Liberty and justice for all United States persons abroad

The Isaac Brock Society

Posted on by Posted in Issues regarding US persons abroad 176 Comments

J-bnn
Reposted from the citizenshipsolutions blog
“Guest post by
John Richardson – “Citizenship Solutions”

FATCA Hearings in Washington, DC – April 26, 2017
 
 
 
 

Beginnings – It all began in July 2016

The purpose of this post is NOT to describe the hearing in detail (that has already been well done), but rather to provide my overall (and perhaps broader) impressions based on actually having attended the hearing.

The April 26, 2017 FATCA hearing in Washington was long in the making.
Its genesis was rooted in a meeting that took place in July of 2016 at the Republican National Convention. The planning and preparation involved the efforts and consistent cooperation (weekly meetings since August) of a number of people in different countries and on different continents. It was a privilege to have been part of this group. A list of the people who worked on making the hearing happen – the “FATCA prep team” – is described here. Those efforts culminated in what some witnessed “in real time” on April 26, and what thousands more will see (thanks to Youtube) in days to come.

The hearing has already been documented IN DETAIL and discussed in various places IN DETAIL, with the best commentary coming from posts at the Isaac Brock Society here and here and various Facebook groups here, here, here and here. (An example of ridiculous commentary is here.) When I say “commentary” I mean NOT ONLY the posts, but the rich and insightful comments. Seriously, this collection of “digital experiences” really is “History In The Making!”

Thinking about FATCA, What is it anyway?

I have written numerous posts about FATCA – “The Little Red FATCA Book” which you will find here. An explanation of how the Meadows “Repeal FATCA” bill would actually work is here.
Basically, FATCA is the collective effect of a number of amendments (including the creation of a new Chapter 4 of Subtitle A of the Internal Revenue Code – which has made largely irrelevant by the FATCA IGAs) which are designed to identify, attack and impose sanctions on:

A. FATCA: Non-U.S. banks and other financial institutions

Forcing them to “hunt down” the financial accounts and entities (examples include mutual funds, corporations, trusts and some insurance policies) owned by “U.S. persons”. The goal is to “turn them over” to the IRS.

This imposes enormous compliance costs on non-U.S. banks. The obvious effect is that they will not want U.S. person customers. Would you? Interestingly the focus of the witnesses
(Mr. Crawford and Mr. Kuettel) was primarily on the denial of basic access to financial and banking services.

Although important, this is only one half of the equation. What happens when “U.S. persons” learn (the vast majority had no idea) that they are subject to U.S. taxation?

B. FATCA: “U.S. Persons” with non-U.S. financial assets and bank accounts

It is not possible for “U.S. citizens” to BOTH: be U.S. tax compliant and live a productive life outside the United States, when they are also subject to the tax laws of other nations. (Digital nomads are the exception.) The reason is that U.S. citizens living outside the United States are living under a system where:

  1. They are presumed to live in the United States (which they
    don’t); and
  2. Their assets (which are local to them) are presumed to be
    “foreign” to the United States.

If you don’t understand (or don’t believe) why this is true, you will find an explanation here.

Just remember:

“When In Rome, Live As A Homelander” and do NOT “Commit Personal Finance Abroad!” (It’s UnAmerican)

Although a major effect of FATCA is to subject Americans abroad to a very special set of tax rules (think PFIC, foreign pension, CFC, and a crushing burden of forms that impact ONLY Americans abroad), there was NO witness that even alluded to this as one of the effects of FATCA. (FATCA is the enforcer of the uniquely American policy of “taxation-based citizenship”). There was also no witness that described how a “FATCA letter” can lead to absolute financial ruin for honest taxpayers, who have made a life outside the friendly borders of the United States of America. There was no witness who explained the confiscatory effects of entering one of the IRS “Amnesty – Ministry of Love” programs.

This had the effect of making it seem as though FATCA (in terms of the effect on Americans abroad) was just a simple “disclosure- Form 8938 issue. Nothing could be further from the truth.

If it were not for “taxation-based citizenship”, FATCA would be no more or less a problem for Americans abroad than it would be for Homelanders (which doesn’t mean it is not a problem). Unfortunately, the hearing did not provide evidence on this point.

(This is NOT a criticism. But, just imagine if there had been witnesses who had been
identified as a “U.S. Person” because of FATCA, did NOT know about “taxation-based citizenship” and then were forced into the “Offshore Voluntary Disclosure Program“. Now that would have been a story …!)

It is “taxation-based citizenship” that makes the effects of FATCA so hard on Americans abroad! In 2011, I remember thinking:

The United States can have either FATCA or it can have “taxation-based citizenship” but it CANNOT have both!

My perception of the hearing itself …

It was clear that some members of the panel had NO idea what the purpose of FATCA was. There were suggestions that FATCA was enacted to combat terrorism, drug dealing, organized crime, human trafficking and who knows what else. The truth is that FATCA was a “revenue offset”
provision to the HIRE Act and few Congressmen even knew that FATCA was part of the legislation. This has resulted in a discussion of FATCA
that:

  • fails to ask “what was the intent of FATCA”; and
  • often asks “what can we use FATCA for and the information received from FATCA for”?

(With regard to the “intent” and “purposes” of FATCA much can be gleaned from the
definitions in the FATCA IGAs.)

It’s as though FATCA is a law that is in search of a purpose!

I encourage everybody to invest the two hours in watching the live video. While watching the video try to imagine that you had no preconceived notions about FATCA. Try to imagine that you were learning about FATCA for the first time (which I believe was the case for various committee members). In fact, my impression is that ONLY Mark Meadows had educated himself about the basics of FATCA and its effects on Americans abroad.

Had it not been for Mark Meadows, the hearing would have been:

“Two ships (pro and anti-FATCA) passing in the night.”

The “opening statement” …

As you know, the hearing opened with a compelling video of Donna Lane Nelson (author of the first FATCA novel) and reluctant renunciant of U.S. citizenship) explaining (among other things) how FATCA forced her to end her requirement to pay taxes to the United States.

Rick Adams, (spouse of Donna Lane Nelson) who attended the hearing and participated in the “door knocks” (the day before) shares his impressions of “being there” in two blog posts referenced in the following tweets:

 

 

Ship Number 1: FATCA Opposition – Mr. Bopp and crew mates (Crawford and Kuettel)

 
Jim Bopp (lawyer in Crawford v. U.S.
Treasury) did a solid job of outlining how FATCA is a draconian law, that presumes that every person with a “non-U.S. bank account”, is presumed to be a criminal. He explained why this was unconstitutional, etc. He outlined the general theory and principles leaving Mark Crawford and Daniel Kuettel to explain the details of how FATCA has specifically impacted their lives.

All three witnesses (Mr. Bopp, Kuettel and Crawford) did an outstanding job. That said their testimony was limited to the access to “banking and financial services” aspect of FATCA. There was no evidence provided on the aspects of FATCA that are aimed directly at Americans abroad (mutual fund disclosure rules, form 8938, etc.)

Further commentary from the crew of Ship 1: Press Conference – Post FATCA Hearing

Ship Number 2: FATCA Support – Wayne State Law Professor and Carl Levin Protégée Elise Bean

Reactions to Professor Bean have been widely discussed. I see no need to comment further on her testimony.

Here is a video that does a good job of breaking down many of her comments:

It was discouraging that Ms. Bean could not see FATCA from anything but a “Homelander Perspective”, with seemingly no awareness of the broader implications of FATCA.

The Moderator: Representative Mark Meadows – Getting The “Two
Ships”: To Stop And Communicate

All of the witnesses played their roles well (including Ms. Bean who was given the thankless job of defending the indefensible). But, Mr. Meadow’s performance eclipsed the performance of all others. He guided the hearing well. He forced each “Ship” to address the concern of the other. The hearing ended with his request that:

Each witness provide three suggestions to improve the FATCA situation.

This is incredible!

Anybody who understands anything about FATCA understands that the effects of FATCA are so devastating to Americans abroad because of “taxation-based citizenship”. If there were no “taxation-based citizenship” then the specific problems experienced by Americans abroad would (for the most part) cease to exist.

Therefore, ALL witnesses (and perhaps others) should use his invitation to argue for:

“The end of taxation-based citizenship”.

(We have a Congressman who wants to hear and is listening to the story!)

Whether this is done through a move to pure residence based taxation, territorial taxation or some combination the point is that:

The abolition of “taxation-based citizenship” would be a solution to all the problems that the FATCA hearing was convened to address. (The abolition of “taxation-based citizenship” would NOT be an admission that FATCA was constitutional. But, if the definition of “U.S. Person” did NOT include “Americans abroad”, that would address many of the specific problems that the FATCA hearing was convened to explore.

The abolition of “taxation-based citizenship” could (in general) be accomplished in either (or both of two ways):

  1. Congressional Fix: Amend the Internal
    Revenue Code so that “U.S. citizenship” was NOT a sufficient
    condition for taxation (presumably
    making residence the
    condition for taxation    ); or
  2. Treasury Fix: Amend the Treasury
    regulations     under Internal Revenue Code S. 1 so that
    “Americans abroad” were NOT defined as “individuals” for the
    purposes of taxation.

(Note that “1” and “2” above are not intended to be precise or exhaustive. My point is that this can be achieved through either Treasury regulations or through amendments to the Internal Revenue Code.)

It is after all “Tax Reform Season1” What Mr. Meadows has done has been to say:

Q. How can we fix this?

A. We end “taxation-based citizenship” – the “U.S. taxation” of Americans abroad!

All individuals and groups representing Americans abroad should work together on this!

Speaking of groups representing Americans abroad. Who did make it into the video? Those attending the hearing included (but are not limited to)…

In addition to the complete FATCA hearing Prep team (see here, here, and here), it was interesting to see that the following were curious enough to appear on April 26, 2017, in that particular room at the appointed time:

Democrats Abroad – Although much maligned, it was interesting to see that

– Katie Solon – International Chair of Democrats Abroad – attended the hearing;

–Joe Smallhoover A man with a long history of involvement with Democrats Abroad (and current Chair of Democrats Abroad France) was in attendance

(I find this interesting given DA’s long support of FATCA.)

AARO – Lucy Stensland Laederich and Paul Atkinson and Tim Ramier of AARO’s board were in attendance.

ACA – Charles Bruce – legal counsel for ACA (and likely principal architect of the ACA RBT proposal) was in attendance.

FAWCO – I believe but am not certain that a representative attended.

James Jatras of Repeal FATCA fame.

Although the FATCA hearing was an achievement of Republicans Overseas and the FATCA Prep team, it clearly attracted wide interest from the various groups that focus on “Americans Abroad issues”.

(Regrettably, there was NOBODY there to represent the interests of “accidental Americans” and “long term resident/dual citizens of other nations and those who never dreamed they were considered to be U.S. citizens, but have lived with the frightening experience of learning they may be considered to be U.S. citizens. But, why should anybody have represented them? They are subject to U.S. laws but have no access to the U.S. political process. To put it another way:

Those who are the most affected had the least representation!)

Although, there has been tension among these various groups, it’s time to “come together” with a unified voice and message that:

In this season of tax reform, it’s time for the USA to join the world and adopt taxation policies that allow its citizens to leave the United States and live productive meaningful lives.

(All of the research has been done and hundreds (if not thousands) of people have explained their story See here and here for examples.)

Believe me:

  • the United States of America will benefit from these policies
  • Americans abroad will benefit
  • the IRS will benefit (I have always thought the IRS is probably the biggest victim of these
    insane U.S. tax policies

and

people will no longer be forced to renounce U.S. citizenship!

And what of the FATCANatics? Would they support residence-based taxation?

In my view, it is entirely reasonable and possible to both SUPPORT FATCA and oppose “taxation-based citizenship”. At the hearings, Professor Bean was clearly supportive of FATCA (even wanting to extend it to Homelanders), but she did NOT (in the hearing proper) reveal her views on “taxation-based citizenship”.

Interestingly, Rick Adams (in his description of the hearing) reported that:

Ms. Bean was standing with the ACA rep, and surprisingly, when I said the real problem was citizen-based taxation (CBT) … or as I prefer, taxation-based citizenship … and that we need to abandon CBT and adopt RBT — Residency-Based Taxation — which is the way every other civilized country in the world administers taxes, SHE AGREED!
That’s right, Ms Bean, oppressor of expats, said she is for RBT instead of CBT. Now, she may recant later, or say I misheard her, but then again maybe she did absorb some of the pain she and her compadres have inflicted on innocents.

Concluding thoughts …

The purpose of the hearing was to explore the unintended consequences of FATCA. I believe that the hearing did a good job of achieving this goal.
But, the best thing to come from the hearing is the opportunity to:

Make the case to Congress that the time has come to end the destructive practice of U.S. taxation-based citizenship.

It’s time for ALL groups and individuals (including Ms. Bean) to work together to achieve this goal!

The hearing illuminated why:

The United States can have either FATCA or it can have “taxation-based citizenship” but it CANNOT have both!

I conclude my observations from sitting in the hearing room!

In the event that “taxation-based citizenship” is not resolved, well:

John Richardson

176 thoughts on “Impressions of the @RepMarkMeadows April 26/17 #FATCA Hearing in Washington, DC – Opportunity to make case to end “taxation-based citizenship””

  1. Patricia: thank you for another excellent analysis.
    One question: why do you use the term taxation-based citizenship instead of CBT? I understand your point. But if we are to make things clear for Congress and neophytes shouldn’t we focus more on the terms CBT vs RBT?
    Note that Democrats Abroad supports RBT (even though they have not pushed it nearly enough in my opinion, and their version of it might be hellish).
    If FATCA is simply repealed, CBT stays, albeit in a more liveable (spell check just suggested loveable!) way. But FBARs remain with FinCEN reporting (I think) and double taxation.

  2. @patricia

    Thanks for the detailed analysis. It is nice to have facts to support our general feelings.

    We can all easily agree with you. While the fight against FATCA is important, it is not the source of our problems. I mentioned in a previous post that while FATCA will probably be rewritten, mostly because of pressure from foreign states, pervasive exchange of information is here to stay.

    Given that, our clear target is CBT and failing that, “simplified renunciation”. Because CBT is one of those almighty legal tools the US is so fond of, it is unlikely to disappear without a massive fight so it would probably be much, much easier to aim for “simplified renunciation”. Could you pass this on to Republicans Overseas?:

    ———————————

    US Citizens living abroad have the option of renouncing the American nationality without being subject to any fiscal requirements if:

    – They have lived more than one year abroad at the date of their relinquishment .

    – They have no residual liability with the IRS stemming from their previous residence in the USA.

    The renunciation is definitive but does not take away any rights the renunciant may have outside of their American nationality. It can be done via mail and through a proxy if the renunciant lacks the capability of doing it themselves. There is a set time limit for processing the application.

    ———————-

    Incidentally, the number of renunciations is low-ish only because you have to come clean and do, at the minimum, five years of returns to truly become free. If there were no other costs than the fee, I would expect renunciants in the hundreds of thousands. That would probably attract Washington’s attention.

  3. @ABN That point not made in the hearing: the incredible cost of renunciation as a brake on total numbers.

  4. Thanks, Anonymous by necessity.

    If there can be no agreement of a change to RBT for the exceptional USA, you lay out here a common-sense, easily understood solution for those who wish to relinquish / renounce — and without the barrier of *requisite mental capacity* to renunciation only available to the individual, instead of someone representing that person, or the financial barrier to so many others of the excessive fee for the right to relinquish US citizenship. We would be able to go forward in our lives without being criminalized, having to make the complex and expensive decisions to obey an extra-territorial US law blessed by our own countries or to forever more having have to look over our shoulders.

    What US representative of the people can determine that this is anything but fair and right instead of governance by instilling fear, that which representatives of a country of *the brave and the free* would / should support? After all, what are our numbers and worth beyond US taxes and penalties compared to all those knocking at the door of the USA? Is it about what is fair and right or is it about US control and what is best for the bottom line of the US tax compliance industry set up in countries around the world and the lobby for the same?

    Would our own governments and local financial institutions where we conduct our financial business of life understand such a change and its fairness which will no longer impact their bottom lines?

  5. John, the only way for the US Homelanders to actually be pro-RBT is for 2 out of 3 Americans to get their asses off welfare and stop the “Your money is OUR money” entitlement attitude. Unfortunately that isn’t going to happen soon.

  7. I believe that with this post John Richardson is requesting a concerted effort on our part to answer Mark Meadows’ call for proposals on how to keep FATCA while relieving Americans “overseas” of its unjust burdens. I’ve written the following letter to Mark Meadows but have no idea how to send it to him. His contact page is only for his constituents. One of our compatriots has offered to Tweet this to him for which I am deeply grateful!

    I know that others are following the strategy that we should deal with FATCA now and worry about CBT later. I have never believed that the two issues can be separated but I was certainly going to go with the flow because something was finally happening. Mark Meadows changed all that on Wednesday by sincerely requesting suggestions for how FATCA could be retained while solving the “expat” problem.

    I’m sure we all have lots of suggestions for Congressman Meadows. Perhaps John or Stephen or someone else who is in touch with Republicans Overseas could arrange to get a collection of our thoughts to him. Here’s mine (with emphases in ** because I can turn on the bold but I can’t turn it off!) :).

    ***

    May 1, 2017,

    Dear Congressman Meadows,

    As a member of the beleaguered community of Americans who no longer live in the United States I am writing to thank you for your part in the April 26 hearing regarding FATCA. For many years we have waited for this day when the issue, that for us takes precedence over all others, would be seriously considered by the government of the United States.

    I am also grateful that you called on each of those present to provide you with three proposals that, if FATCA were not to be repealed outright, would at least relieve the community of non-resident Americans of its dire consequences. I am hoping that you would also be willing to receive such ideas from those of us who could not be in the hearing room that day.

    I have only one proposal for you, one that has already been adopted by the Republican National Committee on p. 13 of its 2016 Election Platform:

    “a change to residency-based taxation for U.S. citizens overseas.”

    This is the only proposal I have seen that strikes the issue at its very root. FATCA would never have been a problem, and could be retained in large measure, if the United States’ unique system of citizenship-based taxation (CBT) were eliminated from the scenario.

    Contrary to Ranking Member Connelly’s statement at the hearing, CBT is practiced by NO other country on earth except for the dictatorship of Eritrea. Mr. Connelly (and a vast number of others) is confused by the use of the term “worldwide taxation” which, indeed, is practiced by a large number of countries. But these countries tax only their *residents* on their worldwide income, NOT their *citizens*. In this modern world there are many residents who are not citizens and many citizens who are not residents. The difference must be carefully considered in the drafting of any legislation.

    Taxation as practiced by the vast majority of the world’s nations is the method by which a country’s *residents* pay for the services and benefits their governments render to them and to the society in which they live. As a consequence, Americans who have moved abroad pay their taxes to the country where they reside, where they have often acquired a second citizenship, and where they have become partners in the society. While they often retain a strong emotional connection to their American heritage and elect to keep their US passports (for which they pay a fee), ties of the heart should, in no way, be considered a “taxable event”. Nor should a US place of birth. It makes no sense at all for the United States to require such individuals (some of whom were merely born in the US but have lived the rest of their lives elsewhere) to file annual tax returns (at great, cross-border accountancy expense) to a government that does not serve them.

    Under the CBT system, these individuals are not only subject to annual tax filing to the United States (with considerable penalty risk if they neglect to do so) but are unable to participate in the normal, local investment practices available to all their friends and neighbours. The punitive tax consequences for an American who invests in a “foreign” mutual fund or deposits money in a “foreign” government-sponsored tax-free savings account renders those savings vehicles useless.

    Most heinous of all is the requirement for all Americans to file a Foreign Bank Account Report (FBAR) in which they must list the highest value in the calendar year of every single foreign financial asset to which they are signatory including those they hold jointly with non-American spouses, business partners and organizations of which they may have signing authority. If you live abroad this is everything you have! No American in the United States would ever assent to such an invasion of privacy. Under CBT, an American abroad must be prepared to live as a second-class fish in a fishbowl.

    It is as the handmaiden of CBT policy that FATCA has wreaked its havoc. The elimination of CBT would simultaneously eliminate the destructive power of FATCA allowing the legislation to actually have a chance of discovering the *real* bad actors. In addition, a more focused law will be shorter, less complex and less expensive.

    Rather than a payment for services rendered or benefits received, CBT is a tax on *who people are*. CBT’s apologists have stated that American citizenship is a benefit because of the rights that are afforded to everyone who is a citizen. In fact, those rights, by definition, are provided at no charge and citizenship is not a benefit. It is an identity. As an identity it is the most precious thing of all and has no price.

    You have seen in the April 26 testimony the devastating effect that CBT, enforced by FATCA, has had on America’s non-resident sons and daughters. It is simply incredible that the United States, a nation whose own identity was forged as the result of a tax revolt (against a stunningly similar policy) would have created a law that forces thousands of its own people to repudiate their own priceless identity as Americans in order to live a normal life. The demise of CBT will bring an abrupt end to the increasing flood of these sad renunciations.

    It is the task of the current US government to end CBT once and for all. Doing so will break the destructive power of FATCA and fashion it into a law that could actually accomplish what it purportedly set out to do. Not only that, but finally, Americans will be truly free to follow their dreams wherever they may lead without being disadvantaged by their own identity.

    Sincerely,

    Mary Blackhill, Canada

  8. It was clear that some members of the panel had NO idea what the purpose of FATCA was. There were suggestions that FATCA was enacted to combat terrorism, drug dealing, organized crime, human trafficking and who knows what else. The truth is that FATCA was a “revenue offset”
    provision to the HIRE Act and few Congressmen even knew that FATCA was part of the legislation. This has resulted in a discussion of FATCA
    that:

    fails to ask “what was the intent of FATCA”; and
    often asks “what can we use FATCA for and the information received from FATCA for”?
    (With regard to the “intent” and “purposes” of FATCA much can be gleaned from the
    definitions in the FATCA IGAs.)

    It’s as though FATCA is a law that is in search of a purpose!

    FATCA seems to have been a law in search of a hiding place.

    The original FATCA bill (H.R. 3933 (111th Congress)) says that its aim is “To amend the Internal Revenue Code of 1986 to prevent the avoidance of tax on income from assets held abroad, and for other purposes.”

    Govtrack now shows when text from a failed bill gets pasted into a later bill and thus passed, as happened when H.R. 3933 got pasted into H.R. 2847.

    https://www.govtrack.us/congress/bills/111/hr3933

    A devious way to sneak bad legislation into law. It’s no wonder the US has such a rotten legal system.

  9. @MNM – “I can turn on the bold but I can’t turn it off!”

    Use the same tag you used to turn it on, but put a backward slash before the b.

  13. Re taxation-based citizenship.
    One further absurdity of CBT (or TBC) is that although it purports to submit US persons abroad to the US tax system, in many cases, such as mine, CBT or TBC does not result in any taxes (I actually got a tax credit last year). It is a huge nuisance, though. In this sense, it is a power/control issue; another aspect of American Exceptionalism.
    It was good that Meadows underlined that among the money the IRS extorted from people, a big part was penalties, not taxes.

  14. I’m very impressed by MuzzledNoMore’s letter to Mark Meadows. It goes straight to the cruel heart of the matter, CBT. We’re mostly thinking of this from a persepective outside the USA but I hope that we can save a space in our thoughts for those inside the USA who are vulnerable to egregious penalties (including US prison time, possibly deportation) for not knowing that FBAR reports on their foreign accounts were required. If the glorious day of RBT inactment does come I’d hope that they could just file going forward. That might be asking way too much of such a punitive country as the USA but it would be the right thing to do, in my opinion.

  15. @MuzzledNoMore: Your letter to Rep. Meadows is superb. Is there any reason it must be electronic, either an e-mail or a tweet??? I would think a printed letter with a human signature would have far more impact. Post it to his Washington office:

    1024 Longworth HOB
    Washington, DC 20515 USA

    Costs you a stamp, and has a greater chance of being read than a lengthy series of tweets lost in a jungle of 100,000 other tweets.

    Even if you already have tweeted/e-mailed it, I urge you to send it by post.

  17. “That’s right, Ms Bean, oppressor of expats, said she is for RBT instead of CBT.”

    Are you sure? She may have heard “Residence Based Taxation” and saw $$$$$. Her thinking may have been “Oh…you mean we’ll be able to tax on the basis of a percentage of their residence? Even better money opportunity.”

    After all it was apparent that she was willfully and selectively deaf on certain key points brought up by Rep. Meadows.

  18. My attention was caught during Ms. Bean’s testimony by the following:

    http://www.youtube.com/watch?v=rV5FpIn3Eyg&t=62m9s

    In 2015, about 4300 people gave up their U.S. citizenship…in contrast. more than 730,000 people coming in, people willing to pay U.S. taxes…. a very small number…that’s less than 1/10th of 1 percent
    Wow, do I ever feel recognized!

  19. ” Regrettably, there was NOBODY there to represent the interests of “accidental Americans” and “long term resident/dual citizens of other nations and those who never dreamed they were considered to be U.S. citizens, but have lived with the frightening experience of learning they may be considered to be U.S. citizens….”

    Very valid point by Mr Richardson but it would have been much more effective to have had an accidental asking Bean what should be a “reasonable penalty” in his /her circumstance,rather than having Meadows repeating it to Bean a few times. This might have left a lasting impression ,maybe even on Bean and shown the stupidity of CBT.

    The excuse used for not having one there was that they have no representation in DC but ,then,who really does ?

    Mr Keuttel and Ms Nelson both were willing and even eager overseas taxpayers even under CBT until FATCA came along .So all that Meadows should /has to do is to amend FATCA enough so that honest patriotic overseas American taxpayers can continue to pay their ” fair ” share,as if FATCA isn’t there,almost.

  20. @Patricia Moon: My attention was caught during Ms. Bean’s testimony by the following:

    Yes, that got me very angry as well. (Hence my 3,500 word post on Vietnamese nationality law: when I get angry I bang it out on the keyboard until I feel better.) Most people here have criticised Carolyn Maloney for not being able to pronounce FATCA and for pushing SCE after Treasury and the witnesses alike rejected it, but she at least deserves credit for implicitly rebuking Bean and stating that renunciations matter whether there’s few or many of them.

    Sadly, Democrats Abroad refuse to thank a Democratic politician for stating a non-partisan truth.

  21. Ms. Bean was lamenting the fact that out of 52,000 accounts, only about 4500 were turned over. I immediately thought of an article in The Hill which prompted this post:
    Hillary Clinton Directly Enabled Tax Evasion in the Swiss Bank .
    http://isaacbrocksociety.ca/2016/03/14/hillary-clinton-directly-enabled-tax-evasion-in-the-swiss-bank-debacle-i-kid-you-not/
    In March 2009, after meeting with Swiss Foreign Minister Micheline Calmy-Rey, then Secretary of State Hillary Clinton intervened with the U.S. Internal Revenue Service (IRS) on behalf of Switzerland’s most powerful banking institution, UBS. The IRS, which at that time was seeking the identity of wealthy Americans who had stashed some $20 billion in 52,000 tax evading UBS accounts, then agreed that the Swiss bank need only turn over information on 4,450 accounts. Afterwards, UBS increased its previous $60,000 in donations to the Clinton Foundation ten-fold. By the end of 2014, UBS donations to the Clinton Foundation totaled $600,000. UBS also “paid former President Bill Clinton $1.5 million to participate in a series of question-and-answer sessions with UBS Wealth Management Chief Executive Bob McCann, making UBS his biggest single corporate source of speech income disclosed since he left the White House.” ……
    ***

    When UBS, which could have lost its ability to conduct business in the U.S. if successfully prosecuted, balked at the IRS demand that it turn over information for all 52,000 accounts, the IRS filed a legal action seeking to compel disclosure. That is when, at the behest of the Swiss government, Hillary Clinton stepped in to negotiate a deal that prevented the IRS from gaining access to more than 91 percent of the illicit, tax-evading offshore accounts.

    It is odd to imagine while FATCA was being written, debated, etc, Ms. Clinton was busy undermining what they were trying to address…….

  23. It is odd to imagine while FATCA was being written, debated, etc, Ms. Clinton was busy undermining what they were trying to address…….

    Which bit of protecting wealthy donors while throwing ordinary people under the bus were you having trouble imagining?

  24. I am worried that our best voice in Washington, Republicans Overseas, is insisting on pushing what they call Territorial Based Taxation. First, it doesn’t eliminate CBT because any American, anywhere, would still have to remain in the system even if they didn’t pay any tax and second, it encourages people to invest abroad, preferably in tax havens. Very, very few countries actually use TBT and the only one I know of is Hong Kong which benefits from very special circumstances and doesn’t spend much money on its citizen’s welfare. Nobody in Europe does it, except for the UK when dealing with its few “non-domiciled” residents but they still have to pay tax on any money that comes back to the UK and the arrangement is temporary. Everybody taxes the worldwide incomeof their residents, deducting any tax paid at source, which is perfectly fair. Why is it so difficult to understand?

  25. Art of the possible. The Republican tax reform plan proposed corporate TBT, the RO are hoping to get it extended to individuals, and thus get change for non-US resident USCs included in the White House tax reform plan.

    At the moment the coattails seem pretty wobbly.

    Shahira Knight (the person they’re meeting on May 4th as per Embee’s post above) was brought onto the NEC by Cohn, who is spoken of as the current lead on tax reform. So something could come of it, eventually. Knight was formerly a lobbyist with Fidelity so she’s presumably knowledgeable about FATCA to some extent.

Leave a comment

Your email address will not be published.

%d bloggers like this: