Congressman Holding has introduced the “Fair Taxation for Americans Abroad Act” in the United States House of Representatives.
“In 2019, Republicans Overseas will focus on getting the Tax Fairness for Americans Abroad Act passed….The TFFAAA will amend the Internal Revenue Code by offering overseas Americans a status similar to that enjoyed by corporations where foreign-sourced income is taxed in the country where it is earned. ” says Solomon Yue, of Republicans Overseas, who spearheaded this effort.
The direct link to the video (found in Embee’s comment) is HERE:
Here is John Richardson’s description of the Bill:
“Tax Fairness for Americans Abroad
The proposal outlined below would effectively end the current citizenship-based taxation system and instead transition to a system that provides territoriality for individuals – often referred to as residence-based taxation. By taking this first step toward ending the onerous burdens of citizenship-based taxation, Americans will become more competitive in the international job market and free to pursue opportunities around the world.
Under this new system, qualified nonresident citizens will no longer be taxed on their foreign source income while they are resident abroad; however, they will remain subject to tax on their U.S. source income.
Eligibility
In order to qualify for qualified nonresident citizen status, an individual must be a nonresident citizen and make an election to be taxed as such. Individuals will make an annual election to certify they remain in compliance with the eligibility requirements.
Under this proposal, a nonresident citizen is defined as in individual that:
•Is a citizen of the United States,
•Has a tax home in a foreign country,
•Is in full compliance with U.S. income tax laws for the previous 3 years, and
•Either:
a)establishes that he has been a bona fide resident of a foreign country or countries for an uninterrupted period which includes an entire taxable year, or
b)is present in a foreign country or countries during at least 330 full days during such taxable yearTax Treatment
Once an individual meets the qualifications to become a nonresident citizen, he may elect to be taxed as a qualified nonresident citizen.
Those electing to be taxed as qualified nonresident citizens will be exempt from taxation on, and shall exclude from gross income, their foreign source income. This includes both foreign earned income (as defined in section 911(b)) and foreign unearned income (defined as income other than foreign earned income that is sourced outside the U.S).
Under this proposal a qualified nonresident citizen will remain subject to tax on any U.S. source income.
While individuals will not be taxed on gain from the sale of foreign personal property attributable to their time as a qualified nonresident citizen, they will still be taxed on any gain attributable to their time as a resident of the U.S. In other words, if an individual holds a foreign asset prior to their election of qualified nonresident citizen status and then sells said asset while they are a qualified nonresident citizen, the individual will only owe U.S. tax on the portion of gain attributable to the period prior to their change in status.”
The above description and the Bill itself is at this link
—
“To me it seems like an Elsie Bean type person obsessively focused on compliance.”
It seems to me that almost everyone in the US Gov. and most homelanders are Elsie Bean type persons obsessively focused on compliance.
“3 years compliance that there would be exemption from FBAR/FATCA fines and this would mean less compliance for accidentals if they wanted to comply. ”
Why should accidentals who have never used the benefits of USCship have to comply with any US laws while living outside the US? (Excepting, of course, if the have US sourced income.)
“The Expatriation Act of 1868 already guarantees that.”
Not being followed, it would seem.
” Why should accidentals who have never used the benefits of USCship have to comply with any US laws while living outside the US? (Excepting, of course, if the have US sourced income.)”
More to the point ,why should anyone who with no financial ties to the US and does not receive any services,benefits,etc have to fill out anything related to the US. Bullocks!
Never heard of such an open admission of Canadian servitude as in Elizabeth Thompson’s latest comment for the CBC regarding FATCA.. “The Canadian government has defended the banking record -sharing deal saying it avoids the prospect of Washinton trying to enforce American law in Canada .”
“
“More to the point ,why should anyone who with no financial ties to the US and does not receive any services,benefits,etc have to fill out anything related to the US. Bullocks!”
True.
@Robert Ross re your comment:
Canada is enforcing US law on Canadians to avoid enforcing US law on Canadian BANKS!
@BB
Your point is probably more accurate. After all, that’s where the money is and even more so as the young indulge themselves more and more into debt.
You morons know this will never become law right? Haha.
Gunna pass a Pelosi house? Republican senate? Never, ever, ever.
Side note: John Richardson is a complete idiot.
@Christopher
Don’t be a party pooper. “Never become law”? You know that never is a very long time, don’t you?
@Christopher
The only way to ensure defeat is to not try.
Otherwise, everything is up in the air until the end.
@Christopher
For years Congress has simply ignored the problem. The proposed law has now been introduced by a member of Congress. So, stage 1 is complete.
Your comment shows that the movement for change has now reached stage 2.
Not a very apposite quote.
George Stephenson didn’t invent the first locomotive, and he certainly didn’t get ignored or laughed at, though no doubt there are quite a few statues.
Did anyone ever build a monument to the Amalgamated Clothing Workers of America, I wonder?
https://en.m.wikisource.org/wiki/And_Then_They_Build_Monuments_to_You
I hope the Holding bill will make progress in the new year. A step in the right direction, as others have said.
@Plaxy
Not a very apposite attempt at an analogy.
The comment above, to which you respond, assumes nothing about the origins of the quote (although the cluster of words used is often attributed to Gandhi (whether correctly or incorrectly).
The attempt to somehow shift this over to to the Nicholas Klein speech which ends with building statutes/monuments – a recognition of a person, rather than achieving a result is misguided and irrelevant.
What was the purpose of your comment? This is not about the origins of quotes.
Holding is not Gandhi either, and US citizens living outside the US are not in a situation of oppression comparable to that of Indians under British rule.
It will be a step in the right direction, if it eventually gets passed. IMO. Because if I understand correctly, under the registration scheme the US doesn’t try to tax non-US income.
And therefore, should this scheme or a similar scheme come into being, it seems to me that IGA1 countries may find it difficult to justify continuing to report the domestic accounts of all their US-born CLNless residents to the US.
(Of course we hope that before then, one or more of the anti-AEOI legal actions may have been successful.)
May be stating the obvious but it is a step in the right direction for some but for many others a meaningless one, as it maintains the same underlying mindset .
Irrespective of the inadvertent juxtapositioning of Holden next to Gandhi, any reference of Gandhi next to a US politician is blasphemy and should be punished by a horsewhip.
Though it might not solve everyone’s problems, it would be a fourth option:
Renounce, ignore, register or comply.
And it would be an acknowledgement that the non-US income of expats is not “foreign” income being “hidden” from the IRS.
@plaxy
One obstacle which you seem to continously ignore is the extortion. In fact , a few comments made here after renunciation mention a bitter taste rather than tears of joy. Think about it for a moment $2350 USD for a piece of paper. Peace of mind,you may say, but extortion just the same. Peace of mind, you may say, but financial unattainable for others. Peace of mind, you may say, but morally objectionable for others.Peace of mind,you may say, but a financial jackpot for them.
@RobertRoss
The juxtapositioning of Holding and Gandhi is introduced by Plaxy in his/her comment which includes:
The analogy is not between Holding and Gandhi (obviously). The analogy is between the struggle faced by Americans abroad and struggles of other minorities who have had to work long, hard and endure ridicule to achieve their objectives.
The renunciation fee is indeed outrageous. It’s the great injustice of the IGAs (Model 1 – I’m not commenting on Model 2 as I know little about it. To be required to buy a CLN to be allowed to live a normal financial life in your own country.
Renouncing solves the bank access problems. It’s conceivable a registration scheme might lead to a cheaper solution (i.e., showing registration instead of CLN as proof of non-US-tax-residence)
A registration scheme might also make it hard for IGA1 governments to continue treating US-born residents with not CLN as tax-resident in the US
Will it pass? Who knows? They seem to have done pretty much what they said they were going to do following the dropping of the transition tax on owners of small non-US businesses. That may suggest that they do actually want to get it passed (for their own reasons, I would guess). But it’s all speculation.
@Robert Ross
Extortion is something that plaxy demonstrates an inability to understand. Just doesn’t exist in the world of plaxy.
@plaxy
“Renouncing solves the bank access problems.”
Not necessarily. For one, many have reported that their FIs have asked “Are you or have you ever been a US citizen?”
At least one woman in France has reported here on Brock that even with her CLN her banks were making life difficult.
For me, renunciation was the obvious solution to the banking problems.
Those who have bank access problems but can’t afford the fee are in a very difficult situation.
If a registration scheme offers a cheaper solution, that will be good news.
“At least one woman in France has reported here on Brock that even with her CLN her banks were making life difficult.”
Same here. The banks are allowed to treat a former citizen’s accounts as mon-reportable but they’re not required to.