Media and Blog Articles Open for Comments – Part 4 of 11 (Year 2017)
You can access all years at this link: Media and Blog Articles – Links for All Years
If clicking on a comment link brings you to the wrong comment, click here to get on the most recent page of comments.(alternatively, to reach the most recent comment page, go to the url in the bar at the top of your browser and delete everything after http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments-part-4-of-4)
Media and Blog Articles
EmBee suggested that it would be good if there was a thread for new articles, so that people would be aware of where to comment. So, I created this permanent page. I’ll make a permanent list of links posted here and keep adding to it, but not deleting, so we’ll end up having sort of a “bibliography” of FATCA/CBT articles. [Note: Some articles are not open for comments]
For more articles on FATCA, enter FATCA into Google then click on the link “more news for fatca” just below the most recent featured article.
Notes:
From JC: To see #FATCA on Twitter for latest breaking news. JC finds that is quite a good source and there even are some international articles that one may read using Google Translate. Others may help certain tweets and articles remain in elevated position by retweeting them.
From Badger: On an important archival note, please use the Internet Archive Wayback machine https://archive.org/web/ (see bottom right ‘Save Page Now’ box to enter URLs of webpages you want saved for posterity, and try to save backup copies of articles and other items of interest in some other form – such as a datastick or external drive. Some important and very significant webpages and the fulltexts of articles are no longer available (although some can be retrieved if someone using the Wayback machine saved them).
Be sure to read the comment stream for this thread — there are usually very recent articles mentioned there that aren’t on this list yet.
2017.12.28
It’s time to address the double standard about tax havens, Angela Wrights, Macleans, Canada.
The US Is Becoming the World’s New Tax Haven, The Editors, Bloomberg View, US.
2017.12.21
Rep. Dina Titus Supports Americans Abroad Tax Reform, Democrats Abroad, US.
Now That The GOP Tax Bill Is Approved, The IRS Gets Busy, Brian Naylor, NPR, US.
2017.12.20
Taxpayers will have to wait to find out how they fare under new legislation , Renae Merle and Aaron Gregg, Denver Post (reprint from Washington Post), US.
U.S. Shareholders –Take Action by December 31, KPMG.
2017.12.18
Have You Ever Felt Sorry for the I.R.S? Now Might Be the Time, Patricia Cohen, New York Times, US.
2017.12.12
EU finance ministers issue warning to Trump over tax reforms, RTÉ, Ireland.
2017.12.11
Banque: les consequences étonnantes de l’accord FATCA, Edouard Lederer, Les Echos, France.
2017.12.10
As Australia ousts MPs with dual citizenship, Canada’s Parliament embraces many in its ranks, Kathleen Harris, Canada. (mentions MP who “assumed his U.S. citizenship was automatically rescinded because he did not meet several requirements for continued citizenship. [But when travelling to Washington] was told he was ineligible to enter the U.S. on a Canadian passport because he was a U.S. citizen. He was . . . allowed in on a one-time basis . . . it cost him $3,000 to later sort out the administrative requirements.”)
2017.12.09
The American Diaspora: Outreach and Organization, Victoria Ferauge, The Franco-American Flophouse, Japan.
2017.12.08
Foreign-owned banks to be hit by US tax rules, Financial Times, UK.
Trump Tax Plan Worries Europe, Christian Reiermann, Der Spiegel, Germany.
For articles earlier in 2017, click here.
Hence the need for the IGA – to remove data protection rights from USPs and the US-born.
Iota: Huh? The IGA allows banks to communicate an unwitting (or unwilling) client’s data directly to the IRS? I thought it allowed only communication to local government, which would forward the data. I need to re-read this. It’s an important point, because if it is not allowed it’s high time we make the banks afraid of doing this to us.
From Belgian Gov:
It says that the banks send the FATCA info to the gov’t and the gov’t forwards it to the IRS.
My interpretation is that banks SHOULD NOT communicate directly to the IRS if they are covered by the local IGA.
This being Belgium, there is also a note saying that the portal used for transmitting information is currently closed, and that banks cannot for now submit anything.
https://finances.belgium.be/fr/E-services/fatca
Le 23 Avril 2014, la Belgique et les États-Unis ont signé un accord intergouvernemental (IGA) dans lequel le SPF Finances s’engage à communiquer les informations visées par FATCA à l’IRS.
La loi réglant la communication des renseignements relatifs aux comptes financiers, par les institutions financières belges et le SPF Finances, dans le cadre d’un échange automatique de renseignements au niveau international et à des fins fiscales obligera les institutions financières d’envoyer chaque année les renseignements visés par FATCA au SPF Finances via le portail MyMinfinPro au moyen de fichiers XML FATCA, comme déterminé dans l’accord entre le SPF Finances et Febelfin/Assuralia.
Le SPF Finances enverra à son tour ces informations à l’administration fiscale américaine (IRS).
—-
Le portail MyMinfinPro FATCA (production et simulation) est temporairement fermé afin de permettre l’implémentation des développements nécessaires liés au schéma XSD FATCA 2.0. L’application web EOI XML-tool pour la création des fichiers FATCA est également temporairement indisponible. Dès à présent, il n’est plus possible de soumettre un fichier FATCA ou une déclaration nihil pour les années 2014 et 2015. Lors de la réouverture du portail et de l’application web, nous publierons sur cette page une note explicative concernant les changements apportés. (18/11/2016)
@Fred(B): “Huh? The IGA allows banks to communicate an unwitting (or unwilling) client’s data directly to the IRS? I thought it allowed only communication to local government, which would forward the data.”
Not unwitting/unwilling clients – only those who waive their d.p. rights.
It’s not illegal in the UK for a FI to send an accountholder’s information to the IRS, provided the accountholder has agreed to waive his/her/its data protection rights. It would be illegal in the UK to send the information without the accountholder’s consent, because that would violate the accountholder’s data protection rights.
The IGA removes those data protection rights from USP’s and the US-born, in order to make it legal for FIs to report accounts to the IRS via HMRC without seeking the accountholder’s consent.
The Canadian records referred to in the article may have been sent to the IRS with the accountholders’ knowledge and consent. There’s nothing in the article that suggests otherwise, as far as I can see.
@iota
There’s one former MP who was “thrilled” with the privacy provisions provided by Canada’s FATCA IGA:
…”I shared your concerns about the U.S. Foreign Accounts Tax Compliance Act
(FATCA). I am thrilled to report that on February 5, 2014, Canada and the
United States signed an inter-governmental agreement under the longstanding
Canada-U.S. Tax Convention. This agreement brings a series of lengthy
negotiations to a conclusion which, I believe, will be of great benefit to
dual citizens and Americans living in Canada.”…
…”Under the agreement on February 5, financial institutions in Canada will
not report any information directly to the IRS. Rather, relevant
information on Canadian accounts held by U.S. residents and U.S. citizens
(including U.S. citizens who are residents or citizens of Canada) will be
reported to the Canada Revenue Agency (CRA). The CRA will then exchange the
information with the IRS through existing provisions and safeguards of the
Canada-U.S. Tax Convention. This is consistent with Canada’s privacy laws.”…
http://isaacbrocksociety.ca/2014/03/06/a-letter-from-john-weston-regarding-the-iga-we-need-to-educate-the-mps/
As you and others have pointed out, we need to know more about this data allegedly sent directly to the IRS outside the IGA, and whether those customers waived their privacy rights. My bank sent my banking information to the CRA because I signed a W-9, which states with regards to privacy,
“Privacy Act Notice
Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. commonwealths and possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to the payer. Certain penalties may also apply for providing false or fraudulent information.”
I was informed by Canada’s Revenue Minister that my Social Insurance Number had been redacted from my bank information slips before they were sent to the IRS. Again, we don’t know whose information was sent directly to the IRS.
@Unforgiven Too
Expats five times more likely to get audited by the IRS?
https://www.taxconnections.com/taxblog/2016-irs-data-book-shows-chances-of-being-audited/#.WQCxqJFfOhA
@Bubblebustin – “My bank sent my banking information to the CRA because I signed a W-9”
I was wondering about that. I believe investment companies in the UK generally want a W-9 from USPs. It may be that once they’ve got that, they’re effectively covered, d.p.-wise, for reporting the accountholder’s information direct to the IRS. I’m not sure.
On a related note – apparently, according to a forum post I saw today ( http://talk.uk-yankee.com/index.php?topic=90309.msg1169444#msg1169444) some investment companies in the UK rely on a different definition of “US Person” when deciding whether or not to allow a USC to open a particular type of account.
@iota
Used to be W-9’s were just kept on file by the bank. FATCA changed all that.
Refusal by a non-US person to fill out a US form verifying his/her non-US status can result in a being denied banking services:
“Most non-US financial institutions are using the Form W-8BEN to identify and document their non-US account holders. US account holders must fill out Form W-9 certifying that they are US persons and thus indicating their US status to the institution. Generally, once the institution obtains a Form W-8BEN from its customer (along with meeting other due diligence requirements) the institution knows it does not have to report information about that particular customer’s account pursuant to FATCA. Information about accounts of US persons held at a foreign institution must be turned over to the IRS (whether directly, when the institution is a participating FFI or indirectly, through its own local government agency that has signed a so-called “intergovernmental agreement”, or IGA, with the US under which the foreign government agrees to forward the information on to the IRS). Read more about how FATCA has developed and grown here. Generally, FFIs must report account numbers, balances, names, addresses, and US taxpayer identification numbers. When the account holder is a foreign entity, the institution must report the name, address, and US taxpayer identification number of each “substantial” US owner of the entity (an owner with at least 10%).
Consequences of Failing to Fill Out the Form W-8 BEN / W-9
In a nutshell, failing to fill out the form for your financial institution can result in negative consequences. Don’t ignore your financial institution’s request to fill out the required paperwork. Individual account holders (both US and foreign) that do not document their status may be denied opening an account with the institution. IRS has recently clarified that foreign financial institutions following the mandates of an IGA applying the due diligence procedures in section III, paragraph B, of Annex I of the IGA simply cannot open an account without the required certification of status. See FAQ 10 ”
http://blogs.angloinfo.com/us-tax/2015/03/09/3023/
“Why Record Numbers of Americans are Renouncing Their Citizenship”, by Adam N Michel. Good intro article, links to William Byrnes’ paper & Stu Haugen’s NYT op-ed from a couple of years ago.
Newer repost (uses Disqus comments): https://nationalinterest.org/blog/the-buzz/why-record-numbers-americans-are-renouncing-their-20343
Original source (uses Facebook comments): http://dailysignal.com/2017/04/24/why-record-numbers-of-americans-are-renouncing-their-citizenship/
Author is on Twitter
https://twitter.com/adamnmichel
The hell with that. Who wants to open an account with an institution that requires a non-US-citizen to sign a foreign country’s penalty-of-perjury tax form!
I’ve opened one new account since renouncing. They wanted to see my passport and CLN, which I expected. They didn’t try to make me sign a W8-BEN form. I would have refused. I annotated the form I signed to state in my own handwriting that I was tax-resident only in the UK and that I understood that the bank would not be sharing my financial information with any foreign government. They weren’t bothered – didn’t even read it I expect.
For USCs, though, since a W9 containing a d.p. waiver is automatically required by IGA-participating banks, perhaps they’re all from non-participating FIs, as the IRS person seemed to be suggesting.
Actually, they were far more anxious about CDOT than FATCA.
@Patricia Moon
It was “tongue-in-cheek”, but not funning.
What I see in this is the confusion of terminology resulting from organizations being treated as people for certain purposes, that leads to corporations suddenly having citizenship, human and constitutional rights, etc.
The analogies are there (I came up with the same parallels myself but left them out), but in the end citizenship is not residency.
The mixing of corporation / human terminology always ends up being used as a Homelander argument for CBT. See all the Homelander comment discussions that have been going on. How will they ever understand what is wrong about CBT, if they never figure out the difference between a human person and a company “person for specific purposes”.
Companies are not humans, therefore do not have citizenship with the rights that (should come with it), constitutional rights, or human rights (their owners may, however, but that is different).
Actually, they have it better because they can just move out, but us humans are still owned.
What really bothered me was that some tax professional wrote this and even he mixes it up.
@iota: “… a different definition of “US Person” …”
The 1933 securities act’s definition of a ‘US person’ is used to determine whether or not a non-US fund can be offered or sold to such a person. This definition differs from the one we’re used to for FATCA and other US tax purposes in that it does not including US citizenship as one of its criteria. Quintessential US lack of tax logic, then. (And if a UK bank or FI is really using this as their definition of US person for FATCA, they’re doing it wrong.)
So… a US person — under the normal definition — resident in the UK may or may not be able to open an account at a UK institution, but if they are able to, then they don’t run into further restriction if choosing to invest in UK or EU mutual funds.
Of course, unless using a pension fund they then have PFIC rules to contend with down the road, and these will leave them envying the dead, so in actual fact they’d very probably have been better off if the Securities Act of 1933 did include US citizen and so prevent them stepping on that landmine.
In practice, though, the difference here does allow US citizens living in the UK to buy normal UK or EU funds inside SIPPs etc without falling foul of US tax restrictions. Otherwise their choices would be extremely limited (and in the case of the funds offered by the olde-worlde life insurance company personal pensions such as Aviva, Friends Life and so on, probably non-existent).
@UnforgivenToo: FWIW, three reinsurance companies have shown up in the Federal Register list
http://www.taxmonger.com/2016/09/07/escape-hatch-expatriation-3/
I wonder whether all the corporate officers had to show up in person at the embassy, or just the board chair, or what =)
@Watcher – no, not for FATCA. As I said, for determining whether to open an account or not. But worth USCs being aware of.
@Eric
Exactly. But it goes farther:
http://www.econexus.info/publication/corporations-are-not-human-so-why-should-they-have-human-rights
I recently changed banks because the one I was at wanted a W8-BEN.
The German implementation of the IGA allows banks to use the W-forms but does not require them. The bank I went to has the required question as part of the application for an account (in German, without penalty-of-perjury phrase, without waiver of privacy rights).
BTW: they do not have to ask about citizenship directly. The question is about being subject to another tax jurisdiction other than Germany.
Hey, if you “honestly” don’t know that the US considers you taxable, why not “honestly” say no?
@Unforgiven Too – do they ask new customers for place of birth?
They want to see an ID, and they want the address of your residence. If the ID only has a city, then ok, otherwise I guess it won’t work.
There are banks that ask, but the question is not required by law.
Could be mistaken on some details, but that’s what I remember when I was opening the account. Will check all the details and post when I’m back from vacation.
When I checked with the bank if they used W-forms or just their own before applying, they had no idea what I was talking about. Later I gave them my CLN without them asking because I definitely did not want them to ask later, they had no idea what to do with it, so I just told them to just put it in my file anyway, one never knows.
Sorry, one more in a row.
I got it: they asked the questions in a “if yes, then” form.
If you answered yes to the “subject to another jurisdiction” then you were asked which and if one was the US then they wanted your citizenship/SSN/TIN. However, if you answered “no” to the first one then you didn’t have to fill out the others.
On purpose, maybe?
http://www.yahoo.com/finance/news/trump-unveil-plan-biggest-tax-134109664.h
Not a word on FATCA
https://youtu.be/eHjTEsWI2ao
Thanks Unforgiven Too, that’s interesting.
Sounds like their procedures are naturally oriented more towards CRS than FATCA.