As a solution to the problems caused by FATCA, American Citizens Abroad (ACA) proposes that FATCA be tweaked by imposing on “US citizens” abroad a “Same Country Exemption with mandatory IRS compliance” (SCEWMIC). SCEWMIC is likely to make the unjust FATCA law even more harmful.
Go to the links below for info and also read: “Why ACA supports Same Country Exemption (SCE) rather than repeal of FATCA, and why SCE will work to correct banking lockout by Foreign Financial Institutions.”
If you don’t like SCEWMIC then tell ACA exactly what you think in an email.
E-mail Mr. Charles Bruce, ACA Legal Counsel, at info@americansabroad.org
You can ALSO comment at ACA’s FB site: https://www.facebook.com/americancitizensabroad
[OF COURSE, you can argue that an email to Mr. Bruce, or to ACA, will not change their minds on SCE, but are you really so certain that when an organization claiming to represent “YOU” makes a bad proposal that will cause you harm — the best way to proceed is to remain silent and not confront that organization? Those who feel that all U.S. laws are irrelevant should not read further.]
So… here’s what you would have to do to make the SCEWMIC election:
“…An individual would complete the election on a 1-page, front and back, IRS form providing the individual’s name, address, Taxpayer Identification Number [Everyone has one?], and country of residence, and listing the “Same Country” accounts (name and address of bank and name, number and type of account, i.e., depository, custodian, etc.). The individual would certify that this information is correct. Also, the individual would state that he or she is a resident of X foreign country and the bank(s) are licensed and regulated under the laws of X country of residence (the same country where the individual is a resident). One copy of the election would be given to the bank; a second would be attached to the individual’s federal income tax return; a third would be retained by the taxpayer [NOTE TRANSITION IN PARAGRAPH FROM “INDIVIDUAL” TO “TAXPAYER”]. Instructions would be included on the form. Taxpayers would be warned that filing the election does not excuse them from having to report any income on the account on their tax return or from having to file an FBAR, provided in both instances they meet the applicable thresholds…”
Mr. Bruce explains to Bob Stack at Treasury why the ACA proposal is a really good deal for the IRS:
“In addition to benefiting American citizens abroad and foreign banks, the “Same Country” exemption will benefit the IRS. Americans abroad, in order to get the benefit of greater access to banking services, will need to come forward and file their US tax return, with the “Same Country” election attached. This will help address the nagging problem of noncompliance.”
Read Mr. Bruce’s letter to Treasury and ACA’s SCEWMIC HERE and HERE.
— and take a few minutes to email your thoughts to Mr. Bruce…
Here are two responses just received from ACA regarding SCE concerns:
“Thank you for contacting ACA.
Same Country Exemption is not a replacement for Residence-based taxation.
ACA continues to advocate for Residence-based taxation (RBT). And, in fact, ACA is the only organization that has developed a proposal for RBT. None of the other overseas advocacy organizations, either non-profit nor party affiliated, have developed a fully written and considered proposal.
ACA’s RBT proposal has been cited in a variety of the tax writing committee reports; Joint Committee of Taxation, Senate Finance and Ways & Means.
See our complete proposal and work here: https://www.americansabroad.org/taxation/
ACA conducted a FATCA survey with the University of Nevada at Reno. The results of that survey indicate that Americans overseas believe that SCE would alleviate the problems of banking lock-out. See: http://acaglobalfoundation.org/PressAndMedia/3748196
As ACA has explained before, Repeal of FATCA would require Congressional vote. ACA does not believe that the Congress, in its efforts to combat tax evasion legislatively, will achieve the majority vote to repeal FATCA. SCE would help alleviate the bank lock-out problem and is achievable as it does not require Congressional vote but simply a regulatory change. This knowledge is a result of our long standing work directly speaking with Congressional offices and committees involved in tax evasion legislation.
As noted in our Mission statement, “ACA works to find practical solutions to resolve issues impacting overseas US Citizens and communicates results to constituents stateside and abroad,” (https://www.americansabroad.org/about/ ). ACA’s proposal for SCE was not developed solely with Europe or Americans living in Europe in mind. ACA does not believe that working toward repeal of FATCA is a practical way forward in getting Americans overseas immediate relief from FATCA. Please see our statement on this here: https://www.americansabroad.org/…/why-aca-supports-sce….
ACA as well has spoken with Foreign Financial Institutions (FFIs) on the viability of SCE to alleviate the bank lock-out problem and reported on our findings here: https://www.americansabroad.org/…/Treasury_Ltr_Same…
ACA regrets that you do not appreciate our work on behalf of Americans living and working overseas, however ACA will continue to support it’s efforts with RBT and SCE.“
The above ACA email was just posted on American Expatriates.
AND:
“Thank you for contacting ACA.
For a full explanation as to why ACA believes that Same Country Exemption is workable and why ACA believes that a repeal of FATCA is not achievable please see: https://www.americansabroad.org/…/why-aca-supports-sce…
ACA”
The above ACA email was posted on: https://www.facebook.com/groups/citizenshiptaxation/
Here is the writer’s response to ACA (posted at the above website):
“Thank you, for your email reply. I have read the documentation you provided. My net takeaway, from your piece, “Why ACA supports Same Country Exemption (SCE) rather than repeal of FATCA, and why SCE will work to correct banking lockout by Foreign Financial Institutions,” is simply that rather than attempting to help American expatriates, by taking the more difficult road, the ACA would rather take the easy way out that does not rock the boat or risk displeasing the US political elites. So, I’m left wondering why the ACA calls itself “American Citizens Abroad.”
With whom, in what countries, and how many American expatriates has the ACA spoken, to come up with its SCE position? Why should American expatriates have to file anything with their banks or the IRS relating to what, for us, are our local bank accounts, when homeland Americans do not have to do this (even those hiding their assets in Delaware Corporations)? Why should we have any confidence that our being “locked out” of FFI services would improve? My reading, of your document, which may be incorrect, tells me that the ACA proposal might make the whole situation, with FFIs even more convoluted, and perhaps expose us to even more discrimination. I would think that you should include, in your paper, something from a significant number of FFIs (not just a few), from varying geographies, indicating that they endorse your views and will treat us more fairly. Did I miss this?
At the end-of-the-day, we expatriates simply want to be treated, in our relationships, with our local banks (which may also include, for good reason, banks in neighboring countries, just like US banks, in neighboring States) no better, nor no worse, nor no different than the relationships that our fellow homeland American citizens have with their banks in and across the US. That seems, to me, to be a pretty reasonable request for support, from an organization like the ACA. Isn’t the real problem that FATCA is an unjust attempt to circumvent the 4th Amendment to the US Constitution? I recall when I opened my accounts, nearly two decades ago (well before FATCA), having to sign a form authorizing my bank to give the IRS full access, to my accounts, upon production of “probable cause.” FATCA shifts the burden of “probable cause,” from the US government to the FFIs and finally to the expatriate Americans. This is an unfair and non-equal treatment of US citizens, under the US Constitution.
Your paper claims that, “ACA works to find solutions to problems facing the overseas community that can be easily implemented.” Sometimes, the less easy and more difficult road is the right road. I know quite a few American expatriates, who would rather take the risk of working for something right, than settle for something wrong, or just easy. That’s why I would rather the ACA work tirelessly for the best solution, as opposed to coming up with something that appears to me to be an easy convoluted way of maintaining the status quo. Having fought and lost is better than not having fought at all. What would have happened to the Colonists, had they just looked for an easily implemented solution to what were actually far smaller issues, back in 1776?
Respectfully,”
@USCitizenAbroad
It does appear that many Americans support Fatca. I remember early on in my journey, I read something online somewhere that most Americans supported Fatca but wanted a same country exception. That was actually my second OMG moment.
I also shudder to think about US tax payers having to show tax returns to foreign banks. How can that possibly work in reality? Some people legitimately don’t need to file. Are the banks supposed to police who has to file and who doesn’t? How will this help make banking easier for Americans or the banks? The implications get scarier by the second.
“The Donald and his ilk dont pay taxes- but somebody has to- it is just somebody ELSE. I strongly doubt that Trump will repeal FATCA. Not when he sees the debt and has to get money to fill the treasury`s coffers. And he contradicts himself constantly. Isn’t one of his favourite sentences “I never said that.” ?”
The alternative is the “devil you know” versus the “devil you don’t know.” So you suggest we vote for Hillary because we know that she’ll just tax us to death. At least that’s the viewpoint that I get from your past posts with regards to Trump versus Hillary.
Fuck that…I’m going with “Giant Meteor 2016” #Just get it over with already!
@Polly
The issue is NOT what Trump thinks. The issue is NOT what Hillary thinks (although that is fairly clear).
The issue is what individual Americans think. If individual Americans continue to:
– allow themselves to be treated as slaves who have escaped the plantation
– put their faith in a political process that is indifferent to them (indifference being one of the worst forms of abuse)
– think it terms of an “On Off Switch” (Democrat/Republican then Democrat/Republican)
– place their trust in many of the advisers that they choose
– place their faith in organizations that have their interests at heart only to the extent that they obey unjust and abusive U.S. laws
– behave as though they have a right to live in other nations and behave as “FATCA Nodes” (allowing the USA to steal the capital of other other nations)
– allow a far off land have so much power over their lives
– vote for a political party that has openly and publicly vowed to destroy their lives
they deserve everything single thing they are going to get.
Really this is getting absurd. It reminds me of the Old TV Show Gilligans Island where they are somehow waiting to be rescued. Maybe they can get the Marines to come and rescue them from the U.S. Government!
So to come full circle: Trump has nothing to do with this. He didn’t create it. He’s not interested in it. And he will do nothing about it. But to vote for the Democrat nominee is evidence of “Stockholm Syndrome”.
i was addressing Bubblebustin who asked what would Donald do.
I honestly dont know why Dems Abroad want to pay taxes to the homeland. I once heard it was because they knew nothing else could be done about it- so at LEAST SCE. Maybe there are other reasons? Like some kind of misguided patriotism? Or maybe they intend to retire back to America and want their SS to add up? Or maybe they just want the Dems to look good. I don`t know, really. What I do know though is that The Donald wont solve these problems even if he promises to. How I wish the Reps had a serious candidate. But dont the Reps have a majority in congress? What has that helped? Nobody is really addressing this problem because it doesn’t concern most of them and it brings in cash. As for SCE, I assume most dems abroad just thought nothing else could be done about it- so they were looking for a smallish victory rather than none. My humble opinion is that nothing will be done until America itself realises how bad FATCA is for business.
@UK Rose
You write:
Yes they support FATCA. That’s why there has been so little movement in stopping FATCA. Here is my theory on the reason:
Most Americans have so brainwashed that they see the USA as a from of “Goodness” in the world. Therefore, they simply presume that everything that the USA does is good, just and righteous. They (to this day) don’t understand what FATCA even is (they ignore the extent to which various sections of the HIRE Act deliberately targeted them independently of the banks). So, they couldn’t imagine that that any of this stuff was aimed at them. But, they are sooooo wrong.
They think it’s a good idea in theory (they of course ignore the fact that they have become “Trojan Horse” soldiers attacking their country of residence). But, they sure don’t want it applied to them (hence the SCE exemption). But, it’s good to apply it to others (especially those who are not even American citizens).
Here is a video of Charles Adams (a Democratic Party operative) on October 31, 2012 (a week or so before the 2012 election). Watch and listen to how he describes the problems of FATCA and how he makes it clear that the Government does understand the problems. He specifically says that “We have been heard … vast overreach that …” This jerk then goes on to say that Americans abroad are not being persecuted by FATCA, etc. The guy is simply delusional. Really you must watch this. #YouCantMakeThisUp
Finally, when you watch the video, you will note a comment from Marcio de Vasconcellos Pinheiro. It pains me to see how much this man in his eighties wanted to believe that this was all a big mistake. You might remember this fine gentlemen who was a clear victim and symbol of the U.S. Government “witch hunt”.
See the post here and don’t forget the comments including this one from Orwell:
http://isaacbrocksociety.ca/2015/08/18/another-brock-warrior-down-in-memory-of-marcio-v-pinheiro/
Now watch the video:
https://youtu.be/u5foXDWnv18
Below is my comment:
Dear Mr. Bruce,
I’m writing in response to ACA’s proposal for “Same-Country-Exemption-with-mandatory-IRS-compliance (SCEWMIC).” Firstly, my wife and I are fully tax compliant, and have been for some 35 years. Second, we are not subject to making a FATCA declaration or form, as we are below the threshold.
That said, we are victims of the onerous FATCA reporting requirements, of our banks. Your proposal for SCE is not very practical in our case, as well, I’m sure, in many other cases. We live in Switzerland, and were forced to move back, as a result of FATCA, which led our bank to inform us that it would close our accounts and not renew our mortgages, unless we made Switzerland our legal domicile. (This caused us to miss out on the last year of my wife’s mother’s life.) However, we have our medical insurance, in Germany, and have, since 1988. The condition for this is that our insurance premiums must be paid out of a German bank account, and all reimbursements must go into a German bank account.
So, as you can see, SCE does not help us. I do not understand why the ACA is not pushing for a repeal of FATCA, the only practical solution. I’ve heard of NO Americans who favor FATCA, in its present form, or with the SCE. For us, our accounts, in our country of residence, Switzerland, and our required, for health insurance, German account, is a situation like having an accounts in New Jersey and Maryland.
We do not make any investments, from our accounts, and never have. We pay only the electric bill, mortgage, health insurance premiums, etc., from our accounts. We kindly ask you to reconsider your position, and advocate for FATCA repeal.
Respectfully,
“That said, we are victims of the onerous FATCA reporting requirements, of our banks.”
@Don Fahnestock
With all due respect, how is it you can’t even hear yourself saying what you are a victim of?
“Firstly, my wife and I are fully [U.S.] tax compliant, and have been for some 35 years.”
Give your head a shake.
“This will help address the nagging problem of noncompliance.”
As we are already compliant where we are resident, the IRS compliance diktat will be ignored, as usual.
I don’t see any mention here of Hilary’s Hint that foreign banks discriminating against US persons would be punished. I tried to find the quote.
Just imagine Clinton imposing a 1 or 2 billion odd fine on a foreign bank for discriminating against US persons. That will fix them and keep them in line wouldn’t it. Perhaps ACA has this in mind when supporting FATCA SCE. Perhaps they should be pushed on the point.
Thought bubble upon thought bubble of what might look good on a PowerPoint presentation, oblivious to a “where the rubber meets the pavement” test or reality, oblivious to the compliance costs of global banks as after all they would not be anything without the mighty US Dollar – “we made them” kind of thinking.
As US Citizen Abroad so eloquently put it above, I have also recently encountered a few people on Facebook claiming to be US expats who tell me that FATCA is right and necessary. Hard to fathom. Of course, those people are habitants of the Democrats Abroad Facebook page, which makes them mentally suspect or (more likely) Homeland-based trolls.
Off-topic: American-Belgians seem to have won a lawsuit against Deutsche Bank over nationality-based discrimination:
https://www.rtbf.be/info/economie/detail_discrimination-liee-a-la-nationalite-deutsche-bank-cede-face-a-unia?id=9416162
I have zero interest in what either the Dems or Reps abroad propose.
Someone above posed the question to all: “what kind of person am I?”
I know exactly who and what I am.
SCEMIC = screw you.
I ask and expect the USG to recognize that I am a Canadian citizen. I demand the Canadian government afford me equal rights as other Canadian citizens are afforded. And I ask that for all Canadians and permanent residents so affected.
It isn’t complicated at all for this Canadian Ginny.
Vin de Table.
Roughly summarized. The Belgian equal opportunity tribunal prevailed upon the Belgian branch of Deutsche Bank to restore services to American clients. DB had closed accounts and refused to open new ones. They agreed to reverse course.
vin-de-table. That is stunning.
@ Polly
The Dems abroad in Denmark that I spoke with found it normal to declare revenu to IRS. I think that is because most are here on temporary basis and intend to return to US (need SS), and because CBT only became imposed under Obama administration.
@UK Rose
I totally agree with you. With FATCA, the US made Foreign Financial Institutions responsible for identifying “US persons” among their clients, in place of Embassies and IRS, and at their own expense. Same Country Exemption (SCE) does not go far enough, as Americans abroad, especially those living in Europe, may have bank accounts in more than one country.
The WMIC part of the proposal is totally out of question. It was bad enough that FATCA gives bank employees the responsibility of identifying “US persons”, but now are these also supposed to inspect my IRS revenu declaration forms?! Do FFIs agree to assume the work of the IRS??? Although I endeavor to be IRS tax compliant, I prefer declaring my bank accounts to FATCA and FBAR, thank you.
ACA is endeavoring to treat the symptom (FATCA) instead of the disease (Citizen-based taxation, CBT). SCEWMIC is a waste of time and effort.
@Jayneire
Yes. Temporary basis. I agree. But so many expats have different stories.
“I reject their damn “solution”. I want a revolution instead.” Right ON, EmBee!!! I’m with you, too.
I have a little saying: “CBT ends with me”. Although my stance has cost me a good part of my emotional well-being, as well as my freedom to travel where, when and how I wish, I refuse to pay the US government a nickel.
@Don Fahnestock
I just read your comment and very much appreciate that you’ve written ACA. Your situation demonstrates yet again, how differently these things affect different people. One thing I am not clear on. When you said “move back” did you mean move back to the US?
I hope ACA listens to your request to focus on defeating FATCA. There is no way around the fact that SCE will keep people “in the system” as it were and that perpetuates CBT. One more thing the government will want to hold on to which is contrary to the idea of dumping FATCA. Again, thank you for taking the time and energy to write both to ACA and to us.
Here’s a Google Translation of the Belgian article posted by vin-de-table. It sounds as though the bank is going to cease the practice of closing the accounts of “Americans”.
***:
An agreement was concluded between Deutsche Bank and the inter-federal Centre for Equal Opportunities (Unia) as part of a dispute concerning a claim of discrimination on the basis of nationality, did on Wednesday with Unia. The latter brought an action before the French Commercial Court of Brussels against Deutsche Bank, for discrimination on grounds of nationality. The agreement is expected to end this procedure.
The bank, active in Belgium, decided in 2014 to close the accounts of its US customers and to refuse any new account opening for US persons following the adoption of a US regulation (called “Foreign Account Tax Compliance Act “or” FATCA “). Deutsche Bank estimated that the regulations required it too heavy and onerous obligations in terms of providing information to US authorities.
Seized by customers, Unia considered that the bank was operating well and truly unlawful discrimination because of the nationality of the interested parties in violation of the law of 30 July 1981. The Centre had filed the case in court against the refusal of the bank change its policy.
According to Unia, the bank finally decided to voluntarily revise its position by agreeing to propose again, from March 1, 2016, to US customers the same services as those that were in effect before the intervened termination in 2014 and the same conditions. This change applies not only to the elders turned away customers, but also to all new customers, US Persons, said the inter-federal Centre for Equal Opportunities.
The legal proceedings initiated by Unia and people who had seized it, is therefore moot because the bank proposed a satisfactory solution, says the Centre for Equal Opportunities.
Democrats abroad are having an online videoconference tomorrow with multiple house and senate candidates.
Why not sign up and give them an earful directly? They are also collecting questions in advance of the event, so suggest away.
I struggled mightily to rework “I hate FATCA and SCE so much that I wouldn’t p*ss on your party if it were on fire” into the form of a polite question. Others may be more successful.
Link here: http://www.democratsabroad.org/take_back_the_congress_town_hall
@Canadian Ginny
“I have zero interest in what either the Dems or Reps abroad propose.”
Agreed. I support our Canadian lawsuit. No longer interested in the USA, except to keep their overreach out of Canada.
@MuzzledNoMore, thanks for that Google translation, and thanks to @vin-de-table for that posted link with update re Belgian banks and discriminatory treatment of those EU citizens and residents also deemed to be “US persons”.
http://isaacbrocksociety.ca/2016/09/29/tell-aca-what-you-think-about-its-proposal-to-build-a-better-fatca-safe-country-exemption-with-mandatory-irs-compliance/comment-page-2/#comment-7675747
I wonder what impact this will have on the broader FATCAnization of accountholders across the EU, particularly in combination with Q#2 below:
Parliamentary questions
12 July 2016
E-005680-16
Question for written answer
to the Commission
Rule 130
Sophia in ‘t Veld (ALDE)
Subject: FATCA (Foreign Account Tax Compliance Act)
Answer(s)
In 2015, the Commission stated in an answer to a question that it ‘supports full reciprocity in information exchange between tax authorities’ and stressed the USA’s commitment to reciprocal automatic exchanges of information with its FATCA partners(1). The Congress has not yet adopted legislation to this end and the US authorities do not provide an equivalent level of reciprocity under intergovernmental agreements (IGAs)(2).
Given the recent parliamentary debates in France, Italy and the Netherlands on the bilateral IGAs on FATCA, and in particular the negative impact of the extraterritorial application of third countries’ law on EU soil, the disproportionate effect of FATCA on EU citizens (‘Accidental Americans’) and the discriminatory treatment they are facing:
1. what action will the Commission take to persuade the US Government to ensure reciprocity without further delay?
2. does the Commission consider that the refusal of ‘Accidental Americans’ by banks is a violation of the Payment Accounts Directive and of the Charter of Fundamental Rights?
3. what action will the Commission take to remedy the situation for the EU citizens affected?
(1) http://www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2015-012237&language=EN
(2) https://www.whitehouse.gov/blog/2016/05/06/president-obamas-efforts-promote-financial-transparency-and-combat-corruption-what
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+WQ+E-2016-005680+0+DOC+XML+V0//EN&language=en
…………
Parliamentary questions
16 September 2016
E-005680/2016
Answer given by Mr Moscovici on behalf of the Commission
“FATCA(1) and the related IGAs(2) are bilateral agreements between the US and other countries, including Member States, and are not directly within the competence of the Commission. However, the automatic exchange of information can only be effective in fighting tax fraud and evasion and preserving the level playing field if implemented on a global scale. The Commission is therefore currently working in international fora — Organisation for Economic Cooperation and Development, Global Forum and G20 — to promote its global reach and ensure that the agreements, including the IGAs, on automatic exchange of financial account information meet the highest transparency standards and are fully reciprocal.
The Payment Account Directive (Directive 2014/92/EU(3)) obliges Member States to ensure that credit institutions do not discriminate against consumers based on their nationality, or place of residence or by reason of any other ground as referred to in Article 21 of the Charter in the provision of payment accounts under Article 15. Besides, the directive also establishes a right of access to a payment account with basic features for all consumers legally resident in the Union in its Article 16. In each Member State, payment accounts with basic features shall be offered to consumers by all credit institutions or a sufficient number of credit institutions to guarantee access thereto for all consumers in their territory, and to prevent distortions of competition.
Following the expiry of the deadline for the transposition of the directive (September 2016), the Commission will assess how the directive’s provisions, including the ones mentioned above, have been transposed in all Member States, and will not hesitate to initiate infringement proceedings in case of non‐ or incorrect transposition.”
(1) Foreign Account Tax Compliance Act
(2) Inter-Governmental Agreements
(3) http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32014L0092&from=EN
Last updated: 26 September 2016
http://www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2016-005680&language=EN
@CanadianGinny re;
“…. I ask and expect the USG to recognize that I am a Canadian citizen. I demand the Canadian government afford me equal rights as other Canadian citizens are afforded. And I ask that for all Canadians and permanent residents so affected..”
Not much to ask if the feds consider themselves guardians of Canada as a sovereign autonomous nation and not a supplicant branch plant / colony / outpost of the US empire.
@badger
It’s unfortunate but it seems the USA acts as an empire and treats Canada and other countries as colonies subject to its tax law.