This post ends with the following question:
Are Americans really “so beaten down, so subservient, so fearful of authority that it complies with the most horrific and undemocratic “laws” and is unable to unite and simply say NO, collectively.”
I invite you to express your answer in this poll:
Perhaps you could consider this question while reading the following post.
_____________________________________________________________________________________________
Re: US Tyranny and Terrorany "People are developing resistance and figuring out there is not much the U.S. can do." https://t.co/Vakr3uya4g
— U.S. Citizen Abroad (@USCitizenAbroad) December 3, 2015
The above tweet references the following comment from @Homelander_NOT on Robert Wood’s blog.
Yet another punitive measure that will further the creation of a US Berlin wall plus make life more complicated for Americans/”U.S. Persons” abroad. Other recent moves which demonstrate the tendency of the U.S. government to repeatedly “do the wrong thing:” ” Is US considering not publishing #USExpatriation list anymore? If yes, efficiency or embarrassment?” https://www.federalregister.gov/articles/2015/12/01/2015-30366/proposed-collection-comment-request-for-information-collection … (not at all sure that is what implied by this tweet I received) and Executor liability for U.S. income tax and penalties, interest, etc., may extend to you if you were aware that the decedent owed the U.S. treasury for say tax from unfiled tax returns.http://www.taxconnections.com/taxblog/good-to-know-part-3-from-larry-stolberg-cpa-ca/#.Vl79_PmrTIV . For such an “ advanced” nation, the U.S. seems not to understand basic psychology. The more one tries to restrict somebody, the more they are likely to be resisted. If it is true the Name & Shame List’s days are numbered, it won’t be of any consequence. Who reads the Federal Register anyway? Personally, I could care less if they kept an ongoing list published in the NYT and like many, consider it a badge of honor. Proof of being a ‘real’ American if you will. And more nonsense/confusion for an executor (really? even an “alien one? Just how would they enforce that?). Or is it more along the lines that no one can even imagine someone having the gall to not obey the exceptionalistic conditioning that can only be dumped by experiencing the rest of the world? It is a well-documented problem that the IRS does not have records for expats; even with FATCA there are likely to be many pieces of undeliverable mail. Yes the IRS cares not and will continue to follow their own procedures. I expect thousands upon thousands to simply ignore those letters. People are developing resistance and figuring out there is not much the U.S. can do. Other than count on the fact that such folks will surely want to come to the U.S. so “we’ll get them at the border.” Lots of people are figuring out the better choice is simply to go elsewhere for vacations and have family visits where the expat families are. All of this is pathetically sad. All this grief for insistence on filing forms to show there is likely no tax owed-when everyone KNOWS its the big fish living in the U.S.that all this effort should be expended toward. Again, such a very basic, basic thing that eludes those running the most dominant, most fortunate country on earth. I remain puzzled that this is what has happened to the country I grew up in and in spite of awareness of its many flaws, still loved until FBAR.
It’s interesting that the recent linking of passport restrictions to tax compliance has received little discussion at the Isaac Brock Society. To me, this suggests that Brock is largely populated by those who:
1. Do NOT consider themselves to be U.S. citizens (meaning they don’t care about a U.S. passport anyway); and
2. Are primarily concerned with the effects of U.S. extraterritorial tyranny and U.S. terrorany on Canadian citizens.
It’s the opposite in Europe where the Facebook groups (at least here and here) have included much discussion about the upcoming passport restrictions. The usual lobby groups, have done their usual letter writing, with the usual response (nothing) from the USA.
U.S. citizenship and the U.S. passport …
The State Department takes the position that a U.S. passport is proof of U.S. citizenship. It is an “incident of U.S. citizenship”. What is the meaning of U.S. citizenship? What does it mean when one holds a U.S. passport?
Bubblebustin recently asked the following question:
@USCitizenAbroad
Isn’t the current Congressional enforcement of CBT in fact resulting in the destruction of US citizenship we are seeing today, the justification for these laws derived from the notion that citizenship is based in taxation, or, “Taxation-Based Citizenship”?
Congress has turned what it means to be a citizen on its head, the result of which is that the citizen becomes the servant of the government, as opposed to the reverse. CBT is like a splinter that until now one could ignore, but because of irritating acts of Congress is now festering to the point of becoming life threatening. Unfortunately because citizenship and taxation are intertwined as such (Cook v Tait) the citizen must remove him/herself from the splinter instead.
Are we dealing with “citizenship-based taxation” or with “taxation-based citizenship”?
Since the 2004 creation of the “Tax Citizen” (as described by Virgina La Torre Jeker), U.S. citizenship and taxation have become one and the same. Taxation = citizenship and citizenship = taxation (without specifying the “incidents of taxation”).
The new meaning of U.S. citizenship – Taxation isn’t everything, it’s the only thing
In 2013, U.S. tax lawyer, Stephen Mopsick opined (while acknowledging the problems of FATCA) on the meaning of U.S. citizenship. On June 30, 2014 (largely in response to his post) I wrote the following post on Brock.
July 4 Reflection: Meaning of "Being an American" vs. "Being one of those #Americansabroad" https://t.co/d3tAQemx0N via @@IsaacBrockSoc
— U.S. Citizen Abroad (@USCitizenAbroad) December 3, 2015
It included:
As we approach the 4th of July – Independence Day – one must ask whether the there is a difference between “Being an American” and “Being an American Abroad”. Another year has passed.
– the formal relinquishments of U.S. citizenship continue to grow
– the informal relinquishments of U.S. citizenship (run and hide) are going through the roof
– the rollout of “FATCA Hunt” is forcing Americans abroad to hide their “USness”
– the U.S. Congress has shown no interest in freeing Americans abroad from the “prison of citizenship-based taxation” – AKA taxation based on place of birth
Tomorrow July 1, 2014 marks the Official start of FATCA Hunt.
As Americans abroad contemplating the arrival of Independence Day:
What are your thoughts on the MEANING of being an American abroad?
What message would you like to send to America this Independence Day?
I encourage you to go and reread the comments to this post.
Leading to: The role of the passport in “facilitating” “taxation-based citizenship” …
A. History of the control of movement through the passport
U.S. Passport as Instrument of Control https://t.co/d0iP8nvkRS – History of the use of the passport as an instrument to prevent travel
— U.S. Citizen Abroad (@USCitizenAbroad) December 3, 2015
The above tweet references a Brock post from USXCanada. It includes:
The extraordinary Mrs. Shipley: how the United States controlled international travel before the age of terrorism
Connecticut Law Review 43:3 (Feb 2011) 819-888http://uconn.lawreviewnetwork.com/files/documents/JeffreyKahn43Conn.L.Rev.819.pdf
[389 footnotes] Career civil servant Ruth B. Shipley acted as chief of the Passport Division of the U.S. State Department from 1928 to 1955. Shipley personally reviewed every passport application, and prior to 1958 Supreme Court decision, her actions were subject to no judicial review. Shipley denied passports to Paul Robeson, Arthur Miller, Linus Pauling, and “many other” Americans during the 1950s. Kahn’s article explores how Shipley acquired such power and how the US passport became an instrument to prevent rather than permit travel. A backgrounder opening (825-842) provides a history of travel controls from 1789 to the Shipley era. Originally the passport was “a document [issued by the country that the traveler sought to enter] that granted a foreigner permission to pass into or out of a country’s ports” (825) — the opposite of what the passport came to be. Kahn concludes that current administration of U.S. citizens has achieved the Shipley effect through authority “diffused among intelligence analysts in multiple agencies who now compile watchlists of people deemed too dangerous to travel.” In this environment, judicial review is crippled by “the traditional deference accorded to national security and the sometimes secret processes by which that government interest is secured” (887).
B. The passport application as a means to notify U.S. Treasury of the existence of Americans abroad
There is NO DOUBT that that passports are now linked to tax compliance. For the past several years it has been common knowledge that passport applications and renewals were being used to notify U.S. treasury of the existence of Americans Abroad (as discussed in this post by MopsickTaxLaw). Until now, the passport application has been used to notify U.S. Treasury of your existence. That was then. Now as discussed by Rober Wood and others , the IRS can “in effect” deny you a U.S. passport.
C. The denial of a U.S. passport to those (including Americans abroad) who “owe” U.S. taxes
Americans abroad are the most likely to be affected by these incredibly punitive measures. Most Americans abroad are in a position where they:
1. Don’t know they are required to pay U.S. taxes; or
2. Can’t understand the rules they are asked to comply with.
Because the Internal Revenue Code penalized all things “foreign”, Americans abroad are particularly susceptible to penalties and IRS tax debts. The effect of this measure is that eventually (we all know how things get worse and worse) many Americans abroad will be denied U.S. passports. This means that they can’t travel to the USA (as is required by law) on a U.S. passport. Perhaps they can risk travel on another passport.
At a bare minimum, it is very risky for a U.S. citizen to live outside the United States if he/she has ONLY a U.S. passport.
Conclusion: The future of U.S. citizenship abroad …
It’s over. U.S. citizenship citizenship is now synonymous with taxation. Taxation is a code of taxes, reporting requirements and rules of life control that:
1. Cannot be understood by the average person (except with the assistance of “tax professionals” of questionable competence); or
2. Is of a level of complexity that compliance is almost impossible; or
3. Is such those who can comply will find that U.S. tax compliance makes living life outside the United States impossible.
And now, the Government of the United States – that “Great Citadel of Freedom and Justice” claims the right to deny you the right to travel from or to the United States. Seems to me that you can either (1) realize that compliance is impossible or (2) take whatever steps are necessary to renounce.
The true Obama Legacy is the destruction of “U.S. citizenship abroad”. Of course, that’s change you can believe in!
The teaching of Cook v. Tait is that the U.S. Government somehow benefits its citizens wherever they may be. That was in the era of “citizenship-based taxation”. In new era of “taxation-based citizenship”, it has become clear that the sole purpose of the citizen is to benefit the government.
The question is: why have Americans allowed this to happen? Why has there been no resistance?
"What astonishes all of my “foreign” friends is how passive, obedient and fearful US people are of their government" https://t.co/1Lfa7lI5fu
— U.S. Citizen Abroad (@USCitizenAbroad) December 3, 2015
The above tweet references the following comment from the Maplesandbox blog.
As a former U.S. citizen, who renounced just in order to survive, as my four non-U.S. business partners gave me an ultimatum, either get rid of your U.S. citizenship, which was contaminating our totally German business and subjecting our company’s accounts to U.S. Treasury and IRS scrutiny, or you must sell your shares and leave. This all started upon the advice of our German bank, who said that they wouldn’t deal with our accounts if there was any American/’U.S. Person’ involvement? Not to mention the personal impact on my mortgage, on my bank closing all of my investment accounts and everything else that every reader here knows all too well.
What amazes me most, and also amazes all of my personal and professional friends, all of them non U.S. persons, is how obedient and conforming the organizations supposedly representing the interests of U.S. citizens abroad are. With all that has happened, and especially now, subsequent to the Senate Finance Committee’s “report” on tax reform, paying nothing but contemptuous lip service to the plight of US citizens abroad, it should be more than obvious that U.S. Citizens abroad are of absolutely no relevance for lawmakers and legislators in Washington. Yet, the attitude of all of the organizations supposedly looking out for and fighting for the rights of US citizens abroad has been to follow a very respectful path of presenting the case for change, as if they were dealing with a fair democratic system, that respects equal representation and justice. They look ridiculous, all of them! When I read that Democrats Abroad have been trying to push the “bandage” fix of ‘Same Country Exception’ for more than four years, with no result, I say that this is absolutely pathetic. When I see American Citizens Abroad sending endless delegations to Washington, year after year, and even opening an office there, only to see the interests of overseas Americans relegated to a footnote, with no action proposed n the recent Senate Financial Committee report, I would think that they should be embarrassed and ashamed, as they should be. It has taken the group Republicans Overseas over one year to formulate an intended lawsuit, which has been postponed endless times, with a “promise” to file it next week, I say that they too have not approached this in the right way. Too much damage has been done in the interim.
What astonishes all of my “foreign” friends is how passive, obedient and fearful U.S. people are of their government, especially when confronted with such outright injustice, literal extortion and destruction of their financial well being and that of their families and business partners. Even the ever law abiding Germans wouldn’t put up with any of this and they would probably, en masse, as one lawyer friend told me, simply refuse to cooperate with any of this Byzantine filing of forms and endless intrusions into their privacy and that of their families and business partners. They would collectively refuse and file class action suits against the authorities behind these injustices worthy of a fascist totalitarian regime. Perhaps the Germans understand better than the Americans what this sort of thing leads to, when a society becomes so beaten down, so subservient, so fearful of authority that it complies with the most horrific and undemocratic “laws” and is unable to unite and simply say NO, collectively. Until Americans fight to recover some form of democracy and fairness, the ravages of FATCA will be but one in a coming litany of similar such abuses. To continue believing that they are dealing with democratic institutions and that reason and fairness will prevail is nothing but a naive attitude that will lead them nowhere, as we can now see with the recent Senate Finance Committee report.
I have bolded the last paragraph of this comment. Are Americans really “so beaten down, so subservient, so fearful of authority that it complies with the most horrific and undemocratic “laws” and is unable to unite and simply say NO, collectively.”
I read that Boris Johnson was denied boarding by an airline employee, not denied entry by a US immigration inspector.
Glad your looking at all angles, Dash.
Norman, that may be true, but the airline employee was following someone’s rules – unless you allege that Boris was denied entry illegally.
When Jews are socialists they’re usually givers rather than takers.
The Russian taxi driver wouldn’t dare to return to Russia if Russia implemented CBT. He deserves to be in jail in the US though. It’s good that he’s hard working, but he should pay his RBT in the US.
“unless you allege that Boris was denied entry illegally.”
No, I read that he was not denied entry. Whether a hypothetical denial of entry would be legal or illegal, he wasn’t subjected to either.
The airline employee was obeying cautious rules for good reason, but still, it wasn’t a denied entry.
When I was a US citizen and a US immigration inspector in Vancouver airport sent me for secondary inspection, that was done by an immigration inspector. The second immigration inspector granted me entry. Both of those events took place after an airline employee had already issued my boarding pass.
I should have added:
When I was a US citizen holding a US passport, …
@ Norman Diamond
Focusing on the in ability to travel while ignoring the ability to continue to reside outside the U.S., is to me like treating a hangnail while ignoring the blood spurting from a gash in the thigh. But, my perspective is from one living overseas and not one contemplating traveling anywhere. It is not so much that I think it wrong to point out the travel restriction, I just have not seen anyone state that without a passport everyone living overseas must either return to the U.S. or live as an illegal alien,Mexico for me is of far greater importance.
I have the new residence card, and it has an expiry date. At best, if my passport were revoked I would have to leave when I went to renew my residence card, at which time it would be learned that I had been residing in Japan illegally for a few years. What happens then?
You may be correct in that I will not be caught until I try to leave Japan or renew my residence card, but I will be in violation of immigration law the moment my passport is revoked. In the past few years, my employers have been asking for photo copies of our passports multiple times a year. I will be caught, either by an employer, or if my spouse insists on a vacation abroad or when renewing my residence card. However, as the U.S. seems intent on doing as much harm as possible as soon as possible, is it out of the realm of possibility that they would just send a list of those who have had their passports revoked and let the MOJ do the rest?
Not a problem at all to transfer your visa from your old to your new U.S. Passport. Did it two times. I just had to bring both the cancelled and new passports to immigration in Tennozo Isle and they stamped my new passport with the proper info. A day off work without pay, but otherwise harmless.
I think the jewish cab driver story is bullshit. Who made that up?
I voted other because I just think that America has become a government where cash is king. Maybe it is because they are in debt- but it began before Enron. It began when I heard that the health insurance companies were calling the shots and not the doctors- and they were trying to make profit on sick people. Who voted for the Vietnam War and then kept it going long long after they KNEW it was a mistake? There is so MUCH going on that is wrong in America that I don`t know where to begin. How about the judgement on gun possession? These decisions are all just a long line of erroneous judgment calls.
ACA did respond, but its response was really slow. JC pasted a snippet on the passport revocation provision on November 22, but I didn’t get an ACA e-mail on this until November 30, the day before it passed and way too late. Even then it was described as ACA news. I am very surprised that they didn’t have us write our representatives and senators. If they had gotten this out before Thanksgiving it would have been the (awkward) topic of a lot of overseas Thanksgiving celebrations and maybe more action. Still, ACA make a nice change from Democrats Abroad. I used to cringe when I saw DA described as Stepford Wives, but that label is increasingly accurate.
@JapanT
The necessity of having a passport was made obvious enough before the bill was passed. In its press release, ACA noted that “This provision is way too harsh and dangerous a remedy, especially for American taxpayers residing abroad who absolutely must have their US passport at hand,” commented Jonathan Lachowitz, Chairman, American Citizens Abroad, Inc.” which sounds promising, but then he goes on to say that “In many situations, they cannot do things like open a bank account, arrange for direct debit of utility bills, travel, or do many other everyday things, without their passport.” Nothing about losing the ability to continue one’s life abroad, so too weak to really hammer the point home.
The one bright spot is that the U.S. tried to do something similar 30 years ago and it didn’t work:
http://www.royalgazette.com/article/20151202/BUSINESS/151209960
Unfortunately, I had a load of work on and just couldn’t think of how to word a convincing letter to my congresscritters. Not that would necessarily make a difference, but I’ll definitely remember in November (and, more importantly whenever my state has its congressional primary next year). Nobody will take U.S. citizens abroad seriously until we start voting against incumbents who do things that are really harmful to our needs.
I am certain that there are Americans abroad without a second passport who do things like vote but are not tax compliant. This is the road to ruin. I would guess that compliance is better among my American acquaintances who are in their 60s perhaps because they remember the old passport policy or maybe because they earn above the FEIE. I would guess that there is widespread non-compliance among those under the FEIE. I warn them, but it is a very unwelcome message.
@Polly
I don’t know whether the story is B.S. or not, but it does highlight the problem. If the story was true, I doubt that many here would protest if the U.S. yanked the taxi driver’s passport for owing $50,000 in back taxes. Doing that to people who owe FBAR fines, though, is crazy. But isn’t the root problem that we can end up owing way too much money for dumb and unjustifiable reasons? The reason FBAR fines were set so high was that international tax evasion was much harder to uncover and prosecute in the past than it is now.
@JapanT
Sorry I meant that it was NOT made obvious enough before the bill passed.
@JapanT etc,
Plenty of gnashing of teeth over the prospect of losing your passport.
You don’t just lose it for having a tax bill. You lose if for having the tax bill and just letting it sit there doing nothing. You have choices:
1) Pay
2) Negotiate if you can not pay. If you really can’t pay you won’t have to.
3) Get a payment plan
As a backup if you live in another country get a passport there when you can. If america treats you badly then you won’t want to come here anyway.
It comes back to why did most of you guys vote for a person who said he would take peoples stuff because your stuff isn’t yours. I paid. I didn’t like it. I hate them for it. I like the fact they they are getting heat for their policies. I still had to pay.
It seems that the US is stupidly escalating threats and sanctions. Withholding a passport for unpaid taxes. Crossing passport applications with Treasury Dept data. Extremely difficult and outrageous renunciation procedures and fees. Obfuscation of renunciation data. Etc. Not all of these are in application yet…
I think that many US citizens abroad will have no choice but to send in all the required forms (well, to the extent that it is actually possible to comply). And naturally form filling will become another meaningless gathering of meaningless data, which we will do in order to keep a passport and bank accounts. But people adapt, and within a short time we will learn to send in numbers that allow us to be left alone. Hell, some people may even claim tax credits and foreign tax credits. There is no practical way for the IRS to check all of this.
Responding to Bubblebustin’s comment,”Congress has turned what it means to be a citizen on its head, the result of which is that the citizen becomes the servant of the government, as opposed to the reverse.”.
The (US) citizen has been considered to be the servant of the government since JFK’s famous, often quoted admonishment to “Ask not what your country can do for you,ask what you can do for your country”. When he said this, (1963?) it was considered to be a brilliant call to patriotism, was , and still is, quoted over and over again, and is still one of JFK’s most famous statements. It was lauded by most Americans, but struck fear into the hearts of teenagers like me, in Grade 11 or 12. Boys knew that they were about to be told what they must do for their country, such as joining the military and being sent on an all-expense-paid trip to Vietnam. Girls, and everyone who cared about these young men and the state of a country which would cheer such a statement, were also horrified – but JFK said it – how could you publicly oppose the great President Kennedy? Maybe in an alternate reality there was an America which existed to serve its citizens, but since at least as far back as the early 1960s, citizens were told that their role was to serve their country.
Here is the message received from ACA on November 30/15 – better late than never.
@Neil – your comment:
The issue is partly that one can get a “tax bill” that is based on penalties for the failure to file international information returns that one knew nothing about. As you know, the U.S. hates anything foreign. Therefore, the greatest penalties are associated with the failure to file these returns – resulting in a much greater risk for Americans abroad.
Your comment is interesting because it reflects an “inside the US looking out perspective” instead of an “outside the US looking in perspective”. That said, I do agree that the best thing that any American can do today is to get a second passport.
@Polly
The cabdriver story might be like the revenue FATCA’s expected to generate – it gets exaggerated every time it’s told.
@Queenston
I used to rally behind Kennedy’s words – that is until I too realized what they really meant.
To answer the poll question, I marked “other”. Feeling exceptional and better than others makes people do all kinds of silly things that make them look stupid. America’s epitaph is going to read, “I did it my way”.
My rep voted “nay”:
https://www.govtrack.us/congress/votes/114-2015/h673
Cook v Tait established that benefits all American’s enjoy are taxable, even though those benefits are in fact rights bestowed upon us through citizenship. Passport revocation is only possible by converting mobility rights into a commodity, as I’ve emphasized in my above comment when I compared it to Canada’s citizenship revocation for terrorist crimes.
Just today, the Tax Foundation has come out against HR 22 for reasons including the following:
“Taxes and spending associated with the Highway Trust Fund are based on the benefit principle of taxation. This principle states that the taxes one pays to the government should be connected to the benefits one receives. This principle is seen as an equitable way to finance government projects—in this case, roads and infrastructure. Those who drive on roads and cause wear are the ones who should pay for future repairs. This type of taxation also sets a price for driving on the road in order to prevent overconsumption in the form of congestion. As such, any increases in funding for the trust fund should come from these types of taxes, such as the gas tax.
Instead, this plan uses transfers from the general fund and other completely irrelevant revenue raisers such as revoking the passports of U.S. citizens abroad who are currently tax delinquent to pay for U.S. roads.”
http://taxfoundation.org/blog/congress-reaches-deal-five-year-highway-funding-bill?mc_cid=7735f6a09d&mc_eid=6f30773d2e
@Bubblebustin
Well said about the exaggeration of the story. And most likely each time it changes according to which group of people should be attacked as scapegoats – once it is the russian jew., the next time it is some black guy etc etc.
I know this is supposedly all about those rich tax cheats in America who hid their money in Swiss banks, but in the meantime I have the impression it isn’t about them anymore. The expats are considered the fat cats with the hidden money. We have to face it everybody- WE are the bad guys! WE are the ones who need to be punished….and don`t let the door hit you on your way out.
@USCitizenAbroad,
I understand that foreign accounts can generate large penalties. I had the large penalties. I hated that I had them. I thought it unfair that I had them. The IRS threatened me with criminal prosecution if I opted out etc.
I paid the damned fines. The size of my fines would totally crush many people who post here. I didn’t have a US passport for them to take away but I would never be in danger of this. Why? Because I paid the fines. If I couldn’t pay them I could get a payment plan or negotiate.
We have Al Sharpton owing millions to the IRS. He won’t lose his passport though I think it reasonable for him to. You know why? Because he is on a payment plan.
Why do you people care anyway? You’re running for the exits.
I would rather not give the IRS more powers but this is a small thing in comparison to the immense powers they already have.
@Neill
What would you have done if your whole story had you situated in Montreal? Would you have paid the fines then? Or if you had a government which would have protected you and told you they would not collect? What would you have done had you not lived in America itself but had the same problem- lets say through an american wife? What would you have done if you had had any choice in the matter? Would you have fought?
@Polly,
I don’t think this stuff changes anything. If you live in Canada and want them to protect you from the IRS you probably should be a citizen of Canada. Then who cares if you have an American passport. If your not going to pay your taxes then you aren’t going to come to the US.
If the UK suddenly traps me with a large tax bill and threatens to take away my passport then I have a choice. Pay and let them come after me again or pay and expatriate. What else can you do? You have to pay or you can end up in jail etc. Maybe a lawyer/tax pro can lower the amount etc but doesn’t really change the options.
Yes it’s crap that you owe unfair taxes and penalties. Yes it’s crap that we have unfair filling burden and risk. Yes it’s shit that the IRS treats us like turnips for squeezing but you have to pay and try and avoid it in future.
For 7 years now the guy that many people here voted for has tolls me I don’t pay my fair share or that I didn’t earn my money. If I earn the money I have to pay the tax. I don’t have a choice. I can of course chose not to earn the money in the first place and that’s exactly what I am doing. I retired to do my own thing and send a big middle finger to those that want my earnings. At 55 I will start to bleed out my UK retirement accounts to limit my foreign exposure. That’s my choice. I’ll use all my options to limit my tax bill but I still have to pay.
@Neill
It may just be that it is hard for people to trust a country they have very little contact with. My contact with the U.S. government is almost entirely with the unpleasant elements: TSA, Homeland Security, Customs, IRS.
I notice that sometimes you express concerns that the U.K. might start coming after its wealthy expats. As someone who lives in the U.K., I really can’t see where your concerns are coming from, since nobody over here is saying anything like that. Maybe what Brockers feel toward the U.S. is kind of like the worries you seem to have about the U.K. sometimes.
A thought about the ACA response.
In an earlier post I said the ACA should reconsider its position on an IBS style European lawsuit.
It’s my understanding the main purpose of the ACA was to protect the US citizenship rights to children born to US citizens abroad.
Doesn’t FATCA and a potential passes of the passport revoking act in a sense invalid its original mission? A US passport has too many ‘strings’ attached to its possession in 2015.
Who would want to burden a young child with that liability?
What’s even more disappointing Homelanders are in denial about what’s happening to their ex-pats or express contempt to their existence.
@Neill
Living in America you had no other option. Do you love it there?
Don,
I would add that for those like my son, born in Canada, who never lived a day in the US and never had any benefit from the US, it is obscene that he and others like him are ENTRAPPED into an acquired US citizenship and all of its ongoing complex burdensome consequences. A person without *requisite mental capacity* which would include many more than just those with a developmental disability, is unable to renounce due to lack of capacity and a parent, a guardian or a trustee is unable to act on such a person’s behalf, even with a court order. No child born abroad and no family of such a child should ever be so entrapped into this result of a non-meaningful acquired US citizenship without consent of that person or of that person’s parent(s). If there is such a thing as the EXCEPTIONAL to all other countries of the world (except Eritrea) US citizenship-based taxation, surely this should only be an opportunity to CLAIM a US citizenship when a person born abroad is an adult and of requisite mental capacity to make such a decision. With the consequences of US CBT, if such a CLAIM is not made — it should be NULL AND VOID — as it is a non-meaningful US citizenship acquired without consent.
ACA has had nothing to say about such entrapment. They, therefore, must condone such entrapment!
The day I attended my Canadian citizenship ceremony I contacted the nearest US consulate and told them it was my intent to relinquish US citizenship. I told them I wanted to send them my US passport as I was no longer an American and didn’t believe I could legally have it in my possession. I was told “don’t bother, we’ll just send it back to you”. Significantly, they didn’t disagree with my claim that I was no longer a US citizen.
If they decided to pull mine I would welcome the news. In fact it would just reinforce my claim that I am no longer one of them.
@Neill. The IRS does have immense powers and one of them no one has mentioned is the power to generate a “substitute tax return” in cases where the IRS becomes aware an individual has failed to file anything. Such a substitute return is based on nothing but IRS speculation because in such cases they have little to go on. This is, of course, exactly the situation for a long time expat, because the IRS would only know what that taxpayer has told them, which is often nothing. In such a situation, it is easy to imagine that the taxes, interest, and penalties could quickly exceed that US$50,000 threshold without the taxpayer even knowing about it until they went to renew their passport. I don’t know if FBAR penalties are added to that total. If the person desperately needed that passport they would have no choice but to pay and straighten it all out later.
A second (good) passport is the best defense and every expat should obtain one ASAP.