Barrie McKenna, Globe & Mail 30 July 2014, p. B3
“A leading accounting firm is taking the unusual step of urging Canadians to double-check their citizenship status, warning there may still be thousands of accidental Americans in Canada oblivious to their U.S. tax obligations.”
Only three comments so far. I made a comment, calling attention to the ADCS.
Here’s my comment:
Thanks Barrie for making it very clear to Canadians what their obligations vis-a-vis the IRS are. What would the IRS do without you?
For those who think that handing over innocent Canadians to the IRS is an act of treason, visit the Isaac Brock Society. At least there, the spirit of Isaac Brock, the defender of Canada, lives on.
Barrie seems to forget that all resident Canadians citizens are equal inside of Canada in the eyes of the law. Apparently he thinks it’s OK to create second class Canadians for the benefit of the US Government.
A Pwc spokesperson says the cost for filing a basic US NR tax return will run to $15K and anything more complex $20K and up. Seems very unrealistic – I´ve heard the cost is around $2K. Still way too much but along way from $20K.
@bdwight
The PwC article may be referring to the one time costs of becoming compliant which include multiple back tax returns, multiple back FBARs, and the filing to participate in the OVDP. I’ve heard a few tens of thousands to become compliant and then annual costs of a few thousands each year after that. Again, though–way too much either way.
These compliance jackals are looking at lining their pockets. The persons they describe are CANADIAN CITIZENS which a FOREIGN COUNTRY is seeking to impose unwanted and unrequested nationality.
Mark my words, the compliance jackals will be pushing their client FFIs to start asking questions about a customers parent;
“Many others with at least one U.S.-born parent may also have inadvertently acquired U.S. citizenship, depending on what year they were born and how long their parents lived in the United States.”
What I have heard is consistent with observations by Dash1729.
This is not a tax issue, this is a citizenship issue and the Government of Canada MUST come forward and state they adhere to the Master Nationality Rule.
Unless the Government hands over every single Canadian’s data to the IRS, it’s discrimination pure and simple.
Of course the Government would struggle to put every Canadian in the dragnet if not lose the election.
My costs to get fully compliant to renounce ran $7000 for the back tax filing and about $1000 for the current year, with an additional year and another $1000 after I get my renunciation interview/papers. The extra year occurs because it took 6 months to do the back filing, and now 2 more months waiting for the interview, processing time after that, resulting in additional time for income that the U.S. claims I must file on, even though I didn’t owe them anything for all those past years or this one. I remain absolutely furious at being put through this process because our fine Canadian government caved in for their political points. My only recourse is that Harper and crew will never see one of my votes.
@John Johnson You say you did not owe US taxes. Did anything come up about the Obamacare surcharge? I thought this was outside the tax treaties, resulting in dual citizens in Canada paying US taxes. Margaret Wente shared her experience on this point in her Globe&Mail column a few months ago.
Checkout what H&R Block charges Canadians for US ‘compliance’ 2013/2014:
http://www.askbernice.com/uploads/2014_US_Pricing_-_July.pdf
Save a copy, the pricing guide is no longer readily available on the HRBlock Canada website.
Cite costs to your MP.
There are those such as the deVere group trying to capitalise on the crisis. I have notices a few announcements on FATCA news.
For all of those people lurking in the shadows, keep lurking and don’t go down without a fight. Contribute to ADCS.
Take my word for it, no matter how much “reasonable cause” you can muster up, the IRS will never view you as anything other than a delinquent taxpayer. It’s just not in their nature. Enter at your own risk and expect the worse, because they don’t give one hoot about YOUR legal fees if they think there’s an extra dime they can squeeze out of you.
This sums up the state of IRS: lack of accountability + absolute power = total corruption.
@John Johnson 7000 is cheaper than most. For us, simple. Anything we are willing to give will go to fight through the ADCS group as they represent innocent people being treated as criminals. The USA is “taking back” citizens just to screw them out of money. My wife came here before 1978 and was told she was a Canadian only, end of story. The USA thinks it “owns” her, well, they will have to take our money from my dead hands before this Native Canadian will give the USA one god dam dime!
Why aren’t Brockers getting in there and posting on the original?
@John Johnson, perhaps you have not figured that the way the system works is you get the best tax breaks of either country denied, and the way the tax treaty works is that if America has any new tax such as the Obamacare investment tax this sails right through and gets put on top. You might attract tax on your retirement account, and others. Sale of primary residence, tax. Death, death tax. You might consider renunciation. Better yet, if you think that this is unjust, donate to ADCS and spread the word about The Isaac Brock Society.
@JC
There were a few Brockers posting. (Some have different names over there as they had to open new accounts awhile back when the site got fussy). The challenge fund was mentioned several times. There is not ONE comment supporting the article. Reckon Dear Barrie and PWC didn’t get much support. So sad huh.
Price Waterhouse Cooper’s suggestion that all Canadians do a self-check of their US citizenship status is reminiscent of Rick Mercer’s skit a few months ago. *That* was funny … this is just sick.
If Barrie McKenna wants to publicize something useful and constructive he would tell his readers about the ADCS lawsuit against the Canadian government for allowing a discriminatory US law onto Canadian soil. He would also let people know about our Human Rights Complaint which will be sent to an international human rights agency before the middle of August. Information about the Complaint can be read in a post below this.
I do not want to comment on this article. Rather, I want to speak about PWC. This is a major accounting firm and puts itself out as having specialists in cross-border taxation. My experience with them this past year, however, has been a nightmare.
The office I worked with was nearby – – but not in – – Toronto. With my renunciation, and deaiing with the sale of a US property, there were several unfamiliar tax forms that PWC was requested to do to make certain all details were accurate.
However, in each case, there were errors (some quite blatant and could have been VERY SERIOUS) that were (thankfully) caught at my end – – some before and some after they were submitted.
Costs, as one might expect, were quite high. Yet, it is now my understanding that (at least at this particular office) there are NO US-licensed CPAs. The work was done by subordinates & reviewed (at some length – – at least they charged for several hours of review) by senior staff (including a PWC partner).
Despite this, the tax forms had to be re-submitted (or corrected before submission). One form was mailed (by PWC or maybe the mailing envelope was addressed by PWC before my signing) to the wrong IRS service centre in the US – – a service center that did not deal with this tax issue from abroad – – leading to rather extensive complications.
Needless to say, I will NEVER use PWC again and urge you to keep this information in mind if you are seeking accounting assistance.
There are a lot of compliance folks out there that are start-ups, trying to sell their “skills” to the scared USC. Be aware that not all are well trained or thoroughly informed. I definitely would not have expected this from such a longstanding and well known organization as PWC, but this has been my experience.
@LM
And that says nothing of the errors the IRS is capable of making once your submission eventually makes it to its destination, errors due to under funding/staffing: SOL’s running out due to long processing times, loss or misplacement to submitted items (ie tax returns), negligence in date stamping important documents when they were received – the list goes on.
Absolutely, MuzzledNoMore.
*That* = http://www.cbc.ca/player/Shows/Shows/The+Rick+Mercer+Report/ID/2431740421/
@LM, herein is a story not about PWC, but a firm in a Western province that promises that it specializes in US tax law and crossborder taxes done well. Very similar story to yours. Big fees, and BIG incompetence in their preparation of FBARs, other reporting forms like the 3520/A, filled in another crucial one as if the filer was a US resident, made simple math errors, left out information, inconsistent conversion from Cdn to US dollars, etc. Good thing I painfully and laboriously went over checking each and and every page to the best of my layperson’s hastily and newly acquired knowledge and limited understanding before I signed them and issued a LIST of corrections and questions for clarification the best I could see to, before I would accept them. They took their sweet time then in correcting and completing my submission, missed a filing deadline which lost me several hundred in a stimulus ‘refund’, and caused me additional grief – all that without apology or acknowledgement from any of the ‘specialists’. No accountability whatsoever. Unfortunately I and other Canadian clients like me – experiencing our OMG moments, funded their subsequent expansion.
And all that flawed work on multiple crucial returns and forms was under the oversight of a ‘team’ that included an IRS enrolled agent, a CA, as well as junior and senior US Tax lawyers, etc. And every single one charged heartily for their ‘oversight’ and signed off on their ‘review’ of the work, yet they didn’t catch the errors before it came to me ‘ready’ to submit to the IRS? Their ‘reasonable cause’ assistance was limited to a cookie cutter generic form sent to the client to fill in the blanks, with no assistance or further efforts to assist in tailoring to specific facts and circumstances. The junior lawyer in charge of that portion had never even spoken to the client, and had not been one for very long. The junior in charge of relaying advice and recommendations had incorrect grasp of the file and couldn’t answer questions. The senior lawyer charged top rate for sending emails with links to their publicly available blog – without anything tailored to specific facts and circumstances.
Only a lowly office assistant and data entry person acknowledged the errors and apologized. One of the errors I didn’t know enough to spot caused a problem after the fact.
Ironically, now they’ve decided to branch out and profit off expatriation services – yet they have no expertise in US immigration or citizenship law. And in fact appeared reluctant to discuss renunciation/relinquishment back in the day.
Some local firms won’t even do 3520/A s at all, or any more, and some who did US filings won’t do them anymore now. Some are willing but have insufficient knowledge or training. The storefront chains want your business but have no expertise – yet charge a great deal.
There is no good or affordable solution even for those who attempt to come into compliance or to remain in compliance from abroad. What is already complex and fraught with potential pitfalls and jeopardy is only becoming more so. It is not possible to remain a compliant USP abroad in my opinion – and often not possible to become one except at great cost and great peril.
It is immoral for Canada’s government and the Conservative party to have aided and abetted this extraterritorial threat to Canadian citizens and legal permanent residents within its borders. It is immoral for Parliamentarians to help to drive Canadians into the arms of US tax and law firms and thousands of Canadian dollars of family savings thrown away in satisfying the extraterritorial demands of a foreign government extorting funds outside of its boundaries and jurisdiction.
@ Badger
Absolutely disgusting treatment! There should be suits brought against some of these compliance folks, but us minnows (even educated minnows) would have a hard time in court given their “expertise” Grrrrrrrrr
I would like to walk in over to the offices of Barrie McKenna and kick each and every accountant in the balls.
The one thing for sure I have learned about this entire FATCA circus is how the opportunistic beancounters and lawyers come out and spew their
compliance propoganda as the best way to proceed. It is the WORST way to proceed. The less info you provide now the better. Don’t let these opportunistic vultures of vested interest persuade you otherwise. Keep quiet and mouth shut for at least another 2 years and let this play out. That is the best advice and the advice these so called “professionals” should be telling you if they had an ounce of credibility and backbone.
@ Beth Thomas
bang on comment. i was talking with my mom this morning and since we are both in this together we both agree the best thing to do is nothing and wait for the court challenge and whatever else might be coming down the pike to play out before deciding our next move (s).
on another note….had to go to the RBC yesterday and open a new business account due to our existing business account being hacked. the new accounts lady went through all the computer screens, asked for my drivers license so i figured a question about my “americaness” would be coming next…nope nothing….no questions at all about any american ties…..very weird as i was a complete stress case prior to going to the bank….
Hope all you Canadians have learned about what it means to have a real leader as Harper is nothing but a limp-wristed faggot pawn to the US treasury.
He missed a golden opportunity to retaliate with similar monetary sanctions against the US if the Treasury
made good their 30% threat.
What a spineless basturd he must be.