As the date for the summary trial for the Canadian FATCA IGA draws nearer, behind the scenes, various groups are contemplating other ways to attack USA’s extraterritorial overreach into the sovereignty of other countries, and its insistence that US persons abroad are Americans first and foremost, thus subject to US law. Republicans Overseas are expected to soon be announcing a legal challenge against FATCA from within the USA. Rumblings at the Isaac Brock Society, and at various forums representing Americans abroad, hint at a potential future legal challenge aimed directly at citizenship based taxation.
All these attempts at helping to save ‘US persons’ living outside USA from American laws, are laudable and worthy of support. However for the most part, no group has been talking about another obvious battle to be fought, which is the fight to help set people free from the chains of unwanted US citizenship. How many times have we heard from homeland Americans who don’t understand our pain, “If you don’t like it, why don’t you just renounce”? Unfortunately, relinquishing US citizenship is a mine field full of potential compliance nightmares (ex’s: PFICS, foreign trusts), possible penalties, and an outrageous renunciation fee (currently $2,350 USD), thus rendering it a near impossibility for many.
Yet to be free from US citizenship would mean freedom from FATCA, and freedom from citizenship based taxation(CBT), and ultimately freedom from ANY AND ALL US LAWS imposed by USA against those it considers ‘US persons’ NOW AND FOREVER MORE.
Of course not everyone wants to give up US citizenship, and for those who do not, their interest is naturally directed more towards the particular US laws that cause harm to Americans living outside USA – currently FATCA and CBT. Some think that FATCA would be fine if USA were to operate on a residence based taxation system like 99.9% of the rest of the world. They argue that citizenship based taxation is the root cause of all US persons’ problems worldwide and therefore is the dragon to be slayed: freedom from CBT is freedom for everyone, whether that person considers themselves to be an American Abroad, or just a Canadian who happens to have been born in the USA.
Others worry and wonder what the USA will dream up next to inflict on its persons living outside USA. Some see US citizenship as the root problem, particularly those who have never identified as American or who are fed up with US imperialism and have fully embraced the nationality of the country they now live in, and are citizens of. Freedom from US citizenship would relieve a US citizen from FATCA and CBT and from all extraterritorial US laws aimed at US citizens.
Unfortunately, so far no one is championing a fight against this particular battle – the right to be able to easily rid oneself of unwanted US citizenship. It could be argued that the Canadian government should intervene and help Canadians rid themselves of clinging US nationality. Canada has the most US persons numerically and per capita in the world. In addition, Canada is unique in that it shares not only a border with the USA, but also a very similar culture. Canadian US persons, unlike US persons elsewhere in the world, don’t have the distance between them and the ‘home country’ that tends to make the heart grow fonder. US persons in Canada look and act and sound for the most part (minus an accent perhaps) like every other Canadian. They blend in. They assimilate more readily than say for example Americans who expatriate to Japan or Germany or Sweden or Australia.
Canada, should be saying to the USA, “These people you call ‘Americans living in Canada’ are Canadian. They live in Canada. They don’t belong to you. Make it easy for them to cut the ties and formally renounce a citizenship that they don’t want. We don’t care about your FATCA laws or your CBT laws or any other US laws. Do not apply your laws to Canadian citizens living in Canada. If you are going to insist that those you deem US citizens obey your laws while living in Canada, then give Canadians the freedom to choose whether or not they want to be US citizens”. The governments of all countries should be saying this, but they are not. The Canadian government should be leading the way, but it is not.
Maybe it’s time for some legal action from Canadian citizens with ‘boots on the ground’, to insist that the USA let people who do not want to be US citizens, go free. As with the Canadian FATCA IGA lawsuit, Canada with its unique position as neighbour to the USA is the obvious country to lead the way towards freeing people world wide from the chains of unwanted US citizenship. But so far, this has not happened. Is anyone up to the challenge?
I am curious what people think with regard to the following two options. And since we all have different backgrounds – some are Canadian, some identify as American, some are US tax compliant, etc – those differences will impact our choices.
If you are deemed a ‘US person living outside USA’, and you were to be presented with the following two choices, which would you choose?
1. You may remain a US citizen, but citizenship based taxation will no longer apply to you. You will no longer have to file US tax forms while living outside of the USA, and USA will forgive you of any prior non filing. Note however that you may or may not be subject to FATCA (that hasn’t been worked out yet, as you are still a US person), and the same goes for FBARS since technically your accounts are foreign (not in the USA). There is of course no guarantee that additional US person rules will not be imposed on you in future but rest assured that CBT is history.
2. You may renounce US citizenship with no strings attached. It doesn’t matter if you never filed a US tax return or FBAR in the past. There will be a small, administrative fee (approx. $200), to process your request, but there will be no past compliance issues to deal with. You will receive a Certificate of Loss of Nationality for your records.
In order to help understand the choice you make, it would be appreciated if you would also answer the following questions:
1. What country do you live in?
2. Are you a citizen of the country you live in?
3. How long has it been since you left the USA?
4. Do you plan to return to the USA to live at some point in the future?
UPDATED June 20/2016 (thanks to Char for the suggestion): For a person with a disability rendering him/her incapable of making a decision for himself/herself, his/her guardian can make the decision between choices 1 and 2 above on his/her behalf.
I have a better idea: Let us sell our unwanted citizen to some illegal immigrant living in the United States for a fair price, say to the highest bid on e-bay.
Petros, you are free already, so you can’t answer the questions. I am serious. I want to know what people would choose, and where they are from, how long they have been away, and whether or not they plan to return to the USA….so quit screwing up my impromptu survey! 🙂
Option #2 (already renounced)
1. What country do you live in?
Canada
2. Are you a citizen of the country you live in?
Yes, from birth
3. How long has it been since you left the USA?
49 years, as an infant
4. Do you plan to return to the USA to live at some point in the future?
Not a chance. Never wanted to live there, never wanted to be American.
Oops, just saw your comment, and I guess I’m not supposed to answer. 🙂
@theMom, that’s OK…lol…you are from the SOO. I get it.
Option 1
I live in Japan and France.
I am not a citizen of either country
About 20 years
Honestly I have no idea where I am going to be in 3 months, much less 3 years or 3 decades. I might go back to the US or I might retire in Casablanca. I could be dead long before I made a choice (yep, clinic visits next week 🙂
Interesting poll, WhiteKat. It seemed to me that I had written something a few years ago about the renunciations and I was right. This is a post from 2013 – note tht SCE is first on the list. Oh was I naive back in those days…..
http://thefranco-americanflophouse.blogspot.fr/2013/05/a-few-ideas-for-resolving-american.html
I have no choice other than OPTION 1.
However, I would strongly support any effort toward Option 2, since I am considering renouncing, and one of the (many) obstacles is the opening of the Pandora’s Box of my last six years of questionable compliance.
I’m still too paranoid to reveal anything too close to my identity, so I’ll reply to your questions as follows:
1) I live in an East Asian country, where it is possible, but quite uncommon and covered with hurdles, for a white westerner to obtain citizenship.
2) Not a citizen of that or any country except the Grand Old USA. We qualify in theory for local citizenship, and my husband and I are strongly considering doing so if there are no positive moves in regards to FATCA, FBARs and CBT in the next year.
3) Left the USA 30 years ago.
4) We don’t intend to return to the USA to retire or live there for any foreseeable reason. Though, never say never, eh? The chance is miniscule at best.
1. Thailand
2. Yes – naturalized
3. 20 years
4. No, plan on retiring in Asia. But never say never
** I have no desire to give up my US citizenship but am being forced to by CBT, FATCA and FBAR’s effects on my life in Asia. I have no hatred for the USA at all, but detest the US Government/this Administration for making me make this horrible choice. It is wrong, it is unfair, and it is unnecessary
Option #2 for me. I would get rid of my US ‘citizenship’ tomorrow if I could. I do like a lot about America but it is not the place for me. Also CBT is a scandal, legalised extortion …if homeland Americans REALLY knew what it was about, ignoring all the insidious propaganda, most would hang their heads in shame.
1. The UK
2. Yes
3. 30 years
4. NEVER
@WhiteKat, “Unfortunately, so far no one is championing a fight against this particular battle – the right to be able to easily rid oneself of unwanted US citizenship.”
Well I have…….but its fighting windmills.
But I do believe that all US Persons have a Constitutionally protected right to easily get rid of their US Citizenship and that it should be without any fear!! That said….we just need a US Court to say it. 🙂
“Unfortunately, relinquishing US citizenship is a mine field”
Renouncing is clearly a minefield…
Relinquishing per se can be less of a mine field in some circumstances.
“and ultimately freedom from ANY AND ALL US LAWS imposed by USA against those it considers ‘US persons’ NOW AND FOREVER MORE”
I sadly believe that we will never be free, with a CLN, or without…..I am in Blazes camp…do not trust em…
” It could be argued that the Canadian government should intervene and help Canadians rid themselves of clinging US nationality.”
Great cakes think alike…meow…meow….
Here is one path for this to occur………….
1. A Canadian Citizen who has committed a relinquishing act under 8 US Code swears out an affadavit before a Lawyer that they committed the act under this US Law all done voluntarily to relinquish…blah blah blah…..its signed, witnessed and stamped….
2. Canadian Citizen goes to FI and says I am not a US Citizen here is statement sworn before a lawyer.
3. Canadian Bank says statement is not good enough….
4. Go to Court!!!
1. What country do you live in? I live in the European Union
2. Are you a citizen of the country you live in? Yes…..and a few others deem me their own including Canada.
3. How long has it been since you left the USA? A decade, but prior to leaving my personal roots were deep and wide.
4. Do you plan to return to the USA to live at some point in the future? ROTFLMAO…….never…never..never. I do not even like to visit anymore…
In regards to options I need to preface that I committed a relinquishing act, the US Govt acknowledged that I relinquished and in writing, lots of $$$$ spent on legal fees but I do not have a CLN because at the time I did not know anything about CLNs and frankly no one cared……..
Having said that I would be tempted by Option 2 to become a documented emigrant but I am like Blaze…do not trust em.
https://en.wikipedia.org/wiki/Bobby_Fischer
Yes other US Laws do apply to US Persons. Look how the US Government pestered Bobby Fischer the chess player.
Yes you may not have agreed with his politics. Yes praising the terrorists on a radio station in Philippines about 911 gained him enemies in the US, but at the end of the day he was outside the US and shouldn’t be subject to US law.
It all ended with the US cancelling his passport (because he played chess in Serbia defining US trade sanctions) and getting arrested in Japan. The Icelandics came to the rescue offering him an Icelandic Passport allowing him to travel there until he died in 2008.
The US has to realise its laws stop at the US border.
1) Europe
2) Yes
3) 35 years
4) Only if something disastrous happens…divorce or widowed. Otherwise I stay here.
Check out Nigel Green’s repeal fatca endorsement http://www.nigel-green.com/2015/06/19/latest-repeal-fatca-push-gets-my-full-support/
I would strongly favor option #2. I don’t believe that anything short of judical actions will save us from these so called laws and agreements. Equal justice under the law, hah you mean all the “justice” one can afford. At least more and more it’s looking like we will be rid of Harper in four months, but that’s the devil we know what the next government will do is anyone’s guess.
1. Canada
2. YES
3. 20 years
4. NO WAY
Thanks for your survey, WK.
I renounced my US citizenship officially (to have that CLN) in 2012 THOUGH was told in 1975 when I became a Canadian citizen that I had thereby lost US citizenship. Nevertheless, I cannot answer for myself but I will on behalf of my son without *requisite metal capacity*.
…and I agree with Petros, that automatically and supposed *acquired* US citizenship that clings to THIS PERSON will be given at no cost to the first DREAM student who does not have documented legal status in the US.
1. What country do you live in? — THIS PERSON LIVES IN, AND ALWAYS HAS, CANADA.
2. Are you a citizen of the country you live in? — THIS PERSON WAS BORN IN CALGARY, AB, CANADA (to two, at the time, US citizen parents) SO *SHOULD BE* A CANADIAN CITIZEN THOUGH CONSIDERED BY THE PRESENT CONSERVATIVE GOVERNMENT *A US CITIZEN WHO HAPPENS TO RESIDE IN CANADA* AND TOLD TO *JUST RENOUNCE*.
3. How long has it been since you left the USA? — THIS PERSON NEVER LIVED IN OR HAD ANY BENEFIT FROM THE USA.
4. Do you plan to return to the USA to live at some point in the future? — THERE COULD NEVER BE A *RETURN* AND, SINCE ALL FAMILY AND SUPPORT RESIDES IN CANADA, IT IS LUDICROUS TO IMAGINE EVER MOVING TO THE USA FOR THIS PERSON.
Neither option should apply. THIS PERSON or someone on his behalf will not go through the hoops and expense and additional stress for his family to prove (not *claim* though) US citizenship.
@George,
RE: “Unfortunately, relinquishing US citizenship is a mine field”
Renouncing is clearly a minefield…
Relinquishing per se can be less of a mine field in some circumstances. ”
My understanding is that renouncing is a form of relinquishing citizenship, which is why I used the term relinquishing – figured someone would comment on that.
RE: “I sadly believe that we will never be free, with a CLN, or without…..I am in Blazes camp…do not trust em… ”
Agreed, don’t trust them neither, that is partly why I wrote this post. Who knows what other laws will be applied to US persons in future??
I’d feel safer with a CLN than without one.
Will remove, Charl, though your comment didn’t look a mess to me (and I can still put it back).
(I would have the proviso not just for someone mentally disabled but for anyone without requisite capacity like my son’s *developmental disability*, which would include those with things like age-related dementia, Alzheimer’s Disease, a brain injury from a medical event or an accident, a mental illness, etc. Such persons must not be influenced in their decision by anyone AND a parent, a guardian or a trustee cannot act on such a person’s behalf, even with a court order)
@Terrified2Sleep,
Thanks for your response. Have you relinquished/renounced already – if not, curious whether you would choose option 1 or 2?
@Calgary, Char made an excellent suggestion which I have updated the post to reflect (at the end).
@WhiteKat, “But I’d feel safer with a CLN than without one.”
I actually feel safer without a CLN. But I do have an official letter after five figures in legal bills…..
My fear of a CLN today is getting roped back in!!!!!
But had I really known about CLNs a decade ago, I would have obtained one at the time.
Option #2 (Including a provision that guardians can renounce for the mentally disabled).
1. What country do you live in?
Canada
2. Are you a citizen of the country you live in?
Yes
3. How long has it been since you left the USA?
40 years
4. Do you plan to return to the USA to live at some point in the future?
No never!
But for some inexplicable reason I remain in a rage that the US is forcing me to make decision #2. They have no right to impose citizenship for those that do not want it and no right to force people to renounce. That should be OUR choice, not theirs. CBT/FATCA has given many no choice. What do I gain from US citizenship? NOTHING, but it is still my choice not some ignorant legislators choice. (Maybe I have just not left the defiant toddler stage).
I also must add that choosing option #2 is circumstantial for me. If the same conditions were occurring a mere eight years ago when my parents were still alive and I had no knowledge of how I would be needed in their long term elder care I would have had to choose #1. Once their needs had been met, whether it was one year or ten I assume I would have returned to Canada and chosen #2. My daughter, friends and life are here. My ashes will be under a tree on Cherry St Beach in Toronto and, here is where it gets so complex for me,….at Race Point Beach in Provincetown, one of my favourite places on this planet. (Sadly it is in the US).
So it seems I want both options depending on where I am at in life. Having elders/family in the US really complicates things. If CBT was gone and one could easily renounce, US deemed citizens could have a normal life as most everyone else on this planet enjoys. So, yes I want it all and yes, I am dreaming.
@Char, re: “I also must add that choosing option #2 is circumstantial for me. If the same conditions were occurring a mere eight years ago when my parents were still alive and I had no knowledge of how I would be needed in their long term elder care I would have had to choose #1 ”
Curious – why would this make a difference which option you would choose? You could still care for your parents in the USA, as a Canadian could you not? (i.e. why do you feel you would have needed to be a US citizen when your parents were still alive?)
I just assume I would be in a mess if I was no longer a US citizen and needed to stay for an uncertain number of years. I did give it a “try” for some months one time but my mother’s dementia was more than could be managed in a home setting. But if indeed I had been able to manage her illness it, most unfortunately, played out for five years.
But I do understand that my particular situation may have been an outlier as cruel and unfortunate as it is for those in similar circumstances. The insanity lies in that it cost the government far more to provide for her institutionalized care than it would have if I was able to be her caregiver. (Maybe there is special VISA for caregiving that I am unaware of). OR, maybe that can be another addendum for option #2!