Spearheaded by Republicans Overseas and the Jim Bopp legal team, a group of plaintiffs (including myself) previously filed a lawsuit in U.S. Court arguing the presence of “…injuries to [“]Americans[“] abroad caused by the coercion of the Foreign Account Tax Compliance Act(“FATCA”) and Intergovernmental Agreements (“IGAs”) purporting to implement FATCA….”
This lawsuit (15-250; Crawford et al.) was filed on July 14, 2015 in U.S. District Court for the Southern District of Ohio.
It begins: “… This is a challenge to the Foreign Account Tax Compliance Act (“FATCA”), the intergovernmental agreements (“IGAs”) unilaterally negotiated by the United States Department of the Treasury (“Treasury Department”) to supplant FATCA in the signatory countries, and the Report of Foreign Bank and Financial Accounts (“FBAR”) administered by the United States Financial Crimes Enforcement Network (“FinCEN”). These laws and agreements impose unique and discriminatory burdens on U.S. citizens living and working abroad…”
The U.S. Sixth Circuit Court subsequently dismissed the lawsuit because of a perceived lack of “standing” of the plaintiffs.
The U.S. Supreme Court has now declined to review the case, meaning that the decision of the lower court dismissing the lawsuit because of lack of standing of the plaintiffs — remains.
See this link for links to the recent relevant petitions and the standing arguments.
The Plaintiffs-appellants were: (a) Mark Crawford; (b) Senator Rand Paul, in his official capacity as a member of the United States Senate; (c) Roger Johnson; (c) Daniel Kuettel;(d) Stephen J. Kish; (e) DonnaLane Nelson; and (f) L. Marc Zell. The Defendants-appellees were: (1) United States Department of the Treasury; (2) United States Internal Revenue Service; and (3) United States Financial Crimes Enforcement Network.
Republicans Overseas now wants to move forward with a new FATCA-plus lawsuit having plaintiffs expressing different characteristics that would successfully deal with the “standing” issue: “… [we] will regroup to fight another day by recruiting a FATCA and FBAR victim who didn’t sign a settlement agreement with the IRS & paid one of two fines to the IRS in the following states: AR, IA, MN, MO, NE, ND, & SD. Please help us to get the word out. We are committed to take down FATCA tyranny judicially, legislatively, and administratively.”
[— Our Canadian FATCA IGA enabling legislation lawsuit will move to trial (very early next year we hope) in Canada’s Federal Court. However, we can expect that Mr. Justin Trudeau’s attorneys will use a somewhat similar argument on “harm” — that none of our plaintiffs, witnesses, or Canadian citizens turned over by our own Government to a foreign country have really been “harmed” — or even if they have been harmed, all is justified to prevent U.S. from imposing financial sanctions on Canada.]
This does not come as a surprise. So ends the first, within the court system, attack on FATCA.
I think the the refusal of the Supreme Court to reconsider the decision to NOT hear the case on the merits, will be helpful in elevating the issue with other governments. Other governments will no longer be able to say:
This is a problem with the United States. You should deal with the United States on this.
The point is that it is not possible to deal with the United States legal system. The concept of standing requires an allegation and demonstration of harm to the plaintiff . It appears that the harm cannot be recognized from a U.S. perspective or (in the alternative) if there is harm that it not caused by the United States but by the foreign banks.
The refusal of the United States legal system to consider the case means that the United States courts will not recognize harm done to residents of other countries. This point must be driven home to the governments of those other countries.
The “transition tax” is an excellent example of how the United States will use FATCA to drain money from other economies. The unwillingness of the U.S. courts to even hear allow this issue to be litigated should we a “wake up:” call for other nations.
SCOTUS will not touch any taxation case that even has a chance it will reverse or void anything to do with the Marxist Income tax. 3 times in history they voided the income tax and pointed to a section of out founding document that prohibited a tax on income.
Marx and his followers knew it was a rotten tax and had a bad name going back to Rome when Cicero said an honest man will pay more taxes than a dishonest man , on the same income and he added when it comes to money over half are dishonest.
Because of its complexity, and based on tradition, SCOTUS, would have no choice but to declare the 82.000 page code.”void because the average person cannot possibly understand it”.. The legal term is void for vagueness.
I noticed last week the French Ambassador to the USA said on twitter that he is working extensively on issues regarding Accidental Americans and FATCA but has received no assistance from any other Ambassador’s in DC including Justin Trudeau’s Ambassador McNaughton.
https://en.wikipedia.org/wiki/David_MacNaughton
Any Thoughts?
In full disclosure I will acknowledge that I have met French Ambassador to the USA.
More than Half the population pays no income taxes. A large segment of the US population who do file only file to claim the earned income tax credit. That is a person who never pays taxes , files and gets a refund of taxes he never paid. It is an insane idea. I think we are in OZ and have fallen thru the looking glass.The fgairTax would solve most of the insanity we find ourselves in. The tea party and all the libertarians favor it, but alas we are still ruled by Marxists.
“[we] will regroup to fight another day by recruiting a FATCA and FBAR victim who didn’t sign a settlement agreement with the IRS & paid one of two fines to the IRS in the following states: AR, IA, MN, MO, NE, ND, & SD.”
So in the imaginary parallel universe where that lawsuit succeeds, FATCA and FBAR would be overturned for US residents, but would remain in place for the US’s diaspora.
Sauve qui peut.
1 CERTIORARI GRANTED
104 CERTIORARI DENIED
That is less than a 1% success rate. Perhaps that reflects the historical percentage.
Solomon Says
Only way we can lose is 2 give up FATCA fight. We regroup 2 fight another day by recruiting a #FATCA/#FBAR victim who didn’t sign a settlement w/ IRS & paid 1 of 2 fines in states: AR, IA, MN, MO, NE, ND, & SD
Solomon says those states are 8th circuit, without elaborating.
Me: The person who wrote this letter is a Canadian bookkeeper. They felt forced to renounce U.S. citizenship because of #FBAR requirement to report employer accounts, and #FATCA coming to get them. https://www.forbes.com/sites/robertwood/2014/11/15/i-am-canada-hear-me-roar-mr-president/#1ae697fa5466
Solomon:
This person is just like Donna-Lane Nelson and Daniel Kuettel. He renounced because of #FATCA & #FBAR reporting requirement. That is the standing argument we had with the 6th Circuit. Now we want a plaintiff who was fired or fined by the IRS because of FATCA & FBAR.
I haven’t the words to express my disgust with the United States and its Supreme Court. Yes, we regroup and look for another way to combat this injustice.
USCitizenAbroad: I hope you’re right, that this will, indeed, make governments and courts in other parts of the world sit up, take notice, and grow some spine. We have GOT to succeed.
Meanwhile, my thanks to the plaintiffs in this suit and to the US legal team all of whom must be long beyond the limits of their patience.
I guess, considering the incredible down-ward spiral in the US since 20 Jan., “sufficient connection to and harm from the law” takes on new meaning & apparently requires threat of imminent death to have a chance of moving forward w/SCOTUS.
🙁
Longshots seldom come in, but when they do they pay a great return.
Thank you to all who gave of themselves in trying.
Surgite!
I agree with @BB, and echo her thanks to all those behind this effort. Surgite!
“Tentanda via”
America thinks it never inflicted any harm on the Vietnamese either. How then could some little expat who is being bankrupted have any effect?
The U.S. courts are going to stand with the government, this was to be expected I feel. This certainly isn’t justice. Canadian courts perhaps not so much, but we might all be dead before they ever get that one done and dusted.
JC:
“We regroup 2 fight another day by recruiting a #FATCA/#FBAR victim who didn’t sign a settlement w/ IRS & paid 1 of 2 fines in states: AR, IA, MN, MO, NE, ND, & SD
Solomon says those states are 8th circuit, without elaborating.”
Perhaps the Eight Circuit has a track record for wanting to take down Roe?
Apparently yes.
https://m.arktimes.com/ArkansasBlog/archives/2017/09/08/for-anti-abortion-activists-route-to-roe-challenge-runs-through-arkansas-and-eighth-circuit
http://www.internationalinvestment.net/products/tax/us-supreme-court-declines-hear-fatca-case/
FATCA just keeps on giving – in terms of growing incomprehensibility even for those who are trying to comply, and in terms of professional fees for assistance;
https://www.angloinfo.com/blogs/global/us-tax/confused-yet-w-8ben-w-8ben-e-foreign-itins-and-dates-of-birth/
There is no way those trying to comply can ever catch up and keep up with the layers and layers of labyrinthine demands, ever growing complexity and associated costs (and penalty traps).
A gross waste of time, effort and money drained from individuals outside the US to no real purpose ….
And the plaintiffs had to prove actual present harm in order to have their case heard by the Supreme Court?
Renounce if you can, and rejoice.
Forgot to add the usual caveat to my comment above. Not intended as an endorsement.
https://www.angloinfo.com/blogs/global/us-tax/confused-yet-w-8ben-w-8ben-e-foreign-itins-and-dates-of-birth/
She charges US$1,000 to apply for an ITIN. If the IRS rejects the ITIN application, does she refund the fee to her client?
I should stop programming computers and charge US$900 for ITIN applications.
Forgot to add….I would like to hear from other xpats in Victoria…I know I am not alone and want to talk to them. To this and my first post above, you can comment by my email as well.
<> got Canadian citizenship less than two weeks ago, and got my passport last Friday. Emailed in the forms to the US Embassy in Ottawa to set a renunciation appointment, they claim 2 to 3 month wait time.
Get out while you still can.
Disappointing. But definitely not a reason to give up.
So the Republicans, who could to a considerable extent could relieve US expats tomorrow by using executive orders and regulations, instead are going to continue suing themselves over standing, citing Roe v. Wade as precedent (i.e FATCA standing flies or dies with Roe v Wade), concentrating on finding plaintiffs who are not expats but US citizens living in the Eighth District, reportedly the district where the chances of taking down Roe are greatest. Do you think they want to win or do you think they want to talk about Roe in the Supreme Court?
https://amp.theguardian.com/world/2017/sep/22/neil-gorsuch-abortion-rights-supreme-court-planned-parenthood-missouri
Renunciation is much more likely to bring relief to expats than waiting helplessly, hoping to be saved by politicians. No one’s going to fix it. No one wants to fix it. Dual citizenship is over, for the US-born. Don’t let it take you down with it. Fix it for yourself. Protect yourself. Choose which citizenship is most important to you, and be safe.
Renounce, ignore, or comply. The first one is the easiest, the second one is the cheapest. The third one is the road to hell, if it doesn’t fit your finances.
In 2011 the IRS’s Taxpayer Advocate reported to Congress that thousands of honest taxpayers were forced to renounce because compliance is impossible. Not because someone can choose to comply, but because compliance is impossible.
Compliance isn’t really possible even for dishonest taxpayers. If you fabricate a social security number for your non resident alien spouse, you run afoul of United States v. Silva-Chavez, 888 F.2d 1481 (5th Cir. 1989). If you don’t fabricate a social security number for your non resident alien spouse, you run afoul of Diamond v. United States, Fed. Cir. No. 2013-5036, Dkt. 29-2 (September 12, 2013). When the IRS stamps “ITIN Rejected” on a Form 1040 it’s OK for the IRS, but if you honestly write “ITIN Rejected” on Form 1040 you’re frivolous. By the way I did comply with the Federal Circuit, I fabricated a social security number for my wife and told the IRS why, and the IRS accepted it. Surely I can be jailed multiple times for complying with multiple court orders. Anyway, honesty is illegal.
@plaxy
Can you explain what you mean when you say that “FATCA standing flies or dies with Roe v Wade”? I read the articles you linked to about the Planned Parenthood suits, but I fail to see the connection to FATCA. How is abortion legislation affecting FATCA decisions? What has it got to do with the Eighth Circuit and Gorsuch?
There was a hearing recently in French parliament where a member called upon France to retreat from the FATCA IGA. I too think that foreign governements will slowly begin to pay attention to the US’s lack of interest in fixing things. In the end FATCA will, as predicted, spectacularly backfire.