Cross posted from: https://adcsovereignty.wordpress.com/2015/07/08/cbtlawsuit-first-report-of-senate-finance-committee-brings-citizenship-taxation-lawsuit-one-step-closer/
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#CBTLawsuit – First report of Senate Finance Committee brings citizenship taxation lawsuit one step closer
As reported at the Isaac Brock Society, the “International Taxation Committee” has released it’s report on tax reform. In spite of the fact that more than 3/4 of the submissions were from Overseas Americans, the committee, acknowledged, but failed to address the intolerable treatment of Americans abroad.
As barely, a footnote, the Committee ended with:
F. Overseas Americans
According to working group submissions, there are currently 7.6 million American citizens living outside of the United States. Of the 347 submissions made to the international working group, nearly three-quarters dealt with the international taxation of individuals, mainly focusing on citizenship-based taxation, the Foreign Account Tax Compliance Act (FATCA), and the Report of Foreign Bank and Financial Accounts (FBAR).
While the co-chairs were not able to produce a comprehensive plan to overhaul the taxation of individual Americans living overseas within the time-constraints placed on the working group, the co-chairs urge the Chairman and Ranking Member to carefully consider the concerns articulated in the submissions moving forward.
What does this mean?
At a bare minimum it means that:
1. The “International Committee” views its purpose as dealing with “corporate interests” and not “individual interests”.
2. The “International Committee” views DNA Americans as less important than “Corporate Americans”.
3. The “International Committee” has acknowledged the urgency of the situation “for the international taxation of individuals, mainly focusing on citizenship-based taxation, the Foreign Account Tax Compliance Act (FATCA), and the Report of Foreign Bank and Financial Accounts (FBAR).”
Remember that many of the same submissions that were sent to the “International Committee” were also sent to the committee focusing on “Taxation of Individuals”. It’s difficult to see how this could not be addressed further by that Committee.
In terms of where to go from here …
1. There will (in the very near future) be a lawsuit launched in the United States against the most egregious aspects of U.S. TAX policy, as they relate to ALL PEOPLE deemed to be “U.S. persons” who reside outside the United States.
2. The lawsuit is likely to, in addition to issues of taxation, include issues related to the “forced imposition of U.S. citizenship” on people who do NOT regard themselves as U.S. citizens or “U.S. persons”. Can the United States deem people to be “U.S. persons” when they believe that they are not?
3. The lawsuit will NOT be run by or through the “Alliance For The Defence of Canadian Sovereignty” (which will “stay at home” dealing with our FATCA lawsuit). It will be run by and funded by a different organization.
4. We hope for the support of all the various groups deemed by the U.S. Government to be “Americans abroad”. “If Americans abroad do NOT hang together, they will hang separately“.
Evaluating your personal situations …
It’s obvious that “U.S. citizenship abroad” lies somewhere between “difficult and impossible” (depending on your personal circumstances). The report from the “International Committee” suggests that the “plight of Americans abroad” is NOT likely to get better soon. This reality raises the obvious question of whether it’s safe to retain U.S. citizenship in a FATCA and FBAR world.
Stay tuned.
John Richardson
P.S. Here is the report from the International Committee.
You have made my day. If there is ANYTHING I can do to help just let me know. I am so proud of you folks. No one else on this bloody planet has the courage to do this. (If you are in need of stationary or a logo may I design it)?
US tax slaves unite!
I’ll donate.
What would be the grounds for the lawsuit?
“2. The lawsuit is likely to include issues related to the “forced imposition of U.S. citizenship” on people who do NOT regard themselves as U.S. citizens or “U.S. persons”.”
Does this mean the lawsuit will be focused on, and limited to, only so-called “accidental Americans?”
Or will the lawsuit include ordinary Joe Six-Pack expats who left the US as adults, albeit decades ago?
To put it another way, is this CBT lawsuit for all Americans permanently living outside the United States?
Or is this a carve-out for so-called accidentals?
2. The lawsuit is likely to include issues related to the “forced imposition of U.S. citizenship” on people who do NOT regard themselves as U.S. citizens or “U.S. persons”.
I like the sound of that! This taxation/citizenship/privacy problem needs to be attacked from many sides. This lawsuit in the offing can be seen as doing that.
I suppose we will see the breadth of coverage of the lawsuit soon enough.
If they are smart, they will realize, the wider the coverage, the easier the fund raising.
Ditto what Embee says. I hope that the restrictions as to who is included in the ‘forced citizenship group’ will be narrow (ex. based on length of time having resided abroad), thus including people like Walt.
Also am happy to see that the Alliance for the Defence of CANADIAN sovereignty has decided NOT to be the organization to take this on, and instead will “stay at home dealing with our FATCA lawsuit”.
Wonderful news on the CBT suit!!! Who cares what group is doing it. ADCS or not (I know its not). If your drowning, who cares who is there to rescue you!!
Phil, If an organization called “Save the Bees” starts saving elephants instead, no one will argue that saving the elephants is a bad thing to do. But what about the poor bees?
People can walk and chew gum at the same time.
Reading between the lines, it seems like the lawsuit may have a focus on people who believed they had relinquished US citizenship when they naturalized elsewhere, even though they may have kept their US passport.
I would be interested to know if the lawsuit will include people who lived outside the US for many years as permanent residents of another country, but only recently obtained a second citizenship (in order to get rid of the US one).
There are many people like that.
I don’t know about that Phil. Trip while walking and you might choke to death on that gum.
I’m confused here. It seems the Paul/Bopp lawsuit has again fallen off the radar. Does anyone have any inkling of whether it will be filed later this month as alleged?
I’m also unclear about the proposed lawsuit referred to here, and even a bit wary. I’m no legal expert, but it seems to me that CBT and “forced imposition of citizenship” (accidental Americans) are, legally speaking, two completely unrelated issues. Yes, yes, yes, I know! For all you accidentals, they absolutely are intertwined and make your lives living hell. But both issues have their separate pitfalls and nuances, so it seems to me they are best addressed separately in the courts.
What worries me most is that the suit will focus only on imposed dual citizenship. As much as I feel for all you accidental Americans, and share your rage, my concern is this: If a lawsuit on this issue prevails, or if the laws are amended, so that the IRS grants a full exemption against filing 1040s, FBARs and being FATCA’d, to anyone who fits a specific checklist, it then gives the US government reason to say, “Well, that injustice is taken care of. Now we can really f— all the ‘real’ American expats up the colon, now that their most powerful argument against CBT is removed.”
I applaud this action, especially number 2.
@ Barbara
I wouldn’t jump to that conclusion. I get the impression that the primary goal of this legal action would be to end CBT, which will free all of us.
“1. There will (in the very near future) be a lawsuit launched in the United States against the most egregious aspects of U.S. TAX policy, as they relate to ALL PEOPLE deemed to be “U.S. persons” who reside outside the United States.”
It’s O.K. to be concerned.
But at this point I’d take heart that “ALL PEOPLE deemed to be ‘U.S. persons’ who reside outside the United States” means “ALL PEOPLE deemed to be ‘U.S. persons’ who reside outside the United States”.
@Shovel
correct
Can anyone comment on the lawsuit that was supposed to be filed over a week ago in the court in Ohio? They were making/adding additions, then they were supposed to file. What happened?
Thanks, all, for the reassurance. I’m on pins and needles waiting for all this to actually happen. Though after reading the news about the Senate Finance Committee, the needle has tipped way over toward hubster and I applying for not-particularly-attractive local citizenship and renouncing. A US-based lawsuit could take so many years that I’ll be old and feeble (almost there anyway) before it reaches the Supreme Court or any definitive change in the law. Not that I won’t wholeheartedly support such a lawsuit. But for myself, I have to say that I’ve pretty much given up hope.
As suggested in one of my submissions to The Senate Finance Committee, that because of injustices of double taxation without representation, with excessive compliance cost, with excessive compliance penalties, without a care by the US government for the well being of US persons overseas, and with $0 in US government services in exchange :: I considered them all Communists until proven otherwise.
Their latest act of ignoring injustices by the US government against US persons overseas has reconfirmed that they – the Senate Finance Committee – are all Communists, and have demonstrated a substantial act of illegitimacy of their “authority.”
It would be opportune for the new entity pursuing legal action against US government injustices against US persons overseas, to produce a Declaration of Grievances And Resolves on behalf of US persons living overseas.
Barbara, I am on my way out. I had good advice from this site about relinquishing, but because of my family situation, I am complying and renouncing. I renounce in December In Calgary. I am no more an American than the Queen! However, I feel bad for all the people on this site who didn’t want to renounce and felt they had too. I hope one day if they wish to have the citizenship restored it will be an option. They should be compensated, too. What utter nonsense, CBT!
@Ann #1 I have suggested and will suggest a Class Action Lawsuit against the USG by nonUS family members of US persons for damages to family financial security in ones home country caused by CBT, FBAR, FATCA. While not likely (and I would support the anti CBT lawsuit first) I hope and aim such request to be provocative and to highlight injustices. Do we have a $ figure to attach to such a lawsuit? $300 billion ?
I wasn’t expecting much from the Senate Finance Committee report, but I thought they would at least declare that they oppose CBT in principle, as they did the last time. Until they show a decent response, I give up talking to Congress.
I’m happy to see that someone will finally make a lawsuit against CBT (and not just FATCA). I offer again my analysis of the constitutionality of CBT. After seeing the astonishing ignorance of lawyers and judges in this matter, I’m very confident that the lawsuit will be successful if we simply explain the facts and legal basis, and preemptively destroy the government’s argument of “benefits of citizenship”. Also, since the current majority party officially opposes CBT, I imagine that the government would not appeal if it loses in the first court.
Regarding “accidentals”:
“Can the United States deem people to be ‘U.S. persons’ when they believe that they are not?” Yes, it can. The unilateral assignment of citizenship at birth, and the assumption that people want to keep it until they declare otherwise, are the accepted practice of all countries in the world. Of course, people should be able to renounce, but just “believing” that they are no longer citizens is not enough. They have to do something, even if it’s just a notification to the government. How else would you expect the government to know?
With that said, the part that I think that can be challenged is the renunciation fee and the waiting time for an appointment, based on the expatriation act, which is still US law: “the right of expatriation is a natural and inherent right of all people”, “any declaration, instruction, opinion, order, or decision of any officers of this government which restricts, impairs, or questions the right of expatriation, is hereby declared inconsistent with the fundamental principles of this government”. The high fee and long waiting times are clearly decisions of government officials that restrict expatriation. If “inconsistent with the fundamental principles of this government” means illegal, the result would be a free “walk-in” renunciation process. But I stress that you need a clear legal basis such as the expatriation act, you can’t just complain that the fee is too high because you “feel” it’s unfair.
I agree with Barbara, CBT and the right of expatriation are legally completely different subjects. You can use the same lawyer to reduce costs, but the lawsuits should be separate.
In a country where healthcare was run for profit, and where the IRS is also run for profit- why should they stop taxing citizens abroad? They want those roads and train tracks renovated. They need our money. I guess the logical consequence with an ever increasing debt is not to get rid of CBT, no matter how onerous or cruel to US citizens ( abroad). Of course for them, the logical consequence would NEVER be to clean up their own tax havens in Delaware etc. and use that tax money. If America cleaned up its own tax havens and loopholes, it probably could afford these things without expats having to repair roads they will not use.
It really is a form of greed.
Can somebody tell me whether we can and should contribute to this lawsuit?