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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. Toronto’s pretty fast with booking as they generally make 176 to 208 appointments available per month. They’re currently taking bookings for February and March. Vancouver, btw, has sped things up since they did their overhaul in October — let’s hope they stick to it because they sure were dilatory, and inconsistent, in the past.

    So at this point it shouldn’t be a problem in Canada to get an appointment for 2014. But there may well be another sharp uptick in the already sharply-upticked demand, now that CBC has really been making people aware of FATCA this week!

  2. If you renounce first, how do apply for a SSN? Could an ITIN not then be used for the streamlined procedure?

  3. @WhatAmI, I don’t think so. If you’re eligible for an SSN, then you have to apply for one. Another reason to hope the IRS will come up with some sort of solution to the problem/

  7. http://www.serbinski.com/taxation-in-usa/ssn-and-itin.shtml

    Social Security Number

    For U.S. citizens and resident aliens, a valid Social Security Number (SSN) must be used. Persons who require a SSN must file form SS-5 with IRS to obtain a number. (Please note that applicants over 18 years of age applying for a SSN for the first time must attend in person and provide appropriate identification.)

    A child born abroad to a U.S. citizen qualifies for United States citizenship even if the child is a resident of a foreign country and if the other parent is not a U.S. citizen. A SSN is required for all children born before December 1996.

  9. I had to go to one of their SS “field” offices in a border state, just one of the many hoops to obtaining your SS number. I had to bring documentation to WA state to prove I had lived in Canada every year since I’d left the US (which they had very strict guidelines for).

  10. Nick Canada is supposed to sign a similar agreement to UK & France. Read these agreement so you know best to hide your US connection. Assume them as worse case. I think we are protected from USA tax collection if you were a Canadian citizen at the time. FBAR does not even apply for non Citizens.
    “The “current application” is, as Flaherty has said in writing to at least one MP and to several persons who have posted on this website, that Canada will NOT collect any taxes or penalties claimed by the IRS against anyone in Canada who was a Canadian citizen at the time these alleged liabilities were incurred. FLAHERTY HAS SPECIFICALLY STATED THIS APPLIES REGARDLESS OF WHETHER THE CANADIAN CITIZEN HOLDS DUAL US CITIZENSHIP. (For now, I’ll leave aside the issue of the US claiming you’re a dual citizen when you are certain in your own mind that you are NOT and that any such claim by the US is absurd.)”
    http://isaacbrocksociety.ca/2012/02/13/3200/
    on legal judgement
    Thus, a claim of a foreign state to collect taxes owed to it made directly or indirectly will not be recognized by the courts of this country.
    http://uniset.ca/other/cs6/68OR2d379.html

  12. I’ve also heard people mention an “exit tax”. What is this about? How can you be charged an exit tax when you are a Canadian citizen, have no assets in the U.S. and left the country over 20 years ago?

  14. It is. But the article is helpful in clearing that point up….my net worth and income aren’t anywhere near that.

  17. Re form 8854 5 years vs Streamlined’s 3 years. 8854 requires you to certify that you’re compliant with your tax *obligations* for the 5 previous tax years. It does *not* ask you to certify that you’ve filed tax returns for the previous 5 tax years. Consequently, a reasonable read of this would be that since Streamlined gets you fully tax compliant, you are indeed compliant with your tax obligations for the previous 5 years and thus do not need those additional 2 years of returns filed.

    Having said that. whether the IRS would agree with this interpretation is anyone’s guess, so the safe thing to do would be to make sure you have 5 years of returns on file, unless being designated a “covered expat” is of no real consequence to you. And BTW, if you’re a “covered expat”, your RRSP will be fully taxed as income as it’s not part of the $663K exclusion.

  18. @tdott, yes that’s the way I see it too. The scheme is too new to say whether the IRS will also view it like that though. I don’t plan to file any more after doing my 8854 and other bits this year, unless my tax preparer really thinks I should. But as I only need to file FBAR’s I don’t think he’ll recommend it as they’re already filed for 6 years so well past the 5 year mark by the time I finish.

  19. @Nick,

    In case it’s not perfectly clear:

    If your relinquishment is denied and you have to renounce, you are exempt from the exit tax no matter how much money you have because you were born a dual citizen and have been living in Canada. You still have to file 5 years of taxes (and 6 years of FBARs for the Streamlined Procedure).

  20. Fatca Compliance Monger for the FCC with helpful timelines…

    http://bakerlaw.com/articles/revised-guidelines-and-timelines-under-fatca#!

    Although the recent IRS Notice 2013-43 extended many of the FATCA deadlines, some commentators are calling for further extensions. However, IRS officials have stated that the deadlines will not be extended again. Given the highly technical and detailed nature of these rules, and the looming registration dates, all FFIs should seek the guidance of a qualified U.S. tax adviser well before the April 25, 2014 deadline to ensure registration and placement on the initial list of compliant FFIs that will be issued on June 2, 2014. There is much work to be done before April 25, 2014. Failure to get started now will put an FFI at serious risk of FATCA withholding on payments to be made to it by U.S. withholding agents and PFFIs after the June 30, 2014 effective date.

  22. @Mark Twain

    There’s no point in maiming it, that will do more harm than good. Are you predicting a full implosion?

  23. @ bubblebustin
    I agree. A maimed IRS could become even more insane and lash out at many more innocents who can’t afford or are afraid to fight back. The increased revenue for the US Treasury would ensure its continued existence and likely the reinstatement of its previous budget allotment.

  24. the wounded bear concept.

    It’s congress who has to reduce the scope of the IRS. But they are asleep.

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