Not sure how this source and these articles have evaded detection for so long, but they deserve wider exposure:
http://wealthmanagement.com/commentary/fatca-violates-rights-american-citizens-overseas
http://wealthmanagement.com/wealth-planning/why-do-americans-hate-expatriates
http://wealthmanagement.com/legal-compliance/accidental-american-0
The newest, FATCA Violates Rights of American Citizens Overseas, is a hard-hitting commentary by Carrie Lowery, who is described thusly:
Carrie A. Lowery, Esq., has worked as a legal professional for over a decade. She recently founded Authority Legal Research & Writing Service, which provides legal research and writing support to practicing attorneys.
I was particularly struck by her close attention to the violation of treaty powers represented by Intergovernmental Agreements:
FATCA requires foreign financial institutions to report the financial holdings of their U.S. clients to the IRS or will be charged a 30% withholding tax on payments from US Banks.
The Treasury Department has been unable to cite any constitutional, statutory, or regulatory authority which allows it to compel foreign institutions to collect and share the financial information of U.S. citizens. As a result of foreign privacy laws which prohibit direct disclosure to the IRS, the Treasury Department has entered into numerous bilateral Intergovernmental Agreements (IGAs) with foreign agencies and governments. There is no reference to or authority provided for IGAs in the statute itself. When asked for a basis of authority for its action, the Treasury Department points to existing tax treaties with foreign governments. Unfortunately, there is one fundamental difference between existing tax treaties and the IGAs: lack of Senate authorization, in violation of the treaty power.
It would appear that Allison Christian’s definitive evisceration of Treasury’s IGA lies continues to make waves. Bravo!
The other two above-mentioned articles are less recent, but no less compelling, even though they do belie the incomplete perspectives of the compliance-industry. Nevertheless, some good solid reading here.
The Congress of the USA has the authority to pass legislation levying taxes against the citizens and the IRS has the authority to collect them. However they also have the authority to pass legislation that is unreasonable and downright stupid. The point. Have the authority doesn’t make it advisable, so when you are given authority and you abuse it, you deserve whatever punishment the citizens decide you deserve. In this case it would be voting you out of a job that gives you an income you couldn’t earn in pvt business, loss of respect, loss of power and if you are oriental, loss of face.
Those are very thoughtful pieces, Deckard1138. Thanks for posting them.
But American’s don’t vote them out of office. The two party system makes sure they are very hard to be voted out and independent can’t do anything even if they are voted in.
Thanks, Deckard, especially for the third link. The section of Leckie’s article The Accidental American called “Can you spot the Americans?” reduced me to tears. Kept me laughing all morning. Really, there oughta be a law …
Don’t know how you found them, but glad you did and brought them to our attention here, Deckard. Excellent pieces, all of them. Thanks!
@All
Thanks and you’re welcome! It is odd how some of these needles hide in the haystack for so long. With my limited time I prefer to focus on mining and curating such nuggets from the vast Internet and it’s always a pleasant surprise to find some new hidden treasure. And that’s two or three metaphors in a row, so I’ll stop now 😉
From the “hate expats” article:
“1. Members of a multinational family, who may have been born outside the United States, moved to the United States at some point and became naturalized and are now moving back to their home or to another country.
2. “Accidental Americans” who were born in the United States to non-U.S. parents and have spent most of their lives outside the United States. (For more information, see “The Accidental American,” by Gavin F. Leckie in the November 2011 issue of Trusts & Estates, p. 58.)
3. American citizens who moved abroad, often to marry or work, have lived in another country for many years and acquired a non-U.S. family and decide to become a citizen of that country and give up their U.S. citizenship.”
I’m guessing that at least as big a group as some of the above–and a group with an especially compelling case for more compassionate treatment–would be:
4. Another type of accidental American–those who were born outside the U.S. to a U.S. expat family–but whose family (parents and children) have never returned to the U.S. These people probably have the best chance of flying under the FATCA radar as they have neither a US birthplace nor any US ties whatsoever, but according to FATCA/CBT they too are at risk.