Renunciation and Relinquishment of United States Citizenship: Discussion thread (Ask your questions) Part Two
Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
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NB: This discussion is a continuation of an older discussion that became too large for our software to handle well. See Renunciation and Relinquishment of United States Citizenship: Discussion thread (Ask your questions) Part One
@Medea Fleecestealer
I’m afraid I don’t understand your comment regarding the W-8EN forms. I know that if continue to maintain an account in the US after completing the relinquishing process (scheduled for September), I would have to file a W-8EN with the US FI, since I will be then be a non-resident alien, but you seem to be saying that you are being required to file a W-8EN with a bank in you country of residence and nationality even though you are no longer a “US person” (I really hate that term). I would certainly not want to have to file any type of IRS document with my Japanese banks after I’m no longer a “US person” and my sole residence and citizenship is Japan.
Could you clarify? Thanks.
@TokyoRose what I filled in and signed was a Form W-8BEN (Substitute) for Individuals. As well as filling in my birthplace and residence abroad details the forms says the following:
“Certificate of Status as a Non-US-Person and as Beneficial Owner for US Tax Purposes
I, the undersigned client, here certify (i) that I am not a US-Person under US tax law and (ii) that I am the beneficial owner under US tax law of the assets and income to which this form relates.
Declaration Concerning the Preceding Calendar Year
I, the undersigned client, hereby certify that all information provided on the form is also true for the preceding calendar year insofar as a client relationship with PostFinance Ltd existed in that year.
Change of Circumstances
For the duration of my contractual relationship with PostFinance Ltd, I, the undersigned client, agree to notify PostFinance Ltd on my own initiative within 30 days of any change in circumstances that may affect the information provided on this form regarding my status as a Non-US-Person or as a beneficial owner under US tax law.”
@Medea Fleecestealer
Thank, and sorry about my typo, I did mean the W-8BEN. I have Japanese (non-US persons) friends who fill them out for account they have in the US.
But I just don’t understand why your bank in your home country would require it? Is it because they have US indicia for you already?
Curiously, in another example that the Japanese banks are still not coping with FATCA very well, one bank has posted on its website that US citizens opening a new account will be required to file a W-9 and US green card holders will be required to file EITHER a W-9 or a W-8BEN. I’m still very fuzzy on all this, but I’m pretty sure that a US green card holder cannot file a W-8BEN.
@TokyoRose, yes they did. When we made the account a joint one they wanted IDs so I gave them my Swiss permit and my US passport as I had used that to enter Switzerland many years before. I always did that for official stuff so as to avoid confusion of having American on my permit, but offering a British passport.
There’s more on the W-8BEN and green card holders on the IRS website:
http://www.irs.gov/instructions/iw8ben/ch01.html#d0e175
down under the bit about IGA models.
So yes, it looks like green card holders do have to file one or the other.
@Media, ” I always did that for official stuff so as to avoid confusion of having American on my permit, but offering a British passport.”
You probably regret that move. 😉
Whats the consensus on accidental americans with no indica (US Parent Only), no ssn, no current US passport, in going through the renouncing process?
@George
I doubt there will be a consensus, but my understanding is that a person born outside the US to one or both US parents (unless they do not have the right to pass on citizenship due to lack of residency) has the RIGHT to US citizenship but does not receive it automatically. If the birth is never registered with the US (normally at the US consulate in which the child is born), the child does not have US citizenship and does not have to renounce. As an adult the child could attempt to claim US citizenship (ironically using the same Form DS-4079 that is used for relinquishing and also sometimes required for renouncing).
If the birth is registered, then of course the person has US citizenship, but if neither an SSN or passport (and then also no driver’s license, residency, voting registration, etc), was never applied for, the person can renounce using the foreign birth certificate and consulate birth registration, but if I were so far under the radar, I personally would not bother. It would seem to be easier to use “selective memory” and just forget that my parent(s) was ever a US citizen.
@Medea Fleecestealer
I read through that it is seems clear that a green card holder is deemed a “resident alien” who therefore must file a W-9 and cannot file a W-8BEN.
@George, well it was 16 years ago and of course never entered my mind that there’d be problems further down the line later on as the account was only made into a joint one in 2009. As far as the accidental American scenario, you have two choices: do nothing and try and stay under the radar or renounce and take it from there as regards any filing you may need to do.
You do have to consider a couple of things though: 1) if you travel to the US without a US passport you seem to get more and more hassle from border control over it and 2) the possibility that if or when your Canadian bank finds out you’ve “lied” about your US status what effect that might have on your accounts. The question is how far the Canadian banks will dig if they don’t have any obvious indica to start with. The Swiss banks are so rattled they’re probably checking every account they have regardless of indica just to be sure.
@TokyoRose, but if a Green Card holder has turned in their card formally using an I-407 then presumably they would need to sign a W-8BEN in the same way I did. If I hadn’t renounced I would have been required by my banks to sign a W-9. Indeed I got these forms from UBS re our joint account just a couple of days after my renunciation. Luckily I was able to tell them I’d just renounced so they gave me more time before returning the forms in hopes that the CLN would arrive, which it did. If the CLN hadn’t arrived by their deadline though I would have needed to sign the W-9 and then inform them of my change of status once I received the CLN or they might have closed our accounts.
I think it may also depend on what category under the relevant IGA the banks have decided to declare themselves in. Having sent my CLN to UBS I haven’t heard anything further about the matter, no W-8BEN to sign even though we still have our account and a mortgage with them. But they’ve already been hit by the US courts whereas PostFinance hasn’t. UBS therefore is a category 1 bank, while PostFinance declared itself as a category 2. The difference is laid out here:
1. Category 1 Bank
A Category 1 Bank is any Swiss Bank for which the Tax Division of the U.S. DOJ has authorized a criminal investigation concerning its operations. The Program is not available to Category 1 Banks. The U.S. DOJ is currently investigating the Swiss-based activities of 14 financial institutions.
2. Category 2 Bank
A Category 2 Bank is any Swiss Bank that is not a Category 1 Bank (not already under criminal investigation) and also not a Category 4 Bank (see below). A Category 2 Bank is a bank that has reason to believe it may have committed tax related offenses or monetary transaction offenses in connection with undeclared U.S. accounts held by the Swiss Bank. A Category 2 Bank may request a non-prosecution agreement (“NPA”) from the U.S. DOJ. The request must be made by 31 December 2013.11
http://www.navigant.com/~/media/www/site/downloads/disputes%20investigations/fatca%20highlights%20volume%2010.ashx
So PostFinance is doing everything it can to make sure its customers are tax compliant to reduce any penalties it may face under the IGA. So I assume they’re going to want either W-9 to say this client should be filing US tax returns or a W-8BEN to say they’re not a US person and the accounts don’t come under US tax laws.
TokyoRose and George,
Your definition and common-sense “understanding”, TokyoRose, is mine as the mother to two children who were born in Canada to two US citizen parents (before they, the parents, became Canadian citizens). My daughter has renounced her US citizenship. My son cannot because of ‘mental incapacity’. Although I agree with you, the US Department of State will not say the words that you have said. I maintain that if my son or anyone like my son does not have the ‘mental capacity’ to renounce, then he does not have the requisite ‘mental capacity’ either to carry out the process to become a US citizen and why would he have to if he already is as is stated here:
I agree with you, George, that an “Accidental American” born to US parent(s) in another country, no SSN, no US passport could / should not come forward; i.e. “don’t ask / don’t tell”. They are not visible. My son is visible because of his mother who says no “Accidental American” should have to go through this; that no such person should have to find a work-around, whether it be by “hiding” that they would be defined a “US citizen” or any other work-around. They had no choice who they were born to or where / in what country that birth took place. It should be their CHOICE to claim a US citizenship when they are adults if they have the mental capacity to do so when / if they have the understanding of all the possible benefits to them as well as all the possible consequences and responsibilities that citizenship (and US citizenship-based taxation and reporting) carries AND to have the protection of the governments where they actually live.
When is the law the law is the law and when is it not the law and can be ignored — like also our crossing the border for years and years with no challenge (until that fatal day) when US law says that a US citizen must both enter and leave the US with a US passport? Where was the law when we were told that we had lost our US citizenship so many decades ago when we became citizens of other countries? Where was the law when Canadian accountants told us that we would not have to file US tax returns as we would never owe any US taxes? As I contend, it is all a absurd crapshoot.
The only thing that makes sense and is fair to EVERYONE is that the US change to residence-based taxation. It is only the punitive actions of the US and their lust for funds that should not in any common sense belong to them that we have FATCA and Treasury’s IGAs that other countries have so gulliblely signed to waive the rights of a portion of persons who are citizens of or make their lives in that country to appease the bully — hand over our lunch money.
That is why there is a Human Rights Complaint submitted on behalf of US Persons around the world. That is why there is an Alliance for the Defence of Canadian Sovereignty — so the very victims of US citizenship-based taxation [combined with the IGA’s that our country has signed with the US to implement the FATCA IGA, waiving our rights under the Charter of Rights and Freedoms and other law, by allowing discrimination of one million of its people PLUS their spouses, their children, their business partners and thereby draining Canadian treasury to the USA] can raise enough money to take legal action action against the government who turns their private financial information over to the USA.
Please help by giving what you can to fight the fight against this at http://www.adcs-adsc.ca/.
This one is a tough thread to catch up on since you don’t get the option to go to the most recent comment and have to scroll through about twenty pages to get to the end. Normally, you can get to the most recent comments page by clicking on the blue line that tells you how many comments there are underneath the title of the thread. However, where, as here, the thread has been divided in two, that options seems to disappear. If there is a shortcut, I haven’t found it!
Couple of short comments a propos of some recent comments in the thread:
– I agree with Calgary411: I HOPE the US consulates and/or State monitor this thread. I would be utterly embarrassed and humiliated to know that so many thousands (or millions) of expatriates are going through so much pain and anguish to rid themselves of association with me because of my country’s callous and negligent treatment of them. And by the way, although the vast majority of people caught up in this morass are indeed “minnows”, I don’t subscribe to the view that perch, tuna or whales are entitled to less fair and reasonable treatment than minnows. All are entitled to be treated properly and it ought to be plain and obvious to any but a blinkered Homelander apparently that the US is way beyond the pale here. Long term/life non-residents at least ought to be an easy case.
– for children born of US parents who may wish to relinquish: no right answer. Practically speaking, they are simply not on the radar. If they don’t assert citizenship and do nothing at all, they are 99.99% invisible. I know some parents who have simply resolved not to tell their children of their “birthright” because they don’t want to complicate their lives with the burden of it. However, Calgary411 is correct: they are citizens whether they know it or not and whether they like it or not in the eyes of the US government at least and within their borders. The perfect answer is likely to renounce, but for any but an 18 year old with no bank accounts or work history, that is a potential nightmare. The pragmatic answer that I’m sure even a US consular official would approve of is simply stay out of their system altogether unless you want to get INTO their system completely. Marginally different if birth registered by parents in that they have SOME record, but shouldn’t change the equation dramatically. A certificate of registration abroad is only prima facie evidence. They would inquire further before issuing a passport. Also remember that despite some leakage, State and Treasury are separate silos and State has no reason to assume (or care) whether a once-registered child who has not sought the tiniest recognition from the US is a citizen when crossing the border on a foreign passport thirty years later. I strongly suspect that the US prefers a “don’t ask, don’t tell” policy for these troublesome citizens that they would rather not think about still less accommodate.
– there are no perfect answers to any of this stuff. Living outside of the US as a perfectly compliant American is a near impossibility for all but the most indigent or wealthy (for whom most of the impediments add an immaterial layer of complexity to tax planning to minimize taxes in their “home” jurisdiction as well). It is a terrific burden if undertaken with full knowledge at the start of one’s working life – it is a recipe for bankruptcy if taken on any later in life.
– there is a separate thread about crossing the US border on Canadian passports with a US place of birth. What the future holds is anyone’s guess. It is their country and they get to make the rules for admission any way they like. For the time being, the episodes of “trouble” at the border are definitely the exception not the rule. Where questions get asked, the answer (relinquished when became Canadian) has always been accepted with a quick nod and a stamp. Will there be the odd eager beaver who denies entry? Clearly it has happened given the stories related above, but it is pretty rare and certainly wouldn’t be reason enough to cause me to have someone go ask for a CLN who otherwise wishes to have nothing to do with their system. If it becomes general policy to obstruct or bar entry and travelling south is important, then I guess a CLN is the way to go. I don’t see that occurring – it is not the case today at any rate. It may happen down the road. Who knows? You can get an Enhanced Drivers License (EDL). It has the virtue of not having birthplace on it (only nationality). It is only valid on land crossings. While it doesn’t have birthplace, I would not exclude Homeland security being able to link it to Canadian passport data if you have crossed with a Canadian passport in the past or even US passport data if you have or ever had one. Full name and birthdate ARE recorded and scanned on both documents, so I would think even a Commodore 64 could connect them if they were looking to do so. So – as before – no perfect answers short of never crossing the border and generally avoiding the place like the plague.
@ Anne Frank
Go to the http address, delete everything beyond “renunciation”, reload the page and you’ll find yourself at the latest comments.
@Anne Frank, “This one is a tough thread to catch up on since you don’t get the option to go to the most recent comment and have to scroll through about twenty pages to get to the end. ”
Shorten this;
http://isaacbrocksociety.ca/renunciation/comment-page-118/#comment-2538791
To….this;
http://isaacbrocksociety.ca/renunciation/
A hat tip to ?????? a fellow Brocker.
@Anne Frank or just click on Relinquishment and Renunciation of US Citizenship under the Ask Your Questions About section on the righthand side of the screen.
@calgary411
Regardless of what any representative of the US gov, regardless of department or level, would say, I still contend that it is impossible for a child born outside the US for which the birth is not registered with the US to have US citizenship. In the eyes of US law, the child does not exist.
Beware what anyone in gov will tell you. There is a Japanese saying, ” 10 people, 10 colours”, but with bureaucrats and lawyers it is more like 20 or 30 or even 100 opinions for every question asked.
As for standing on principle, you are a far, far, haver soul than myself. While I’m prepared to go head to head with my Japanese banks to avoid filing a US IRS W-8BEN form, which i find demeaning as a Japanese citizen, I have much more (hopefully irrational) fear of the long-distant IRS.
As for hopes that US consular or other DOS staff read this site, I would say zero chance and that any hope elsewhise is pure dreaming. You/we are on a level of priority similar as to whether garbage is recyclable or not.
LOL, TokyoRose. I so contend as well even though I have been told to shut up, be quiet so not to be noticed. I really resent being told to shut up and have a voice for the audacity of this for my son and any other “Accidental American” to be caught up in the immoral US overreach. He will not be the only one so entrapped into the absurdity of some automatically-obtained, never-registered with the US citizenship for which he hasn’t and we don’t ask any benefit. There really are contradictory statements if you look. I don’t intend to buckle under to the bully, but I sure would like to get some semblance of life before FATCA back.
@Embee, Medeafleecestealer and George: am navigating like a pro now. Thanks for the tip!
@calgary411 and @pacifica777
Thanks for the information, the latest form and the link to Voyons visit to the Ottawa embassy. I’ll keep you all posted.
Hello everyone,
I am in the process of becoming “compliant” and have a question for all of you. I will have filed 2010-2013 Tax Returns and FBARs going back to 2007 by October 15th or this year. I have an appointmaent in October to renounce my citizenship. Even though I renounce before the 5th year of tax compliance is over, will I be able to file final Tax Returns and and all the necessary forms for 2014 in the spring of 2015 ? Also, does my declared revenue end in October or do I need to do a full year (Jan. to Dec. 2014). This is somewhat important since I own a business and do not receive regular income, I pay myself on an “as needed” basis.
Also, I received this info from the Montreal Consulate. It may help those in the process of planning for renunciation. (I would like to have it appear in a nice grey box, but I don’t know how…)
“If you are considering renouncing your U.S. Citizenship it is important to note the act of renouncing U.S. citizenship is irrevocable. For more information regarding renouncing U.S. citizenship please go to: http://travel.state.gov/law/citizenship/citizenship_778.html
Be Prepared – make sure the following forms are duly completed.
DS-4079 http://www.state.gov/documents/organization/97025.pdf
DS-4080 http://www.state.gov/documents/organization/81606.pdf
DS-4081 http://www.state.gov/documents/organization/81607.pdf
DS-4083 http://www.state.gov/documents/organization/81609.pdf
If you do decide to pursue a claim of renunciation, you will be required to make an appointment. Request an appointment for notarial and other services by clicking here.
Once you have booked your appointment, send an email to Montreal-ACS@state.gov to notify us, so that we can have the appropriate documents ready upon your arrival. If you fail to notify us of your appointment date by email, you may be required to book another appointment.
You will also be required to complete, scan, and email the above forms AT LEAST one (1) week before your appointment and all proof of your U.S. citizenship such as but not limited to, birth certificate, U.S. passport, U.S. Naturalization certificate, Consular Report of Birth Abroad; and proof of your foreign citizenship, such as but not limited to, Canadian Naturalization certificate, Canadian passport. If you fail to do so at least one week before your appointment date, you may be required to reschedule your appointment.
On your appointment date, be prepared to pay the fee of US$450.00 and bring a Canada Post prepaid express post envelope (from Montreal to your home address).
At that time, you will also be required to bring with you all proof of your U.S. citizenship such as but not limited to, birth certificate, U.S. passport, U.S. Naturalization certificate, Consular Report of Birth Abroad; and proof of your foreign citizenship, such as but not limited to, Canadian Naturalization certificate, Canadian passport.”
@ LivingToRenounce
Thanks for that update on what the Montreal consulate requires. It could be very helpful to people in your area. I believe that for form 8854 filed in 2015 (or as soon as the 2014 form comes out) you would need to certify filing 1040s for 09, 10, 11, 12 and 13. (It asks for years “previous to expatriation”. My husband took that to mean whole years but if that is wrong someone will correct me on that.) The 1040 for 2014 would be a partial — up to the renunciation date plus a 1040NR past that date if you have income from the USA (some just send in a bunch of zeros). You seem to have plenty of FBARs filed though.
To do a grey box just put
(don’t forget the slash) at the end of the section you want to greylight. Try it, it’s fun!
Oops that looks weird. Let me try that again because I accidentally blockquoted my blockquote instructions.
To do a grey box just put at the beginning and (don’t forget the slash) at the end of the section you want to greylight. Now I have to add don’t put those spaces in when you do it.
Okay that didn’t work either. It bolded things this time. Put a back arrow, the word blockquote, forward arrow at the beginning and back arrow, forward slash, the word blockquote, forward arrow at the end. Sheesh!
@EmBee,
Thanks for the filing info, and the technical info for the box (but I think I’ll stick to quotation marks 🙂
@LivingToRenounce
Sorry I made that grey box thing sound so complicated. It really is easy to do but obviously not so easy to explain. 🙂 Actually it took me a long time to figure out that the grey box is just the blockquote html tag and that you don’t have to do the “cite” part. I hope all goes well with your exit plan. Sounds like you have a good grasp of how to navigate your way through.
@LivingToRenounce
I agree with EmBee re the filing.
My understanding is that you will need to certify filing a 1040 for 2009 on the 8854 you will file in 2015 (unless there is a change is the 2014 form when it comes out).
And yes, your declared revenue for income from outside the US will end in Oct, but you will have to also file a 1040RA for any EARNED income from the US from Oct to Dec 31 (as Embee says, for most people, this is usually zero). To be specific, regarding only Canadian income, if you had $5,000/month income for Jan through Oct and $10,000/month income for Nov and Dec, you would file a total of $50,000 on 1040 and $0 on 1040NR. (Actually the amount through Oct could be less depending on the date of your appointment at the Montreal consulate, but that it probably not that important to you.)
At least that is how I read the instructions. Hopefully someone will comment if they have a different interpretation.