Media and Blog Articles – Part 1 of 11 (to 26 May 2015)

3,971 thoughts on “Media and Blog Articles – Part 1 of 11 (to 26 May 2015)”

1. @Kartoffel

   You have got to be kidding. Now is the time to get rid of the US passport, not to renew it. Unless of course you are a glutton for punishment.

2. the best SCOTUS reversing a previous decision that resembles our situation Plessy v Ferguson reversed by
   Brown v Board of Education

   1. passage of time 90 years
   2. substantial change is US law which now allows dual-citizenship
   3. Admission by the US that it can not protect all of its citizens abroad, as written in US passports

3. Looks like the moderator just woke up on Tax Connections. There are 23 comments up now.
   http://taxconnections.com/taxblog/are-the-psychological-benefits-of-u-s-citizenship-an-adequate-justification-for-the-worldwide-taxation-of-nonresident-u-s-citizens/#.VLCoMks5ApF

4. We nice article. I assume this is from the bitcoin crowd.

   http://cointelegraph.com/news/113280/when-banks-become-law-enforcers-op

5. @ calgary411
   You will be interested in the comment made by ExUS (January 11, 2015 at 9:56 am) on the Tax Connections article. It begins …

   For those the US deems legally incompetent to understand the concept of citizenship, and thus too incompetent to understand renunciation/relinquishment of it, there are no ‘psychological’ or other intangible benefits:

   The US prevents them from EVER renouncing or relinquishing for life if the underlying condition is chronic and permanent (ex. mental, psychological, intellectual or physical states which cause substantial lack of understanding sufficient to be considered legally ‘competent’ – ex. brain injury, developmental delays). And prevents minors from doing the same for years until age of majority (rarely earlier unless the minor can prove their understanding to stringent consular judgement) – on the basis of being not mature enough to appreciate the consequences.

   Adult parents and legal guardians are prevented by US law from relinquishing/renouncing their children or ward’s US citizenship status on their behalf.

   So, why is it that US extraterritorial citizenship-based taxation does not then exclude those deemed legally incompetent (by US laws) of the burdens of taxation predicated on the very status (citizenship) which it also FORCES them to retain (many for life) – because it states that they are incompetent to understand the status, and to form a decision to retain or renounce it?

6. Thanks for pointing this out, EmBee.

   Yes, why is that?????? Stephen, would you be able to ask on behalf of ‘such persons without requisite mental capacity’ to anyone you deal with, including our lawyers? My family will not be the only one so affected. I will ask the Senate Finance Committee that question.

7. Foreign Account Tax Compliance Act leads Mutual Funds to avoid fresh investments from US investors

   “…have even barred investment from residents of US and Canada for some of their schemes” Canadians grouped in with US persons barred from accounts in India?

   http://economictimes.indiatimes.com/mf/mf-news/foreign-account-tax-compliance-act-leads-mutual-funds-to-avoid-fresh-investments-from-us-investors/articleshow/45840717.cms

8. @JC

   Re Canadians barred from Indian investments, please read the conversation thread beginning here with Neill’s post…

   http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments/comment-page-48/#comment-2891107

   …and ending with Eric’s assessment of the situation:

   http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments/comment-page-49/#comment-2893148

   I wrote to the Financial Express article’s author, Ashley Coutino asking for clarification, but never heard back from her.

9. @Calgary411, you may have had a thought along these lines. In particular I am thinking about a non-US born person who became a USC by parentage who is disabled.

   IF such a person lacks the mental ability to renounce or relinquish, can such a person “become a US Citizen or affirm their US Citizenship?”

   Hmmm, can a mentally disabled person naturalise as a US Citizen?

   If a mentally disabled person can naturalise as a US Citizen can they then subsequently said US Citizenship??????

   Shazam, I think that is the key…………

   IF a mentally disabled person can become a USC by naturalisation then it makes sense constitutionally that same person in the same situation can then undo or relinquish their US Citizenship.

   To say that a mentally disabled person can in fact naturalise and become a USC but can not subsequently renounce or relinquish same then the law and reasoning is flawed!!

   Now I am guessing that a mentally disabled person would need a person to “speak for them” and act on their behalf for a naturalisation application. IF a guardian/trustee can act on a naturalisation for a mentally disabled person to become a USC then it makes equal sense for a guardian/trustee to undo same.

10. http://www.taxconnections.com/taxblog/are-the-psychological-benefits-of-u-s-citizenship-an-adequate-justification-for-the-worldwide-taxation-of-nonresident-u-s-citizens/#comment-12600 is the best description and asking of pertinent questions regarding a US-defined US citizenship for a person who lacks ‘requisite mental capacity’. You, George, present the other view of common sense on this issue. It is quite circular and contradictory for things to be allowed for naturalization that are not allowed for renunciation. No one, no one, should be entrapped!

    IF a guardian/trustee can act on a naturalisation for a mentally disabled person to become a USC then it makes equal sense for a guardian/trustee to undo same.

    contrary to what I have been told by Department of State, Legal and similar advice by a Washington, DC immigration / nationality lawyer:

    Here is the advice I got from US Department of State, Legal: http://isaacbrocksociety.ca/2014/06/01/its-time/comment-page-72/#comment-3097016

    From: Kavaler, Howard
    Sent: Wednesday, May 07, 2014 9:55 AM
    To: caroltapanila
    Subject: RE: Question re US Citizenship never registered with the US
    Ms. Tapanila:
    If your son was born in Canada to two U.S. citizens, at least one of whom had a residence in the United States prior to his birth, your son is a U.S. citizen pursuant to Section 301(c) of the Immigration and Nationality Act. Your understanding of U.S. citizenship law is absolutely correct. U.S. citizenship is a status that is personal to the U.S. citizen and may not be renounced by a parent or a legal guardian. If your son seeks to renounce his citizenship, it will be incumbent upon him to demonstrate that (a) his action in renouncing his U.S. citizenship is the product of his own free will and (b) that he fully understands the consequences attendant to the relinquishment of his U.S. citizenship.

    …which agrees with the information from an immigration / nationality lawyer in Washington, DC, to confirm this son’s US status and give possibilities for his renunciation. The result was that her children were US citizens from the moment of their births. The following is information from that lawyer based on his conversations with the US Department of State: DOS persons have “sympathy” for such cases. However, the developmentally disabled person will have to have FULL understanding of what he’s doing; if any question of lack of comprehension and grasping meaning and importance of ramifications, they could NOT approve such a case. From DOS point of view, US citizenship is precious and they have therefore established fundamental requirements for “compelling reason”. Even though there is the risk that a person’s financial resources could run out before his/her life was over, they will never approve a renunciation for financial / economic reasons. DOS has NEVER had such a renunciation case approved due to “compelling circumstances”. Ms. Tapanila could sue but persons he talked with at DOS are SURE no one would ever win such a case as the courts view the discretionary action that DOS has would take precedence.

    ExUS
    January 11, 2015 at 9:56 am

    For those the US deems legally incompetent to understand the concept of citizenship, and thus too incompetent to understand renunciation/relinquishment of it, there are no ‘psychological’ or other intangible benefits:

    The US prevents them from EVER renouncing or relinquishing for life if the underlying condition is chronic and permanent (ex. mental, psychological, intellectual or physical states which cause substantial lack of understanding sufficient to be considered legally ‘competent’ – ex. brain injury, developmental delays). And prevents minors from doing the same for years until age of majority (rarely earlier unless the minor can prove their understanding to stringent consular judgement) – on the basis of being not mature enough to appreciate the consequences.

    Adult parents and legal guardians are prevented by US law from relinquishing/renouncing their children or ward’s US citizenship status on their behalf.

    So, why is it that US extraterritorial citizenship-based taxation does not then exclude those deemed legally incompetent (by US laws) of the burdens of taxation predicated on the very status (citizenship) which it also FORCES them to retain (many for life) – because it states that they are incompetent to understand the status, and to form a decision to retain or renounce it?

    The FBAR online instructions state that children (deemed ‘US taxable persons’) should complete and submit THEIR OWN FBAR themselves – an absurd and offensive instruction to impose on a minor whom US law states is legally incompetent/immature. It is completely unacceptable that the US should instruct children that their local legal birthday and education savings accounts are reportable (and PENALIZABLE) to an agency called “FINANCIAL CRIMES ENFORCEMENT NETWORK” merely because they are outside the US, and have either a US parent, or a US birthplace. This would apply to those adults deemed incompetent as well.

    The FBAR treats ourselves and our children and wards as criminals.

    Where is the presumption of innocence before guilt?

    And how can the US government and US law maintain the fiction that minors and those deemed legally incompetent due to immaturity or physical/psychological/mental/intellectual conditions are incompetent to understand the ‘benefits’ of US citizenship, yet are competent enough to be mandated to file their own FBARs, and to be US taxpayers?

    The US taxes and penalizes the education and disability savings and grants of our children and dependents outside the US – despite giving tax preferred or deferred status to the US equivalent accounts.
    
    The US deprives our children and dependents who are deemed to be US citizen-taxpayers ‘abroad’ of the benefits it extends to ALL US residents (whether citizens or not).

    There are no psychological benefits or other similar intangible benefits for those who the US deems legally incompetent to understand US citizenship.

    Whereas there are substantial burdens and costs and potentially bankrupting penalties the US imposes on even minors and the legally incompetent – as well as their parents and legal guardians – who may themselves NOT BE US citizens or ‘US taxable persons’.

    Obviously, everyday there are many people born around the globe – outside the US – who may have had one or more US citizen parent, and who have NO other US connection or relationship, who will never set foot in the US, are citizens of the non-US country where they were born, and who may never know that the US considers them ‘US taxable citizens’.

    That does not even cover the situation faced by those who happen to have been born in the US to non-US parents who are there on a short or temporary basis – to students, visitors, etc. Or, who were sent across the Canada-US border to a US hospital on an emergency basis. Their parents are NOT US citizens and did NOT seek US status for their children. In those cases, the US forces citizenship twinned with lifelong US taxable status on them.
    January 2015

11. @ George,

    Re: ” IF such a person lacks the mental ability to renounce or relinquish, can such a person “become a US Citizen or affirm their US Citizenship?”

    That’s a really good question. I got curious and I found this government brochure ( “A Guide to Naturalization,” US Citizenship and Immigration Services) that indicates they are willing to make some accommodation for persons with a developmental disability seeking to acquire US citizenship.

    “USCIS can waive the Oath of Allegiance when it is shown that the person’s physical or developmental disability, or mental impairments, makes them unable to understand, or to communicate an understanding of, the meaning of the oath. See 8 USC 337. “

    This is from page 39. The topic of acquiring US citizenship if you are disabled is also mentioned on a few other pages of this booklet, including pages 11 and 27 — sorry I can’t be more specific –I’m on my coffee break at work, so could only take a quick look.

12. Blatant lie in the IRS news wire IR-2015-01:

    Where a jurisdiction has a reciprocal IGA and the jurisdiction has the necessary safeguards and infrastructure in place, the IRS will also use IDES to provide similar information to the host country tax authority on accounts in U.S. financial institutions held by the jurisdiction’s residents.

    Not got an online link yet.

13. Got a link now:

    http://www.irs.gov/uac/Newsroom/IRS-Launches-International-Data-Exchange-Service-FATCA

14. I just got a letter from the IRS telling me how much taxable interest they paid me for 2014 (from OVDP). It’s good to be the government. Over charge me. Pay me back + interest and then they get to keep a bunch of it through crazy taxes.

15. @ Neill – Doesn’t sound like “International Data Exchange” to me – – sounds like “Acceptance of International Financial Information Offerings from Foreign Countries”. According to my dictionary, the word “Exchange” means
    Act or process of giving one thing and receiving another in its place
    Again, doesn’t sound like that to me…………

16. @LM
    Eh? It says right there they will give data to a remote countries tax authority. I think that’s a lie but it’s what it says.

17. This Rob Carrick article at the Globe and Mail needs some more comments:

    http://www.theglobeandmail.com/globe-investor/personal-finance/taxes/the-longer-you-stay-in-the-us-the-more-youll-pay-to-the-irs/article22418714/

    My comment:

    BC_Doc 3 minutes ago
    “Mr. Bewick’s advice to American homeowners in Canada is to discuss taxes with an accountant before they sell because there are measures that can be taken to at ease the damage somewhat.”

    The cross-border accountants and lawyers are loving FATCA because it is driving buckets of business their way from people living in Canada for years that are suddenly finding out they are “IRS non-compliant.” The cross-border accountants will always say file, file some more, and back file even further because this generates $1000s of dollars in professional fees. Before visiting your accountant, your first step should be to visit isaacbrocksociety dot ca. This website is a treasure trove of free information whose value is priceless.

    In a nutshell, the two big problems are:

    1) The US practices Citizenship Based Taxation (all citizens are required to file with the IRS no matter where in the world they live. All other countries practice Residence Based Taxation– if you live here we tax you, if you move away, we don’t.

    2) The US claims people to be US citizens and “US persons” who don’t consider themselves to be such– e.g. accidental Americans (Canadians born in a cross border hospital who’ve never lived there), folks like the Mayor of London who moved away at age five, people who had a Green Card but moved home and let the Green Card lapse, people like myself who moved to Canada decades ago.

    People who never thought of themselves as “US persons” are now suddenly waking up and figuring out that their bank and the Harper government now consider them to be “US persons living in Canada” (I thought I was a Canadian citizen living in Canada?!!). Not only that, but both the banks and the government are happy to spoon-feed their local, private banking information to the IRS so they can be lambasted for illegitimate back taxes and penalties.

    The political solution for this is two-fold:

    1) The US needs to change to Residence Based Taxation.

    2) The Harper government needs to grow a pair, put on its Big Boy Albertan cowboy boots and stand up for Canadian sovereignty. This means there is no such thing as a “dual citizen” living in Canada. A Canadian citizen living in Canada is viewed as Canadian and Canadian only– private, confidential financial information will not be shared with a hostile foreign government.

18. @BC_Doc – great comment!

    Here’s an article about something that can’t come soon enough for me!

    Ditching the Dollar | International Man http://www.internationalman.com/articles/ditching-the-dollar

19. Here is another article that speaks of the US sharing data…..NOT!

    http://www.accountingtoday.com/news/irs-watch/irs-opens-fatca-data-exchange-service-73297-1.html

20. @BCDoc
    That article is excellent to show the discrepancies of the tax systems. They just dont jive, and the USA will make money off of expats one way or another. Even if the dollar goes down, it will be seen as a phantom profit in another currency. I can upset when people say “We wouldn’t owe any taxes anyway because the taxes here are higher!” That only applies to people who don`t own anything.

21. They are trying to push new inversion rules. Totally unexpected that companies wishing to escape worldwide taxation have found ways around the recently changed rules. So they have to have another go at stopping it. Never involves taking less or making the rules simpler mind you:

    http://fedtaxdevelopments.foxrothschild.com/2015/01/articles/federal-taxation-developments/senate-democrats-push-for-irs-to-expand-reach-of-the-anti-inversion-rules

22. @Charl, re IRS Comissioner Koskinen’s propaganda release:

    Sharing, shmaring:

    …”Where a jurisdiction has a reciprocal intergovernmental agreement and the jurisdiction has the necessary safeguards and infrastructure in place…”

    One wonders if these safeguards will ever be safe enough for him now that FATCA can and is being used to manipulate public opinion, as evidenced by his remark that FATCA data collection is “fair”.

    “This will enhance our ability to detect hidden accounts and help ensure fairness in the tax system.”…

    FAIRNESS, Mr Koskinin? What’s fair about a program that systematically treats people as tax-evaders for having bank accounts where we live, and exists for the purpose of tax collection on assets resident US taxpayers generally aren’t taxed on? Mr Koskinen clearly has no idea what’s “fair” and should not be using his position as commissioner to give such opinions. Clearly FATCA is not “fair” to the countries it’s inflicted nor the citizens it will affect.

23. @GwEvil

    That “Double Eagle” alternative to the SWIFT system of money transfer being developed by China and Russia is a double poke in the eye to the US as the US’s identity is so closely tied to the eagle.

24. …with one comment so far, Charl:

    It is fascinating to see this go through finally. For more information about FATCA and its effects on Americans living overseas, take a look at this article I wrote about this back in August: http://wealthmanagement.com/commentary/fatca-violates-rights-american-citizens-overseas

    Violation of Treaty Power

    FATCA requires foreign financial institutions to report the financial holdings of their U.S. clients to the IRS or will be charged a 30% withholding tax on payments from US Banks.

    The Treasury Department has been unable to cite any constitutional, statutory, or regulatory authority which allows it to compel foreign institutions to collect and share the financial information of U.S. citizens. As a result of foreign privacy laws which prohibit direct disclosure to the IRS, the Treasury Department has entered into numerous bilateral Intergovernmental Agreements (IGAs) with foreign agencies and governments. There is no reference to or authority provided for IGAs in the statute itself. When asked for a basis of authority for its action, the Treasury Department points to existing tax treaties with foreign governments. Unfortunately, there is one fundamental difference between existing tax treaties and the IGAs: lack of Senate authorization, in violation of the treaty power.

25. @Calgary
    I found it a bit difficult to sign up for commenting there. Have you tried?

Comments are closed.