I agree with others that Jim Jatras’ words in The Hill is important for its own post. Thank you, Mr. Jatras, saying that…
FATCA’s only beneficiaries are the army of lawyers, accountants and software vendors who are making a fortune on it, with the costs passed onto consumers.
I started my journey regarding US tax compliance almost ten years ago. I have paid dearly from my retirement savings and, although compliance has ended for me (but will that ever change?), the absurdity has not ended for my US-deemed Canadian-born son who has a developmental disability and, without requisite mental capacity, who would be trapped into such ongoing, never-ending costs of US tax and reporting compliance. Again, I will say that it is not only for my son that I have come forward in this fight but for that of any person / family with the same entrapment. My son will not be the only one so affected and for them this injustice to continue, year after year, to benefit that described army of lawyers, accountants and software vendors who are making a fortune on it, with the costs passed onto him and others like him.
I chose to go the route of having these professionals help get my family out of this US citizenship-based taxation nightmare, but have found it is impossible. I don’t want any special work-around for my son. I want this to end for all such sons and daughters. Personally, I want the end result to be US residence-based taxation so no *accidental American* faces this injustice. If there is the exceptionality of US CBT rather than RBT of the rest of the world (save Eritrea), then, in my eyes, there should only ever be an OPT-IN to US citizenship if the facts permit, never an OPT-OUT where some, the most vulnerable, are entrapped into, by US tax law, never-ending US tax compliance and reporting.
FATCA needs to go. The unconstitutional IGAs need to go. And the US needs to change to the same and much fairer residence-based taxation as the rest of the world and end the unconstitutional “warrantless seizure of personal financial information without reasonable suspicion or probable cause.”
I continue to be incensed that my chosen country of citizenship, Canada, and the country in which my son was born and raised (and never registered as a US citizen abroad) chose to honour the US in agreement to sign the extra-territorial IGA with the USA. I continue to say that the words of Prime Minister Trudeau that *A Canadian is a Canadian is a Canadian* were political rhetoric, untrue and audacious. It is discriminatory that some Canadians, those with some US connection, however meaningless, do not fit with his faux words. I don’t know what will take away the injustice for many. I continue to feel betrayed by both my chosen country and the country in which my children were born and the country of my birth.
Again, thank you for this article, Mr. Jatras. I have included it all below. (If there is a problem for this site with quoting all of it, I will update to remove part of it. I think it important for all to read the article in its entirety.)
President-elect Donald J. Trump has stated that among his top priorities will be revocation of President Barack Obama’s misguided executive orders. Among the first such items to get the ax should be a series of legally infirm international agreements to implement a monstrosity unfamiliar to most Americans, called the Foreign Account Tax Compliance Act (FATCA).FATCA, enacted by Democrats in 2010, is an indiscriminate information dragnet requiring — under threat of extraterritorial sanctions — all non-U.S. financial institutions (banks, credit unions, insurance companies, investment and pension funds, etc.) in every country in the world to report data on all specified U.S. accounts to the IRS.
No proof or even suspicion of wrongdoing is required. The 2016 Republican Platform rightly called for FATCA’s repeal as an unconstitutional “warrantless seizure of personal financial information without reasonable suspicion or probable cause.”
FATCA supposedly is aimed at “fat cat” American tax cheats with money stashed abroad but does not include a single provision targeting actual tax evasion.
It has not yielded significant revenue recovery while imposing crushing compliance costs worldwide. FATCA’s only beneficiaries are the army of lawyers, accountants and software vendors who are making a fortune on it, with the costs passed onto consumers. It is a perfect example of the kind of wasteful, indiscriminate and counterproductive regulation Trump has promised to roll back.
Repeal of FATCA is a must-include item in a tax reform package Congress will send to President Trump’s desk in 2017. But while that package takes shape, there is something the incoming administration can do on its own authority as soon as the new president takes office, consistent with Trump’s pledge to reverse his predecessor’s extravagant abuse of his executive authority: He can nullify a series of unconstitutional fake treaties that outgoing Treasury Secretary Jack Lew (and before him, Timothy Geithner) used as a mechanism to implement FATCA.
This requires some short explanation. In addition to its other defects, FATCA is also one of the worst-drafted pieces of legislation this veteran of over 17 years working at the U.S. Senate has ever seen. Evidently no one noticed prior to enactment that the law’s central requirement — that hundreds of thousands of foreign firms outside of U.S. jurisdiction in almost 200 countries turn personal data directly over to the IRS — would be unenforceable under most countries’ privacy laws. Even supporters of FATCA concede it is “wholly unachievable” as written.
Accordingly, after FATCA became law, the Obama Treasury Department figured out that the only way it could work at all would be to pressure foreign governments to enforce it against their own citizens and to abrogate their domestic privacy protection laws to do so.
This was done through a series of bilateral “intergovernmental agreements” for which Treasury has no statutory authority, under either FATCA itself or any other law. While these agreements read like treaties and are duly ratified as such by foreign “partner” governments, they are not submitted to the U.S. Senate for its advice and consent under the U.S. Constitution.
In short, these agreements are purely distilled examples of Obama and his underlings using their respective pens and phones to create the appearance of legality where none exists. Dozens of such agreements have been signed and more are in the works.
But wait, it gets even worse! As a sweetener to induce countries to agree to sacrifice their sovereignty and to place their financial sectors under Internal Revenue Service (IRS) supervision, Treasury offered, also without statutory authority, “reciprocal reporting” from domestic U.S. institutions to foreign governments.
This would hit U.S. banks, credit unions, insurance companies, mutual funds, etc. with costs comparable to those FATCA inflicts abroad, extracting billions of dollars from American consumers and taxpayers and spurring job-killing capital flight from the United States.
Several attempts by the Obama administration to sneak through legislation for FATCA reciprocity have been blocked in Congress. But as long as the law remains on the books and the implementing agreements remain in force, they hang like a sword of Damocles waiting for the next Democratic administration to press forward.
The illegitimate FATCA agreements include a provision for one year’s notice of termination, which Trump’s Treasury secretary can issue upon taking office.
Even better, the Trump White House’s Office of Management and Budget could also immediately issue a determination declaring the agreements null and void on the grounds that the Obama administration had exceeded its legal authority in making the agreements in the first place.
That would effectively gut FATCA and put foreign governments on notice that the U.S. is pulling the plug on it, pending enactment of a tax reform bill that includes final repeal of what I have called “the worst law most Americans have never heard of.”
James George Jatras is a former U.S. diplomat and foreign policy adviser to the Senate GOP leadership. He edits www.RepealFATCA.com and recently published a major study, “How American Media Serves as a Transmission Belt for Wars of Choice.”
@Carol, I will say again that in me and many others you have gained allies for your son and we will not stop until we have won for him.
I will NOT stop until the US State Department issues an “Adminstrative Presumption” that a foreign born person shall not be considered a US Citizen until such time they lodge an application for said US Citizenship with the US State Department.
I believe that this is reasonable, proportionate and above all attainable.
I will not cease in my efforts until this is obtained.
From Bloomberg Politics;
“Pence also told lawmakers one of Trump’s top priorities was taking a deep dive through President Barack Obama’s executive orders.
“We applaud that,” he said. “He will be reversing many of them.”
BRAVO!!!!!
As always, George, I am grateful for the support from you and so many others. As you understand and have stated — and thanks for that! — this is NOT only for my son.
It’s now or never, at least for me. Thank you for this, James Jatras.
BTW, you would have made a great Veep 🙂
I really appreciate the brilliant efforts of Jim Jatras and many thanks to the Isaac Brock Society for highlighting it. The persistence of this group is awe inspiring.
Definitely FATCA should get the axe. I have my doubts that this will be a priority for Trump, so continue to support the lawsuit here. There are so many injustices out there caused by this insane law, complicated even more by the IGAs. Calgary’s son being one of many affected by this abominable mess. One possibility is that under a Trump presidency, the USA empire may crumble.
Can anyone think of any reason(s) why Trump would want to keep FATCA?
I continue to make the point that:
Those who were born abroad to U.S. citizen parents should NOT accept that they are automatically U.S. citizens by birth. Reasons are explained here:
https://renounceuscitizenship.wordpress.com/2016/01/16/born-abroad-to-us-citizen-parents-in-a-cookvtait-world-are-you-a-us-citizen-or-do-have-a-right-to-us-citizenship/
Position should be that: Some carbon life forms born outside the USA have the right to obtain U.S. citizenship, but have no obligation to accept U.S. citizenship (unless of course they have already accepted it).
THIS IS GOOD! Unfortunately we never got a statement from Donald Trump during the campaign on FATCA or CBT. If Pres. Trump is too busy to read Jim’s article then Reince Priebus who will be working adjacent to the Oval Office can read it out loud for him. We know Reince Priebus is familiar with FATCA so he will be able to give the correct answers to any questions that might come up and reiterate that repeal of FATCA and switching to RBT is in the Republican Party Platform (pg 13).
https://prod-cdn-static.gop.com/media/documents/DRAFT_12_FINAL%5B1%5D-ben_1468872234.pdf
In today’s hope-to-dashed-hope political climate it’s hard to keep one’s spirits up but I think this article has a good chance of reaching Pres. Trump, one way or the other.
Nobody tells it like it is quite like Jim Jatras. Thank you, Jim, for this fabulous article in The Hill. It will certainly be read by many of those who, I hope, are poised to finally act on our behalf when the new administration is installed two short months from now.
I also hope that they don’t stop with repealing FATCA. They’ve got to go all the way and rip out the root of the evil, CBT. Repealing FATCA will make us safe in our home countries once again. Repealing CBT will make us free.
@Bubbles…..yep now or never….this is it. Amazing how it came suddenly like this, two weeks ago some could have never imagined.
What would Trump want to keep FATCA? I can not think of even a remote reason. The good news is Trump is NOT a lawyer as many Presidents have been as lawyers like this kind of B-S. He is not a product of the compliance industry so he does not care about accountants and lawyers. The IGAs are unconstiutional so they need to go and their father is Obama and grandfather is a Democrat Congress.
More good news is that he personally survived the attack that “he paid no tax in blah blah year.” The truth is he had a business tax loss so had no positive income. Having him gone through that WE now have teflon that repealing FATCA is a sop for the rich…..well for Embee it is who is now sailing on the family yacht to winter in the Med off Monaco sipping fine champaign. 😉
@Muzzled…..we are on the same hymn sheet. FATCA repeal lets us breath again BUT it needs to be pulled out by the roots that being CBT. Otherwise it WILL come back under a new future Democrat Administration.
But……I take one win at a time and give thanks accordingly.
I am wondering how we can remind the Trump camp of the tax and citizenship issues as they relate to us expats. Are they reading IBS comments like Jim’s article.
I hope someone in the House or Senate sticks it in a huge Bill as some sort of obscure amendment that nobody reads like FATCA.
I’m sure the new Senate Minority Leader, Chuck Schumer, would be jumping up and down over it.
Let’s hope common sense finally prevails. In the meantime, I’m still waiting for FATCA data to drop on the doorstep from some hacker at a bank so it can be used as a ‘customer list’ in future.
Jim Jatras writes:
“He can nullify a series of unconstitutional fake treaties that outgoing Treasury Secretary Jack Lew (and before him, Timothy Geithner) used as a mechanism to implement FATCA.”
And as Eric and I think another Brocker pointed out tax regs are not written in stone, never to be altered nor tossed aside:
http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments-part-3-of-3/comment-page-104/#comment-7715115
“New article in the Yale Journal on Regulation blog pointing out: tax regulations are absurdly easy to repeal. No notice & comment period required, according to the IRS’ own position. Can be done on Day One of the Trump Administration if he is so inclined (giant if):”
This may be the ONLY thing related to the IRS that is easy. Whodathunkit?
The method to fix things is clear and now it appears to be relatively easy too. It’s a matter of motivating Pres. Trump to do what’s needed and to do it sooner not later. Or, as Mike Holmes (a Canadian builder) would say, “Make it right, Mr. President!”
Trump is going to have to get a bigger axe …
http://www.washingtonexaminer.com/obama-sets-new-record-for-regulations-527-pages-in-just-one-day/article/2607677
What efforts are made to get our issue brought up with Congress?
@Fred, thats the 99 Euro question. 😉
Let me tell you how I have sorted that question in my mind as you and others may other ideas.
We were blessed it was included on the GOP Platform!! Its on the To Do list on the refridgerator.
Rand Paul seemed hot to trot on the issue so as a man he is going to want his win. Hence, I am now sending letters to his office. With an overseas address all he knows is that I am expat constituent!!
James Jattras has been another blessing keeping the issue alive.
Keith Redmond needs support and encouragement as he is keeping it alive.
IMO the Canadian Lawsuit IS a pressure point in the sense we win worldwide if Trudeau capitulates as that would be a bell ringing in Washington. Our Canadian friends need to use every wedge they can think of to get the government to drop the lawsuit defense. That WOULD trigger an avalanche around the worldwide and the rest of us could hold up young wise PM Trudeau as an example of the man who said A Canadian is a Canadian. Really, I want him to take the credit for standing with the people!
The Bopp lawsuit is a major pressure point……..but we need to know where that is at and how to support. I did not send them money before but would know.
The sister lawsuit with ADCT same officers as ADCS is a pressure point and hope we get an update from them on that.
Republicans Overseas need to be asked what can we do to help.
I read that there was suppossed to be a House FATCA hearing after the election by I think Rep Meadows. Thats an important hearing.
Every week I am sending ten snail mail letters which includes Rand Paul and the co-sponsors of the two FATCA repeal bills.
I think on our side of the pond we need to start placing doubt in our representatives heads by writing and sending news clips that FATCA is DEAD. We need to be constantly talking that FATCA and the IGAs are dead.
@George
You know me too well…..
Re, “Republicans Overseas need to be asked what can we do to help.”
You can always reach Solomon Yue at solomon@fatcalegalaction.com
He’s very good at returning emails.
@ Jim Jatras thanks for a well written article.
@ George as usual you and I sing from the same hymnal.
I recently was so privileged to be invited back to my law school alma mater to present a seminar to the advanced international law class. I meant to report about this sooner to this group but since then things have been very busy on the plaintiff end and didn’t get to it.
As usual the law students query what the tipping point was for me to decide to be a plaintiff. It’s a complicated answer because it is quickly followed by “and what is it like? is it anything like you expected?” and those sorts of questions.
There of course were many reasons why I made my choices. But I always end with telling the same story of one person’s experience and watch them as their mouths form into collective gapes, if that is the right expression.
I tell them the story of Carol T’s experience ( Calgary 411) and what she and her family had to endure and the costs expended to try to extricate their family and yet, despite the costs, how the process did not allow her to accomplish what she set out to do and how her son is still irrevocably trapped by our collective nightmare. At that point in my lecture, you can hear a pin drop and I know they get it. I tell them I wish I had time to tell them all the similar stories from across the world. I have never been able to tell them the worst story ever, as far as I am concerned about the brilliant young man in Europe who lost his life, as his father recounted to us. I am not that brave.
I also tell them about how so many heroic people donated hundreds of thousands of dollars to support our lawsuit and they are also astounded. I tell them about how many supporters we still have even though they have renounced and freed themselves and could quite easily go about their lives having acquired that freedom, but are still with us supporting the three plaintiffs and the others in our situation from many countries. I tell them about France, Israel, Australia and other countries’ efforts. About the world movement.
I am always so grateful to my alma mater for their invitations because I feel strongly that these types of issues should be presented to law students in their early education to demonstrate to them what they can do with their degree to the benefit of others. I was so impressed by this particular class’s reactions. A few days later, their professor informed me that one student decided to change a previously chosen topic for the required paper in the course and will now be writing about FATCA from an international law perspective. I look forward to working with that student and reading the final paper.
I can’t do the hard work that so many of you do, with writing to your MPs or government officials, or liasoning with them on a personal level as many of you have done, because as a plaintiff I am precluded from doing that. Nor can I comment on written articles as so many of you do so well, though I would like to.
So, I do what I am able to do as we all do. Spread the word, educate, use our talents in whatever way we can to get the word out. Support each other, especially when new people come to their omg moment. Commiserate with the now ‘old-timers’ who are still facing all the effects of trying to live their lives wherever they are situated with the consequences they face with bank account closing etc. I don’t need to point out all that to any of you here.
I know this process is not moving at any pace we might wish it would in any country, be it mine or yours. But Leonard Cohen,said it better than I ever could: It’s a cold and it’s a broken Hallelujah.
As is CBT and FATCA. But we will get there. Things might be changing since the USA election and this is the time and opportunity that may just be the opening we need. To be seen.
Meanwhile, our Canadian law suit is moving forward, as we make steady progress, as usual behind the scenes. Hopefully it won’t be long before we can give you another update. Meanwhile I look forward to hearing any progress from proposals like the one fromJim Jatras and others who are in the USA who see this as an opportune time to correct the worst law in the history of that country. May it be so.
@ Canadian Ginny
You’ve been such an inspiration to all of us and now to the law students who attended your seminar as well. Thank you!
Friends,
My wife is relinquishing her US citizenship next week. She filled the forms DS-4079 and DS-4081. She got approval for conditional citizenship, which requires her to relinquish the US citizenship and submit proof for grant of citizenship. Since she is only relinquishing as required by the government, does she need to fill DS-4082? Any other advice? Can we pay the relinquishment fee by credit card?
With Regards,
Surya
@Ginny….your update was like gathering the family together to hear what “Aunt Ginny” has been doing. So cool…..so brilliant…..
In regards to the foreign election that occurred in that other place, I think you will agree that with regards to our battle we need to put the politics of the foreign land away because as I said its a foreign election in a foreign land. Thats what keeps me sane on this, they are foreigners to me.
But with that foreign election….your head must be spinning along with the rest of the ADCS team (no comments needed or wanted). We have been in a slow slog battle and now this literally changes the whole battle field!!! The battlefield is now fresh with new roads…prime targeting.
The battle field for ADCT and the Bopp lawsuit has now been changed for the good. And they will help the slog with ADCS in their own way.
Team Crown I am confident is not so pleased, I hope that gets back to Trudeau…..the domestic political implications he now faces. The cons gave him a poisoned chalice and now he must drink from it or toss it aside. He originally thought he could leave the poisoned chalice on a shelf but no more…….he was warned and warned and warned.
One month ago, I expected we would be begging “Obamas Third Term” for mercy with same country exemption but now we are dreaming of the possibility of RBT and restoration of USC to those that want it!! And Trudeau…..he lost his cover for the IGAs that instead of burning he embraced and defended.
That is so great with the students and you as a lawyer must be thrilled. The questioning of the students on being a plaintiff……… Its great you are planting the seeds that will be great trees in a few decades.
With every fiber in me, I now know the battle will be won as we have gone beyond the turning point. I think both of us would love to be the fly on the wall in the offices of Team Crown. The domestic political dynamics of this has been put on its head! The cons started this mess by telling us 2+2=7, we thought the liberals could do math but when they took office they came back and effectively said the cons were wrong because they said 2+2=5.
But now……the world is learning that 2+2=4 and A Canadian in Canada is a Canadian is a Canadian.
Ginny, you have made it to the footnote sections of future law books. And that future footnote will be on the winning side. The other part of this that I know with my very being is what you did “today” will be very important on same case in the future pertaining to citizenship and/or extraterritorial laws. This case will be quoted in the future.
In a sense I am sorry to say that ADCS is not going to the Supreme Court of Canada after all but in another sense I am relieved and thankful.
@ Surya,
Witnesses and the DS-4082 (Witnesses’ Attestation Renunciation/Relinquishment of Citizenship) are required only when the person doesn’t understand English. This would come into play, if applicable, in both relinquishment cases as well as renunciations (7 FAM 1227(b)(4)) and the DS-4082 form specifies “renunciation/relinquishment.” It seems to be fairly uncommon (at least no one has reported doing so at Brock).
At any rate, if your wife does not speak/understand English, it would probably be good to check with the embassy/consulate regarding that and also to find out who the witnesses should be, as the Foreign Affairs Manual says witnesses may not be “not relatives, friends or associates” (7 FAM 1263).
If a person speaks/understands English, they won’t need witnesses; and in general circumstances most embassies/consulates do not allow the person to bring a witness.
For payment, AFAIK they take credit cards, but If your embassy/consulate sent instructions, it would be good to double-check them to see if they’ve mentioned methods of payment or you could check with the particular embassy/consulate to ensure they take credit cards, because things can vary from place to place.