Relinquishment and Renunciation Data (as reported on Isaac Brock), Part 2
US RELINQUISHMENT RENUNCIATION.m2
Above is a link to data we are compiling on Relinquishments and Renunciations — a work in progress.
(We are starting Part 2 as Part 1 has now over 1,000 comments.) Link to “Relinquishment and Renunciation Data (as reported on Isaac Brock), Part 1”
This Relinquishment and Renunciation database corresponds with the Consulate Report Directory, which tracks individual experiences for each Consulate, along with a timeline chart.
Note: We are using numbers instead of blog names for this public posting so there will be no compromise of private information. Your facts will help give a snapshot of relinquishment and renunciation activity and where that occurs.
Please submit information in the comments below (or someone can contact you privately if you leave a message).
This database and the Consulate Report Directory have proven valuable resources for those new to the subject of relinquishment and renunciation. They can see numbers for and read others’ experiences of relinquishment or renunciation at various US consulates throughout the world — as reported by participants of the Isaac Brock site.
Thanks for your addition to the Relinquishment and Renunciation database. Your input will definitely help others.
I think the consulate here just has a lot to learn, maybe not as much experience as the larger ones have. When all this is over I might contact the higher ups and give them whatever feedback I can. I can feel they are understaffed big time and maybe having to take on things they have not had to deal with before. I doubt the NZ branch has ever done a relinquishment. As far as the fear mongering, I think this could be lack of training. It sounds like the larger consulates have it right. It doesn’t help that the word “ramifications” is used, what a horrible word for such a thing. That word itself is highly negative and made to instigate fear. Hopefully I will get a back dated CLN (If that’s possible), my relinquishing act was in 2008. In any case my next nightmare after obtaining the CLN will likely be closing out everything I need to with the IRS. I have not filed since 2005. If my CLN is 2008 I don’t know if that means I need to file 06-07-08 or all the way up to 2013. I don’t have many assets, certainly no where near the limit, etc.
@PukekoNZ,
It sounds like a disgraceful way to conduct an expatriation meeting/phone call.
If I were a dual citizen planning to renounce and had any doubt about doing so, that conversation would scare me all right –it’d push me right over the edge to renounce ASAP – because normal and stable countries don’t desperately try to hang onto their citizens with fear tactics.
There’s stuff like they’re supposed to tell people like expatriation does not relieve them of IRS obligations (as in DS-4081) and they could also tell people they might be subject to exit tax – but this guy with “the IRS will place you under extreme scrutiny” makes it sound like a threat. Govt officials should be very careful they’re making neutral (and accurate) statements of fact and not statements that could be construed they’re gonna sic the IRS on someone.
The e-mail from the consulate you posted about at 8.00 pm above sounded very neutral and professional. The phone call sounds outrageous. Glad you’re strong and taking it in stride. With attitudes like this US “diplomat” has, you really will feel free when this is over with!
@PukekoNZ,
You posted as I was writing. As you wrote, it does sound possible they don’t really know how to handle this stuff due to lack of experience (they should anyway, but it’s not a perfect world). Thank goodness you know what you do, so you’ve been able to keep things on track regarding your relinquishment. Certainly their e-mail sounded professional, so I was surprised to read of the phone call. That is a good idea to give feedback to higher-ups — they’ve been quite open to it and definitely seem to want this stuff to go smoothly.
As for IRS, if you relinquished in 2008 and signed the CLN application documents in 2013, DOS will consider your last year as a US citizen to be 2008 and IRS will consider it to be 2013.
Your 8854 will be due June 15th, 2014. On the 8854, you have to certify that you’re tax compliant for the past 5 years, so 2008-2012. And your 2013 partial year 1040 is also due June 15th, 2014.
Thanks Pacifica, a bummer that I have to sort out all those tax years because that sort of thing is way over my head. I have seen a lot of these “expat” tax places online. They seem to charge $4-500 a year. Some have said just file the forms it’s easy. One issue is over the past 5yrs one or more accounts may have briefly had more than 10k in it (for example during a home sale our account was inflated for a few days during the transaction) so I guess I have to do an fbar or two because of that. Otherwise our accounts are basically always negative due to our mortgage. I’ve never gone over the income thresholds. My wife and I also own a NZ Ltd 50-50 for the last 6yrs or so which is where our income is generated which may be tricky as well. I guess I’ll get one of these expat firms on board and just pay the cost so I can get it done properly. What a pain. NZ also has different tax years here. Maybe I can just put the expat accountant in touch with my NZ accountant and let them work it all out. I cringe to think what this will all cost me.
@pukekonz
Don’t know about NZ, but in Canada gains on a principal residence are NOT taxed. This can create major issues for USCs’ since the US only partially exempts the gain. I mention this because you mentioned a home sale. Hopefully you’ve already looked at this and are fine and I’m just being an alarmist.
@pukekonz
A fellow American in NZ was very interested in your comments. Do you know of other Americans taking your path, or is it the passive Pacific down there, with little knowledge or awareness of FATCA? Any resources or approaches that you would suggest to get more light shined on the subject. I have seen nothing in the media.
Not sure you are aware, but there was this posting about the NZ IRD a while back
http://isaacbrocksociety.ca/2013/07/29/new-zealand-ird-prepares-its-tax-agents-and-financial-institutions-for-fatca-compliance/
@All, I hope I am putting this in the right place but, wanted to comment while things are still fresh in my mind. I relinquished today. I arrived in Toronto for a 2 o’clock appt. with all my paperwork ready to go and filled out but, not signed. The woman at the desk was pleasant and friendly and even mentioned that she knew why I was likely relinquishing. She made some joke about it, and foreign spouses and didn’t seem at ALL irritated or anything like that. She was very cheerful and seemed as if she completely understood. She went over my documents and passed them along to an officer while I was made to wait. I had to wait a good long time. An HOUR. While I was waiting several people got to talking about why they were there. Three others said they were interested in relinquishing their U.S. citizenship so I wrote down the web address of Isaac Brock Society for them as all three seemed really lost about how to proceed.
One lady came to Canada at 1 year of age and H and R Block had told her she HAD to do her five years of tax forms and six years of FBARS BEFORE renouncing/relinquishing. I told her this was not true. She was there to get social security number as she did not have one in order to file all those forms before renouncing! Another women said she and her husband both were seriously considering giving up their citizenship. There were seven people in the room. One relinquishing *me* and three others thinking about doing so, one in the process besides myself.
I was finally called to speak with a very pleasant officer. She told me it had taken so long because in December I had crossed into the U.S. and had been told I had to use U.S. passport. She had put in a call to D.C. about it and D.C. told her it was still a “relinquishment” I was quite happy about this as that was my intent when taking Canadian citizenship. She asked me to raise my hand and say a oath and affirm that no one was coercing me to relinquish. They handed me back my documents except for my applications and U.S. passport.
She said it will be three to six months to get my CLN. I inquired as to why it would be so long and she said “We are really backed up with these right now as you probably can guess.”
Everyone was very pleasant. The officer seemed to want to be helpful to me in my desire to relinquish rather than renounce. All in all it was a pleasant experience with some surprises in that so many in the room seemed to be there in order to either inquire about renouncing or were in the process of doing so.
@Atticusincanada, congratulations! How does it feel? It was very difficult for me to renounce, but as soon as I had renounced, I felt so free and liberated from threats and complications. Yesterday, I was jogging in my hometown, and it was so beautiful!
@ AtticusinCanada
Toronto really seems to be on the ball. Will yours be a back dated CLN? Will you still be willing to put on those tennis shoes even when you are free and clear? Something tells me you will because you are so passionate about confronting this injustice called FATCA. What a smooth sailing relinky-dinky day for you. Congrats!
@pukekonz
I just read your comment about filing and the differences with the IRD tax year. That certainly complexes up the process, and I know that only too well having had to file both. Even now, that I am no longer NZ tax resident and have only passive income from NZ, it still makes the filing more difficult, especially if the IRD refunds something that I wasn’t planning on, which then requires amending of years, and prorating .75 / .25 across two US tax years, or at least going to the process to see if I have additional US tax liability.
I never attempted doing the NZ forms and just had a local accountant doing that for me, but as you know, if you have any money in the USA, like in a 401K, then that has to be declared an a 5% fair dividend rate added to your taxable income based upon the years opening balance as determined in NZ FX rates. That wasn’t fun!
I once used a so called stateside international tax expert to do my first U.S. offshore filing, and even though it was simple it was over a $1000 dollars. He would NOT do the FBAR and screwed up my foreign tax credit form 1116 which I had to redo. Now with the FATCA form, things have become more complex, so I would be very wary of any online Expat tax service representing that they can do it for $4-500 dollars. You get what you pay for in these deals, and that house sale as Tdott says might balls things up for you.
You might find that Turbo tax will work for you, as it does now deal with offshore accounts, prompt you on the FBAR and FATCA forms and handles most common forms except the Trust forms which you might have to do if you have any NZ mutual funds. Then that KiwiSaver will have to be reported too. There is some manipulation of the forms section that I have learned to do to link things properly from schedule B, to make it work correctly, but once you have it down, it is repeatable year after year. It seems intimidating, but it is possible to do yourself without paying for a lot of expert advice.
Good luck mate. Hope the Kiwis are over their mourning of the America’s Cup loss. I hear that there were traffic jams at 10a in the morning with everyone staying home between 8a-10a and not going to work until the races were over. A septic pump out service wouldn’t come to my house to undo a clogged drain until the race was over! 🙂 They almost had it in their grasp, but that Oracle comeback was pretty impressive too. America doesn’t even know it was happening.
Cheers
@pukekonz took me several weeks of calling to get a phone call back from the Auckland Consulate, then they gave me all the reasons why I should not renounce and made a few threats like an IRS audit, once I got my appointment and arrived to renounce through the bullet proof glass, they asked me if I was renouncing to avoid taxes or criminal prosecution, I just smiled and said no, then they told me again the IRS would likely audit me, and that I might not ever be able to return to the US and would not have the protections of any country as I’m stateless, which I again smiled and said thank you for all your help, they of course took my passport with my PR visa and told me I would not be getting it back even after they punched a hole in it.
While standing in line to renounce I managed to inform several people renewing green cards that they have obligations like FBAR which they had never heard of and should be paying capital gains taxes on their home sales in New Zealand to the U.S. IRS.
I felt like a new person when I left the building and I did get my CLN in 37 days, but I renounced.
Good luck with the relinquishment.
@AtticusinCanada
Congratulations and thanks for the report. This was exactly the right place to put it. I just sent you a tweet with a link to your comment. So pleased to hear that yours was more pleasant than @Pukekonz Obviously the officer dealing with you did not know about Robert Stack’s FATCA myth! 🙂
Thanks all. @SwissPinoy, I thought it would be VERY hard for me but, the officers in there were SO kind and so friendly it was not. They both acted as if they perfectly understood. I almost got the sense that if they were in my shoes they would do the same. VERY nice both of them. I stated I was there to let them know I had relinquished U.S. citizenship. When the lady finally got back to me she said “I’m happy to tell you it’s a yes to your relinquishment” She said it in the way someone might say “It’s a boy!” LOL! I had stressed that I was relinquishing and calmly told her that I had no choice using my U.S. passport that one time and she agreed with me but, had to get confirmation from D.C.
They are really “backed up” One lady in there who was going to relinquish told me “This is going to blow up and be huge when it more people here know about it.” Yes, I think my CLN will be back dated to the day I took my oath of citizenship to Canada.
Of course I am still going to be willing to fight this. It’s deplorable.
Atticus, it is huge already but the cover up is still holding. Congrats to you!! I am glad everything went so well and that the officials understood the dilemma of the foreign spouse thing. Some people act like it’s silly to choose your spouse and family over the place where you were born but I think they are crazy. My husband is the one who has my back at all times – not the USG, which I sometimes think wouldn’t hesitate to stab me in the back as literally as they have figuratively.
@Atticus, congratulations! So happy for you.
So glad that they acknowledge that the US gave you no choice but to use the US passport, and that you’ll be a relinquisher anyway. Hope the CLN comes in swiftly.
@pukekonz, sorry to hear about the threats and attempted intimidation as you exercised your human right to choose to shed the unwanted US citizenship. Thanks for reporting it.
Hi guys, I really enjoy these chats (I’m not alone in all this -relief-). The main concern with me after getting the CLN will be getting tax complaint past 5yrs. It will be my worst nightmare I think. Tax issues are way way over my head. Even when I started the process of getting one of these internet expat tax services on board, they sent me all sorts of questionnaires and I couldn’t even get my head around them, much less all that’s involved after that. I was curious about how the final filing process works. When it’s all done do you get any sort of communication from the IRS saying you are officially done? Suppose I file the best I can, but do something wrong unintentionally, am I likely to be accosted by the IRS 5-10yrs from now? I just want a 100% clean break, I don’t want to spend the next 20 years looking over my shoulder. I hate how stressful all this is, I feel like we are all being punished.
@Atticus
WOW! It’s almost 2 yrs since we first connected on this. I am so very happy for you and especially, that you were treated so well at the consulate. It makes all the difference in the world and having read pukekonz’s account, makes me feel grateful that I also had a relatively easy time of it.
I know it has been very hard on you and sincerely hope you are going to feel the positive feeling of freedom from all this nonsense and relief that you are no longer in danger of causing damage to your family.
pukekonz I gather you live in NZ. I can’t possibly imagine why the IRS would be bothered with you. Apparently they acknowledge bugger all. File 5 yrs. of simple stuff and then get on with your life. Or file nothing and get on with your life.
@KalC yes I’m in NZ and have been here over 14yrs. Going simple (turbotax online or such) with my filings and hoping for the best might be all I can do in reality. I can’t afford much else really.. how’s a guy who lives check to check going to come up with 5-7k US for a tax specialist? What is confusing is how you are able to obtain a CLN but still have to deal with the IRS. How can you be required to do anything with a country you are no longer a citizen of? And as far as FATCA goes once I have my CLN would it not then be illegal for the IRS to gain information from my NZ bank account? I would think if the NZ bank turned over my personal info behind my back to a country I am no longer a citizen of then my NZ bank would be violating my rights it seems… but like I say this is all over my head and like a bad acid trip.
@AtticusinCanada
Congratulations! 🙂
@pukekonz
None of us (as far as I know) who contribute to IBS are professional tax advisors, but many have lots of experience (more than most professionals…) with issues pertaining to expatriates and are very much willing to help. Just ask.
Once you have your CLN, you should contact all your banks and inform them that you are no longer a “US person” (USP). Do it in writing and ask for written confirmation. You can also provide them with a copy of your CLN and the IRS form W-8BEN, in which you affirm that you are not a USP (i.e. the opposite of W9 for USPs.). Some banks may explicitly ask for these, but it doesn’t hurt to provide them even if they don’t. If they send any information to the USA about you after that, sue them.
@AtticusinCanada,
I am so happy for you! Congratulations!
@All, pukekonz got me thinking about something. I wonder what would happen in the situation where someone renounces, and follows up with the 5 year filing, but IRS decides to audit. How does IRS get banking information if you are no longer a citizen? Or any information for that matter? For example, what if you make a mistake on your filing, say for example, forget to declare interest earned on a TFSA. Could that come back to haunt in an audit? How would IRS even know?
@WhiteKat I’m also curious. I suspect FATCA will have some sort of deep powers to turn over info from “non-US” citizens to the US. If that were the case though it would almost seem like a violation of human rights. Maybe it depends on the local government? Once I am no longer a US citizen is NZ going to turn over one of their own to the IRS and extradite me because I failed to file a few things properly? Just some dude living check to check on a meager income? I can’t see that happening but who knows.. I can certainly see me not knowing what I’m doing, not filing 110% properly and being fined 10x what my net worth is. Maybe the UN needs to get involved in this madness. I believe it should be a basic human right to give up citizenship of any country and be left alone. It’s like we have no free will which is disturbing.
@WhiteKat @pukekonz
I’m not an expert on international law, but I can’t imagine that any country would provide information on their own (non-USP) citizens to the USG. The USA simply cannot dictate laws to other sovereign states which apply to non-USPs living in their home country. If you’re no longer a USP, the only one who can provide the USG with any information at all is you.
If a person is never going to go the the US again even for a visit, I don’t see the point in filing IRS returns for past years. They can’t do anything to you. In Canada, the government has already stated that they would not extradite or assist the US in collecting taxes or penalties from any Canadian citizens. So if the banks can’t report on you after you get your CLN, the US has no ability to get any info on you and has no ability to get to you. You are free.
@greyowl, yes, unless one flies on a plane which flies over US airspace and is forced to land, or a plane crash-lands in the US, or one gets kidnapped by the CIA during a vacation in Rome, or the US invades Canada, etc.
Of course, this is maybe all unlikely to happen, but the US is “exceptional”.