A Must Read from Shadow Raider’s IssacBrockSociety.ca comment:
I just sent my suggestion for tax reform to the Senate Finance Committee. You can read it here.
A Must Read from Shadow Raider’s IssacBrockSociety.ca comment:
I just sent my suggestion for tax reform to the Senate Finance Committee. You can read it here.
Really well done.
I haven’t checked yet to make sure that it wipes out FBAR for nonresidents for section 31 rather than “tax code”
This is great, especially the cost/benefit analysis. It defines our “fair share” of taxes to be nothing, as it should be. Anything else is tribute, like to an overlord.
The fact that the US subsidizes virtually nothing in support of its taxpayers abroad only adds insult to injury. Just who are the freeloaders here?
Thanks, Shadow Raider!
I wonder if someone on the committee could be encouraged to order a cost/benefit analysis of CBT. Not sure who would do it – the Congressional Research Service?
I can’t imagine that the IRS, internally, sees CBT as a good use of resources. Increased compliance will mean more and more administrative burdens for them, without much of an increase in revenue.
I think that this, rather than appeals to justice and common sense, is the only plausible route to reform in our lifetimes.
So far, the bureaucrats have only sought to remedy the situation by encouraging fewer of us to remain American!
I dream of the day the bureaucrats will make it easier to cease being ‘American’ for those who have been so encouraged.
The US bureaucrats don’t recognize any value to the those US citizens living overseas other than the taxes and penalties they can collect from them. So much for goodwill ambassadors. The negative impact of CBT and FATCA is shown in the increase in the numbers renouncing, numbers artificially controlled by limitations to the required Consulate appointments and an increase in the cost to renounce. The reluctance of the US government to publish factual numbers of all the renouncement’s/relinquishments shows they are trying to hide the impact. Tourism and investment in the US may also decline. The bureaucrats do not seem to be able to see the big picture.
CBT needs to be attacked also upon its costs. 82% of returns do not provide revenue. The IRS workload in processing these exceeds the revenue gained from the 18% which they steal from people living in places where they get taxed up due to non/matching tax systems.
I have a really difficult time encouraging people to renounce US citizenship, and congratulating them when they do. As much as I’m happy to see people find freedom, we wouldn’t be doing it if the US acted like the nation it purports to be. We are doing it under duress and I cannot bring myself to rejoice in that. Maybe I’m stupid for holding out for justice and the belief that the US is still capable of doing the right thing, but if after the next year or two they remain stuck on stupid, I won’t be.
@Bubblebustin
I feel mixed feelings too. I still remember the summers in Virginia of my childhood with such deep fondness. Maybe that is the thing about childhood anyway. But truth be told, I left 52 years ago and I have felt foreign in America whenever I went to visit. I didn’t understand the customs, the humour at times, the habits and slang, and the viewpoints. I have not felt at home there for a long loooong time. All the more it is a shock to be suddenly criminalised by a country I have felt so remote and detached from.
This common sense approach should (one would think) easily be supported by the IRS in that they would not have this added extra burden of dealing with all the international nil returns that FATCA will bring. Talk about cost benefit.
http://www.washingtonpost.com/blogs/federal-eye/wp/2015/04/08/in-dallas-the-irs-says-it-cant-chase-tax-cheats-who-owe-less-than-1-million/?wpisrc=nl_headlines&wpmm=1
and
http://www.c-span.org/video/?325248-1/irs-commissioner-john-koskinen-budget-cuts
@ bubblebustin I understand your point of view but some of us are in a different situation. I agree that many people are being forced to give up their citizenship in order to be able to live their lives elsewhere and that is wrong. I have much sympathy for them. However, I never wanted or asked for this citizenship and now it is threatening my family’s financial well being. I resent the claim the US has on me, a foreign country that I left 50 years ago as a child. I have no need for two citizenships and fail to see any benefit from the US one. I have no ties to the US, it is simply my place of birth, nothing more, I would have no regrets in losing this citizenship. It is not even I place I want to visit anymore. Like you I would like the US to see the light and make right a very wrong situation for everyone and abolish CBT
I happily encourage people to renounce US citizenship, and congratulate them when they do so, presuming this really is the right decision for them in their particular situation.
However, I do get upset when I see people overreact, when they could reasonably just stay put for now, rather than embroil themselves in a big, expensive compliance mess. But for those who carefully weigh all the options, and decide to go that route, all the power to them!
If I could do it in a reasonably straightforward, inexpensive manner, I would too. Maybe some day, there will be an escape route for those who just want out.
The point is, no one would want out if the US did the right thing and went to RBT. You don’t see Canadians renouncing in record numbers. Don’t get me wrong I’m not condemning anyone for renouncing, in fact, the bigger the number, the better case it makes against CBT. It’s just a hell of a price for a nation to pay.
@Polly
What we remember as a child is very different then what is the reality…. I had wonderful memories of a place in the US that we had gone to a few times… I wanted to share it with the kids… we went but what a dump… past & present memories are never the same… Maybe cause I grew up piss poor… every place we went was wonderful… Kids don’t understand not having 2 nickels to rub together growing up… OMG.. I just realized… I am turning into my mother… oh… geez
@bubblebustin At this point I no longer trust the US government, even if they went to RBT. I did once when they told my family that I would lose this citizenship because of their residency requirement. That’s why I am in this mess. Never again, Shedding this citizenship is somewhere in my future.
It is too, too bad that so many have to even look at this, but it is my opinion from my family’s situation, that dual citizenship is not just and does not make sense. Different scenarios in my family, one obscenely absurd and unjust.
For my family…
I became a Canadian citizen in 1975 when I was warned that by doing so I would thereby lose my US citizenship. I became that Canadian citizen UNDERSTANDING that warning and accepting it. Sure, I do have many good memories of my growing up years in the US. And, I would love to be able to visit my family there and could because I officially renounced in 2012 and have my CLN to prove to the next border guard who might intimidate me from using my Canadian passport than I am no longer a US citizen and need not enter (or leave) that country with a US passport.
Neither of my Canadian-born children were registered as US births abroad. I know NOW that makes no difference — they acquired it without any say so from them — they were just *magically* born with that way — and I, their mother (as well as their dad now deceased) was the cause.
Trips across the border I’d want to make would include my son so he would be able to visit with aunts, an uncle and cousins. I don’t feel safe to travel with my son and wouldn’t ever put him at risk of some interrogation at the US border. He, because of a *mental incapacity* cannot get rid of that acquired US citizenship, must not have any influence in deciding to or influenced in how to renounce and cannot have a parent, a guardian or a trustee act on his behalf for his renunciation, even with a court order.
My daughter did choose to use her US citizenship early on in her young adulthood when she could not make a good living in Vancouver even though working full time but knew there were jobs waiting for her in Seattle, a short trip away. She took the initiative to (what we thought) CLAIM her US citizenship, which was actually quite a lengthy process for her to prove. She enjoyed her years in Seattle and may or may not have stayed there with a good career had she not been in a bad car accident and subsequently reached the ceiling of her insured medical care through her employer, resulting in her then charging medical needs to her VISA. She decided to return to Canada, eventually recovered almost completely, but still was not quite able to handle the stress of long hours as a contractor in IT here in Calgary. Her next life step was to go back to Mount Royal University for a two-year course in therapeutic massage therapy and has since opened her own business, now happy and making her way in life knowing she is helping many people. She has her own small business — one absolute reason she had to also renounce her US citizenship. She knew well by that time that Canada, where she was born, was where she prefers to live and work.
Two examples of *Accidental Americans* — one who should have had a CLAIM to a US citizenship if she chose to do so as an adult and with *requisite mental capacity*. The other a person entrapped into US citizenship and its CBT consequences — with no way out for any amount of money to any US tax lawyer or US tax accountant or US immigration / nationality lawyer. If there is such an anomaly as citizenship-based taxation, then there should never be an *automatic* acquisition of such citizenship, US or otherwise. Any child born, as my children were, in Canada (or any other country) to US parent(s) or children born in the US to other-country parents but who returned to their own countries when they were infants or children should through their facts be eligible to CLAIM a US citizenship – with full knowledge of all the consequences along with possible benefits of doing so. If that is NOT CLAIMED, there should be no *acquired* US citizenship, null and void if unclaimed. Isn’t that the only fair process for our Accidental American children if the US does not have and will not choose to change to residence-based taxation as the rest of the world (save Eritrea)? To me, if the US will not change its taxation law, it must change who IS automatically a US citizen. It should always be a CHOICE. I call these *Accidental Americans* none less than slaves to the unjust US system.
@broken man
This is reference 3 from Shadow Raider’s letter– a 50 page Treasury report from 1998. I found it extremely interesting. It offers a bit of historical perspective.
@Shadow Raider
A huge thank you. I’ve been Tweeting your letter far and wide. I believe it’s the Answer.
Sorry, here’s the link for that report:
http://www.treasury.gov/press-center/press-releases/Documents/tax598.pdf
@ Bubblebustin,
Re:
Well, some people would. Eg, I didn’t know about CBT until years after I relinquished. The US just wasn’t part of my life, so why be a citizen, was my thinking. I don’t have any problem with other people being dual citizens, but it’s not for me. So, I chose. I’ve known others who’ve chosen for similar reasons and also some people who chose to relinquish for political reasons.
The weird thing for me, in retrospect, is that in 1978 I felt fortunate that I had not only one good country (already more than many people in the world have) but was actually able to choose between two good countries.
Today, for me, it wouldn’t be a choice, it would be a necessity — and not involving, in my mind, two good countries, cause I sure don’t feel that way about today’s US, to whom the most important component of citizenship appears to be money/tax, and vilifying its citizens abroad and, as Calgary pointed out, trapping people in unwanted citizenship, which to me is a denial of freedom.
Anyway, I think people are still expatriating for non-CBT reasons; but I certainly agree with you in that undoubtedly most (an extremely high percentage) of the expatriations occurring today are directly because of CBT and the mess it is causing their lives.
Heartsick. Bingo. The trust is gone. Even if USA converted to RBT tomorrow, I would still want out, as I no longer trust them. The sooner I find a reasonable escape route, that noose is coming off, and I won’t be waiting around to see if RBT becomes a reality.
@US-foreign-person
Thanks for the guffaw.
Once I visited Virginia later in life and sat outside at 5 am in the morning (I used to smoke and the time change had me up early) and a sense of peace came over me. Weird I know- but it was the sun and the warmth of summer and the smell of the bushes I remembered so well. Maybe I was in some kind of trance because all the rest was just strange to me. But still- what I am trying to say is that I am european through and through now. When I renounced I mostly felt relief because the fear level was so great.
@ Bubblebustin @pacifica777
I’m with pacifica777 on this one. If the US had RBT and it made no difference financially (i.e. no exit tax, no renunciation fee, etc.) in getting a CLN, I would have definitely still have done it. I’m a Canadian and always have been. I don’t want to be considered an American by anyone. Never wanted it in the first place.
Sure there may be many who would not give it up if there was no CBT, but there are definitely those who would and are giving it up.
Well, the US government can be trusted in one sense. They can always be trusted to do what they deem to be in their national interest. It doesn’t matter what international agreements they renege on, what human rights they violate, how many of their own citizens they screw, or what the collateral damage is.
I learned this the hard way when I came to Canada as a Vietnam refugee. Those of my peers at the time who remained and “did the right thing” either came home in a box, came home horribly maimed, or were permanently rendered mentally unfit to cope with a normal life. They are doing the same thing to the veterans of the latest wars. This is, in my opinion, unforgivable. I didn’t feel the slightest regret when I shed my US citizenship. Good riddance to a lousy government. CBT is the least of the problems I have with that government.
The US government considers its younger generation to be an expendable commodity to promote whatever the current political agenda is. If they have no problem sending their young off to be killed in useless wars based on lies why should we be surprised that they also have no problem making life impossible for their expats. They simply don’t care. They have their sacred myths and their agenda (however wrong) and there is little hope of any meaningful change. They are drinking their own Koolaid to the point they are harming themselves and it doesn’t bother them at all.
Do I sound bitter? You bet I am, but I try not to let it negatively affect my wonderful life here in Canada.
@Polly
I understand where u are coming from… it wasn’t a trance.. it was the wonderful smells & thoughts of the past… its usually jet lag for me that the kids use against me… cause if I was of sound mind… I would have never ok them having a sword fight with my expensive knives… use the cheap knives… not the expensive knives… Sometimes u are just too tired to care…lol…
@MAZ
What you say is absolutely frightening. Terrifying.