Democrats Abroad has published a report of their four month study of how FATCA affects Americans. These reports have been sent to “selected members of Congress and senior officials at the US Treasury and IRS.” DA also indicates discusions with them are ongoing.
DA Report DataPack-CDNS top the list of respondents; 31.8% of those denied jobs due 2 #FATCA Senior Exec Positions http://t.co/6HNFnd4NZK
— ADCSovereignty (@ADCSovereignty) September 15, 2014
The report consists of the following (3) documents:
1. Executive Summary of 2014 FATCA RESEARCH PROJECT – “FATCA: Affecting Everyday Americans Every Day”
2. 2014 FATCA RESEARCH PROJECT – “FATCA: Affecting Everyday Americans Every Day”
3. 2014 FATCA RESEARCH PROJECT – Datapack
The Democrats are a day late and a dollar short with their Johnny-come-lately FATCA Research Report.
The Republicans are way ahead of the game in trying to solve problems for expats.
Someone on twitter or here said something like: “Dems want to tinker with the seasonings in the FATCA gumbo, while Reps want a full deal repeal.” I might have garnished that a bit but you get the idea.
@Neill at 2:45 pm
You are quoting Article 17, paragraph 1 as found in the Technical Explanation (2001).
I would direct you to “Relation to other Articles” of Article 17 (in the same Tech. Exp. and follows paragraph 5) which says:
“Subparagraph 1(a) is subject to the saving clause of paragraph 4 of Article 1 (General Scope) while subparagraph 1(b) is not, by reason of the exception in subparagraph 5(a) of Article
1. Thus, a U.S. citizen who is a resident of the United Kingdom and receives a pension will be subject to U.S. tax on the payment, notwithstanding the rules in those paragraphs that give the State of residence of the recipient the exclusive taxing right.”
“notwithstanding” generally means “in spite of”.
I wonder if Jack Townsend has seen this “FATCA Research Project” made by DA.
Jack Townsend thinks expats are a bunch of whiners and considers their complaints as being purely “anecdotal.”
As a trial lawyer, he is probably a Democrat so perhaps the may open his “willfully blind” eyes once he sees the report from DA.
@OAP @Neill
I have no idea which of you is correct in your discussion about the tax treatment of UK pensions. You both appear knowledgeable and well researched. What I take from the discussion is how incredibly complex these issues are. No “normal” person should have to wade through dual tax treaties to determine if or how their pension income is to be taxed by a foreign government.
@OAP,
Now I think I am with you. I see what your saying for a private pension. I don’t know if that applies to the state pension since that’s covered in par 3. Par 3 is exempt from the saving clause. Though to protect the UK state pension we would have contracting state and other contracting state the same.
I think your going to be right on this but it’s incredibly complex and it makes no sense.
DA’s Johnny-come-lately FATCA survey couldn’t be better timed for a mid-term election, wouldn’t you say?
Test
@Bubblebustin,
What amazes me is how terrible the survey is for democrats. I can’t see what it does to help them beyond saying that they know there is a problem. Of course the rest of the administration is shouting that there isn’t a problem. I doubt few people who will vote will see it.
John Smith, I remember it. I had many freelancers friends who were tearing their hair out wondering how to make that work b/c it was a nightmare.
But it’s one thing for homelanders to be afflicted with idiotic law and another for expats and immigrants. The former have a vote that counts while the later doesn’t or can’t vote at all.
Not that I believe that voting will get a person any relief if the powers that be have a conflicting agenda.
@Bubblebustin-
Here is an angle on it. Republicans want to repeal FATCA/CBT. Democrats want same country exception for FATCA (which may not completely remedy impacts in country of residence), and the Democrats have said nothing about instituting RBT.
As the Republican position is remove taxes, the U.S. tax take, and U.S. compliance burden, it may be said that, in regards to American citizens tax resident abroad, Republicans are way ahead of Democrats on all major areas of concern to voters.
Relative to the Republicans, in regards to US citizens tax resident overseas:
The Democrats are anti Family.
The Democrats are anti Education
The Democrats are anti Employment
The Democrats are anti Self Employed
The Democrats are anti Business
The Democrats are anti Pensioners
The Democrats are anti Women
The Democrats are anti Poor
The Democrats are anti Retirement Planning
The Democrats are anti Estate Planning
The Democrats are anti Freedom
The Democrats are anti Pursuit of Happiness
The above areas may be easier for others to grasp than the taxation situation. I plan a focus on the Anti Family position of the Democrats. http://tiny.cc/ANTIFAMILY ow.ly/BICFV
The Democrats may not claim that they benefit US persons overseas through their programs that homelanders may benefit from. As when you live overseas you get no benefit of U.S. government programs.
I don’t see how the Democrats Abroad can win, unless one narrowly defines expats as those just gone for a year or two and who expect to move back to the U.S.
Bubblebustin, we may see how valuable such research and letters are. The research does help the Democrats Abroad, as it does all Americans abroad. We must encourage AA to disclose the testimonials that they have been collecting.
@Neill says at 4:04 pm
“I think your going to be right on this but it’s incredibly complex and it makes no sense.”
First, it’s a pleasure to observe your perseverance on this issue. As I said previously, you are not the first to struggle with this complexity.
As regards the UK State Pension, and as I said earlier, it appears the technical explanation indicates an ‘intent’ to have the UK State pension only taxable in the UK. But, as you have discovered, the actual legally binding wording in the treaty itself develops into the conclusion that the contracting state and the other state must be one and the same for that to be the case. It does make no sense, and the conclusion therefore inadvertently forces a declaration on the 1040. That’s why most just go ahead and declare the UK State pension distribution on a 1040 and use tax credits to offset. And, that’s where the problem begins for the low income pensioner in the UK. One must have a sufficient income in order to generate tax credits to offset the taxable income.
If you carry this example of complexity, vagueness, and lack of guidance through to a conclusion, you soon discover why the Democrats and ACA may have opted for the positions they have taken. To completely do away with CBT would require a major rewrite of the IRS Code, all treaties, all forms, and all instructions. This would be a massive undertaking. The monster has become too large to correct. But, at some stage, it MUST be done. The fault lies with Congress who could avoid all this if they simply declared immediately that US Persons abroad are to be treated as NRA’s (and subject to existing NRA rules which would do away with reporting requirements for most), and then passed the appropriate laws which would rewrite the Code to abolish CBT in favour of RBT in a pragmatic time scale. FATCA is by comparison a much, much simpler issue to resolve (and abolish for those living abroad).
The ‘real ostriches’ are those occupying the House and the Senate.
Thanks, JC, for the list you provide of the things Democrats are against. There is at least one other that I think is important to highlight:
The Democrats are also anti “Disability by Mental Incapacity, whatever the cause” as they condone ENTRAPMENT INTO US CITIZENSHIP upon those persons who the Department of State says cannot renounce because they do not understand the concept of ‘citizenship’ and their parent(s), their guardians or their trustees cannot renounce that citizenship on their behalf, even with a court order.
@OAP
“If you carry this example of complexity, vagueness, and lack of guidance through to a conclusion, you soon discover why the Democrats and ACA may have opted for the positions they have taken. To completely do away with CBT would require a major rewrite of the IRS Code, all treaties, all forms, and all instructions. This would be a massive undertaking.”
They wouldn’t have to reinvent the wheel. Our amazing Shadow Raider did it for them.
http://isaacbrocksociety.ca/2012/07/23/shadow-raider-is-rewriting-the-united-state-internal-revenue-code/#comments
@JC, and @calgary;
The Democrats have shown themselves to be hypocrites of the worst kind as per our children and their education grants and registered savings, and our children/dependents as to their disability benefits and registered savings.
Not only do the children born/living abroad who are NOT USPs not count on their USP parent’s US returns as an allowable tax deduction/credit (which tells us that USP parents who do not have USP children are judged not worthy of US tax relief as parents regardless) – but, their government grants and benefits are taxed by the US, and the RESPs and RDSPs of those living outside the US are taxed by the US and punished as ‘taxable foreign trusts’ while the virtue of the US equivalent (which we cannot use) is extolled by the very same Democrats (ex. Senator Levin) who deny those abroad and their children what their own home country governments have given us.
See:
http://news.cchgroup.com/index.php/tax-headlines/federal-tax-headlines/house-ways-and-means-approves-bill-to-allow-tax-free-savings-for-disability-costs/
“…Levin also voiced support for the measure, saying it will provide economic security for millions of disabled Americans and their families. “Whether it is costs associated with transportation or housing or health prevention and wellness, this legislation aims to ease the financial burden by encouraging and assisting families to save money for disability-related expenses,” Levin said….”.
Note that the very same Senator Levin (D) who is so obsessed with destroying families of USPs abroad, and their legal local savings, who is willfully blind to the destruction and US criminalization of Registered Education Savings Plans and Registered Disability Savings Plans via US CBT tax and costly punitive reporting (FBAR, 3520/A, FATCA, etc.) basks in the media and takes credit for assisting those in the US with disability savings needs.
The Democrats and the US government does not care what happens to those they claim as US citizen taxpayers living outside the US.
They do not care if USP children living abroad are emperilled by the threat to their family and individual income and savings. While at the same time denying minors and those with disabilities deemed legally incompetent relief from the citizenship status which the US makes inseparable from the tax and reporting and penalty burden. And anything which threatens the USP parent/s threatens their children and the viability of their family security. As in the US threat to marriages http://blogs.angloinfo.com/us-tax/2014/09/19/thank-you-fatca-youve-just-busted-my-marriage/ .
And lets not forget that 2008 Democratic platform where they and Obama promised to ‘listen’ to the concerns of Americans living ‘abroad’ and represent them just as if they were residents: “….Our government must work to ensure that overseas Americans have every chance to compete
on a level playing field, and he will work with Americans abroad to identify and understand problems they
may face as a result of U.S. government policies………. “Concerns of Americans Living Abroad: Obama believes it is important to understand the role of
Americans abroad in determining U.S. policy. Obama will work with members of the Americans abroad
community and the U.S. embassies to determine how the U.S. government can be responsive to the concerns
of overseas Americans. As a U.S. Senator, Obama has taken seriously the concerns of all Illinoisans,
whether they are currently in Illinois or not. As president, Obama will work to establish a direct dialogue
with Americans abroad. ”
…..”He welcomes a continued dialogue between the White House, the State Department, and citizens
abroad in an Obama administration”….
http://obama.3cdn.net/610c7f29ee85b124a3_3cm6bxltu.pdf
@Neill @JC
Let’s face it, our situation is way too complex for most homelanders to understand, and for that reason is too explosive for most politicians to want to touch. So the narrative continues: Americans are renouncing because they don’t want to pay taxes. The emphasis should be on how the rest of the world’s citizens have an advantage over the US’s due to the difference in how the US chooses (yes, chooses) to tax it’s citizens. The alienating effects of CBT are only just beginning to manifest themselves in the ways you mention – broken marriages, failed business partnerships, etc. Americans are being rejected by the rest of the world because of CBT. If we were made symbols of the relationship the US government has with its citizens and the rest of the would, many Americans would cringe.
I feel absolutely certain that homelanders and politicians would be on board with us if we could clearly demonstrate that:
a) America as a whole is weakened by a system that weakens it’s citizens abroad,
and
b) Americans living abroad support being subjected to the US tax system, only one that’s based on residency, not citizenship.
Dammit, as well as the legal challenges, we need a good PR firm! Having a healthy diaspora (as opposed to none at all) is GOOD for America!
@all
I’m all for discussing a strategy with a PR firm. Are there other out there who have experience in this area who can remark on this idea?
@Bubblebustin
On the PR thing. I always thought if you could advertise and let say potential American immigrants know all the problems they face you would lose a fair few of them. The US needs them. I have no idea where you would advertise for them to see it mind you. Many Americans likewise dream of retiring abroad (often some place cheap). If they know now what problems they may face then they may act. An important message is that if your a US person and want to live abroad indefinitely then you really have to renounce.
Rich people who beat the government in what they feel was unfair treatment often gloat in full page WSJ advertisements.
@Neill
That’s a great point, and very important to people like you because you have been personally and negatively affected as a immigrant to the US, but I doubt anyone who is contemplating moving to the US would write to Congress about it. They would simply go elsewhere or stay where they are if they have a problem with it. The difficulty here would be in proving a negative by having to distinguish between the type of immigrant you are referring to, and the millions clamouring to get in under any circumstances. I could hear the homelanders and politicians saying, well we don’t want them anyway if they are prepared to use the US with the intention of one day leaving and not paying their ‘fair share’.
#OverseasVotersGuide :
Send links 2 your candidates’ statements 2 US citizens abroad. http://bit.ly/1rqMyUO
Am Expats send links to overseas voter issues
“The Swing States are determined by Swing Voters. Lest your candidate forget–the 2004 election came down to counting the absentee ballots in one swing state. But your candidates have indeed forgotten and they are not addressing the issues of this minority—US citizens overseas. US citizens overseas are outraged at the attitude of their politicians. And the race has come this far and a tiny few candidates have addressed any of overseas voters’ issues.
US candidates are currently courting the Homeland vote. Many candidates are directing their talking points at US citizens overseas with derogatory labels. This is the place where candidates have a chance to turn that attitude around and address the overseas vote that is going to turn the elections in 2014 and 2016.
Candidates are especially invited to comment by sending links to their published statements regarding their support-for or antagonism-to Overseas Voters . Bloggers and media are especially invited to copy this concept and provide their own guides.
This post will help to show the critical issues that affect Overseas voters directly. All Representatives are up for re election each 2 yrs.”
SEND LINKS TO VIDEOS OF POSITIVE OR NEGATIVE STATEMENTS.
SEND LINKS TO BILLS AFFECTING YOU
SEND LINKS TO POSITIVE AND NEGATIVE STATEMENTS TOWARDS US PERSONS
Somebody was kind enough to pass on my above comments to tax law professor Jack Townsend. Thank you for that.
As expected, Townsend replied back with the usual homelander BS:
“Complain about the system. But comply with the system until your complaints move Congress to change the system”…. yada, yada.
How the heck are expats supposed to move Congress to change the system when expats don’t have any Senators and Congresspersons to represent them? Jack, are you wilfully blind to that as well?
Reference hiring a PR firm:
I think it may be possible to do something less expensive such as writing full page open letters in the WSJ, NYT, IHT, etc. There is so much great stuff already written on this website that it shouldn’t be too difficult to put something together and edit.
IMO it needs to appeal to homelanders and the politicians that represent them. Describing the parallel between the plight of today’s expats and grievances of American colonists would be good because the situation for today’s expats is actually worse than what the colonists were facing in the late 1770’s.
Taxation without representation and without any government services or benefits is tyranny. Who can argue against that?
Some of the reasons I think focusing on such a theme will be effective is that any homelander with a sixth grade education should be able to understand it. Moreover, anyone who argues the contrary is arguing against the legacy of the founding fathers and the legitimacy of the creation of America itself.
Well written open letters will leave the supporters of CBT, FBAR and FATCA with a lot of egg on their faces, and deservedly so.
Maybe we could get the Audubon Society or Greenpeace to take up our cause, as Americans Abroad is a threatened species about to become extinct 😉
Kidding aside, those are great ideas. How do you get major newspapers to print open letters?
@PR Firm
In some ways we are doing this ourselves. Educating ourselves and posting comments on articles.
Putting some budget behind directed PR is interesting. I like this idea of publishing in the NYT/WSJ. That will take some budget, coordination, and then what to say. One rule of advertising is frequency. Would we hope to gain attention with one placement? Or, it could be an idea for Republicans Abroad to help gain attention and donations for fatcalegalaction.com which is a US based lawsuit, then with added donations help pay for the advertisements?
As stated before, I believe these expat stories and letters are a great form of publicity. DA published their research, how about the other organisations? ACA must have a stack of letters that they may make use of.
ADCS does publish press releases.
I wouldn’t want to associate myself with RO’s legal action by virtue of the fact that James Bopp is a lightening rod for alienating Democrats because of winning the Citizens United decision. Sort of a strange decision from a PR point of view hiring him, I think.
Dash1729 is right in his opinion that we won’t get anywhere with the US or lawmakers there if we come from a position of hate. I would like to send the message that America needs it’s citizens abroad and that our loss will have a negative effect on the entire country, that we are not against taxation by the US, just the kind of taxation we are subjected to -which has no place in a free country and globalized world vs something that came about in the Civil War. I can appreciate how those who’ve renounced wouldn’t have much interest in this effort, but there great many who are really having difficulty renouncing without exhausting all avenues first.
@Calgary411 I was thinking of your story when I said that the Democrats are anti Family. Describing FATCA and CBT as Anti Family is a bit broader of which your story may fit into. I did suggest this angle under ‘Comment on current Media and blogs’ section as an Isaac Brock Feature article. I don’t have the power to make it so.
Another feature I suggested is: FATCA and CBT is anti Pensioner. You don’t owe any tax in your resident country, but wait, the US wants to tax you as whatever pension you have is unqualified. See comments under ‘comment on current Media and blogs’.’ Perhaps it is best to not have both the above on the same day.
@Bubblebustin, I see your point about fatcalegalaction.com Bopp as polarizing. From a PR viewpoint then in any ad in NYT/WSJ maybe not mention Bopp / play him down. How will you fund it then from ADCS? Try to attract donations from Canadians in New York?
@FromThe Wilderness I agree with the approach of evoking the image of the Founding Fathers and some of the ‘lines’ they are best known for such as ‘Double taxation without representation’ and in defence from the tyranny of an overseas sovereign.