Clearly "Not All #AccidentalAmericans Are The Same" – "U.S. Treasury remains silent as bank accounts of EU 'accidental Americans' still being frozen" https://t.co/oB2Gdmb88B

— U.S. Citizen Abroad (@USCitizenAbroad) February 17, 2020

The article referenced in the above tweet from Helen Burggraf from American Expat Financial begins with:

The U.S. Treasury is continuing to maintain its silence with respect to the issues European banks have been struggling with for months over their perceived need to report to the U.S. – under the tax evasion law known as FATCA – government tax information details on certain of their American account-holders that they don’t have, European banking sources, expat groups and others report.

This is in spite of the fact that so-called “accidental Americans” in Europe are continuing to have their non-U.S. bank accounts frozen in cases where their banks say they have failed to provide “Tax Information Numbers” (TINs, typically Social Security numbers) as the banks say FATCA requires them to have as of the end of last year, according to sources in the accidental American community.

In the same way that U.S. “citizenship-based taxation” impacts people differently in different countries, FATCA impacts people differently in different countries. Canada and Europe are home to large numbers of “Accidental Americans” (however they may be defined). Although Canada and most European countries have the same model 1 IGAs, it appears that the “FATCA Experience (How do you like your freedom now?) differs between FATCA and Europe. Specifically: more Europeans are experiencing: pressure to provide U.S. Social Security Numbers, bank account closures and the resulting pressure to enter the U.S. tax system.

Interestingly the latest catalyst for FATCA problems is the “panic” resulting from a supposed December 31, 2019 for Accidental Americans to supply U.S. TIN numbers (AKA Social Security Numbers) to the banks. At the risk of oversimplification, what happened was this:

1. FATCA IGAs required the banks to provide the Social Security numbers of “USness Contaminated Accounts”.

2. Many accidentals (including those who didn’t even know they were U.S. citizens) didn’t have Social Security Numbers.

3. U.S. Treasury in a gesture of unprecedented kindness and understanding allowed the banks to NOT supply the Social Security Numbers until December 31, 2019.

4. In the fall of 2019, it occurred to the banks that December 31, 2019 was approaching.

5. It is reported that some European banks are cleansing their customer base of recalcitrant U.S. citizens.

6. Interestingly, France’s Finance Minister has taken the unprecedented step of assuring French banks that they will not be punished for having U.S. citizen customers.

Hence, the latest panic.

It’s important to note that this latest brouhaha is actually based on an incorrect assessment of the clear terms of the Model 1 IGA. Contrary to what the banks think (or claim they think), they actually have 18 months to fix any suspected or actual “noncompliance”. Furthermore, as documented at the Fix The Tax Treaty Blog, the IRS has updated it’s FATCA FAQs to state that banks should NOT be closing the accounts of accidental Americans. (But, why let a dose of objective reality interfere with a great opportunity to further terrorize those poor souls who either chose to be born in the United States or chose to be born to U.S. citizen parent(s), right?)

Is this a problem in Canada too?

Well, yes and yes.

Why yes? The clear terms of the FATCA IGA require that the Social Security numbers of “U.S. citizens” be turned over. Sooner or later this issue will be addressed.

Why yes? Some argue that it is easier to hide one’s “USness” in Canada than in Europe (at least for now). My impression is that this is because identification in Canada does not presumptively include a “place of birth”. (Why should somebody have to hide where they were born anyway?) Even if this is true now, it may not be true in the future. Agreements change. Treaties change. The world changes.

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Knocking on the door of U.S. Treasury? Is anybody home?

The bottom line is this:

U.S. Treasury doesn’t care. It’s that simple. If Treasury cared it would have long since interpreted this FATCA nonsense to apply only to Homeland Americans with offshore accounts. But, (I suspect Treasury learned fairly quickly) that FATCA was just one more sanction that it could impose on the rest of the world. Also, the great FATCA hunt allowed them to pick up some more “U.S. Person” taxpayers along the way. So, the chances of long term relief coming from Treasury are slim indeed. (This is too bad. Treasury could simply decree the “FATCA same country exemption” if it wanted to.)

The Governments of other (in general) nations don’t care. At least some of the European nations are beginning to listen to their citizens and stand up for their citizens. In Canada, not so much.

In Canada: A Canadian is a Canadian is a Canadian (unless the Canadian is deemed to be an American by the United States).

Shockingly, by signing a Model 1 IGA, each country has specifically allowed the United States to define ANY of its residents as a U.S. citizen. It’s true.

The interests of accidental Americans may conflict

One would think that the interests of all persecuted people would be aligned. But, this is clearly not the case. Leaving aside the perception versus the reality, it appears that:

– Some accidental Americans (largely in Europe) have a strong interest it opposing FATCA and the FATCA IGAs

– Some accidental Americans (some in Canada) claim to have an interest in not opposing the FATCA IGAs (a fear of further and worse beatings?). Some go even further and oppose the FATCA lawsuits.

Based on the fundraising: Not enough Accidental Americans appear to be interested in supporting the FATCA lawsuits in the UK and Canada

This is unfortunate. As a recent donor to Canada’s FATCA lawsuit comments:

I just managed to make another small donation. The sovereignty issue should wake up others out there and perhaps we’ll get past the standstill in donations. U.S. territorial overreach extends far beyond FATCA. Those of us who have renounced or in some way distanced ourselves from U.S. citizenship taxation are fortunate. But can still be negatively affected by infringement on the sovereignty of nations worldwide by U.S. bullying, which seems to go unchecked.

Bravo!!

Really, as the above comment confirms there must be an organized opposition to this “U.S. tendency to extra-territorial overreach“.

Are “Accidental Americans” around the world stuck together in economy class on Air #FATCA?

So far Accidental Americans have been unwilling to project a united front. This brings to mind the thinking that:

“If we don’t hang together we will hang separately”.

Most Accidental Americans don’t actively oppose each others’ interests. Interestingly, some Accidental Americans seem to believe in the IGAs and other do not. I suspect that this is a matter of geography. It’s as though Americans abroad in general and accidental Americans in particular are fighting for their own space. Somehow the following reminds me of the situation … Some passengers believe in opposition to FATCA to FATCA IGAs. Is there space for all passengers in economy class on Air FATCA?

Airlines have pitted economy class passengers against each other. #FATCA + @citizenshiptax have pitted some #accidentalAmericans against each other: Is it wrong to recline your airline seat? Is it wrong to not support FATCA lawsuits? https://t.co/2QN3TF3T7n via @usatoday

— U.S. Citizen Abroad (@USCitizenAbroad) February 17, 2020

In closing: FATCA has a tenth birthday approaching

March 18, 2020 is the tenth anniversary of FATCA. It’s time to get serious about opposing this appalling sanction that the United States has inflicted on the world.

"FATCA at Ten: March 18, 2020" – How will you be celebrating? https://t.co/cISV4qwOsc

— U.S. Citizen Abroad (@USCitizenAbroad) February 17, 2020