IRS Webinar: “Relief Procedures for Certain Former Citizens”
Excerpts:
“PHILIP YAMALIS: Welcome to today’s webinar, Relief Procedures for Certain Former Citizens. We are certainly very glad you are joining us today. My name is Philip Yamalis and I am a Stakeholder Liaison with the Internal Revenue Service and I will be your moderator today’s webinar which is slated for 100 minutes. Before we begin, if there is anyone in the audience that is with the media…”
“Phil, how about stopping here first for a polling question. YAMALIS: That sounds like a great idea. Let’s do it. Our first polling question, folks. Here it is. What are some of the common tax responsibilities of United States citizens? Now is the correct response, A, annually file income tax returns reporting worldwide income if income is over a specified threshold. B, annually file all required information returns, C, annually file Foreign Bank and Financial Accounts or FBAR on FinCEN Form 114, or, D, all of the above? Please click on the radio button that you believe most closely answers this question. I’ll give you a few seconds to make your selection. OK, let’s stop the polling now and we’ll share the correct answer on the next slide. And the correct response is D, all of the above. OK. I see that 97 percent of our audience responded correctly. That’s an awesome response rate. Thanks for your attention, folks. So with that, let me turn it over to Lara…”
“Philip, why do[n't] we stop here for our second polling question? YAMALIS: Lara, that sounds very good to me. So, audience, are you ready for the second polling question? Here it is. I’ve heard this enough, so I think we all got this, but here it is. On what IRS form must individuals who relinquished citizenship certify compliance for the five years before expatriation? Is the correct response Form 911, B, Form 5471, C, Form 8854, or D, Form 8939? You know how this goes. Click on the radio button that you believe most closely answers this question…I’m glad that 90 percent of you responded correctly, the Form 8854, Initial and Annual Expatriation Statement. Available where? Yes, on IRS.gov. That’s a great correct response rate, by the way, 90 percent. Thanks so much for paying attention, folks…”
“So, in Hypothetical 1, we have John, who was born in the U.S. and became a U.S. citizen at birth. He renounced his citizenship on October the 1st, 2019. In making a submission, he tallies up his total tax liability and it’s under the 25,000-dollar threshold. Now, here’s an important point. It was stated in the Hypothetical. John uses his best efforts in computing his total tax for each year. John computed the income from his foreign [?]mutual funds and reported them as ordinary income on the other income line of his Forms 1040. Anybody that’s familiar with foreign [?] mutual funds knows that they’re treated as special categories of investments. John should have used a Form 8621. The title of that form is Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund. We often refer to these as PFICs. So, John should have reported his PFIC on a Form 8621 with some special computation, but he didn’t. He tried his very best…”
“The term, Accidental American, is not a term used by the government…”
“…Thanks again for your time and attendance. We wish you much success in your business or practice.”
