FATCA Discussion Thread (Ask your questions) Part Two
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.
@Em, and all, I was interested to see that the IRS Taxpayer Advocate has read and is noting for Congress the letter by Murray Rankin of the Federal NDP regarding FATCA. It is quoted, and included in a footnote of the FATCA section. And the link was to Maple Sandbox. That is something. That is the fruit of our lobbying and contacting the federal NDP and finally their decision to respond definitively.
The TAS has created a public record that is very valuable. I know it is disappointing that she is in some ways forced to note the same Most Serious Problems again, because the IRS and Treasury are not responding, but still, several of our concerns are reflected in her report. We have no alternate and equivalent voice of our own to Congress.
Can our Canadian federal government completely ignore or cover up the fact that event the US IRS’ own Taxpayer Advocate is quoting the NDP as to the sovereignty issues and conflict with Canada that FATCA raises? See: Most Serious Problem MSP #23
‘REPORTING REQUIREMENTS: The Foreign Account Tax Compliance Act Has the Potential to be Burdensome, Overly Broad, and Detrimental to Taxpayer Rights’ on page 243 and the TAS says this; “in addition to objections based on resource burdens, it has given rise to discussions of sovereignty issues, as well as concerns regarding economic repercussions. For example, Murray Rankin, the Canadian equivalent of a “Shadow Minister” for National Revenue, recently reiterated his party’s concerns regarding FATCA: New Democrats are concerned with the prospect of a foreign nation unilaterally imposing obligations on Canadian banks to disclose personal information. The Canadian Government has a responsibility to protect Canada’s tax base, and while we understand the United States’ desire to protect their own tax
base, this should not come at the cost of the rights of individuals residing in our own country. Crackingdown on tax cheats should occur through international cooperation rather than unilateral action. 38”
The footnote is “…….38 Letter from Murray Rankin, Member of Parliament for Victoria, Official Opposition Critic for National Revenue, to Canadian Minister of Finance James M. Flaherty (Sept. 25, 2013), available at http://maplesandbox.ca/wp-content/uploads/2013/09/Rankin-Letter-to-Flaherty.pdf;
see also James Jatras, Canada’s Shadow Revenue Minister Warns Government against Sellout on FATCA!, OpEdNews (Oct. 5, 2013), available at http://www.
opednews.com/articles/Canada-s-Shadow-Revenue-Mi-by-James-Jatras-Canadaus-Integration 131005-282.html. For the IRS’s response to allegations such as those raised by Mr. Rankin, see Robert Stack, Myth vs. FATCA: The Truth about Treasury’s Effort to Combat Offshore Tax Evasion
, Myth No. 7, Lexis Nexis (Sept. 20, 2013)……..”
The section on the OVD and VD programs also noted:
Page 232, footnote 24
“24 IRS response to TAS information request (Sept. 17, 2013). This figure does not include taxpayers who opted out of the 2011 OVD program into the streamlined program. For example, it does not include 339 of the 475 Canadians who opted out of the 2011 OVD program and who were placed into the streamlined program. Id. We understand this is an estimate, as a system error prevented accurate reporting on these cases before September 2013. The IRS was unable to provide data regarding the resources it used or the time it took to process streamlined submissions. Id. ”
Nina Olson also reiterates the lack of any robust FATCA cost/benefit analysis, and the duplicative and layered penalty burdens and jeopardy that FATCA adds on top of FBAR.
She notes the continued rise in renunciation rates (though it would have been great if she had chosen to cite this article http://globalnews.ca/news/782020/why-are-so-many-american-expats-giving-up-citizenship-its-a-taxing-issue/ which contains the comparison of the FBI figures with the Federal Register ‘name and shame’ list and thus bring to light the underreporting of the true and much higher totals).
It did me good to read her previous reports and to see that some of the same points we raise and discuss get support and validation from someone with a long history of familiarity with the worst excesses of the IRS. Even her footnotes are so valuable.
I’ll take this against silence any day, even if we can’t force Congress and Obama to read it or act on it.
@ badger
The Canadian references might only serve to crank up the force shields of American exceptionalism. It’s gratifying to see them from a Canadian perspective but from the American perspective it might be taken as an affront and the reaction could well be, “What gives Canada a right to comment on OUR tax policy?” But, as you say, it’s better than silence and speaking of silence … when will Flaherty either put us out of our misery or sink us deeper? I wish Tim could give us a hint at what will happen when parliament is back in session (January 27th).
Nina Olson nails it for the most part, but she’s still trying to make CBT work. CBT will not work no matter what measures the IRS take to encourage offshore compliance. She seems to have a mental block in this area. She says:
“While the OVD programs attracted over 27,000 applications (perhaps less than one percent of those who did not file FBARs) and collected almost $5.5 billion, a more effective initia- tive could prompt significantly more taxpayers to come into compliance voluntarily.44 The OVD programs may be prompting them to renounce U.S. citizenship instead. The number of people renouncing citizenship has risen to an all-time high — nearly quadrupling over a four-year period — from 470 in 2007 to 1,788 in 2011.”
All any educational outreach in making USP’s aware of their tax filing obligations will do is to cause more renunciations, relinquishments and fewer registrations of US births abroad.
Dick’s Hangout in Oslo
http://bit.ly/1eKTG5j
@le President amateur
I thought the Norwegians had more modesty than that.
If ya got it—flaunt it
The US Taxpayer Advocates report (at
http://www.taxpayeradvocate.irs.gov/userfiles/file/2013FullReport/REPORTING-REQUIREMENTS-The-Foreign-Account-Tax-Compliance-Act-Has-the-Potential-to-Be-Burdensome%2C-Overly-Broad%2C-and-Detrimental-to-Taxpayer-Rights.pdf
as reported elsewhere on this site) is, considering its authorship, about as scathing an official criticism of FATCA and its unworkability as we could hope for. If the launch of Obamacare is any indication, the attempt to launch FATCA this year is going to be a financial, legal, and PR disaster for the US. May it be so.
@Broken Man on a Halifax Pier, re your comment of January 5: Giving CLNs serial numbers would make it possible for people to count how many they are issuing and would give each of us an official “ex-citizen number”. As you said, making CLNs harder for fake would be an acknowledgement that they are valuable documents.
http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1314/QG/FATCA
Australia and FATCA
(couldn’t remember the thread on which someone recently asked for an update re Australia).
Note that the link above for the Australian Government statement is very recent – webpage dated Jan 10, 2014. Includes references to media articles, PWC pages, a few academic papers (notably one by Itai Grinberg).
Notes workaround of privacy concerns – by changing domestic laws.
Those in New Zealand and Canada and elsewhere should read through the Australian government’s rationalizations because I am sure we will see copycats using the same rationales.
Here is also a recent link from Pakistan:
http://www.brecorder.com/taxation/181/1142626/
news for FATCA and Italy;
http://www.reuters.com/article/2014/01/10/usa-tax-italy-idUSL2N0KK21Y20140110
“…The IGA is reciprocal, requiring the IRS to send Italy similar information about Italians with financial accounts in the United States. This arrangement has raised concerns among U.S. banks and some members of Congress…………….
“…………..Italy was one of the first countries to participate with the United States on FATCA. In February 2012, Italy joined with four other European countries to sign a FATCA framework.”
What about the Vatican bank and FATCA? See: …”…The IOR is a sort of central body of the Holy See whose profits are at the Pope’s disposal. Its purpose is to provide for the protection and administration of moveable and immovable assets transferred or entrusted to the institute and destined for religious works or charity. Financial transparency and successful cooperation with Europe’s anti-money-laundering agency Moneyval has continued to remain a priority for the institution in recent years.”…. http://www.patheos.com/blogs/catholicnews/2014/01/cardinal-commission-for-vatican-bank-could-undergo-changes/
Also see: “The Vatican doesn’t consider the IOR a bank, but rather a financial institution that manages assets for religious and charitable works. According to the report, the bank manages $6.8 billion, including more than $4 billion in securities, the majority of which is tied to government index bonds. But the bank also holds $55.9 million in gold, metals and precious coins as well as a real estate company with two investment properties worth $2.5 million, according to a Reuters report.
from ‘Secretive Vatican Bank Publishes First Financial Accounts’ | TIME.com http://world.time.com/2013/10/02/vatican-bank-opens-its-books-for-the-first-time/#ixzz2q7WT5lT1
And then there is the Mafia, (have they been in talks to sign on to a FATCA IGA ?):
‘Mafia now “Italy’s No.1 bank” as crisis bites: report’
By James Mackenzie
ROME Tue Jan 10, 2012
http://www.reuters.com/article/2012/01/10/us-italy-mafia-idUSTRE8091YX20120110
@badger
The mafia being what they are can probably deal effectively with extortionists.
@bubblebustin, I’m sure that they are not concerned about FATCA. That is what makes this a farce. As noted many times before, those with the means, knowledge and motivation will not be deterred by FATCA. Only ordinary accountholders will be hurt. Not the big sharks.
Along with the Mafia banking and other organized crime, and countries and banks not known for their transparency INSIDE and http://www.globalresearch.ca/money-laundering-and-the-drug-trade-the-role-of-the-banks/5334205 ) as well as outside of the US.
Example, Afghanistan:
“Depositor and U.S. taxpayer losses
With regard to public sector corruption in Afghanistan and the loss of nearly U.S. $1 billion in U.S. taxpayers’ funded foreign assistance to Afghanistan in the form of U.S.-supplied Afghan government and Afghan military and police salaries deposited into Kabul Bank, The New Yorker Magazine, the Wall Street Journal, the New York Times, National Public Radio (NPR) and others, have reported that widespread corruption, ponzi schemes, fraudulent loans, mass looting, insider loans to fake and bogus companies run by family and friends, and other corrupted practices, were undertaken by a small group of Afghan insiders (less than 12 people), apparently linked to Mahmoud Karzai, President Hamid Karzai and Ahmed Wali Karzai.[29][30] This resulted in nearly $1 billion ($900 million) in Kabul Bank’s deposits seemingly vanishing into Dubai and other off-shore locations and unknown offshore bank accounts and tax havens. Hundreds of millions of U.S. dollars were often smuggled and flown out of Afghanistan secretly stashed in bags and airline food trays [31][32][33]
Anti-corruption report
On November 28, 2012, the Independent Joint Anti-Corruption Monitoring and Evaluation Committee published its report and declared in a news conference that US$5 billion, including $400 million the Kabul Bank’s shareholders, were illegally transferred abroad. About 22 people are accused of embezzlement in the case, and their trial started. At three hearings, 18 people, including Sher Khan Farnood and Khalil Ferozi, appeared before the court to defend themselves. Some $935 million of the bank assets was transferred abroad through various systems and $825 million are needed to bail out the bank. The Afghan government will have to pay 5-6% of its GDP to save the bank, which would be a huge blow to the country’s economy.[34] ” http://en.wikipedia.org/wiki/New_Kabul_Bank#Depositor_and_U.S._taxpayer_losses
@badger
FATCA: Farcical Antics To Catch All
http://bancdelasteroideb612.wordpress.com/2014/01/12/obituary-for-the-us-expat-diaspora-population-usas-fatca-euthanasia-program-for-those-inflicted-with-the-fbar-cbt-diseases-and-possessed-by-the-us-personhood-demon/
Living Obituary for the US expat / diaspora population. USA’s #FATCA #Euthanasia Program for those inflicted with the #FBAR & #CBT diseases & possessed by the US-personhood demon!
Another amateur submission
http://paper.li/FinancialCrime1/1329517783
Top billing at the Financial Crimes Network Consulting. Size matters!
@le President amateur
I like your Obituary write up. The ending showing the RNC link is kind of an off because many people are liberals and would diss your write up right away just because of it. I am a progressive but I still think your op was good
Oslo Dick very good too.. In fact I like your humour with truth.
Mr. Quinn of Financial times seems to be quite productive and probably will make a mighty bunch of money on FATCA. …
No wonder! I left the US thinking it was spelled “youth in Asia”!
I got your point on the partisan thing. Now removed.
http://www.democraticunderground.com/10024319510
An ally started a thread on this, and got a load of dufuses to answer. No need to give them more dufus food with one link.
People are going to have to figure out that a solution has to come from one side of the aisle or the other. I have a wee littie bittie guess is that the left side isn’t going to come from Senator Obama (the cosponsor of the Stop Tax Haven Act, with the dream that somewhere there are billions of dollars that he hasn’t found yet), Harry Reid, the leader of the state where one house has more than 500 corporations listed with no beneficiary, or the Vice President that has just in one building with 20,000 corporate registrations with no listed beneficial owners.
@le President amateur
Thank You!!!!!!! Now maybe there may be less nuts . I notice one was excommunicated. LOL.
http://www.democraticunderground.com/10024319510
I think they can change the name of their blog to “servants of the state”
My new account is now blocked. My post was something like this
Whoaaaa, you guys are really “underground” Are you servants of the state? Do you work for the NSA?
1209 North Orange Street in Wilmington, Delaware. According to one investigation, that address is home to 217,000 corporations .
Google it. The Vice President, whose home is in Delaware, does not want competition for the business of his home state. That’s why he has started this hype.
If he was worried about Mitt Romney, why did the president hire Jack Lew as Secretary of the Treasury?
http://www.washingtonpost.com/opinions/obamas-hypocrisy-on-jack-lew-and-his-cayman-investment/2013/02/11/4382c754-73e9-11e2-95e4-6148e45d7adb_story.html
The majority leader of the house (Senator Harry Reid fromNevada), he doesn’t want any competition, either
http://www.cnbc.com/id/46404372
Here is the profile of the man chosen to lead the US Treasury Department—a real clean guy?
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/18/AR2009011802070.html
Senator Ted Cruz has a written Limits On The Treaty Power published in Harvard Law Review
it can read or downloaded from http://reclaimourrepublic.wordpress.com/2014/01/12/sen-ted-cruz-limits-on-the-
treaty-power-published-in-harvard-law-review
or at http://www.volokh.com
his arguments might limit the ability and authority to implement IGA’s
@ northernstar
Judging from some of the comments at Democratic Underground, the only things “underground” are some DUers’ heads — completely buried in the sand, completely oblivious to the truth about CBT and FATCA. Some people will simply never get beyond the America is great, America is good, myth. And yes, @ le President, I believe you are right that DU is a SOS.
Wow, they removed my post and posting privileges! These people are insane. I wish I’d kept my post, as it was just telling them about CBT and our experience in entering the US tax system, in response to the accusation that we’re making this stuff up. I guess they don’t want to hear the truth. Underground is right – six feet would be just about right for that blog.
@ bubblebustin
I saw your comment before they removed it. I didn’t save it but it was exactly as you say. Incredibly intolerant place isn’t it — unless you are pounding someone who represents some degree of reality into the (under)ground using your trusty but rusty, American-made, highly exceptional hammer. Then the mod-bot says have at ’em.
P.C. bots. Fantastic! Try creating another Hotmail or gmail account. “underground” is their motto! And they have a “jury”