In a new “Special to the Financial Post” advertorial that makes Barrie McKenna look like Woodward and Bernstein, über compliance condor Max Reed attempts to reassure “American citizens in Canada” that they have nothing to fear, except perhaps some red-herring nightmare of IRS goon squads swarming across the border to seize their homes. It is a tour de force of utter nonsense and, sadly, another disheartening example of what now passes for journalism in Canada. Here are a few tidbits, displaying all the comforting factuality of a PMO press release:
Don’t panic, American citizens in Canada: The IRS is not coming to seize your house
To get on the IRS’s good side, take advantage of the amnesty program called “Streamlined Foreign Offshore Procedures” (which you can find on the IRS site). It will help you catch up on overdue tax returns without fear of penalties.
U.S. citizens in Canada are only subject to U.S. federal tax. (The Canadian taxes you pay are credited against your U.S. taxes.)
Unless you have U.S. source income, you will not owe anything.
The deadline for filing a return in the U.S. is April 15, but can be extended to June 15 for those outside the U.S.
Intriguingly, this is just part one of a spring series of helpful articles for “One million American citizens in Canada.” It is difficult to imagine just how much more useful advice Max Reed can offer than he does in his first instalment.
Comments are wide open.
This morning (March 30) the Financial Post Editor called me and advised that the FP would issue a simple retraction of the offending March 7 sentence in the online, and later, print version of the FP. We shall see.
A half of a congratulations to you, Stephen. This really calls for a correction, not retraction.
A “correction” (not really) was made in today’s FP (bottom of article):
@ Stephen Kish
That still doesn’t get it quite right, does it. Not when you consider income can be from salary AND from investments — both from Canadian sources. With salary thresholds and differences in how some investments are treated there’s ample opportunity for U.S. taxes to kick in. And, yes, as Max Reed points out, there is also the gain from the sale of a primary residence in Canada. There are many ways for the IRS to put it’s thieving hand into the Canadian cookie jar. To be absolutely certain of being relieved of U.S. tax you would have to be a house renter, with a below threshold salary and hold nothing but a simple savings and chequing account. I guess now an RRSP would be okay too.
Latest Max Reed piece
@ Eric RE the latest Max Reed piece: Oh, the innuendo and flagrant scare tactics. This, again, is dusted with inaccuracies that could leave any ‘US” person worse off and wanting to run to the compliance condor for salvation.
Even his example of a Canadian-born US Person who was a US Person only because his parents were US Persons is distorted; from the first he focuses on this poor example “John” who might have to pay an “Exit Tax”. But duals at birth are exempt. Yes, Max mentions this, but not before he’s led the reader into the pit of fear; he is obfuscating, twisting the message to bring the reader around to being frightened and being drawn towards finding a might-know-the-rules-accountant-saviour. Cachingggggggggg!
Probably there will be lots and lots of articulate Brocker comments but the newspaper readers will not see these demands for retraction. Rather, perhaps a letter should go to the Law Society about these false and manipulating statements rather than the FP as we already know their willingness to go along with their obfuscating “expert”.
I did receive a friendly email from the Editor of the Financial Post (cc the FP Letters Editor and the legal fellow with the Publisher) asking if I was satisfied with the “correction” of the offending March 7 statement in the on line and print version.
I thanked the Editor for his attempt but explained that the FP never drew the reader’s attention to the actual single misleading, and outrageous, sentence I wanted corrected (“Unless you have U.S. source income, you will not owe anything.” — pretty good news for us — eh?) and that FP “corrected” another sentence instead. I also told him that I would not pursue my request and considered the matter, for me, closed. I gave up the fight.
On the positive side, this does show that if you are persistent, communicate directly and personally with the Editor (I don’t think online comments are usually effective), and cc a legal person at the Publisher’s office (and mention the words “misleading”, “litigation”, and “ethical standards”) you might get someone’s attention and at least an attempt at a partial retraction.
I just don’t get why use JOHN as an example at all. He was born in Canada and is home free!
At least Max Reed suggests anyone look at their tax situation before before marching down to the consulate to renounce US citizenship. Hopefully that research might involve more than just talking to condors like him, and leads to Brock where people can learn about relinquishing acts, and the wealth of information here that may lead to one fewer person’s bones getting picked over.
Wish I could give many, many UP arrows for a Brocker comment at the latest Max Reed article in the Financial Post series —
Max Reed co-authored “A Tax Guide for American Citizens in Canada” with some guy named “Dick Pound”. I know what I would like to tell Max and Dick to do with their guide.
I’ve seen that guide. Lots of “not covered in this guide, see a tax professional”.
In case anyone is interested: the guy named “Dick Pound” — http://en.wikipedia.org/wiki/Dick_Pound.
Does it involve the use of “pound” as a verb?
I just noticed on the latest Max Reed FP piece — http://business.financialpost.com/personal-finance/taxes/many-u-s-citizens-in-canada-are-heading-for-the-exits-but-it-could-cost-them — that yesterday there were 24 comments which were mostly “pluses”. Today there are 45 comments and amongst the latest ones are some “minuses” — ffgfgf and carlingford2. Now comments are closed so I guess the vitriol will have to speak for itself.