Media and Blog Articles Open for Comments – Part 4 of 11 (Year 2017)

1,720 thoughts on “Media and Blog Articles Open for Comments – Part 4 of 11 (Year 2017)”

1. Bolivia proposes new law against tax havens

   http://www.internationalinvestment.net/regions/bolivia-proposes-new-law-tax-havens/

   “Bolivia’s lawmakers have draw up fresh legislation they say is aimed at targeting tax evasion. ”

   “That said, neither Bolivia nor Ecuador has yet signed up to participate in the CRS, according to the most-recently published list of countries that have agreed to.
   Another non-signatory is the United States, although it says it is not participating because it has its own information-exchange agreement, FATCA, which it implemented in 2012.”

2. @ badger
   Seriously … Equifax!!! The sound you hear is my palm slapping my forehead … very fast, very hard.
   Here’s another article:
   http://www.politico.com/story/2017/10/03/equifax-irs-fraud-protection-contract-243419

3. @Embee, I can’t hear your palm, cause of the sound and fury of my own….

   If I was a US taxpayer, I’d be furious at the way the IRS intends to misspend on that contract with Equifax ( bid not open for competition either), and at the way that it compromises the personal and financial data of those it demands information from.

   It beggars belief that our CRA pretends that our domestic data is safe despite the Patriot Act, Homeland Security, and now, putting Equifax in charge of securing data for the IRS.

   If one wasn’t convinced by all the other reasons why ‘all roads lead to renunciation’ for those who can take that path, this is another reason to make sure vestigial US citizenship ties are severed.

   The articles are open for comment, so those who wish to can insert FATCA references, and connect the dots. And I think I remember from Lynne and Victoria’s article ( http://thehill.com/blogs/congress-blog/foreign-policy/313775-fatca-simple-premise-gone-terribly-wrong ) that The Hill (and Politico) get Washington political types as readers.

4. Not directly FATCA related, and not an opportunity for comment, but for those who are interested in her work, Prof. Allison Christians has a new journal article, and it does mention US extraterritorial CBT and US exceptionality and Eritrea’s, though that is not the main theme.

   Christians, Allison, Buying in: Residence and Citizenship by Investment (September 26, 2017). St. Louis University Law Journal, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3043325

5. “FATCA? Who Cares? Information CHAOS at the IRS”

   “…on September 26 the IRS advised (https://content.govdelivery.com/accounts/USIRS/bulletins/1b981ce#First) hat it has a VERY high volume of files coming in, impeding its ability to send out File Status Notifications which will take longer than usual to be sent.”

   https://www.angloinfo.com/blogs/global/us-tax/fatca-information-chaos-at-the-irs/

   Love that upper-case “VERY.” Let’s hope they drown in their own mess.

6. The National Law Review comments, in response to the TIGTA report:

   “The amount of information exchanged among tax administrations will dramatically increase again with the imminent implementation of country-by-country reporting. It will be interesting to see how the government manages that increase.”

   https://www.natlawreview.com/article/irs-underutilizing-exchange-information-capabilities

7. More on anti-FATCA pushback in France where a legal application (“….In its application, filed Monday at the Council of State and which AFP was able to consult, the association of Americans accidental asks for the “cancellation” of the decree which allowed the creation by the Directorate General of Public Finance , of the “automatic processing of automatic exchange of information called + EAI +”….” ) was just filed this week;

   See;
   ‘A group of Franco-Americans appeals against the Fatca’
   http://www.notretemps.com/argent/un-collectif-de-franco-americains-afp-201710,i151862
   Use the ‘translate’ feature next to the link for English.

8. @ plaxy
   RE: that angloinfo.com article
   How does an unreciprocated extortion of information by the IRS from foreign tax agencies and financial institutions become an “exchange”? The US refuses to return identical information to the foreign countries it has hammered with FATCA reporting. The US created this $hit so I do not weep that the IRS is in a state of chaos trying to deal with it. Like you (unlike Virginia), I hope they continue to drown in data. And if the new Crime Chief ever does manage to get his data mining machinery in place I hope some helpful person throws a spanner into it.

9. Very satisfying, isn’t it? Poetic justice…

   “if the new Crime Chief ever does manage to get his data mining machinery in place I hope some helpful person throws a spanner into it.”

   It sounds like the spanner is already in place and doing its duty.

10. Thanks @plaxy. The Jeker commentary and that TIGTA report is well worth reading.

11. …and well worth passing on to Congressman Posey, whose office now has a request into the IRS as to what exactly it is doing with the FATCA info.

12. Thanks plaxy!

13. Global reporting rules threaten to impose huge penalties on our banks
    Robert Gotliebson
    7:47AM October 5, 2017

    http://www.theaustralian.com.au/business/opinion/robert-gottliebsen/global-reporting-rules-threaten-to-impose-huge-penalties-on-our-banks/news-story/029f7579dfe8e64825e065932a64e420

    Skirting Paywall: enter this into a browser: Global reporting rules threaten to impose huge penalties on our banks.

14. @bubblebustin, this is also very valuable in terms of the imaginary numbers that have brought us FATCA without any robust proof, and without any cost benefit analysis;
    http://kluwertaxblog.com/2017/04/18/15527/
    Is FATCA ‘Much Ado About Nothing’? Is FATCA’s Tax Revenue Going to Offset Its IRS and Industry Costs?
    William Byrnes (Texas A&M University Law)/April 18, 2017

    “…Also, see William Byrnes’ Guide to FATCA & CRS Compliance (Matthew Bender 5th ed., 2017) at pp. 30, 33-34, 50, 59, 109-112, and 119-122. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2926119“…….
    https://dx.doi.org/

15. Thanks for ferreting that out, badger.

    I still don’t understand how the NTA figures expats are better at US tax compliance than homelanders when so few of us file and report. From the Posey letter:

    “This is despite the fact that the IRS’s own Taxpayer Advocate Service reports that “the vast majority” of Americans residing abroad “actually appear to be substantially more compliant than a comparable portion of the overall U.S. taxpayer population.”

    http://isaacbrocksociety.ca/2017/09/29/congressman-bill-posey-asks-secy-mnuchin-to-deal-with-fatca/comment-page-1/#comments

    Anyone have any idea what she’s basing this on?

16. I haven’t seen this posted here, so once again I’m copying from Facebook. Democrats Abroad’s letter to the SFC on International Taxation:

    http://www.democratsabroad.org/da_letter_for_senate_finance_commitee_hearing_october_2017

17. Bubblebustin:

    “I still don’t understand how the NTA figures expats are better at US tax compliance than homelanders when so few of us file and report…

    Anyone have any idea what she’s basing this on?”

    Good question. IRS statistics?

    IRS “tax gap” estimates seem to be based on estimated tax collected as a percentage of estimated tax due (from one tax band or another). Estimates of tax due from expats may be very low because of FEIE and foreign tax credits. And a large hunk of what’s expected and what’s collected is likely to be withheld tax on US source income – a category for which “compliance” is probably very high.

    Maybe the IRS considers it prudent to present statistics in a way that minimizes the “tax gap” in general and the absolutely colossal “tax gap” for US citizens living outside the US. Lies, damned lies, and statistics.

18. @bubblebustin, and @plaxy, I think I read that the numbers expressed by the NTA might be as the percentage (80%?) of those who did actually file from abroad but who did not actually owe any US taxes (would have to find the source, but it is probably cited more than once in one of her annual Reports to Congress or priority reports from the past 6 – 8 years) – can’t find it right now)? So, most of those who did try to comply did not owe the US anything. Which is perhaps primarily because of the FEIE and foreign tax credits. Most of us are probably paying more in local income taxes, and most would likely not be millionaires (and that is not even considering that many are paying locally in types of taxes that the US won’t recognize or give credit for, as well penalizing those who file separate married in order not to drag non-US spouses into the quicksand). The numbers might also reflect that those who file are a self selecting group. The TAS doesn’t highlight this, but would be well aware that also some of the most egregious US extraterritorial tax assessed comes from double taxation and mismatch between our local systems and the US one as applied to those ‘abroad’. And then there are those confiscatory penalties used in lieu of the zero US tax owed ….

    Recently, statements such as this (and the following table) have appeared;
    “… The Consequences of FATCA Continue to Fall Heavily on Honest Taxpayers
    In her 2013 report, the National Taxpayer Advocate also observed that based on analysis of the data then
    available “… to this point, the IRS is imposing additional reporting burdens and increased potential
    penalties primarily on a category of taxpayers that, under principles of quality tax administration, should
    be encouraged, rather than penalized .”
    14
    Further review of updated and expanded data from FY 2010
    through the present continues to demonstrate the weight of FATCA is being felt not by tax evaders, but
    by U .S . taxpayers who likely would be compliant regardless . U .S . taxpayers under the FATCA umbrella
    who must file Form 8938,
    Statement of Foreign Financial Assets
    , are generally at least as compliant as the
    overall U .S . taxpayer population . This comparison is shown in the following table:…..”
    pg 49-50 https://taxpayeradvocate.irs.gov/Media/Default/Documents/2016-JRC/Area_of_Focus_4_Implementation_of_FATCA.pdf

19. Found this secondary source https://adcsovereignty.files.wordpress.com/2015/01/acafinalsubrbtmarch2013.pdf , an ACA position paper to the Ways and Means Committee, citing the NTA;
    “….5 http://www.taxpayeradvocate.irs.gov/userfiles/file/Full-Report/Most-Serious-Problems-International-Taxpayer-Issues.pdf
    The National Taxpayer Advocate 2012 Annual Report to Congress cites the 2012 WIRA Research Study 23-24 as its source.
    Further perspective on why 82% of Americans abroad do not have a U.S. tax liability comes from the National Taxpayer
    Advocate 2011 Report to Congress: (http://www.irs.gov/uac/National-Taxpayer-Advocate's-2011-Annual-Report-to-Congress).
    It reported that in tax year 2009, “After the application of the Foreign Tax Credit, only about nine per cent of these taxpayers
    had a U.S. tax liability.”, p.155. Since the passage of TIPRA legislation in 2006, many Americans abroad no longer use the
    Foreign Earned Income Exclusion because any non-excluded income is taxed at the marginal rate that would have applied if
    there had been no exclusion (exclusion with progression). This change is not reflected in the 2006 statistics. IRS statistics on
    international taxes are produced every five years; the 2011 statistics are not yet available. However, about 10% of Americans
    abroad reside in countries with tax systems that are radically different from the U.S. in that their tax revenue is generated
    primarily or exclusively, not from taxes on income, but from very high consumption or other indirect taxes, which are neither
    deductible nor creditable against the U.S. tax liability. Americans in these low income tax countries cannot benefit from foreign
    tax credits; they apply the foreign earned income exclusion and any income earned over the foreign earned income exclusion is
    subject to U.S. taxation. (The foreign earned income exclusion, which was $95,100 in 2012, would exceed $250,000 if it had
    been adjusted for inflation since introduced in 1962.) Hence, 58% of filers of Form 2555 have no U.S. tax liability, based on IRS
    Form 2555 statistics for 2006, the latest available. (http://www.irs.gov/taxstats/indtaxstats/article/0,,id=132037,00.html). One
    reason why proportionally more taxpayers filing Form 2555 owe U.S. taxes than those filing Form 1116 is because of the low
    cap on the amount of foreign earned income exclusion which does not correspond to economic reality.
    ….”
    from;
    ‘Residence-Based Taxation: A Necessary and Urgent Tax Reform Working Paper, updated March 2013, submitted to the International Tax Reform Working Group of the Ways and Means Committee ‘

    See also other stats and sources cited by the ACA

20. The statement “One reason why proportionally more taxpayers filing Form 2555 owe U.S. taxes than those filing Form 1116 .. ” makes it sound a return would never include both. You have both if you file a 2555 for earned income up to the limit, and a 1116 for passive income like interest, dividends and capital gain and for the excess of earned income above the FEIE limit if any. Laid off after 28-years I got a C$ severance payout total above the FEIE limit, but that year was still a zero US tax year, after I opted to treat my spouse as a US person and file jointly with both 2555 and 1116 forms. I doubt that using only a 1116 for all income to avoid the marginal progression tax rate would have helped, because a chunk of the payout was a non-taxable RRSP-type allowance, i.e. no Canadian taxes to go on the 1116. I am so glad I don’t have to deal with this anymore.

21. RO hitched RBT to the territorial cart. While the thinking was this may help…

    http://thehill.com/policy/finance/353457-groups-urge-congress-to-oppose-incredibly-bad-idea-in-gop-tax-plan

22. The letter and a full list of signatories:
    https://thefactcoalition.org/wp-content/uploads/2017/10/Letter-to-Congress-Opposing-Territorial-Tax-System-for-Circulation-100.pdf

    Interestingly, back in June this FACT Coalition responded to Mark Meadows’ request and “sent a letter to the Committee on Oversight and Government Reform with three recommendations to improve the implementation of the Foreign Account Tax Compliance Act (FATCA).

    https://thefactcoalition.org/letter-to-the-committee-on-oversight-and-government-reform-with-recommendations-to-improve-the-foreign-account-tax-compliance-act-fatca?utm_medium=policy-analysis/letters-to-congress

23. From Buzzfeed today:

    US Intelligence Unit Accused Of Illegally Spying On Americans’ Financial Records:
    The Treasury Department’s Office of Intelligence and Analysis has been illegally rifling through and filing away the private financial records of US citizens, Treasury employees alleged. “This is such an invasion of privacy,” said one official.

    https://www.buzzfeed.com/jasonleopold/us-intelligence-unit-accused-of-illegally-spying-on?utm_term=.gggbV7KR54#.pq18Odjn0G

24. ACA: Tax Reform Should Tackle The Worldwide Tax System
    GUEST POST WRITTEN BY Marylouise Serrato
    OCT 6, 2017
    https://www.forbes.com/sites/kellyphillipserb/2017/10/06/aca-tax-reform-should-tackle-the-worldwide-tax-system/#4a59fa946601

25. Serrato has always written excellent articles on FATCA and CBT/RBT. Let us just hope that the tax reform she describes actually happens.

Comments are closed.