Author Archives: usxcanada

Here are two just-heard stories that deserve a repeat. One first-hand, one second-hand, both from a credible source known personally for decades.

A Canadian-only university professor who has travelled widely (Asia, South America, Africa, Europe) felt disinclined to enter the Bush-era United States, and never did. After Obama, a 2010 flight south of the border. At the destination airport, treated like everyone else on the plane, the Canadian prof got fingerprinted. To round off the indignities, singled out for a full-body scan. No intention ever to enter that land again.

A neighbor of the above reporter, a provincial government employee, crossed the border about five years ago on a day trip, a previously common practice. The US border guard stood by the trunk of the car. When it was opened, the guard accused the driver of striking him with the trunk lid. Four hours of interrogation and harassment followed. Then one guard said to the other, “That should be enough for now.” That Canadian has not crossed the US border since that day.

Read also:   Welcome to the United States: Lesson I. Watch what you tweet

 
Check out this Reuters story by David Cay Johnston: More Than 100 Million Unnecessary Tax Returns Filed Each Year. Highlights follow —

On March 28, the U.S. Justice Department sought to close a nationwide chain of income tax preparation shops it accuses of fraud.

Canada, with a ninth of the U.S. population, listed all 204 tax convictions last year at the Canada Revenue Agency’s website.
 

 
This FATCA word just in from the Channel Islands on

Why in Jersey and Guernsey an FFI cannot lawfully transfer information to the US without that person’s permission …

Principle 8 provides that transfers are only permitted to countries that are deemed to have adequate protection of confidential information. US data protection law is much weaker than that of Jersey and the United States is not a country which is listed as one having adequate data protection – the de facto position in Jersey and Guernsey is therefore that an FFI can’t lawfully transfer information to the US without that person’s permission. Again, whilst client consent is an exception to this principle, compliance with another country’s laws is not. On the face of it, it will therefore be unlawful for a Jersey or Guernsey institution to transfer information pursuant to, or indeed register for, FATCA.

Rosie Stott – Jersey: The United States Foreign Account Tax Compliance Act (“FATCA”) – Implications For Financial Services Businesses In The Channel Islands – 4 April 2012

link to above full article
 

Merryn Somerset Webb has just posted a big-picture piece at Money Week – Why every bank will soon be a tax collector for every government everywhere. Bottom line? Financial repression is a government tool to force a broad population to hold debt that loses them money in real terms. This is outlined as the context for FATCA.

 
The cover story for the current issue of Canadian Business is “Canada’s Banks Under Fire.” Cover caption is “Why we’re about to pay for America’s mistakes.” Long story, pages 24-29. All about Volcker rule and Basel III.

Not one single word about FATCA. Not one single word about current attempts to harvest revenue from hundreds of thousands of tax-compliant Canadian residents.

One of the best bits is a quotation from Ian Lee of Sprott School of Business: “There’s a casual carelessness from American government officials about the impact of their decisions on people outside of their country. They just shrug their shoulders.”
 

 
A new 15 March 2012 issue of Wealth and Tax Matters from PriceWaterhouseCoopers appears to have just been released. The first separate article is “Stricter new U.S. investment reporting rules” and the second article is “Act now, save later – Gifts made in 2012 may lead to substantial estate tax savings for U.S. citizens” [ … not to mention reduction of net worth ].

http://www.pwc.com/en_CA/ca/high-net-worth/publications/pwc-wealth-matters-2012-03-en.pdf
 

Read this —

Ronald L. Brekke, 55, helped prepare phony tax forms for nearly 1,000 people, most of them Canadians, claiming more than $763 million in fraudulent refunds … Brekke told clients to cash their fraudulent checks as soon as they received them and take the money back to Canada.

http://www.latimes.com/business/money/la-fi-mo-tax-fraud-20120316,0,4261032.story

                 — and then ask yourself how big the red flag is that now flies over the word Canada at the IRS.

$14 million … all but impossible to recover.
 

As the ides of March premonish the far more perfidious April 15, this day of 2012 just now passed seems to have coincided with the number of named participants at Isaac Brock Society having crossed the 200 threshhold. Hard to tell for sure, but it looks that way.

Following in the footsteps of James Fallows, who questioned the Brock identity, markpinetree has just registered his wish that the Isaac Brock Society morph into Americans Abroad Society.

One of the interesting aspects of this virtual watercooler, and of the technology that makes it possible, is that place does not matter. Off the top of my head, besides Canada, we have Belgium, Brazil, Denmark, France, Hong Kong, India, New Zealand, Sweden, Switzerland, United Kingdom … and USA.

Elsewheresers are welcome to make that listing fuller. No intent to omit. With Brockers thus far in March spitting out an average of over 17,000 words per day, keeping track is a stretch.

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Over the past half-year, tens of thousands of words have swirled around the current situation of extraterritorial citizens of the United States.

In all that flood of comment, one piece stands out for treatment of an important but little-considered facet. Early on, financial planner (fee-for-service) David Christianson squarely addressed the topic of personality in Long arm of American tax law. It is good to see that his perceptive take at Winnipeg Free Press still remains available, just a click away.

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