If you have information about how FATCA will affect green card holders in your country, or a question about FATCA and your green card status, or an experience to share, please comment here.
The idea for this thread comes from News, who posted the following FAQ from Canada Revenue Agency’s website, regarding FATCA and Green Card Holders, as a comment on the “Terminating a Green Card” thread.
Canada Revenue Agency: Information for individuals with accounts with Canadian financial institutions
“I hold a U.S. green card. How does this affect my tax residency?
If you are a green card holder (that is, a lawful permanent resident of the U.S.), the U.S. considers you to be a U.S. resident.
However, if you are a resident of Canada for tax purposes and do not hold U.S. citizenship, you should not identify yourself as a U.S. person to your Canadian financial institution.”
I’m almost dumbfounded, but thrilled, that the CRA has taken this position regarding US green card holders resident in Canada. Very bold of them! However, it probably comes too late in the day, if green card holders have already been identified, or identified themselves, as “US persons” in order to deal with the March 15th FATCA-reporting deadline.
You refer to *the March 15th FATCA-reporting deadline”. Canada’s is a Model 1 IGA and it really is not clear that there is a specific reporting date deadline for the CRA to turn over to the IRS our financial information as gleaned from Canadian *foreign financial institutions*.
As I read it — but I may be completely wrong — the March 15, 2015 FATCA reporting deadline is for countries that have either no IGA or a Model 2 IGA to hand financial information on *US Persons* over to the IRS.
This really needs clarification — at least for me.
I’ve seen so many references to that March 15 date that I assumed it was ‘true’. I don’t have a document I can point to right now that validates that date.
In regard to the CRA not having a defined date to turn over Canadian records to the IRS perhaps they should wait until the US government provides its promised reciprocal taxpayer reporting information. Have an exchange of information – but, of course, we know that foreign taxpayer info will never be forthcoming from the US government so that exchange of information will never happen. Maybe there is a strategy here to delay indefinitely FATCA data transfer!
This is legal logic behind decision
March 5, 2015 at 8:34 pm
for rational people
Green Carder who live in Canada are considered resident of Canada (especially if you have not live in USA for a long time. I think Green Card are not valid if you leave a country for more than a year.
Canada USA Tax Treaty
1. For the purposes of this Convention, the term “resident” of a Contracting State means any person that, under the laws of that State, is liable to tax therein by reason of that person’s domicile, residence, citizenship, place of management, place of incorporation or any other criterion of a similar nature, but in the case of an estate or trust, only to the extent that income derived by the estate or trust is liable to tax in that State, either in its hands or in the hands of its beneficiaries. For the purposes of this paragraph, an individual who is not a resident of Canada under this paragraph and who is a United States citizen or an alien admitted to the United States for permanent residence (a “green card” holder) is a resident of the United States only if the individual has a substantial presence, permanent home or habitual abode in the United States, and that individual’s personal and economic relations are closer to the United States than to any third State. The term “resident” of a Contracting State is understood to include:
additionally from Canada government
“IRS Publication 519 states that the U.S. domestic rules that determine if a non-U.S. citizen is a U.S. resident do not override tax treaty definitions of residency. If you are considered a resident of Canada and the U.S. under each country’s laws and the Canada–U.S. tax treaty considers you a resident of Canada, the U.S. has to treat you as a non-resident taxpayer and you should not identify yourself as a U.S. resident to your Canadian financial institution.”
The IGA only asked talked about citizen and resident individual. I am not certain that for US citizens the exit taxes has to be done to be considered a non US person.
does anybody read agreement from CRA May 2, 2015 scroll down to see full timetable
“12.29 The obligation to obtain and report information with respect to U.S. reportable accounts is phased in over a three-year period as shown in the tables below. The phase-in is provided for in Articles 2 and 3 of the Agreement.
2014 In respect of Information to be reported to the CRA before May 2, 2015”
Of course IRS has these guidelines
Reporting (by financial institutions)
2015: Reporting Begins
When to Report
March 31 FFIs in non-IGA jurisdictions and FFIs in Model 2 IGA jurisdictions
September 30 FFIs in Model 1 IGA jurisdictions
Refers to deadlines for Canada (Model 1 IGA jurisdiction) — just deadlines for hand-over to the CRA.
All of the information listed in 2014, plus the following:
paid or credited to the account during the year.
All of the information listed in 2015, plus the following:
2017 and onwards
All of the information listed in 2016 is to be reported to the CRA before May 2 of the following calendar year.
CRA then to deal with / determine the information to be sent to the IRS on a go-forward basis, with no specific deadline????
I agree — right there / no specific deadline for our financial information to be handed over to the IRS — that is when the *equivalent reciprocal information* promise from the US should be put into play by Canada and all other countries — call them on it (the ball in their courts) and find out if their reciprocity promise is real or faux!
While it’s great the CRA is giving agreeable advice, in someways it’s a moot point. At present FFIs have to rely upon the honesty (or ignorance) of their customers to disclose their ‘US personhood.’
However, unless FATCA is ruled illegal in Canada, what is stopping the US Government moving the goalposts yet again.
Today’s FATCA pushes out data from the banks, to the CRA and onto the IRS – data is a one way street from the FFI to the IRS.
Future FATCA could also enable the IRS to push in data up to the FFIs. What is stopping the IRS to using green card records to push up that data to FFIs, have the FFIs interrogator their databases, and then the FFIs send back the matches back to the IRS? Nothing. What’s worse the IRS could move the goalposts yet again demanding all this is done in real time. So instead of a match being done annually, it could be done as soon as someone opens an account with a FFI straightaway. You open your FFI account on Monday at noon, the IRS knows about it later that day. A bit of ahead thinking, but that’s what’s possible.
All the more reason why the IBS lawsuit must succeed.
Custodial accounts Total gross proceeds from the sale or redemption of property paid or credited to the account during the year.
Does ‘property’ mean if a US person sells a Canadian house in 2016, it will be reported to the CRA thus the IRS by 2017?
Mistakes will be made, in order to shun liability by banks, and lives will be ruined!
Somehow or other the U.S. government will identify you as a U.S. person if there is any way they can. If you want to fly under the U.S.Government Radar, then stop all reference to the U.S. in any of your correspondence. Go back to your country of origin and stay there and don’t try to claim citizenship for your children. or any benefits from any financial institution or government agency and if asked by your country lie, lie, lie, and maybe they won;t find you and confiscate your worldwide assets for failure to file.
Even if you ARE a US citizen you should not identify yourself as a US person to your Canadian financial institution!!
@maz57 I completely concur. Identify yourself as Canadian only, born in Canada, no US connections and stay off the US grid (no passport renewals, etc). And last but not least, give to the ADCS lawsuit.
As an aside, I met with a friend of mine today. He is US born and a dual US/Taiwan citizen, but his wife holds just her Taiwan citizenship. Their 1 year old son was born in Taiwan. They applied for a US tourist visa for their son (did not register him the the ‘US Embassy’ equivalent in Taiwan. Visa application REJECTED and he was told that since he was a US citizen that that makes his son a US citizen, and he needed to get him a US passport -> which he then did as he was forced to do this to be able to take his child to the US for a visit.
My MP John Weston scoffed at my suggestion that there should be legal ramifications for the Canadian government should it send the private financial information of EVEN ONE CANADIAN on such a bad deal.
Did the US Embassy (or whatever it was) somehow determine that your friend met the US residency requirements to be able to transmit US citizenship to his son?
*US residency requirements*
That is something a person has to know about because US officials just see American Citizens and assume it was passed on to their children… US officials make up crap as they go along… u have to understand the laws or they will make u jump all over for nothing… They all assume everyone & their dead dog wants to be an American…. *waving… waving* not me nor mine… they can keep that toxic citizenship to themselves
@tdott – I don’t know the specific answer to that question, but my friend is of Indian origin/born and educated in the USA and his wife is Asian/Taiwanese. The US official may well just have assumed (correctly) that he grew up in the USA and therefore passed his US citizenship to his son born in Taiwan…..
Would have been priceless to see what the Embassy (?) official would have said if your friend had said, “My wife had an affair and my son is not my biological son and therefore not a US citizen”. Would your friend have been required to produce DNA results backing this up? Yes, I’m asking if DNA testing would have been required to prove that someone is NOT a US citizen. It’s both logical and absurd at the same time.
This is amusing. When I was researching the subject almost 12 years ago, as my wife was pregnant, I determined that in order to legally qualify to pass on my US citizenship to my son, I was missing one week of US presence in my life. I therefore went to Florida with my dad for 1 week, and then proudly brought all the documentation to the embassy (Brussels) and got my son the US passport (ok, ok, …). They actually seemed to examine all the documenattion I brought. Later, I found out that other Americans were doing it much more simply, just stating that they complied with the requirements.
Therefore I believed that obtaining US citizenship for a child born abroad is far from automatic. It seemed obvious to me that if I had not done all this, my sons would not be Muhrican. Also if I had not met and documented that I had met all the requirements.
It also seems to me that if I had not obtained US citizenship for them, there would be no way in hell they could be deemed US persons, nor could it be forced upon them. If it was forced upon them I imagine that the US would have to document eligibility (parental residency history), an almost impossible task (I left the US in 1980), especially if I was uncooperative.
It is also a bit sick that there are people now in the US who should by anyn reasonable standard be considered American but are illegal aliens, and citizenship is withheld from them, while there are citizens abroad, who would like to get rid of their passport. Wish that we could choose to whom we give our citizenship — that would be nice. If you find a deserving immigrant, your renunciation fee should be waived!
@tdott: absurdity is never a problem in these matters! Your question is indeed intriguing. What of adopted children? What of biological children, but unrecognized by the father? It may be possible that even if the child is conceived from an extramarital affair, only the declared family is taken into account. Can a child claim US citizenship against parental will? etc. No end in sight.
What it means to be a US citizen will be completely turned on its head now that US citizens are emerging as pariahs in the world. Expect people to defend themselves against accusations of being American, and retaliation against those who made them one.