151 thoughts on “Ways & Means Urged to Hold a Hearing on #FATCA”
@plaxy
“What’s Fatca connection”
That simply ignoring CBT and trying to stay under the radar after Fatca is a risk if one has US assets that can be confiscated.
Re Model 1 IGA.
Lucky ole Swiss but I suspect little will change, re banks once bitten….but not my worry now.
Heidi – there is no radar. I agree, USCs with US assets may need to file a return. But that’s because of the US asset, not because of FATCA.
The banks aren’t at risk of the withholding penalty under IGA Model 1. And they can’t demand that customers show them FBARs and tax returns. It would be surprising if the change made no difference. Though I do wonder if this is one of the treaties Rand Paul is blocking.
Plaxy
Spoke to my nephew who works at Deloitte and Touche in Zurich re change to Model 1 , he says Americans will still be regarded as toxic for the foreseeable future.
Yes perhaps. But I assume Switzerland has to comply with the Payment Accounts Directive.
The nuisance under IGA1, at least in the UK, is that certain accounts are verboten for USCs. Stocks and shares ISAs for instance. If a USC wants to invest in anything the IRS treats punitively, the sensible option is renunciation.
“Fred – I think what they’re asking for is very interesting.
Privacy and denial of service are the basis for citing Roe as a precedent in the defeated US anti-FATCA lawsuit, if I’m not mistaken.
The illegality of the IGAs is the basis of Rand Paul’s complaint.”
There is no recovery for lost privacy.
“From all I’ve seen, these Congressional hearings and calls for public input accomplish exactly as much as “thoughts and prayers” tossed at gun violence victims.”
Why just gun violence victims? Knife victims are of a lesser concern? How about vehicular murder? Ever here someone being bludgeoned to death? Why are such victims of less concern than gun victims?
Why must so many always insert their political beliefs into unrelated discussions?
“FYI, the original letter didn’t include a reference to bank lock out. It’s only after input from Americans Abroad it was included. I wonder how many of these ignorant reps at the first hearing heard back from their constituents in an attempt to educate them. I doubt not many, if any.”
If I remember correctly, many do not accept correspondances from addresses abroad.
@Bob,
“That is precisely why, “all roads still lead to renunciation.””
Except for the very real fact that there are those of trapped and can not!
私は日本で住んでます。日本語むずかしいです。無り。
Yes, it’s unfortunate that that’s the case, JapanT, but if you choose to have a rep it’s because you more than likely lived in their district. If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).
Anyone who lets this be an obstacle to contacting their rep is just looking for excuses to do nothing. Let’s all just give up and limit our activism to the pages of Isaac Brock, why don’t we?
“CBT, double taxation, investment limitations etc. is only a problem for those who are compliant – a small minority of US persons outside the US.”
Say what! Investment limitations affect many more than just those who are compliant. USCship or US birthplacecare enough to be turned away from investing. Hell, just living in certain countries can limit investment opportunities regardless of citizenship. A friend who is a British national had his accounts innGB closed and was refused in the US and the EU because he reside in Japan. As his problems are post FATCA, I put that it the FATCA fallout column.
CBT and double taxation will affect the non compliant when we next must renew our passports.
@Plaxy
Ok, since you did this, “Seriously? Of course George Clooney doesn’t have FATCA annoyances, why would he!”, I will do this.
“The Washington Post said when Beyer was appointed:
Beyer, who in 2014 won a Northern Virginia-based seat long held by Democrat James P. Moran, is a former ambassador to Switzerland and Liechtenstein who has strong ties to the Democratic donor class.
So. Not very interesting after all. Just another bit of electioneering, it seems.”
Why would have ever thought differently?
“Actually, in Europe the banks seem to have calmed down quite a lot, since CRS arrived. Now they have to do the due diligence on all their customers, not just the ones born in the US. Everybody’s a suspected tax cheat, nowadays.”
We are saved! Yipee!
“Actually, in Europe the banks seem to have calmed down quite a lot, since CRS arrived. Now they have to do the due diligence on all their customers, not just the ones born in the US. Everybody’s a suspected tax cheat, nowadays.”
Actually, that kinda shreds the privacy concerns of the letter, doesn’t it. The answer to these concerns is, “What privacy? You have none regardless of FATCA (now).”
“FATCA was an enabler of CBT it would be the means by which their financial life including any non US house sale would be reported.”
Intersting. I made this exact same point, or actually similar, that FATCA was the enabler for FBAR, and got smacked down for it. By whom I wonder?
“I am arguing the point that being married to an American brings its problems wherever one lives, or however much money one has, except you live in the homeland with no connection to anywhere else.
Of course she wouldn’t be concerned with Switzerland but she would be alerted by her own situation.
I am arguing the point that being married to an American brings its problems wherever one lives, or however much money one has, except you live in the homeland with no connection to anywhere else.
Of course she wouldn’t be concerned with Switzerland but she would be alerted by her own situation.
“Your counter arguments are obtuse.””
Nothing new there.
“That’s their choice but if I was resident in the UK with an expensive house that would be liable for cap gains tax as I was married to an American, I would want it in my name if I was male or female. The other houses would of course be up for Capital gains regardless, ( if one was not resident there.)”
All my family’s assets are in my wife’s name. On part to satisfy local (Japanese) law and in part to protect her and our children as much as possible. If I pass before she does, she and they still have a home. If she passes before I do, we are homeless.
“From all I’ve seen, these Congressional hearings and calls for public input accomplish exactly as much as “thoughts and prayers” tossed at gun violence victims.”
‘Why just gun violence victims? Knife victims are of a lesser concern? How about vehicular murder? Ever here someone being bludgeoned to death? Why are such victims of less concern than gun victims?’
I can think of two reasons.
One is that victims of knives and vehicles don’t get thoughts and prayers tossed at their dead bodies, except in Japan.
One is that the US’s second amendment (the only one that the Supreme Court still upholds) doesn’t guarantee a right to keep and bear vehicles. I guess everyone forgets about knives. But let’s not forget the most powerful weapon that strikes the greatest fear into the US government. One time when I entered a US embassy, my pocket knife and tape recorder had to be deposited at the guard’s office.
@Plaxy
“Goodness, I must say I’m shocked! Anybody would be unwise to agree to such an ultimatum IMO. If the intended insisting on sole ownership of expensive property, we’re probably not talking about luv.
Seriously, the point I keep trying to make is that in IGA1 jurisdictions such as European countries, FATCA does not force Americans to file US taxes.”
You do not live in the real world. My wife and Inhad a joint account until I learned of this. We no longer do. I was paying her back for my portion of the house so that I could meet co-ownership requirements under Japanese law until I learned of this. Now I just pay toward living expenses, child rearing costs, etc, but towards the house.
I was shocked myself to learn that of all the mixed married couples I know in Japan, which are many, my wife and I were the only who had a joint account.
“If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).”
Huh, you’re right.
For everyone else, I wonder if zip code 20224 would work. (20225 is for the last known address of the IRS’s Director, Foreign Operations District, but my second-last letter to that address was signed by an IRS employee in zip code 20224 and my last letter to that address came back undeliverable.)
Previous addresses work in Japan too. In the corporate registration of a former employer, the company president listed the address where he had lived as a child. But that address was no longer a residence. It turned into a car parts factory. Somehow the labour board found him and arrested him but prosecutors refused to prosecute and he was freed. He was an illegal immigrant in Japan, having lost Japanese nationality when he naturalized in the US. When I reported the illegal immigrant to the immigration department, they weren’t interested in deporting him, they only decided to stop his company from hiring foreign employees.
Well, enough with the usefulness of previous addresses; let’s get back on topic. The guy issued falsified 源泉徴収票 (the equivalent of T-4 and W-2). A few years later, the IRS coerced me to refile my US return for a tax year including one of those falsified 源泉徴収票, and the IRS coerced me to sign the jurat declaring under penalty of perjury that to the best of my knowledge and belief that attachment was true and correct. Never mind that the Japanese government and court know that it most certainly wasn’t true and correct. US courts also don’t care that the IRS coerces perjury. Internal Revenue Bulletin 2005-14 confirms it. Honesty is illegal on US tax returns. Honesty brings penalties.
H.R. 6760, the Protecting Family and Small Business Tax Cuts Act of 2018,
49 State and Local Tax Deductions:
‘‘(A) no deduction shall be allowed under
1 this chapter for foreign real property taxes paid
2 or accrued during the taxable year,
I believe living overseas one does not get those deductions anyway for tax on foreign real property. Yet if it were an investment property – would these be treated as an expense when figuring out any taxable gain or income?
JC –
I believe that section is talking about itemized deductions for individuals only – foreign property tax incurred in a trade or business would still be deductible in computing taxable income for the business.
With the increased standard deduction, there will be fewer who itemize – so this won’t affect many. But, those whose primary residence is overseas (and who live in a jurisdiction that charges something the US recognizes as property tax) are being discriminated against relative to those who live inside the US. If they are going to claim the right to tax the residents of other countries, they should at least allow equivalent deductions.
This is yet another example of Congress writing the law with US resident taxpayers in mind without any consideration of how the rules affect US taxpayers who are residents of other countries.
@Karen, I don’t even know if we could claim interest deduction on the primary residence because the local government does not allow it. Could that be claimed. Or is it a longtime pre taxreform 1.0 discrimination against U.S. Persons overseas?
My experience (or at least the way I’ve filed my 1040s like a goody-goody USC abroad) is that my local (that is, “foreign”) property taxes were never a deductible expense for a non-investment property on US income taxes. On the other hand, mortgage interest has been deductible. On an investment property, I’ve always used Schedule E, where there are lines for both mortgage interest and taxes, where I’ve entered the full amount of both, and never been challenged about it.
I wonder if this is about to change, continuing the pattern of each and every new tax reform somehow making things measurably worse for expatriates.
“Yes, it’s unfortunate that that’s the case, JapanT, but if you choose to have a rep it’s because you more than likely lived in their district. If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).”
Say what!?
a non US ISP is a dead give away and easy to block. There are reports of USCs abroad being block from their reps and senator’s webpages.
Foreign postmarks on envelopes have the same effect.
“My” Senator is one of the one who supprts all this. I’d rather not let that POS know I even exist.
How about USC’s born abroad? Who are their reps and Senators?
“One is that victims of knives and vehicles don’t get thoughts and prayers tossed at their dead bodies, except in Japan.”
@plaxy
“What’s Fatca connection”
That simply ignoring CBT and trying to stay under the radar after Fatca is a risk if one has US assets that can be confiscated.
Re Model 1 IGA.
Lucky ole Swiss but I suspect little will change, re banks once bitten….but not my worry now.
Heidi – there is no radar. I agree, USCs with US assets may need to file a return. But that’s because of the US asset, not because of FATCA.
The banks aren’t at risk of the withholding penalty under IGA Model 1. And they can’t demand that customers show them FBARs and tax returns. It would be surprising if the change made no difference. Though I do wonder if this is one of the treaties Rand Paul is blocking.
Plaxy
Spoke to my nephew who works at Deloitte and Touche in Zurich re change to Model 1 , he says Americans will still be regarded as toxic for the foreseeable future.
Yes perhaps. But I assume Switzerland has to comply with the Payment Accounts Directive.
The nuisance under IGA1, at least in the UK, is that certain accounts are verboten for USCs. Stocks and shares ISAs for instance. If a USC wants to invest in anything the IRS treats punitively, the sensible option is renunciation.
“Fred – I think what they’re asking for is very interesting.
Privacy and denial of service are the basis for citing Roe as a precedent in the defeated US anti-FATCA lawsuit, if I’m not mistaken.
The illegality of the IGAs is the basis of Rand Paul’s complaint.”
There is no recovery for lost privacy.
“From all I’ve seen, these Congressional hearings and calls for public input accomplish exactly as much as “thoughts and prayers” tossed at gun violence victims.”
Why just gun violence victims? Knife victims are of a lesser concern? How about vehicular murder? Ever here someone being bludgeoned to death? Why are such victims of less concern than gun victims?
Why must so many always insert their political beliefs into unrelated discussions?
“FYI, the original letter didn’t include a reference to bank lock out. It’s only after input from Americans Abroad it was included. I wonder how many of these ignorant reps at the first hearing heard back from their constituents in an attempt to educate them. I doubt not many, if any.”
If I remember correctly, many do not accept correspondances from addresses abroad.
@Bob,
“That is precisely why, “all roads still lead to renunciation.””
Except for the very real fact that there are those of trapped and can not!
私は日本で住んでます。日本語むずかしいです。無り。
Yes, it’s unfortunate that that’s the case, JapanT, but if you choose to have a rep it’s because you more than likely lived in their district. If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).
Anyone who lets this be an obstacle to contacting their rep is just looking for excuses to do nothing. Let’s all just give up and limit our activism to the pages of Isaac Brock, why don’t we?
“CBT, double taxation, investment limitations etc. is only a problem for those who are compliant – a small minority of US persons outside the US.”
Say what! Investment limitations affect many more than just those who are compliant. USCship or US birthplacecare enough to be turned away from investing. Hell, just living in certain countries can limit investment opportunities regardless of citizenship. A friend who is a British national had his accounts innGB closed and was refused in the US and the EU because he reside in Japan. As his problems are post FATCA, I put that it the FATCA fallout column.
CBT and double taxation will affect the non compliant when we next must renew our passports.
@Plaxy
Ok, since you did this, “Seriously? Of course George Clooney doesn’t have FATCA annoyances, why would he!”, I will do this.
“The Washington Post said when Beyer was appointed:
Beyer, who in 2014 won a Northern Virginia-based seat long held by Democrat James P. Moran, is a former ambassador to Switzerland and Liechtenstein who has strong ties to the Democratic donor class.
So. Not very interesting after all. Just another bit of electioneering, it seems.”
Why would have ever thought differently?
“Actually, in Europe the banks seem to have calmed down quite a lot, since CRS arrived. Now they have to do the due diligence on all their customers, not just the ones born in the US. Everybody’s a suspected tax cheat, nowadays.”
We are saved! Yipee!
“Actually, in Europe the banks seem to have calmed down quite a lot, since CRS arrived. Now they have to do the due diligence on all their customers, not just the ones born in the US. Everybody’s a suspected tax cheat, nowadays.”
Actually, that kinda shreds the privacy concerns of the letter, doesn’t it. The answer to these concerns is, “What privacy? You have none regardless of FATCA (now).”
“FATCA was an enabler of CBT it would be the means by which their financial life including any non US house sale would be reported.”
Intersting. I made this exact same point, or actually similar, that FATCA was the enabler for FBAR, and got smacked down for it. By whom I wonder?
“I am arguing the point that being married to an American brings its problems wherever one lives, or however much money one has, except you live in the homeland with no connection to anywhere else.
Of course she wouldn’t be concerned with Switzerland but she would be alerted by her own situation.
I am arguing the point that being married to an American brings its problems wherever one lives, or however much money one has, except you live in the homeland with no connection to anywhere else.
Of course she wouldn’t be concerned with Switzerland but she would be alerted by her own situation.
“Your counter arguments are obtuse.””
Nothing new there.
“That’s their choice but if I was resident in the UK with an expensive house that would be liable for cap gains tax as I was married to an American, I would want it in my name if I was male or female. The other houses would of course be up for Capital gains regardless, ( if one was not resident there.)”
All my family’s assets are in my wife’s name. On part to satisfy local (Japanese) law and in part to protect her and our children as much as possible. If I pass before she does, she and they still have a home. If she passes before I do, we are homeless.
“From all I’ve seen, these Congressional hearings and calls for public input accomplish exactly as much as “thoughts and prayers” tossed at gun violence victims.”
‘Why just gun violence victims? Knife victims are of a lesser concern? How about vehicular murder? Ever here someone being bludgeoned to death? Why are such victims of less concern than gun victims?’
I can think of two reasons.
One is that victims of knives and vehicles don’t get thoughts and prayers tossed at their dead bodies, except in Japan.
One is that the US’s second amendment (the only one that the Supreme Court still upholds) doesn’t guarantee a right to keep and bear vehicles. I guess everyone forgets about knives. But let’s not forget the most powerful weapon that strikes the greatest fear into the US government. One time when I entered a US embassy, my pocket knife and tape recorder had to be deposited at the guard’s office.
@Plaxy
“Goodness, I must say I’m shocked! Anybody would be unwise to agree to such an ultimatum IMO. If the intended insisting on sole ownership of expensive property, we’re probably not talking about luv.
Seriously, the point I keep trying to make is that in IGA1 jurisdictions such as European countries, FATCA does not force Americans to file US taxes.”
You do not live in the real world. My wife and Inhad a joint account until I learned of this. We no longer do. I was paying her back for my portion of the house so that I could meet co-ownership requirements under Japanese law until I learned of this. Now I just pay toward living expenses, child rearing costs, etc, but towards the house.
I was shocked myself to learn that of all the mixed married couples I know in Japan, which are many, my wife and I were the only who had a joint account.
“If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).”
Huh, you’re right.
For everyone else, I wonder if zip code 20224 would work. (20225 is for the last known address of the IRS’s Director, Foreign Operations District, but my second-last letter to that address was signed by an IRS employee in zip code 20224 and my last letter to that address came back undeliverable.)
Previous addresses work in Japan too. In the corporate registration of a former employer, the company president listed the address where he had lived as a child. But that address was no longer a residence. It turned into a car parts factory. Somehow the labour board found him and arrested him but prosecutors refused to prosecute and he was freed. He was an illegal immigrant in Japan, having lost Japanese nationality when he naturalized in the US. When I reported the illegal immigrant to the immigration department, they weren’t interested in deporting him, they only decided to stop his company from hiring foreign employees.
Well, enough with the usefulness of previous addresses; let’s get back on topic. The guy issued falsified 源泉徴収票 (the equivalent of T-4 and W-2). A few years later, the IRS coerced me to refile my US return for a tax year including one of those falsified 源泉徴収票, and the IRS coerced me to sign the jurat declaring under penalty of perjury that to the best of my knowledge and belief that attachment was true and correct. Never mind that the Japanese government and court know that it most certainly wasn’t true and correct. US courts also don’t care that the IRS coerces perjury. Internal Revenue Bulletin 2005-14 confirms it. Honesty is illegal on US tax returns. Honesty brings penalties.
3 bills of Taxreform 2.0 out. Missing is TTFI.
https://waysandmeans.house.gov/brady-hails-introduction-of-tax-reform-2-0-permanent-tax-relief-for-families-and-small-business-helping-families-save-more-and-spurring-innovation-here-in-u-s/
H.R. 6760, the Protecting Family and Small Business Tax Cuts Act of 2018,
49 State and Local Tax Deductions:
‘‘(A) no deduction shall be allowed under
1 this chapter for foreign real property taxes paid
2 or accrued during the taxable year,
I believe living overseas one does not get those deductions anyway for tax on foreign real property. Yet if it were an investment property – would these be treated as an expense when figuring out any taxable gain or income?
JC –
I believe that section is talking about itemized deductions for individuals only – foreign property tax incurred in a trade or business would still be deductible in computing taxable income for the business.
With the increased standard deduction, there will be fewer who itemize – so this won’t affect many. But, those whose primary residence is overseas (and who live in a jurisdiction that charges something the US recognizes as property tax) are being discriminated against relative to those who live inside the US. If they are going to claim the right to tax the residents of other countries, they should at least allow equivalent deductions.
This is yet another example of Congress writing the law with US resident taxpayers in mind without any consideration of how the rules affect US taxpayers who are residents of other countries.
@Karen, I don’t even know if we could claim interest deduction on the primary residence because the local government does not allow it. Could that be claimed. Or is it a longtime pre taxreform 1.0 discrimination against U.S. Persons overseas?
My experience (or at least the way I’ve filed my 1040s like a goody-goody USC abroad) is that my local (that is, “foreign”) property taxes were never a deductible expense for a non-investment property on US income taxes. On the other hand, mortgage interest has been deductible. On an investment property, I’ve always used Schedule E, where there are lines for both mortgage interest and taxes, where I’ve entered the full amount of both, and never been challenged about it.
I wonder if this is about to change, continuing the pattern of each and every new tax reform somehow making things measurably worse for expatriates.
“Yes, it’s unfortunate that that’s the case, JapanT, but if you choose to have a rep it’s because you more than likely lived in their district. If you lived in their district then you have a previous address to put in the required fields (yes, it ridiculous).”
Say what!?
a non US ISP is a dead give away and easy to block. There are reports of USCs abroad being block from their reps and senator’s webpages.
Foreign postmarks on envelopes have the same effect.
“My” Senator is one of the one who supprts all this. I’d rather not let that POS know I even exist.
How about USC’s born abroad? Who are their reps and Senators?
“One is that victims of knives and vehicles don’t get thoughts and prayers tossed at their dead bodies, except in Japan.”
Oh, how about London, Paris, etc?