Phil Hodgen stands high among the few tax/law “professionals” in the U.S. expatriation sector that I have respect for. Hodgen has just shared this precious pearl:
The real risk is uncertainty and fear.
If you wish, go on to read the whole classic answer that is distilled into this pure nacre.
The coda, also a quotation: In the long run everyone pays the price. Sauve qui peut.
@MuzzledNoMore
Well, I’m making the decision to renounce with regret – I don’t owe tax, but fear the capital gains tax on my heavily mortgaged property value will wipe out what I’d planned use for my old age. My gt gt gt grandfather was the first elected governor of the Plymouth Colony, and I deeply regret having to reverse the journey generations later. Deeply regret the direction the US is taking with re the world – arrogance, hypocrisy and greed.
Mettleman said “i am very vocal in my comunity about how the sitting gov’t in canada sold out 4 million of us to the americans and bring FATCA up at any chance i get.”
You will be happy to know that yesterday I spoke up when I was called yesterday if I would be supporting Harper. I gave the caller an earful. Without swearing or letting her know the nasty things I thought of Harper, I just let her know why I won’t support Harper, that I’ve lived in Canada 25 years but thanks to him, I’m expected to send all my financial data to the IRS like every other Canadian who happened to be born in the U.S. or once held a green card or is married to a spouse in that situation. The caller was taken back, and even said “Canadian CITIZENS?”
Yes, we are now second-class Canadian citizens, I told her, adding that the opposition party BEGGED the finance committee to exempt Canadian citizens from the demands of FATCA and the IRS, but they refused. The caller said she didn’t know that. I started to tell her about our lawsuit, and if she had stayed long enough on the phone I would have told her that my two kids are now voting age, and we all voted conservative in the provincial election this past year, but I guarantee none of us will vote conservative in the upcoming federal election. I hope that caller starts hearing more of the same from other people, and word gets around. I’m sure the Conservative Party is counting on the fact that many voters put them in and so they think all those people will be glad with their performance and ready to vote for them again. Wrong!!!!! I hope they learn how wrong they are!!!!
[FYI: we voted Conservative in the NB election b/c our tiny province is sadly a sinking ship with 12 billion dollars of debt and the Liberals, who won, were and remain in la-la land. The worst idea touted by our 32-year-old premier is to tax top earners at a bracket that would make them have the HIGHEST TAXES in North America. No other candidate or media reporter could reason with him and get him to see what a dumb idea that is. Given all the desirable places in North America that professionals can live in such as British Columbia and New York and Hawaii, why would we want to make New Brunswick the very worst choice? Seriously? We’ve already lost general practice doctors and specialists who are not being replaced; and waiting lists for surgeries grow ever longer; and Gallant plans to give these sorely needed professionals greater incentives to leave?]
@Jan, I too voted Tory in the last election but will not in the next election.
Do you know the position of your Liberal MP (and Mr. Trudeau) on FATCA? Will your Liberal MP promise to advocate to repeal the entirety of the FATCA IGA enabling legislation? Will he/she also promise to pressure strongly the United States to stop the transfer of Canadian-made retirement assets of innocent Canadian citizens to the United States? How about your NDP candidate?
@Stephen, I don’t know the answers to your questions yet, but my husband and I intend to find out. We talked about it yesterday. Right now we’re leaning NDP because they’re the only ones who’ve shown having a “backbone” to stand up to the U.S. and that is exactly what Canada needs. (My husb. uses a different set of words for “backbone”).
Is there a threat yet for people to share info on candidates?
OK – some of you are taking a principled stand on not getting a CLN. Some of you just don’t trust the US government. I can understand that and can’t take issue.
However, I will comment on something maz57 wrote:
Well, for some people getting a CLN may have no upside, but for others it can be quite important.
1) People who need to travel to the US for family or work related reasons.
2) People who don’t sleep well at night with major, unresolved issues.
3) People who don’t trust the Canadian government to not cave (once again) to the US and permit the Canada-US tax treaty to be changed to require Canada to collect taxes, tax penalties, FBAR penalties, etc on behalf of the US.
For such people there is very much an upside in getting a CLN. One can argue that the US may change the the rules in the future thus voiding the upside. True. But then again it may not. The best one can do is take an educated guess at what the future holds and then govern oneself accordingly.
@Jan, that’s a great idea to have a thread on positions of candidates.
Maybe something like one easy to access part of the thread consisting only of stated positions or lack of positions of candidates broken down by province (without comments), and perhaps a second part (or second thread) with comments.
Stephen Too much risk of getting way off topic and diluting the effectiveness of IBS. Ut is already far too difficult to follow.
@Duke of Devon,
I can’t speak on behalf of Brock, but I would suggest that information helpful in using the Canadian political system to address our problems might be “on topic” for this website.
@tdott. I guess we’ll have to agree to disagree just a wee bit. (But please don’t take it personally as I expect we generally agree on a great deal.) I will respond to each of your very valid points in turn:
1. Although I travel regularly to the US I am mentally prepared to never set foot in that country again if they get stupid enough. Since I started crossing with my Canadian passport (with US birthplace) I seem to be treated with more respect than I did on my US passport. I have no explanation for that.
2. After having been tormented by this situation for several years, I now have made up my mind and sleep like a baby.
3. I don’t trust either government at this point but I especially don’t trust the US government. I am hopeful that the ADCS lawsuit (and the court) will force the Canadian government to totally rethink what it has done to loyal Canadian citizens.
In the end people have to decide what course of action is right for themselves personally. I certainly wouldn’t criticize those who choose to jump through the hoops to get a CLN. Heck, I’d get one myself if it only required a stamp and a self-addressed envelope. But the present procedure is not for me. (Easy decision because you can’t get an appointment anyway.)
@tdott @maz57 I am an undocumented relinquisher. In fact, I went to the consulate a year ago in an attempt to relinquish but was refused. I disagree. I continue to travel to the U.S. when necessary on my Canadian passport declaring myself to be Canadian. Last month I flew through Seattle. At the border, I was sent for secondary screening. After asking me the usual questions (where are you going, when are you leaving), the border agent spent a good minute or so reading from his computer screen (I guess I must be in their system now…). At the end of this he looked up, stamped my Canadian passport with an entry visa, dated it, and sent me on my way. Despite what the State Dept and the Harper govt may say, I’m willing to stand my ground on this one– I am a Canadian. And I’m not going to travel five hours and pay $2350 to enter the rats’ nest of a bunker in Vancouver to prove it. Cheers! BC Doc
Clarification– when I say, “I disagree”, I am mean w the consulate staff.
If it seems unclear to many of us expatriates how to proceed, it seems by now that the US government is equally unclear how to proceed. I think FATCA was passed with total disregard for the number of ordinary US citizens living overseas and how they would react. The number of people who have decided to renounce their citizenship seems to have caught them by surprise. The consulates and the IRS are now swamped with people trying to exit the US system.
I think it’s going to be a long time before they start cracking down on expatriates who try to visit the US on a non-US passport with or without a CLN. That would only compound the negative publicity that they have already incurred from FATCA and the apparently unanticipated reaction to it.
Mr. Hodgen, being of limited vision, has neglected to address what the real risk to the U.S. is.
It really isn’t just a question of not owing any taxes “now”. The system basically makes people afraid of being successful because one then will enter the “covered expat” status.
Or just the higher value of some real estate could catapult somebody into this category.
So giving up citizenship at a later date could become extremely expensive.
@Shovel. I have been following Phil Hodgen’s online presence for several years now. Although he hasn’t commented much about it recently, he is “in the trenches” every day and gets to see first-hand what a disaster the situation is. He is more keenly aware than most of the risk that current idiotic US policy poses to that country.
Although people who decide to expatriate inevitably lose something, they gain far more. They finally have their freedom back. The US as a nation is the loser; they are throwing away their human capital for absolutely no gain whatsoever.
@BC_Doc. When you watch the US news they like to refer to those who have illegally entered the US from Mexico as “undocumented illegal immigrants”. They now will have to come up with a term to describe the new class of non-US persons being created by the US government.
How about “undocumented legal emigrants”? (Lol!)
@maz57
I don’t think we disagree at all. My point (which I apparently did not make well), is that while one person may see no upside to obtaining a CLN, someone else may see significant upside.
And, I do (and have always) agree that each person must determine their course of action for themselves based on their particular circumstances (and lots of due diligence!).
@AnonAnon. I think you have got it right. When I travel I don’t carry my US passport because that would contradict my assertion that I self-expatriated when I became a Canadian citizen. (I did offer to send it to the Vancouver Consulate but they refused, saying they would just mail it back to me.)
If a US border goon decides to turn me back the next step will be talking to the Canadian government about the US’ refusal of my valid Canadian passport for no good reason. I don’t think they want a public airing of the mess they have created.
The general US reaction to those who object to FATCA, CBT, and the rest of the whole convoluted mess is “if you don’t like it, you can just renounce”. To then turn around and say “but we won’t allow you to do that either” would just demonstrate how crazy the US government has gotten. But never say never; the Read Amendment still lurks on the books. They could suddenly decide to start enforcing that just as they decided to bring FBAR back from the dead a few years ago.
We are at a bit of a disadvantage here; we logically expect all this to make sense.
I like some (many) of us here on IBS count my self as self renounced. I admire bc doc, maz57 and all the other self renouncers.
my last trip across the border was November 2013. after the interaction I had with the agent I realized crossing the border had taken a turn for the worse. I had never in over 40 years of crossing had to answer so many questions and then be told to make the post office for a passport application my first stop.
while I miss many sights and things America has to offer I in no way shape or form desire to have any interaction with any American official and so as such am just never going to put myself in the position of showing up at a border crossing and have to engage such mentioned official.
they can keep their country to themselves I will travel to other parts of the world that want me.
your loss uncle sam and the rest of the worlds gain 🙂
Just checked and remarkably, this is the sixth anniversary of my last trip across the border! March 12, 2009!
And like Mettleman, I’ll never touch foot there again.
@all. I forgot to mention that I stumbled on a good documentary called BorderLine on the CBC Documentary Channel the other evening. I checked their website and it will next air on March 17.
The show was a very good analysis of the profound changes that have occurred since 911 for folks who live along the 49th parallel on both sides of the border. It talks about the creation of the Dept. of Homeland Security, the US obsession with the war on terror, the massive amount of money the US now spends on border surveillance, and the fact that fear has now become one of the biggest industries in the US. Well worth watching.
Thanks for this, maz57. Will give myself a reminder.
The description for the documentary says:
Trailer: https://www.youtube.com/watch?v=89IPNllPN6Y
@HELP wrote:
“Well, I’m making the decision to renounce with regret – I don’t owe tax, but fear the capital gains tax on my heavily mortgaged property value will wipe out what I’d planned use for my old age.”
I worry about that, too, as the real estate market has been hot in my area for the past ten years (as long as I’ve owned my small home). I renounced earlier this month and am wondering about the f8854 and the US-CDN exchange rate: will I be able to use the exchange rate on the day I renounced or will I have to use an annual posted rate (which may be higher or lower)? The exchange rate will dramatically affect my total net worth and capital gains (in home value).
@HELP
Welcome to the club, you are not alone. Many on this blog have renounced.
Graham Vapors. Use the value and exchange rate as of the day you expatriate. You don’t need a formal appraisal of your property. Since the Can$ is so low, that will work in your favour.