declare anyone who had ever French kissed an American to be a “US person.”
@Joe Smith
I can just imagine the enormous # of ex-pat dollar that must be moving out of the banks these past few days and into CU’s! Then, some of it out again in smaller packages, to be re-parked in even safer homes until this shit is resolved. Bound to be quickly noticed by the banksters I would think.
Population of 35M, 1/35th trying to protect themselves against an Elephant gone haywire — the mind boggles.
@bubblebustin, thanks for your concern. I’m on a very low daily dosage of Ativan. I only take a half milligram at night and a half milligram in the morning. I’ve been on the same dosage for several years now and it does help.
I’ve found the antidepressant I’m on is much more helpful with the anxiety even though it’s making me fat and my cholesterol has shot up making it necessary for me to now be on cholesterol meds.
I’m also under the regular care of a psychiatrist. Thank God for Canada’s healthcare system. Maybe the government of Canada should send a bill to the US government for all the increased healthcare needed here due to FATCA!
@always something
It might seem that your children would be able to fly under the radar, but who knows how far the US will go to smoke us out? They are after all USC’s, unless they performed a relinquishing act since they were registered (I believe, I’m not an expert in this area). Do they know what being a USC entails? This is such a mess, that Americans who might have once been proud of their citizenship now cower in fear of being discovered. Is this what the US really wants for itself? Staggering. What’s next, speech lessons to learn how to ditch the American accent?
I was reading something today about how $500 million has left Texas banks thanks to FATCA. Wouldn’t it be amazing after putting us all through this hell if the Americans repealed FATCA for their own good?
Just imagine all the South American drug money that’s been sitting safely in the banks of the southern states. Now that Canada is no longer resisting, the people who put their money in American banks are going to start to panic and move their money out.
@OMG
I hate that this is happening to you and so many others, when with a stoke of a pen this could all go away (a move to RBT, like the US should do in order to be a civilized country). Instead it gets much more complicated where we have tax compliance specialists telling us “COMPLY, COMPLY, COMPLY” and now our MP’s telling us that the IGA Canada just signed will allow us to avoid our responsibilities as US taxpayers. This is a brief twitter exchange between me and Allison Christians on this new development:
me: some MP’s telling their dual constituents that #IGA carve-outs get them off IRS hook. “Good deal for USP’s”
Allison:if by ‘off the hook’ you mean ‘able to evade US taxes,’ I agree, but isn’t that what FATCA is supposed to prevent.
me: Yes! MP’s are encouraging US tax evasion or trying to smooth over having sold us down river. Both bad!
Allison: unless there is an MOU that would treat these accounts like RRSPs (you must report but can elect deferral)…
Has anyone seen any evidence of an MOU?
Speaking of sending governments bills, you might find this amusing:
There’s a Vancouver band that’s sent the US military a bill for the unauthorized use of their music as an instrument of torture.
http://www.ctvnews.ca/canada/vancouver-band-demands-compensation-after-learning-music-used-for-guantanamo-bay-torture-1.1671312
WhatAmI. A spouse can transfer unlimited amounts to his/her better half. There are no gift taxes. The adjusted cost base for capital gains purposes carries forward. I.E. there is no deemed disposition.
However there are attribution rules designed to prevent income splitting. Even though this is the reverse of income splitting, earnings from the transferred funds are supposed to be attributed back to the donor for tax purposes. Then, earnings on the earnings are not attributed. The accounting gets complicated.
@OMG
I feel for you as well
@bubblebustin
My youngest son was 9 (who 2 years ago said when I warned him about FATCA–‘There must be some Charter Rights that would be trampled on’ !), the others were teens. I’m sure they don’t know what being a USC entails. I plan to get them to meet us this wkd and discuss what we know. We thought we were doing them a good turn to give them future options. Now it has turned into a landmine.
Hi, OMG. Good to see you back and sorry to know you have been struggling with all of this as so many of us are! Hope you stay around. You have a lot to offer and we have the support for each other here that we all need.
Here’s the article you refer to: http://www.reuters.com/article/2014/02/05/us-usa-tax-bankers-idUSBREA141QN20140205
@KalC
So, the fund units can be transferred “in kind” to her account without actually having to sell them?
Since she works and I don’t, I’d much rather claim the income instead of it being claimed by her, so any attribution rules applied would be good for us in this case.
International Adviser, February 6, 2014: “Wary Canada signs FATCA agreement”
@always something. I renounced last Sept in Vancouver but I stupidly registered my 3 kids at the US consulate (this is before Bush invaded Iraq). The have a SSN! That is the only US indica. Also, I guess I am not a “US person for tax purposes” forevermore. There could be a loophole though if the parent is non-USA but the kids are (my wife is Canadian at least). My kids are quite naive about FATCA etc., I think when you are young you think you are invincible. We have had many dinner discussions and they are totally aware (they are 17-22) but they just don’t think it can apply to them. I am not filing their taxes to USA, only to Canada (I do their taxes).
@bb: have you found a place yet in Vancouver? If that room in your condo building is unavailable or not large enough, I can look around tomorrow.
WhatAmI. Not all advisors, especially entry level ones, know the rules.
Google ‘transfer of capital property to spouse’.
If you don’t mind the capital gains hit you can elect to transfer at fair market value. This makes accounting much simpler.