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.
@George
The appropriate answer would be “how the f*ck am I supposed to know?”, but I suppose that wouldn’t help.
I reported October 7th that I had requested an appointment to renounce at the U.S.Consulate in Toronto and had been told they were booked through the end of May, 2015 and were not making appointments for June, July and August at that time. I was advised to send my appointment request again in early November which you better believe I did on the morning of November 1. Today (November 3, 2014) I received an appointment for March 9, 2015.
@tdott
Thanks for your reply. You say:
The one thing that filing 8854 does get you, is that it logs you out of the US tax system; so until 8854 is filed, you are officially still a “US person” and still subject to US taxation.
do you know if this means i will be in theory taxed on the years AFTER i have renounced? eg say i renounced in 2012, will i be taxed more on 2013 and 2014/etc ?
@all
Yeah currently im probably not on the IRS radar – as i said i’ve never really been a US person/citizen.. to even fill in the 8854 and last 5 years requires i get a SSN which seems to me stupid to just log out.
@pukekonz – very interesting you are getting contacted by the banks. I can’t imagine they are calling everyone so somehow you’ve been identified to them? Did you live in the US? or are you born and lived entirely in NZ?
Such an unbelievable nightmare…..
@WhatAmI
Relinquishing and renouncing have the advantage that you don’t infect your children born after that date. If a government agent can give you a one-day job answering the telephones and you relinquish, there is no wait or $2350 USD fee. If you already relinquished, (and didn’t get a USA passport after that) it is reported on IBS that you get a CLN dated on the date of the relinquishing act. Any children born after that are clean.
There are often celebrations for major events such as weddings and religious sacraments.
When you get your CLN, hold forth a party and invite people over. It’s a “CLN Party.” Invite your USA family members, invite the consul and ambassador (just to get on their nerves) and invite the reporters.
There have been parties when somebody with cancer if finally cured, so why not when somebody with US Personhood is finally cured?
@ Rlee That’s great news. Maybe you got a cancellation, in any case at least the wait is shorter for you. It would be nicer to hear that Toronto has opened up more appointments.
@justme
Me culpa. It looks like I may have been wrong about what I said concerning the need to file 8854 to stop the tax clock. From the sounds of it, that was for 2004-2008. For 2008 onward, the clock stops the day you renounce.
See: http://banderasnews.com/1009/nz-marknestmann22.htm
So, assuming the above is correct, I was wrong – you don’t have to file 8854 to sever tax residency.
Can anyone else chime in on this with something more definitive than an article from an unfamiliar source? Given the stakes involved, the last thing I would want to do is tell someone something that’s not correct.
@tdott, the point is that if you don’t file the 8854 you will still be a covered expat with all that entails. As he says in the second part of the article:
“There is no requirement that you complete Form 8854 for your expatriation to become effective. That may make it tempting not to file the form, which requires that you list every asset you own to calculate your net worth and any unrealized gains in your investment portfolio. This could be especially true if you’re a “covered expatriates” (e.g., have a net worth over $2 million or meet other conditions defined in the expatriation amendments).
However, there are still consequences if you don’t file Form 8854.
First, there’s a $10,000 penalty for failing to file it.
Second, you automatically become a “covered expatriate.” That triggers either the termination or punitive taxation of future distribution from any U.S. retirement or pension plan. It also means that if you make any future gifts or bequests to any U.S. recipient that exceed $13,000 annually, the recipient must pay a tax on the excess amount at the highest estate rate then applying. Finally, if you have unrealized gains that exceed $627,000, you’ll need to pay tax on those gains as if you sold them on the day before expatriation.
And don’t think the IRS won’t know you’ve expatriated without Form 8854. State Department regulations require the IRS to be informed when a certificate of loss of nationality is issued. So if you have serious tax problems, expatriate without dealing with them, and then fail to file Form 8854, the IRS won’t necessarily go away.
In a worst-case scenario the IRS could even refer your case to the Justice Department, which could issue a criminal indictment. It could then notify Interpol of the indictment. Interpol would in turn issued a “red notice,” requesting assistance worldwide for your arrest and extradition to the United States. The same sequence of events (less extradition) could occur if you travel to the United States.”
So, yes the 10 year rule doesn’t apply any more iirc, but that’s about it.
@justme, no, because you work backwards from your renunciation date to file the necessary 5 years of taxes to be able to file the 8854.
@tdott
I’m not clear on your terms so I’ve attempted to (re?)define them.
“Stopping the tax clock” sounds like it should mean fixing a date that is the end of your tax filing obligation: the last day included in your 1040 etc.
“Severing tax residency” sounds like a state of compliance where the IRS is satisfied that you don’t owe them any more filing of any kind and they “close the books on you”. Maybe this should be “Severing IRS obligations” to be more clear.
With the above definitions, I think your quotes and the blog link affirm that renouncing or having a relinquishment appointment (that is ultimately successful) “stops the tax clock” as you said. Filing Form 8854 where you attest that you are compliant with its filing obligations “Severs IRS obligations” and unless or until then, as far as the IRS is concerned you still owe them and they can still try to get you to comply. If you never do the filings you are a covered expat and they have a claim to any future estate you leave to a US citizen and all the rest of it. When you “sever IRS obligations”, it is back-dated so to speak to the date that you stopped the tax clock in that this is the cut-off date in all of your filings.
I would agree that you don’t have to file Form 8854 to cease to be a USC and get a CLN as far as their Immigration Dept and laws are concerned. But until you become compliant with the 8854 and its filing obligations, you are fair game for the IRS. That’s why I think renouncing without filing may be worse for some people than doing nothing at all since once you renounce, the IRS knows about you. Whether or not you can stay off their radar if you do nothing is the subject of endless posts. Certainly, people born in the US will have a harder time laying low due to FATCA and over-zealous banks, and certainly shouldn’t ever enter the US again.
Medea. Treasury pursued Raoul Weil for yrs. and prosecuted him at great expense. A US jury took 75 minutes to acquit him. ( this represents a stunning defeat for the government). The odds that they will go after some unknown offshore minnow for not filing 8854 approach zero.
@WhatAmI
“Stopping the tax clock” and “Severing tax residency” were meant to be different ways of saying the same thing: no longer being taxable as a “US person”. I did not mean either one to have anything to do with compliance, or lack thereof. I didn’t go into the aspects of compliance, etc because I was trying to specifically address justme’s last question.
I think Medea Fleecestealer captured the situation quite well above.
FWIW, I came across the phrase “sever tax residency” when, out of curiosity, I looked into Canada’s “departure tax”. A Canadian citizen that moves abroad is still subject to tax by Canada unless she severs her residency, which can result in paying a “departure tax”. Probably shouldn’t have thrown in that term in a discussion of US taxation, since it doesn’t seem to ever show up in that context.
@Duke of Devon, I agree. However, if you decide to turn up on their doorstep while on holiday I suspect they would probably want you held at least pending any possible charges. The $10,000 penalty for not filing would take all your holiday spending money and more alone.
If you have no US assets or money there, no plans to leave anything to any relatives and don’t plan to go there ever again you can probably get away with not filing the 8854. That’s assuming of course that your bank isn’t going to give you grief over not being US tax compliant. For us here in Switzerland I think that’s been the main reason why so many have not only relinquished/renounced, but become compliant too. When your bank demands copies of your recent US filings to prove you’re compliant or your account will be blocked/frozen, there’s not much else you can do.
Medea Time for ordinary Swiss citizens to stand up to the bullies à la ADSC.
I was born dual (born in the U.S. to Canadian parents). I just discovered that it is possible to re-affirm your Canadian citizenship (kind of like renewing your wedding vows lol). See the link below. I wonder if a bunch of people could get together and organize a re-affirmation ceremony complete with an oath to Queen Liz, but perhaps add a line to the end of the oath about intent to relinquish all other citizenships or somehow make it clear (with witnesses and documentation) that the oath to re-affirm is taken with intent to lose U.S. citizenship? Perhaps with a lawyer present? According to the U.S.’s own rules, advising the consulate or obtaining a CLN is not required if one takes an oath to a foreign state with the intent of losing U.S. citizenship.
http://www.cic.gc.ca/english/celebrate/menu-reaffirmation.asp
Nick,
We are not changing our Canadian citizen status by reaffirmation of our Canadian citizenship.
From an earlier comment of mine:
…Upon renewing my Canadian passport that had expired, I got permission to attend the next Canadian Citizenship Ceremony in Calgary, which was very emotional — reaffirming the Oath of my Canadian citizenship along with 100 other New Canadians. Mine, though, was only a “commemorative certificate” that I had done so and could not be recognized vs being a official document.
@Nick,
As @calgary411 just posted, the oath does nothing in so far as a relinquishing act. This is very clear in 7 FAM 1250, page 4:
http://www.state.gov/documents/organization/120544.pdf
As far as the IRS is concerned, you are not off the hook until you advise them of your expatriating act. If your act was before 2004 you have no IRS obligations, but after 2004 your obligations do not end until you notify the State Department (have an appointment at a consulate).
I regularly see posts with the idea that one could swear and sign all sorts of declarations and affidavits before Canadian lawyers and other Canadian officials as a way to shed US citizenship. You have to think about it from the side of US law and their Constitution, and their arrogance and hypocrisy. They don’t give a crap about any of that. Nobody in a foreign country can give or take away your US citizenship. Only the US Congress, who makes their laws, can do this and in the case of taking it away: since 1986 this can only be done by them if you consent (and they agree with the conditions).
Now, you might be able to present such sworn forms and statements to a Canadian financial institution for FATCA reasons instead of a CLN, and many of the posts are suggesting this as the reason. This is as yet a complete unknown, and will surely vary by institution, branch office and perhaps even down to the employee level.
@NIck, I think people have already thought of that. It probably wouldn’t count because you’re already a citizen of Canada. But go ahead and give it a try if you want to. If it works, tell us because it would certainly save a LOT of people a LOT of time and hassle.
You would still need to visit an embassy/consulate to obtain a CLN though as this would be needed for the tax side of things (8854 form) and possibly also for your bank/s.
@Nick By coincidence, I was looking at the very same idea last night. I went through the IRS Streamlined procedure and now have 5 years of filing accomplished but would love to avoid the $2350 fee if possible. I was born a U.S. citizen, moved to Canada in 1970 and didn’t take Canadian citizenship until dual citizenship was recognized by both countries. IF I knew than what I know know I would have moved heaven and earth to be able to accept the offer to work for Elections Canada at the polls last spring. Surely that would count.
@RLee
I know a guy who worked at an election polling station for a couple of days. He listed this in his list of claimed expatriating acts, and the consul ridiculed him and said it didn’t count. The consul also discounted his other claim of government employment as a contractor, but sent it all to DC with a strong recommendation to be denied. It’s been some months, but no word yet.
What do you mean by “I didn’t take Canadian citizenship until dual citizenship was recognized by both countries”? How old were you, what year, and what did you do? Naturalize? Request a registration of birth abroad? Which of your parents if any were Canadian when you were born in the US?
I must have posted to the wrong area, but check this out guys:
http://www.forbes.com/sites/ashleaebeling/2014/11/04/irs-commissioner-predicts-miserable-2015-tax-filing-season/
“Internal Revenue Service Commissioner John Koskinen warned that close to half the people trying to reach the IRS by phone might not get through during the upcoming 2015 tax filing season. “Phone service could plummet to 53%,” he told an audience of tax practitioners at the AICPA National Tax Conference in Washington, D.C. today. That would be down from an already unacceptable 72% during the 2014 filing season. The average hold time projection: 34 minutes! What’s to blame? Budget woes. “All we can do is try to maximize our services as well as we can; as well as we can is still going to be miserable. You really do get what you pay for,” he said.”
@ WhatAmI , I am a U.S. citizen by birth and a Canadian citizen by choice. I moved to Canada after I finished university in 1970. At that time and for many years after, I did not want to give up my U.S. citizenship because I didn’t want them to have the right to prevent me from visiting my family or earning money there if the need arose. What I find quite ironic is that, the U.S. warns about the pitfalls of dual citizenship while being the source of those pitfalls in my life.
Nick, I tried what you suggested, it doesn’t work. if you are already a Canadian citizen when you swear the oath, it does not change your status in Canada, and the US won’t accept it. They don’t follow their own laws.
@Nick, taking the Oath again for the same nationality does not comply with 8 US Code.
If I worked for state and wanted to be an a__ hole, I might be able to make an argument that an Oath in itself for an existing Commonwealth Citizen would not qualify in another Commonwealth Country as its to the same Queen!!
@WhatAmI, “I regularly see posts with the idea that one could swear and sign all sorts of declarations and affidavits before Canadian lawyers and other Canadian officials as a way to shed US citizenship. You have to think about it from the side of US law and their Constitution, and their arrogance and hypocrisy.”
1.) No one can renounce apart from doing on it proscribed forms at a Consulate.
2.) Relinquishment and documenting that relinquishment is another matter. Anyone that relinquishes should immediately document that relinquishment with sworn statements and supporting documents and do same as quickly as possible.
Once that relinquishment is documented a person can and will decide if they want a CLN.
For purposes of nationality law, a CLN is absolutely not required to lose ones USC. No where in 8 US Code is it required EXCEPT for a renouncer.
Some people can not obtain a CLN for various reasons and that could simply be the travel cost to get one is money not available.
It is unfortunate that post 2014, anyone who relinquished MUST document that relinquishment with either a CLN which is preferable or documents with a local lawyer.
That said, a CLN is likely to be required to enter the US or it should be assumed one would be required.
But the question of proving that you are not a US Citizen is based on local law and what will be acceptable.
@George
“But the question of proving that you are not a US Citizen is based on local law and what will be acceptable.”
Agreed. And that local law is the IGA since nobody else in Canada cares if you are a USC. In another thread, @Silver Birch reported that he asked MD “what is acceptable”. They said “Reporting to CRA in 2015 can be avoided if we have acceptable documentation on file prior to 2014 year-end indicating why a client is not to be considered a U.S. citizen.” To further define “acceptable documentation”, MD’s Compliance Department only quoted directly from the IGA: “the account holder’s Certificate of Loss of Nationality of the United States or a reasonable explanation of why the account holder does not have such a certificate”.
It’s going to be a long time before anybody can be sure in advance of what their particular FI will accept in lieu of a CLN. If they reject your explanation and documents or you walk and close your account, they are required to report you to the CRA.