Media and Blog Articles – part 2 of 11 (Year 2015)

1,837 thoughts on “Media and Blog Articles – part 2 of 11 (Year 2015)”

1. @Polly
   The EU is unusual in encouraging freedom of movement among EU countries; however, even in the EU there are occasional conflicts. For example, it is possible to end up with two countries trying to tax an estate of a deceased recent emigrant/immigrant.

   @Neill
   I take your point about these rules raising problems for people who move around. Governments increasingly rely on tax exempt accounts for health and pensions, but don’t take account of people whose careers span many countries or even those who go back and forth between two.

   In terms of the U.K., the big problem is that you might not be able to buy and sell funds in your pension because of the AIMD (I ran into this situation with a Fidelity IRA). Britain charges full income tax on foreign mutual funds and ETFs that do not have the right reporting status, but there are some U.S. ETFs that are o.k. to own.

   Has anyone said anything to you that makes you think that Britons generally dislike expats? I haven’t run across this. People who move to residential tax havens, like Monaco, or evade justice on the Costa del Crime are disliked, but generally not people who seek opportunities elsewhere. Everyone has relatives or friends who have emigrated.

2. @Polly,

   I don’t own individual stocks. Too costly in time and money etc to get diversification. I own tax efficient and low cost ETFs.

   @Publius,

   Over the years we have had politicians in the UK call us traitors. Recently they are talking about changing he rules to hit expats with property tax in the UK. I don’t have anything though. They have been talking about removing the personal exemption to hit us on taxes but I don’t have anything there either. I have seen mention of changing the state pension to limit what I can get (wouldn’t be much and I don’t care anyway).
   They changed all my private pensions to deny me the right to move my money out of the country until I am 55. They are attacking QROPs providers to stop me moving my money that way with taxes and penalties if the QROPS destinations don’t keep my money locked up.
   They are pushing to have anything foreign with an underpayment of tax to be automatically criminal.
   One major component of getting the US passport was to give me options if the UK continues.

3. @publius
   Does that happen when part of the estate is still in the former country of the deceased?
   I`ve really rolled everything back. Don`t own anything foreign and have basically remained in my own country`s currency. I get a bit of rental income. I consider myself retired and don`t want any sort of other hassles anymore. My US passport experience was enough of a shock.

4. An article not about trump but about data (un) security and FATCA

   #Muslim Countries Track Americans — So What about #Trump?

   https://bancdelasteroideb612.wordpress.com/2015/12/11/muslim-countries-track-us-citizens-so-what-about-trump/

5. Moodys Gartner Blog, December 11, 2015 – “US citizenship renunciation – inheritance tax proposal update”

   On Dec. 9, 2015, Roy Berg, Paul Barba, and Kevin Kirkpatrick submitted our firm’s comments to the IRS regarding the proposed regulations to section 2801 and will be providing oral comments to the IRS at a hearing in Washington, D.C., on Jan. 6, 2016.
   …

   from Moodys Gartner Tax Law LLP “Comments on IRS Proposed Regulations: Guidance Under § 2801 Regarding the Imposition of Tax on Certain Gifts and Bequests From Covered Expatriates (80 Fed. Reg. 54447, Reg–112997–10)”

   A. SUMMARY OF RECOMMENDATIONS

   In summary, we recommend the IRS:

   1. clarify the effective date on which an individual loses U.S. citizenship for tax purposes generally and, specifically, for individuals who naturalized in another country and those who were dual citizens at birth;

   2. remove the rebuttable presumption in Prop. Treas. Reg. § 28.2801-7(b)(2); and

   3. clarify the recipient-U.S. taxpayer’s record keeping requirements in Prop. Treas. Reg. § 28.6001-1.

6. Thanks for the post, banc de l’asteroide.

   Where are the human rights organizations upon tracking of US citizens by Muslim and other antagonistic countries? Where is the mainstream media? Where is the left and the right media? Who is covering this? Where are the rights protection groups such as ACLU?

   In summary, you’re right — Who cares about the tracking and reporting of Americans in any country?

   Under Executive Actions of the Obama administration, and with the approval and legislation of US Congress, US citizens are required to be identified and tracked by Muslim and nonfriendly countries. Who cares? Where is the Constitution? Where is the media?

7. http://www.forbes.com/sites/robertwood/2015/12/12/to-renounce-u-s-passport-get-in-line-or-just-dont-pay-your-taxes/?utm_source=followingimmediate&utm_medium=email&utm_campaign=20151212

8. Good — the ball is in their court to prove some *Accidental Americans* are indeed US citizens. Go ahead and revoke the US Passports never applied for for those of us who have no meaningful relationship to the US, have never lived in the US and have never had any benefit from the US. Hopefully, this can also be sort of a *work-around* for those who have been entrapped by the US with by *lack of requisite mental capacity* who are not allowed to renounce their unasked for, without their consent *ACQUIRED* US citizenships and neither can a parent, a guardian or a trustee act on their behalves, even with a court order.

   Please recognize, US legislators, how much better not to have to depend on ways to *work around* absurd US citizenship-based tax law when the rest of the world taxes based on residence.

9. Panton to tax evaders: Go someplace else

   http://www.cayman27.com.ky/2015/12/10/panton-to-tax-evaders-go-someplace-else

10. putting it into perspective. China’s approach to “accidentals”?

    http://m.huffpost.com/us/entry/56692ca3e4b080eddf570d99

11. @calgary411,

    You can bet your life that even if your passport is taken away you will still be owing and accruing taxes. You can bet your live you still have informational filling requirements. Just take a look at how the green card works for a hint.
    You have to jump through all their hoops.

12. Neill,

    I have my passport with the holes punched through it returned to me after my renunciation and with my CLN. As always, I speak on behalf of my Canadian-born son and his US-deemed *acquired* US citizenship that has never BEEN CLAIMED as there is NO CLAIM or CONSENT to that available to him — but there is entrapment for him into their US CBT.

    I tried to put it into context regarding my son and came up with the following circular reasoning, so this sort of (maybe) puts the ball back in the US court because nothing my son (or I on his behalf) could do would make any sense:

    The EXCEPTIONAL U.S. Absurdity of

    1)*NOT BEING ABLE TO GET A U.S. PASSPORT IF ONE BORN ABROAD DOES NOT HAVE A SSN*,

    2) *NOT BEING ABLE TO GET A U.S. SOCIAL SSN as USCs without a Social Security Number (and a Passport) Cannot Travel to the U.S.* and

    3) *NOT BEING ABLE TO RENOUNCE A U.S. CITIZENSHIP(acquired by birth abroad to U.S. Parent(s) (Unmeaningful & Totally without Consent) U.S. CITIZENSHIP BECAUSE OF *LACK OF REQUISITE MENTAL CAPACITY and a Parent, a Guardian or a Trustee unable to act on such a person’s behalf even with a Court Order* –

    with THE ONLY REASON ONE WOULD GET A U.S. PASSPORT OR U.S. SOCIAL SECURITY NUMBER, THE ABILITY TO BE ABLE TO RENOUNCE (which cannot be done because of *lack of requisite mental capacity*) REQUIREMENT

    with further requirement to BACKFILE IRS TAX and REPORTING (FINCEN114) FORMS in order to certify compliance on IRS FORM 8854

    to AVOID BEING DEEMED a U.S. *COVERED EXPATRIATE*

13. Paris … will be interesting to see how she handles matters:

    http://www.20min.ch/people/international/story/18638498

14. @Orwell
    Paris Hilton- the next case of “inversion”. Will America put lock on that too?
    She immediately gets a swiss passport if she marries a swiss man. Her boyfriend must be clearing her up on these issues.

15. @Neil, “You have to jump through all their hoops.”

    With all due respect for what may be a large subset of “US Citizens Abroad;”

    1. The USA like every other country remains a Foreign Country.
    2. These are Foreign laws.
    3. The person has sole/paramount/absolute allegience to some other Nation.

    When all is said and done, I think FATCA and IGAs will create a culture of US Compliance amongst “American Citizens Abroad” being those persons who keep a valid US Passport as either their sole or additional passport. But in regards to others….

16. @George,

    Other countries are bending over backwards to turn American persons in to the IRS as fast as they can.
    I hoped for some resistance but I haven’t seen any.

17. @Neil, “Other countries are bending over backwards to turn American persons in to the IRS as fast as they can.”

    How do you define “turning in?”

    There are no collection treaties that impact by way of example a French Citizen, resident in France, born in France who is a USC solely because of parentage.

    So what, a foreign government has data. Yes, I am repulsed by the idea but how does it impact a person?

    Do you know what this is looking like? Registration for the draft that started in 1980 under President carter. No one has been succesfully prosecuted because there are too many that refuse.

    Just read that young USC women will soon need to register, how many do you think will voluntarily register especially overseas?

    The penalty for failing to register is $250k and five years.

18. @Neil, look at our two plaintiffs Ginny and Gwen who thought long and hard about this.

    Lets assume, the court case wins in Canada which in the end I believe it will win. I say that because Arvey even took the case and the plaintiffs thought long and hard before signing on.

    If they win in Court, they does nothing to their position with respect to the USA.

    What is the USA going to do in regards to Ginny and Gwen? The best they are going to do is hold their breath until they turn blue like a smurf and refuse to issue a blue passport to them.

19. @Neill, do not get me wrong I fully agree that American Citizens Abroad meaning those that solely carry the blue book are absolutely screwed over. And yes, out of eight million they represent millions in their own right.

20. @calgary

    from Moodys Gartner Tax Law LLP “Comments on IRS Proposed Regulations: Guidance Under § 2801 Regarding the Imposition of Tax on Certain Gifts and Bequests From Covered Expatriates (80 Fed. Reg. 54447, Reg–112997–10)”

    A. SUMMARY OF RECOMMENDATIONS

    In summary, we recommend the IRS:

    1. clarify the effective date on which an individual loses U.S. citizenship for tax purposes generally and, specifically, for individuals who naturalized in another country and those who were dual citizens at birth;

    ….

    I am concerned by the details of how Moodys Gartner want to “clarify” the effective date for loss of citizenship:

    At first blush, the new rules for termination of tax citizenship under the HEART Act appear to apply prospectively. However, a close reading of the statute reveals that, for practical purposes, it applies retroactively as well. Under the HEART Act, the new rules for termination of tax citizenship are effective for individuals whose “expatriation date” is after June 17, 2008. The individual’s “expatriation date” is defined under § 877A(g)(3) as the date on which an individual “relinquishes” U.S. citizenship, and the individual “relinquishes” citizenship on the earlier of the date he or she gives notice to the Department of State (either by renouncing before a diplomatic or consular official, or submitting a statement confirming an expatriating act) or the issuance of a CLN.

    They follow this with an example of a person who relinquished quietly in 1962, and did not obtain a CLN before 2008. They state that under the HEART Act, that person is still a US Citizen (for tax purposes at least).

    Is this example meant to show how they wish the regs to read? Or is it meant to highlight the absurdity of the law as it is written? How can a person not be a citizen from 1962, then, magically, become a citizen again in 2008 because of a law in what is now, to him, a foreign country?

    Yes, I’ve read the “Time Machine” article (don’t have a link handy). I don’t see how Congress can change the status of someone who relinquished prior to 2008. I’m just concerned that these new regs might come down with the absurd conclusion that relinquishment at any time before 2008 without a CLN was magically undone by the HEART Act.

21. Karen,

    Most who became Canadian (and other country?) citizens decades ago were told / warned that we would lose our US citizenship. No one, or not many, knew anything about a CLN. No one, or not many, knew anything even about US CITIZENSHIP-based taxation — they did not learn about that in their US schooling. There was no full disclosure for any of us who today claim relinquishment by having become Canadian citizens back then — although that WAS our intent. It is apparent to me that the warning that we would lose US citizenship by becoming Canadian citizens did not stop me / us from becoming Canadian citizens so long ago!

    …Or is it meant to highlight the absurdity of the law as it is written? How can a person not be a citizen from 1962, then, magically, become a citizen again in 2008 because of a law in what is now, to him, a foreign country?

    To me, it is only one of the evidences of absurdity.

22. Karen they are pointing out the absurdity and at the same time asking for clarity. The advice in the sidebar under ‘ did you relinquish before Feb 1995 ( or June 2004) still applies

23. #Muslim Countries Track Americans — So What about #Trump?
    December 11, 2015
    https://bancdelasteroideb612.wordpress.com/2015/12/11/muslim-countries-track-us-citizens-so-what-about-trump/

24. @Calgary and @Karen

    With respect to the discussion about the Moody’s post starting at:

    http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments-part-2-of-2/comment-page-66/#comment-6948093

    Moodys Gartner Blog, December 11, 2015 – “US citizenship renunciation – inheritance tax proposal update”

    On Dec. 9, 2015, Roy Berg, Paul Barba, and Kevin Kirkpatrick submitted our firm’s comments to the IRS regarding the proposed regulations to section 2801 and will be providing oral comments to the IRS at a hearing in Washington, D.C., on Jan. 6, 2016.
    …

    from Moodys Gartner Tax Law LLP “Comments on IRS Proposed Regulations: Guidance Under § 2801 Regarding the Imposition of Tax on Certain Gifts and Bequests From Covered Expatriates (80 Fed. Reg. 54447, Reg–112997–10)”

    A. SUMMARY OF RECOMMENDATIONS

    In summary, we recommend the IRS:

    2. remove the rebuttable presumption in Prop. Treas. Reg. § 28.2801-7(b)(2); and

    3. clarify the recipient-U.S. taxpayer’s record keeping requirements in Prop. Treas. Reg. § 28.6001-1.

    Moody’s has a long history of arguing that the S. 877A rules ARE retroactive. See for example this post at:

    http://isaacbrocksociety.ca/2015/05/08/26-u-s-code-%C2%A7877a-the-exit-tax-rules-do-you-see-them-as-applying-prospectively-or-retrospectively-or-both/

    where Mr. Berg is quoted as saying:

    Under a literal interpretation of current law Mr. Maple Leaf’s U.S. citizenship is terminated for nationality purposes in 1981. However under HEART, termination of his U.S. citizenship for tax purposes is determined under section 7701(a)(50)(A), which sends us to section 877A(g)(4). Under section 877A(g)(4), Mr. Maple Leaf’s U.S. citizenship is lost on the earlier of: berg_2f930c9 1. The date in 2015 on which he submitted a statement that confirmed a prior expatriating act (i.e., becoming naturalized in and formally declaring allegiance to Canada); or 2. The date in 2016 on which his CLN was issued. Because his submission to the Department of State antedated the issuance of the CLN, his tax-citizenship terminated in 2015. Thus, Mr. Maple Leaf is liable for tax and reporting obligations from 1981 through 2015. Further, since Mr. Maple Leaf and the Department of State did not concurrently consider his U.S. citizenship to have terminated, he will not be relieved of tax obligations under D’Hotelle de Benitez Rexach or Revenue Ruling 92-109 until 2015.

    At the very least their submission to the IRS underscores their view that the S. 877A rules either do or can reasonably be construed to apply retroactively. Remember that S. 877A is an an Act of Congress. It is not something invented by the IRS. Therefore, I don’t understand how Moody’s can:

    On the one hand tell the IRS that S. 877A can (and possibly should) be construed to apply retroactively, but

    On the other hand tell them to not apply S. 877A in accordance with what they say the meaning of the statue is.

    These positions are inconsistent.

    Moody’s first recommendation is asking for clarification with respect to two groups:

    First, those who naturalized as Canadians; and

    Second, those who were born dual citizens.

    It seems to me that Treasury/IRS can issue regulations affecting the second group but NOT on the first group. So, it’s hard to see what Moody’s is up to. But, I am not sure (given their previous statements about the retroactivity of S. 877A) that it is good.

25. @George

    Re: Undocumented Chinese people

    What an odd symmetry with US Persons who are struggling to rid themselves of an unwanted US citizenship:

    “Two decades of struggles against intransigent courts and hired thugs have instilled Li with a blend of idealism and cynicism: perpetual hope that Chinese law holds the key to resolving her problem, and fear that the Chinese legal bureaucracy will forever find ways to reject her right to legally exist.”

    We, on the other hand, are fighting for our right to legally NOT exist (as US citizens), yet the “…blend of idealism and cynicism; perpetual hope…” is so painfully familiar.

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