http://www.svt.se/nyheter/regionalt/vastnytt/svenska-banker-letar-efter-amerikaner
(hit the right button on the picture two times, and you come to a video with English text)
The article says:
Tinna’s mother became pregnant at the ship to America, and Tinna lived in the US its first three months. Now she can owe the US Internal Revenue thousands of dollars.
1962 had Tinna dad got a job as a visiting scholar in New Haven, United States. He took his family and on the way there was Tinna’s mother pregnant.
– They were bored on the boat, and nine months later I came, says Tinna who currently works as a teacher at Lerum’s high school.
She shows a photo of him and his proud big sister, and a telegram that his father sent when she was born.
– Rejoice Kristina is born, it says. After three months, we went home.
I noted this:
“agreement with the United States that gives the bailiff opportunity to recover the tax from taxable Americans in Sweden.”
SOunds like this is the plan all along huh? Out 7 million expats, levy billions in fines, then get the nations of the world to collect these fines for them.
On a serious note, how deep can this go? I have a CLN but have been to broke to back file. I intend to do this but it could be another year or two. At the moment I have zero assets, zero bank accounts. Everything (the house, banking, even car, etc) is in my wife’s name. My wife is not a US citizen, she was born in New Zealand. So, if I am fined by the IRS for say 50k but have no money and do not pay, can they actually seize my wife’s accounts even though she is not a US person but happens to be married to one? Surely this could not be possible, but who knows..
http://www.svt.se/nyheter/regionalt/vastnytt/hon-valjer-sjalv-att-vara-medborgare
Politicians answer to affected americans?
“She chooses to be American”
@pukekonz
If worse comes to worse you can divorce; there may also be different types of marriage contracts where you are that protect personal assets (your wife’s).
But above all, realize that going after you will cost money, and require going through local courts, who may not look kindly upon the long hand of the IRS if you are totally in good faith in your country.
Going to court in a foreign land (if my reading is correct, IGAs stipulate that matters can be resolved in the local court — if your home country decides to tax you, you can go to court about this) is not something they can do to everybody, and in your case they would lose money doing it. It is common knowledge that the US court system would explode if they had to bring everyone to trial — they rely on plea bargains — in your case they could try that, but you don’t have to agree. In your hypothetical case the cost would be huge, for them, for no result, except bankrupting you. It would be a public relations disaster, and probably trigger changes. It would give Republicans ammunition to ridicule the IRS further, and perhaps change legislation.
I’m not a lawyer, but that’s how I would read things. Therefore, not to worry excessively. We all tend to be paranoid around here (includes me).
If you are so broke you can’t afford to file, I doubt they will be coming after you any time soon, so maybe a year or two would be enough. Brian Mahany had a piece in National Law Review today where he suggested that the IRS is now unlikely even to prosecute little fish over missing FBARs because they are focusing on HSBC accounts in Switzerland and the Americans who were moving bricks of unmarked dollars around in suitcases.
I was interviewed for about 29 minutes on camera for this story at Swedish TV’s DC studio. I went heavy on the details of the one-sidedness of the arrangement, violation of Sweden’s sovereignty, and especially that the promised reciprocity is a deception. Obviously, zero interest — didn’t make the cut.
Good to hear from you, Jim Jatras!
Horrible to hear that your interview wasn’t aired. Could it just be delayed or has it been suppressed in the media — who makes these decisions?
Mass renunciations is the only solution.
Sweden is a socialist state. Paying high taxes is almost like a national sport. So getting any sympathy from the Swedes will be surprising.
Now it is clear why expats who decide to get compliant must submit to the “Financial Crimes Enforcement Network”. With that name everyone who refuses to comply with the FATCA extortion are guilty of hindering a criminal investigation into their assets. In the US that would lead to asset confiscation (proceeds of crime). Now FATCA IGAs (at least in Sweden) extend this internationally. Will this also apply to Canada????
James was mentioned in this clip. 2 sentences
http://www.svt.se/nyheter/regionalt/sverige-blir-en-avdelning-at-irs
There is no texting of this, but the article below actually says more than the verbal part
the last words of Leif Jakobsson (S) on the video:
“det blir en naturligt ordning I världen framöver”, or
“There will be a natural order in the world from here on out”
What does that mean “There will be a natural order in the world from here on out”
Sounds ominous. Kind of like something a Hitler might have said.
@Samual Adams
From what I understand, in Sweden people pay high taxes with the expectation of getting a lot of things in return. Now in this case, not only would these Swedish “US persons” not be getting anything in return for paying US taxes, in most cases they would not even owe any US taxes but would only be having their hard earned money confiscated through penalties for “form crime”. I am betting even in a high tax state like Sweden, that would not be looked upon kindly at all.
@Gwevil
“in most cases they would not even owe any US taxes but would only be having their hard earned money confiscated through penalties for “form crime”.”
Perhaps no taxes on earned income but there can still be a bunch of taxes on various types of investment income, PFICs, capital gains on home sales etc.
Hopefully the Swedes have enough tradition in respecting human rights to do something, but I am not going to hold my breath.
I agree with @Samuel Adams that a high percentage of even ordinary middle class expats could be hit with double taxation from PFIC investments and capital gains n home sales. I’ll bet that many in the past filed their investment income and capital gains as ordinary dividend income and gains via Schedule D and have been oblivious of PFIC issues and former 8621.
When I discovered that investments were ‘riddled with cancer’ and with FATCA looming, plus the fact that I already had to file 8938, I concluded that to not correctly file would have been willful. Had I learned of the problem a year or two earlier, I could have probably gotten away with filing the investments as ordinary dividends and capital gains and gotten out of these investments quietly without having to pay thousands in double tax plus over a year’s salary in accounting fees…
But it seems with FATCA that the stakes are now too high, especially if one has enough assets to also have to file 8938 and declare all their investments directly to the IRS.
What none of us know though is how aggressive the IRS will be towards expat minnows. They will no doubt receive reams of information on unintentionally undeclared accounts and could have a field day issuing huge numbers of fines for failure to file tax returns and FBARs.
On the other hand, as the IRS would probably have to pursue these penalties and tax bills through the foreign courts, I suspect that they will still focus on whales because it would be more cost effective and avoid public relations disasters. They will probably issue many warning letters and reminders to file though.
Monalisa: you are absolutely correct.
While some people have been aware for many years, for many others, like me, things are just percolating now. I certainly need to reorganize stuff in my financial life, not to evade tax, but to make things simpler.
Doing so now is “too late”, that is that all the information on mutual funds, etc, all that is there and cannot be ignored.
So the big question is how the IRS will treat the mass of minnows. Logic would be a certain benevolence. The generalized issuance of massive fines and penalties would undoubtedly provoke a backlash. There is a limit to how much you can milk the cow, or you’ll never be able to milk it again.
I for one would fight them in court in the country I live, which has a tax agreement to collect tax for the IRS. But that tax agreement also says you can fight in local courts. Which are notoriously slow. And do not work in English. Will the local government really want to do this? Will the IRS bully more? For someone who owes no tax? And pays a lot locally (I am in a 53% bracket, come on!)? The publicity would be bad too. In a time where the US is trying to con the EU into signing a free trade agreement. Being pursued by the IRS would absolutely prompt me to apply for local citizenship, and thus pave the way for relinquishment.
It passed. No surprise.
Here is the report, which includes James Jatras explaining that Sweden gets nothing
http://www.svt.se/nyheter/regionalt/vastnytt/politisk-debatt-om-fatca
at the bottom you can see a number of related reports
@Fred, the more I think about it, the more I believe that the real winners in all this will be the accountants and tax lawyers. In a way, I feel conned. I doubt if the IRS will have the resources to aggressively go after all the expat minnows but I fell for all the scaremongering back in 2011….
I spoke recently with an accountant, who has friends in the IRS area that is processing streamlined applications. They say that the offices are literally covered with towering piles of papers on all of the desks.
The IRS wanted “compliance” from 7.6 million, most of whom will provide no tax revenue.
Now they are getting it, and Congress was smart enough to cut their budget so that the IRS knows what it is that it wanted.
@Mark Twain, so it sounds like posturing by Congress. I suspect that many within the IRS are privately fed up with the charade. They ensnare us with legal technicalities though. For example, had I not subsequently gotten into compliance, I would have been deemed wilful. FATCA will be the enabler of CBT enforcement. But it’s the compliance vultures and banks who will be enforcing the rules.
I gather that the IRS and FINCEN will more likely pursue uncompliant foreign institutions than minnow expats, directly, but this will effectively put these minnows into a corner whereby they feel forced to comply.
The bureaucrats and their appointed leaders (on temporary leave from their normal jobs as compliance condors) always want bigger departments and more papers to shuffle.
The new Congressional leadership has this figured out and are making them pay for their ploys to make the IRS into health care managers and global bank police.
It was the GAO & the IRS that constructed the desire to make 7.6 million “compliant” people—most who won’t owe anything.
Now, it is there own that are swamped, so they will have to figure out how to fix themselves. If they are smart, they will prioritize Obamacare over FATCA & FBAR
@Mark Twain, I gather they’ll go after the most bang for their buck