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FATCA Discussion Thread (Ask your questions) Part Two

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Please ask your questions here about FATCA.

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NB: This discussion is a continuation of an older discussion that became too large for our software to handle well.  See FATCA Discussion Thread (Ask your questions) for earlier discussion.

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3,498 thoughts on “FATCA Discussion Thread (Ask your questions) Part Two”

  1. Lebanon striving to adhere to U.S. regulations

    “Lebanese banks are market takers, not makers like the U.S. and Europe, so we have no say in the financial world,” said Camille Barkho, chief compliance officer at the Lebanon and Gulf Bank.

    “But something funny is taking place today in some countries who have anti-money laundering and counter terrorist financing rules and regulations – they are strictly applying those rules more because of fear of the U.S. and Europe than complying with local regulators.”

  2. Good Evening all,

    I have just found this site and I find it very compelling. I am interested in learning more and more then likely getting rid of my USA Citizenship. I was wondering if there was a primer introduction for what is required to renounce in one spot or is the information kind of scattered all over the place. From my high level sort of a look it seems to me to be scattered all over. If some one has a link to where to start that would be fantastic.
    I appreciate everything I have found so far.

    Cheers.

  3. @ Krackerjack
    Yes, things are scattered but a good place to start reading is the Consulate Report thread. It will give you an idea of renunciants’ experiences and the process they went through at various locations. Each consulate deals with renunciants a bit differently. Calgary, for instance, where my husband is scheduled to go, sends you an e-mail package (after you contact them by e-mail) with forms to be filled out and returned by e-mail (your Adobe reader must be updated we found out) and then they give you an appointment date with instructions to bring your original documentation to the appointment.

    http://isaacbrocksociety.ca/consulate2/

  5. HI Em,

    I found that and started reading some of the stories. It sounds pretty cordial all things considered. I mean people are giving up the “most important” thing ever. They will no longer be exceptional. Just regular citizens of the country or residence. I say that in jest of course. I am actually quite pleased to here all of the cordial responses that have taken place. Thanks for the information I will review it.

    I don’t know if anyone here has contacted Roy Green in the past or not, but he is a weekend talk show host on the Corus Entertainment Network and I have found him to be quite receptive to the average Canadian. So I just finished sending him a note asking if he would be interested in doing a segment on this. I will let everyone know what I find out.

    If he is comfortable with this request and would like to have some one come and speak about it would anyone be interested in doing this. I don’t know enough about this to be able to present an informed presentation. I am hopeful that some one on hear would be willing. Of course dependent of course if he is willing to discuss the issue. Once I hear from him, I will be contacting other media personalities to see if they present the issue. I think that this is one way to get more publicity out about this important issue.

    Cheers.

  7. George 111
    With respect to New zealand’s IGANew Zealand IGA

    Calgary new limit $250.000 USD
    Accounts that you don’t have to review, identify or report on

    You don’t have to review, identify or report on accounts with the balance or value of USD $250,000 or less unless you elect to do so.

    http://www.ird.govt.nz/international/nzwithos/fatca/nzrfi-oblig-entity-preexist.html

    Unfortunately this limit or 250K applies to so called entity accounts. The threshold for individual accounts is still 50K.

    The NZ inland revenue is so bad they simply take the IRS regs and transpose them word for word. They even call NZ banks ‘foreign’

    It gets worse- there is no mention of an exemption for retirement accounts.

  8. Sorry about double-posting. I put this on the Relinquishment thread but it might be better here.
    Subject : Update

    My status: old relinquisher (pre-1980), Canadian citizen, low bank account, never travel to US, no assets in US, no CLN, obsessive worrier

    IBS has helped me keep my sanity over the past year or so, and several of you have helped me understand and have reassured me. I’ve just looked at the website again after 2-3 months during which I tried to think of something else 😉 , and have been doing some catchup reading of the posts.

    I had gathered together all my papers to apply for a CLN, and then decided there was no need for me to get involved with the US consular service at the moment.

    The only stuff that seems to have changed in the posts are some people’s fears that the FIs will simply ship off to the IRS the info on all accounts with indicia, however small. Checking some recent FI docs (esp Credit Union Central’s timetable), this doesn’y seem too likely:
    http://www.cucentral.ca/Connections/Connections%20FATCA%20July%2023%202013%20FINAL.pdf

    So I remain with my decision not to budge, but to keep up with IGA news. As long as there is no indication of fishing for the small fry (plankton, someone wrote) or any change in Canada’s collection and enforcement policy vis-à-vis IRS, sitting pat seems OK.

    Any feedback or reassurance appreciated.

    Incidentally, I have become more sympathetic of those in a worse situation. Those that in good faith have keep their American-only citizenship status are being totally screwed over by their own government.

  9. Just came across this ion the site of Credi Unions Central:

    http://www.cucentral.ca/Connections/Connections%20FATCA%20July%202013%20FINAL.pdf

    They think 50% of their credit unions are small enough (under 175 million$ total accounts) that they will be deemed compliant. If they publish a list, they may quickly grow beyond that limit after being swamped by so-called US persons seeking refuge.

    But, seriously, would seeking out such a place for one’s savings violate some law?

  11. Insight into politics of USA

    From the December Harper’s Magazine, the article “John Kerry and the myth of foreign policy, Secretary of Nothing” . The Secretary of Nothing is the same problem. There is no USA foreign policy because it is decided by domestic votes. I would like to post the whole article but it is copyright violation.

    My take on this is that Congress will never to anything about CBT because there is no self interest in their voting districts. This is very evident in this article.

    Also, one was conspicuous by her absence: Hillary Clinton, away on diplomatic business in East Timor. “for decades,” she said by way of explanation, “secretaries of state have not attended political conventions because of the nonpartisan nature of our foreign policy” Harper mag retorted “Kerry, it seems, had fallen into the trap of believing in the existence of something called foreign policy, divorced from domestic political interests. There is no such thing..”

  13. China and Singapore have a better solution than FATCA!

    http://www.cnbc.com/id/101244789

    The Singapore Exchange and Hong Kong Exchanges and Clearing on Wednesday signed a deal to co-operate on a number of areas that include promoting the internationalization of the Chinese yuan.

    The move reflects the growing importance of the Chinese currency, also known as the renminbi, in international trade and finance.

  14. @Mark Twain
    would it be good to buy Chinese Yuan for the future?

    http://www.cnbc.com/id/101241055

    The yuan has overtaken the euro as the second most used currency in international trade finance, according to the Society for Worldwide Interbank Financial Telecommunication (SWIFT).

    The share of the Chinese currency’s usage in trade finance, such as Letters of Credit and Collections, grew to 8.7 percent in October, from 1.9 percent in January 2012, data from the transaction services organization showed.

    It now ranks behind the U.S. dollar, which remains the leading currency with a share of 81.1 percent.

  15. @all
    I found this interesting today.. Canada is sinking
    “Canada sinks in ranking
    We’re still in the top 10. But not No. 5, like last year. Or, more importantly, No. 1 the year before that…….Here’s how Canada ranked in the breakdown: No. 6 on trade freedom, No. 77 on monetary freedom, No. 9 on property rights, No. 21 on each of innovation and technology, No. 2 on red tape, No. 4 on investor protection, No. 9 on corruption, No. 1 on personal freedom, No. 8 on tax burden and No. 58 on market performance.
    .http://www.theglobeandmail.com/report-on-business/top-business-stories/canada-sinks-in-key-forbes-ranking-of-best-countries-for-business/article15778947/

  16. @Northernstar, I wouldn’t buy any fiat currency–including not the Yuan. In my opinion, they are all doomed to the trash heap (unless you can sell Zimdollars to tourists). Buy something with intrinsic value for the long run (e.g., precious metals). Or buy tangible goods for the short haul. E.g., how many months of food supply do you have at your house?

    I bought a dehydrator, to make storing food more efficient (as our freezer is already full). I dehydrated about two years of pumpkin (a staple that we eat every day). Working on beef jerky now, but my wife likes my bulgerky (Korean bulgogi made into beef jerky) so well that she’s eating it instead of saving it for a rainy day (a.k.a. the Apocalypse).

  18. @northernstar, if you buy precious metals below $10,000 in cash, there are no reporting requirements to any government. Do multiple transactions on separate days in the name of “walk-in client” if you want to do buy more than 10K. But since that lady who was depressed was not allowed into the US, who knows what they know and what they don’t know. 🙁

  19. Fortunately I’m too poor to need a deemed compliant FI, but I am curious as to the distortions that could be caused to our financial system by money running all over the place seeking refuge.

    I have a question about FATCA and CLNs. One gets the impression that many participants in this forum think that having a CLN will remove them from problems with FATCA. Please correct me if I am wrong, but FIs are supposed to report based on certain indicia, one of which is place of birth, and a CLN doesn’t change that, and it also doesn’t change the fact that non-US citizens can be considered US persons. In fact, wouldn’t presenting a CLN when opening a new account give the FI reason to believe you might have been born in the US?

  20. Old & Simple,

    Hopefully, showing your CLN, will have relevance. From one bank, RBC, re FATCA http://www.rbc.com/aboutus/fatca.html:

    Who or what is a U.S. person for U.S. tax purposes?

    A citizen of the U.S., including an individual born in the U.S. but resident in another country, who has not renounced U.S. citizenship;
    A lawful resident of the U.S., including a U.S. green card holder;
    A person residing in the U.S.
    Certain persons who spend a significant number of days in the U.S. each year. (For example, some Canadian “snowbirds” may be considered U.S. persons. However, the Canada-U.S. tax treaty allows them to claim benefits to be treated as Canadian rather than U.S. taxpayers. Similar relief is provided under many other treaties with the U.S.)
    U.S. corporations, U.S. estates and U.S. trusts.

  21. @Old & Simple,

    I got this from the UK IGA, but these same words are in the final FATCA regs:

    5.6 Identification of the account holder as a US citizen or resident
    Where the indicia found indicates that the account holder is a US citizen or resident by birth, the account needs to be reported unless the Financial Institution obtains or currently maintains a record of all of the following:
    – a self certification showing that the account holder is neither a US citizen nor a US resident for tax purposes, and
    – evidence of the account holder’s citizenship or nationality in a country other than the US (for example passport or other government issued identification).

    5.7 Unambiguous US Place of Birth
    Where the indicia found is an unambiguous US place of birth then the account needs to be reported unless the Financial Institution obtains or currently maintains a record of all of the following:
    – a self certification showing that the account holder is neither a US citizen nor a US resident for tax purposes,
    – evidence of the account holder’s citizenship or nationality in a country other than the US (for example passport or other government issued identification); and
    – a copy of the account holder’s Certificate of Loss of Nationality of the United States or a reasonable explanation of the reason the account holder does not have such a certificate or the reason the account holder did not obtain US citizenship at birth.

    Of course, we’d all like to know what a “self-certification” and a “reasonable explanation” look like. I wouldn’t trust that much, as it leaves the decision up to the FI.

  22. @Old & Simple, in addition to Calgary411’s post on the criteria I can only offer my own experience. I renounced in early March this year and a few days after received from my bank the letter, US indica form and a W-9 for signing and sending back to them by the end of March. Apart from being born in the US all my other indica answers were no. I contacted my bank and told them I’d renounced a few days before. They said until they saw the CLN they couldn’t do anything, but would give me until July to return the forms in the expectation that I’d get my CLN before that. And that is what happened; I checked with the embassy on the status of my CLN as I was going on holiday in late April and was concerned that the CLN might arrive while I was away. The embassy informed me that my renunciation had already been approved and I arranged to collect the CLN from them. As soon as I got home I copied the CLN, e-mailed it to my bank and that’s seems to be the end of it as I haven’t heard anything further from them on the subject. For them my renunciation has “cancelled out” my birth as far as they’re concerned for US tax reporting purposes.

    There’s nothing to say that the US won’t change the rules farther down the line, but renouncing and then doing my back filing to be tax compliant is all I can do to cut myself off from their grasp (not that I have anything worth grasping). Should the US try and grab money back from renunciants/relinquishers then I, as a British citizen, will complain long and loudly to my MP, MEP, UK and Swiss goverments and the Court of Human Rights about America’s illegal continued hassessment of those citizens who have lawfully cut their ties with the US.

  23. @ Old & Simple
    Good points. It all goes to show how utterly ridiculous this whole thing is. I believe at least one bank in Switzerland (probably UBS) is trying to get its suspected U.S. customers to provide proof of up to date IRS filings and to do it before the end of the year. Good luck with that, since it takes paperwork and time to get an official tax receipt from the IRS because it can’t be bothered to send this automatically after it receives and approves a tax return. What’s next? Can’t board a plane flying into or near the U.S.A. without producing your official IRS tax receipts going back 6 years? Will there be people in the future who roam the streets, with the last vestiges of the money they once were able to keep “secure” in a bank, jingling in their pockets, and unable to go anywhere else because they can’t produce the “Papiere, Bitte”.

  24. A CLN doesn’t prove tax compliancy however. Presenting a CLN also leaves it up to a bank employee to authenticate another country’s documents. Seems to me that the banks will be obliged to send your personal information off to the USG for verification.

  25. further to @ old & Simple’s question

    yesterday i went and dug out my certificate of canadian citzenship (all printed on nice heavy bond paper) as well as my canadian citizen card with my picture on it from june 1980.

    my canadian passport shows by birth place as usa

    what would happen if / and when the day comes and the bank asks me to prove my citizenship and i produce my certificate and card?

    i have not renoucned and am not planning on because i can not afford to become tax compliant if i were to renounce

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