UPDATE: JUNE 14, 2015
from JakDak:
The Senate Finance Committee chairman, Senator Orrin Hatch (R-UT), has established working groups to study different aspects of the tax system. These working groups are scheduled to report back to the committee by June 26.
Tax Policy Update
June 09, 2015[Interesting: NUMBER OF THE WEEK: 61. The number of countries that have signed on to implement the OECD’s multilateral agreement for the automatic exchange of tax information, in conjunction with the ongoing Base Erosion and Profit Shifting (BEPS) project. Although the U.S. has committed to implement the standard, it has not yet signed onto the formal agreement (the “multilateral competent authority agreement”), which lays out in detail what information will be exchanged, the timing and method of exchange, and how signatories will work together to ensure compliance. Signatories to the agreement will begin exchanging information as early as 2017. Additionally, the OECD released on June 8 its “Country-by-Country Reporting Implementation Package” developed under the BEPS Action Plan. Under the plan, which the Treasury Department has said it will implement for the 2016 fiscal year, multinational companies are required to aggregate and report information annually regarding where they do business, the global allocation of income, and amount of taxes paid, along with other information that will allow taxing authorities to more closely examine multinationals’ tax practices. The release of the package coincides with the 2015 OECD International Tax Conference in Washington, D.C., this week where OECD representatives are expected to review and discuss key initiatives under BEPS.]
SPOILER ALERT: Comprehensive Tax Reform Unlikely in 2015. In an interview last week, Senate Majority Leader Mitch McConnell (R-KY) outlined a busy legislative agenda between June and August recess: passing a highway bill, cybersecurity legislation, No Child Left Behind, and the Toxic Substances Control Act. Tax reform, however, is conspicuously missing from the list. “We’re certainly not going to be able to be doing big, comprehensive tax reform with this president,” McConnell said. Tax reform optimists have been eyeing the highway reauthorization bill as a potential vehicle to move a limited set of tax reform measures, but according to McConnell, the bill might instead be better suited to pick up a different legislative passenger—the reauthorization of the Export-Import Bank. McConnell believes the highway bill would provide the best opportunity to reauthorize the bank, which is set to expire June 30.
The inability of the Senate Finance Committee Tax Reform Working Groups to meet their original May 31 deadline to report recommendations to Chairman Orrin Hatch (R-UT) and ranking member Ron Wyden (D-OR) only adds to the general pessimism. The international tax working group may offer the only glimmer of hope, with reports that it has made the most progress in hammering out detailed recommendations. The working groups are now aiming to deliver their reports before Congress departs for the July 4th recess.
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UPDATE: MAY 25, 2015
Em’s comment to JakDak:
I’m not sure of the where for the SFC recommendations but the when has been delayed:
http://thehill.com/policy/finance/242916-senate-tax-reform-groups-get-more-time
The Senate Finance Committee’s leaders are giving tax reform working groups some more time to formulate their recommendations.
Finance Chairman Orrin Hatch (R-Utah) and the panel’s top Democrat, Sen. Ron Wyden (Ore.), had hoped for recommendations by the end of May.
But in a statement Thursday, the two senators said that the working groups made it clear that they needed extra time to do the job right. The panel will set a new deadline after lawmakers return from next week’s recess.
“It is our hope these bipartisan working groups will use this extended time to finalize their recommendations for tax reform and produce in-depth analyses of options and potential legislative solutions,” Wyden and Hatch said in a statement.
etc.
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Shadow Raider says
April 29, 2015 at 6:39 pm
The Senate Finance Committee just released the comments sent by the public on tax reform. As expected, there are lots of comments about CBT and FATCA.
http://www.finance.senate.gov/newsroom/chairman/release/?id=3b14e94b-69f9-41e2-9fd3-7d191971b7ee
Hatch, Wyden Release Public Input on Bipartisan Tax Reform
Over 1,400 Submissions Made to Working Groups
WASHINGTON – Finance Committee Chairman Orrin Hatch (R-Utah) and Ranking Member Ron Wyden (D-Ore.) today released over 1,400 submissions from stakeholders on how to best to overhaul the nation’s broken tax code. In March, the Committee sought input from the public in an effort to provide additional data and information to the Committee’s bipartisan tax working groups, which are currently analyzing existing tax law and examining policy trade-offs and available reform options within each group’s designated area.
“We thank the stakeholders and public who provided us with this valuable data and input,” Hatch and Wyden said. “These submissions have equipped us with the ability to better evaluate how reforming the tax code will affect both American families and business of all kinds. As our bipartisan groups work towards producing substantive recommendations on how to reform the tax code, they will now be able to consider these valuable ideas.”
All comments received by the Committee that met submission requirements were made public.
Submissions can be found below. Total submissions to each bipartisan tax working groups are as follows:
Individual Income Tax – 448
Business Income Tax – 332
Savings & Investment -128
International Tax – 347
Community Development & Infrastructure – 207
Each of the five bipartisan working groups is currently working to produce findings on current tax policy and legislative recommendations within its area, with the goal of having recommendations from each of the five working groups completed by the end of May.
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Thanks, Shadow Raider, for alerting all here. There will be many Brockers reading, starting with the submissions (not all by individuals) to International Tax.
Being patriotic to a bunch of dirt that has arbitrary lines seems dumb at best. There can be admirable to horrible traits of people living on the bunch of earth, but to love a piece of dirt? I don’t think so.
@Heidi, @Em-Bee, in regards to what homelanders should be able to do……..
It is up to the US Government to determine what its laws should or should not be within its territory.
If they deem homelanders need to fill out fincen forms so be it……
We must be consistent in what we believe.
@D-L Nelson, I agree with your premise but you/we need to understand where they/homelanders are coming form in their state of mind…..Stephen Kish could probably write a paper on the subject.
Brockers are NOT homelanders!!!! We left so we are unique….but we all left so we have that common link amongst us…it is a type of libertarian link…..
People that immigrate to the USA are different than the people they left behind in their home country. The majority of people in Mexico/Central/South America do NOT plan to actually go to the USA.
If you take a conservative politically Brocker and compare them to a conservative Homelander, I think even though they are ideologically similar there is something profoundly different between them.
Look at the two groups Democrats Abroad and American Citizens Abroad…….those people are different than us!! They actually are interested, very interested, sometimes rabidly interested in what is happening “back home.” To be honest, I am as interested in what is happening internally in the USA as I am interested in what is happening in Chile.
Where I live, I have run into folks (ACA types) that are all keyed up about weither Hillary is going to get the nomination. Me…..I frankly do not care……and when I tell them I do not care I get this glaring look back like how could I not care because I have the same accent they do!!!
The last few years have been a “Journey of Identity” for many of us.
I think the crux of the problem is;
1.) Homelanders think Brockers are Americans Abroad!!! I believe that they believe that something mystical happens if you are born on that patch of dirt.
2.) Brockers have now gotten a clear understanding that they are Canadians in Canada or French in France or Irish in Ireland………. Ginny and Gwen CLEARLY get it, they are NOT American!!
I got some more clarity when I realized that because of my mutt lineage that with changes in Canada Citizenship that I could go through the process and “claim” another citizenship. So yes, I could stary carrying a Canadian Passport, it is insane for me to think or call myself Canadian!! But at least Canada is not going to bother me…..and for the record I did relinquish my USC many moons ago.
@EmBee I agree people should be able to keep their money wherever they want to. They also should pay tax on income from that money to the country where they live.
My post about Congressman Grayson was to point out to R Talbot that it is not only Republicans who seem to have dirty little secrets. The potty mouthed Democrat said his millions of dollars were in the Caymans to reduce tax liability.
If the Democrats expect the Republicans and all of us to file FBARs for criminal investigation with FinCEN, shouldn’t the Dems do the same? Or are they entitled to their own dirty little secrets?
Remember, it was a Democrat who insisted FATCA data be made available to national security and law enforcement agencies for investigation of money laundering, drug trafficking, terrorist financing, corruption, fraud and other crimes and misconduct.
http://maplesandbox.ca/2013/carl-levin-fatca-for-law-enforcement-national-security/
Surely, that would also apply to a potty mouth Democrat Congressman with $5 million to $25 million in the Caymans, wouldn’t it?
@R Talbot I hope you will answer some of the multitude of questions and comments you have raised here.
@R Talbot As U.S. Citizen Abroad said:
Instead of saying RBT is not going to happen and instead of attacking us and the Republicans, why won’t Democrats Abroad work with Republicans Overseas to stop this attack on innocent people.
Someone who is not even directly affected by this has spent huge amount of his own time and energy to make it easy for Congress to adopt CBT.
http://www.taxconnections.com/taxblog/making-citizenship-based-taxation-reform-easy/#.VVnXmlJvnhl
Democrats Abroad, Republicans Overseas, ACA, AARO and others could join together and promote this to Congress. Because Americans Abroad need tax justice too.
http://thehill.com/blogs/congress-blog/economy-budget/240259-americans-abroad-need-tax-justice-too
Because I do not want to be accused of any dirty little secrets, here is a full disclosure: I am the author of the article in Tax Connections and the co-author of the one in The Hill. I am not a Republican, Democrat or American. I am a Canadian.
Just checking FATCA at Wikipedia Interesting read
these systems allow 2 governing authorities over the same activity occurring in one country. etc.
http://en.wikipedia.org/wiki/Foreign_Account_Tax_Compliance_Act
@George
I agree one has to abide by the laws of the country where one is a resident. Here in Switzerland I have to declare my wordly wealth and I pay a wealth tax on that which influences my yearly tax rate. I do not have to report it to a financial CRIME bureau and as an EU citizen I am not prevented from having an account in ANY country in the world . The US gov have made their citizens toxic.
I am being consistent. Homelanders deserve the same as all of us as long as they are prepared to declare their accounts they should not be prevented from owning assets abroad. FATCA and cbt effectively prevent them from doing this.
There are some homeland brockers here too.
@Heidi
*The US encourages foreigners to buy vacation homes in Florida *
Because this is a trap… if u are not very careful in counting your days in the US… u can be treated as a US person & be stuck in the heck like all of us are in… if u are a Canadian living near the US border… its not a big deal to pop over the border for a few hrs… now that the US & Canada are tracking all our movements… this can be a very expensive mistake & all your life is laid out bare for every database…
@US Foreign person
Yes, I understand this 120 days rolling average over 3 yrs. The UK has joined the club, they are not part of the shengan agreement and are checking people in and out now under the pretext of terrorism but really it’s all about tax. The EU still has open borders.
@Heidi, “The UK has joined the club, they are not part of the shengan agreement and are checking people in and out now under the pretext of terrorism but really it’s all about tax.”
Picture a dual UK/US Citizen departing London Heathrow to Los Angeles.
They must present a US Passport to the airline to depart the UK and enter the US because of the pre-information clearance.
But…….the UK will cross check and find that person under a US Passport has had no visa or record of entering the UK!!!!
The UK is not part of Schengen.
@George
I was not thinking of US persons but of many UK citizens who have retired abroad to Spain or Portugal and become officially resident there. Many retain a presence in the UK. They will now be logged in and out just like the US does to Canadians for tax purposes. But it has been reported to be for security reasons…. The rest of the EU has open
borders.
@George
I was not thinking of US persons but of many UK citizens who have retired abroad to Spain or Portugal and become officially resident there. Many retain a presence in the UK. They were once only logged in but now it’s also out (just like the US does to Canadians for tax purposes.) It has been reported to be for security reasons…. The rest of the EU has open
borders.
Hatch, Wyden Release Public Input on Bipartisan Tax Reform / Over 1,400 Submissions Made to Working Groups
Recommendations are supposed to be out by end of this month,
Anyone read or heard anything regarding this
I believe many people are holding their breath
@JakDac
I wouldn’t hold my breath on this… recommendations don’t mean anything… I have yet to see real action… we can not rely on the US to wake up from this nightmare they created… too busy rubbing their hands for all that free info they will get from the world… money they are getting from not the taxes but the crippling fines for mistakes made or people not knowing since none of us hired fancy expensive professional help to keep on top of the ever changing rules…
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Just maybe the problem is the DA nor the DNC know the US taxes based on citizenship!!!! Maybe if we enlighten them they will understand the error of their ways. An exchange on the Democrats Abroad France FB page regarding Same Country Exemption: (I really don’t know if this is funny or frightening).
Mark Horchler I don’t see how this solves the real problem which is CBT.
Like · Reply · 10 hrs
Democrats Abroad France What is CBT?
Like · 1 · 9 hrs
Democrats Abroad France Please contact Democrat Abroad at any time with questions: FATCA@democratsabroad.org
Great Expat info
http://www.expat.hsbc.com/1/2/hsbc-expat/expat-experience/expat-finances/global-tax-navigator#!/AU
Got this from a Australian tax advisor in the US Your opinion ?
The treaty clearly excludes pensions from US Tax.
https://www.law.cornell.edu/cfr/text/26/301.6114-1
@EmBee
Todd Stoudt’s submission on the International list. It’s a very long story but it shows how confusing it can be to try to comply. He was calculating each salary payment from multiple employers with the daily exchange rate because nobody bothered to tell him he could MUCH more simply use the annual average exchange rate.
The confusion came not from no one telling me that I could use the annual average rate, rather from specific instructions from the IRS that I must use the daily rate. These instructions were in the form of a letter attached to the cover of the instructions for my tax return that year sent directly to my Japan address by the IRS and confirmed verbally during two separate, middle of the night expensive overseas phone calls to the IRS.
Since I first posted on this issue I have been giving it much thought. I seem to remember that my capital gains on my mutual fund in the States was somehow involved. My capital gains being a whole buck 27 or some other similarly infinitesimally small amount, it was a whole lotta trouble over nuthin.
CBT is a whole lotta trouble – and loss – over nuthin, Japan T, and needs to go into the dustbin of history.
Hear! Hear!
@ Japan T
Yes I realized that when I reread the submission. But I remember thinking for a few heart stopping moments the first time through … OMG … did my husband do that wrong too? If we had received any instructions like the TS attachment we never saw it, so ignorance and/or the average annual exchange rate turned out to be bliss. Thinking about the lost “Golden Week” hours/days and the lost LCUs (Just Me’s Life Credit Units) makes me want to choke an IRS critter. The only time my husband used the daily rate was when he inherited some stock from his mother and as quick as possible he cashed out. What a mind-boggling experience the Schedule D became for both of us because of that. On the Canadian side though, when my husband phoned to ask which exchange rate to use they just said pick whichever you want and stick with it throughout the calculations … soooo much easier. He simply attached the spreadsheet he had had to put together to untangle the US side and entered one final number on his Canadian tax form … again soooo much easier.
Even my Japanese tax returns are soon much easier to understand, and they are in Japanese! Takes just half a day.