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
@dod, it may seem like nothing more than Halloween spooky things. But the Reed Amendment is law and it does bar any covered expatriate from ever entering the US again. The fact that, so far, no one’s been able to make it workable doesn’t mean they won’t do so in future. Mr. Reed keeps trying, the last attempt in 2014. The DHS report subsequently found that 2 people had been denied entry under the law so it is possible, however remote it may seem to you. 5 others were also identified, but not removed from the US.
“According to the DHS report, two individuals were denied admission to the United States on the grounds of the Reed Amendment between 2002 and 2015, while another five individuals “were identified as possibly inadmissible” on that basis but were not removed.[1] Joel Paget of Ryan, Swanson & Cleveland states that one such denial (against a person who renounced before the enactment of the Reed Amendment) was reversed after the renunciant’s lawyer submitted a legal brief to CBP.[19]”
And I believe I have read the occasional report of someone being arrested at the airport and held until they pay whatever fines the IRS have issued, before being allowed to continue their journey. Can’t find a link with Google though.
DOD
Well the US Gov is certainly not offering any treats and their tricks are getting more malicious; better to know their full hand, even if not yet played.
No newcomer will thank you if they are not warned.
dod asked – Why have a joint account?
I can’t speak for anyone else but one of the reasons I have a joint account is so that when one spouse dies the other has immediate continued troublefree access to the account to pay the bills.
Not only death, but how about illness or injury where the main account holder is mentally incapacitated?
The problem really is that none of us know what the future will bring. Will any legal case against FATCA win? Will the ability of the IRS to ferret out US persons become more thorough in the future? Will technology allow for more invasive probing into people`s whole identity or holdings 5 or 10 years from now? Could it be that one day in the future a thumbprint will be used instead of a passport and all personal data will be stored in some database? Will the IRS notifications be directly tied in to our personal information? With one click will they know everything about us? It certainly looks like things are heading this way. Seems like I have to get a new passport for international travel- one with my thumbprint on it. A “digital one”. Thats new. What else will be new in the next 5 years because innovations are happening so often and so fast that my head is spinning. Will FATCA go away altogether or is it here to stay? We don`t know what the future will bring.
But I would think it would only be prudent, if a great inheritance is expected or any other financial windfall – to renounce sooner than later. Streamlined seems to be an option, although this can be painful too, but at least it does not involve the incredible penalties.
Also, if one decides to go into hiding, then one has to always keep a low profile. In many ways, this can be very constricting. Not only travel could be problematic, but also investing. Simply knowing that one always has to hide can take the wind out of our sails and lower our ambitions. What also might matter are one`s age and professional aspirations. For example many countries wont be hiring US persons in any signatory position and already now we are hearing about those who were denied promotions or partnerships. I could imagine that lying here might be impossible and/or considered fraudulent.
So everyone`s situation is different. It even depends on the country in which one lives. In Israel, bank accounts have been frozen. We also have NO idea how the banks will react when all of this actually goes down. The IRS has just begun collecting information from recalcitrant account holders and we don`t know what they will do with it. I have not heard about one person who has been called out this way- by having his information sent to the IRS without his knowing about it. What will they do with this information? I cannot imagine that they would collect and do all the work without hope for financial gain from it. And what will happen if they do go after a Canadian citizen/Us person with an account in Canada? Will Canada really say no to America? Up until now, America has always had the bigger club. Will America then exert even stronger pressure on foreign countries to assist with collection? Which countries will then cave in first? Or will they finally have the guts to stand up to America and its demands on their own treasuries? All of this we don`t know. And one can only be honest by saying that we don`t really know what will happen down the line.
I chose to pay up and renounce, simply because I am older and frail, and I never intend to go back (have lived in Europe for over 50 years and this is my home) and the anxiety of making a mistake when filing was too much to bare. I wanted to simplify my life in my old age and that did not include constantly being scared to death of America and what they think up next. But everyone`s situation is different which is why the advice offered here tends to vary. Somebody who is 70 and at the end of his life might chose very differently to somebody who is just starting an international career.
So the choice, as I see it, is up to bjorn. Perhaps it is a question of how much pain he can stand to free himself now with no strings attached, as opposed to risking more for an uncertain future. But we have to be honest and say to him that we dont know what will happen in the future. We just dont know yet.
They say that there are about 7-9 million US expats in the world and add a few million with green cards. Seemingly- not sure about the exact number any please correct me here – but maybe 300000 have come forward? Where are all the REST? That would be a lot of people who are in hiding or maybe just don`t know about this mess even today.
It’s funny, people’s opinions here. If they’ve renounced, they say that the US will never return to RBT. If they’ve decided to stay off the radar, they’ve taken the stance that the US will never come looking. If they’ve complied, there’s no place to hide.
It’s all matter of opinion, nonetheless. HOWEVER, if past behaviour is any indication of future, the US will try (I emphasize “try”) to do what it needs to do in order to enforce its laws, that is until it decides to “do the right thing after it’s exhausted all other options.” The US will undoubtably try to enforce CBT to the best of its ability until it has no other choice than to abandon it.
Tomorrow marks the day that Treasury Secretary must provide renunciation numbers to the “Liberty List” in the Federal Register.
@Polly
“The problem really is that none of us know what the future will bring. Will any legal case against FATCA win? Will the ability of the IRS to ferret out US persons become more thorough in the future? ”
Absolutely we do not know what the future will bring. That is why we must do whatever we need to protect ourselves as individuals. And then collectively support the lawsuit as a form of resistant to USA tyranny.
I also wished to simplify my life in retirement years and renouncing was the way to this goal in my case. It may or may not be for others.
@PatCanadian
My father got senile in his old age. It started already around 70. I am afraid that it will happen to me too and then how will I understand all these crazy rules? How would I keep up with the constant changes and new laws? How would I even GRASP them? And who would then take advantage of me? I totally wanted to make my life as simple and safe as possible for my old age.
@Bubblebustin
“do the right thing after they have exhausted all other options” – DO THE RIGHT THING. Could this be a reality or is it just wishful thinking? Sigh. Such a sin. Even Nina Olsen who works at the IRS said so. We face such adversity in life. There is so much injustice. We have to decide what we need or want or even can do about it. So grateful for Brock to gather all the information possible and look at all sides.
All the above are true. And don’t forget the simple things like in future you need to have a SSN to get a passport. It’s not law yet, but the following suggests it may well become so.
The fact that if you’re not up to date with your tax filings you could find your passport revoked.
http://www.forbes.com/sites/robertwood/2015/12/04/irs-power-over-passports-signed-into-law/#563c57012030
https://www2.deloitte.com/content/dam/Deloitte/us/Documents/Tax/us-tax-passport-control-new-legislation-in-the-us-provides-the-irs-with-another-tool-for-collecting-delinquent-taxes.pdf
For those people trying to hide/ignore the situation it simply isn’t going to happen. Sooner or later if they want a US passport they’re going to have to become tax compliant or get/have another citizenship and give up the US one. The State Department is actively assisting the IRS in making clear to US citizens that they have fling obligations even though they live abroad.
http://www.citizenshipsolutions.ca/2016/03/30/us-passport-application-links-citizenship-statedept-to-taxation-ustreasury-to-enforce-taxation-based-citizenship/
‘Sooner or later if they want a US passport they’re going to have to become tax compliant or get/have another citizenship and give up the US one.”
but what about those of us who will never want or need a us passport, will never travel to amerika again and already have another citizenship.
are they really going to either search for us or even begin to determine who/where we are?
i am willing for myself and only myself to roll the dice and quit living my life in fear of a foreign gov’t coming after me because “a candian is a canadian is a canadian” after all.
@mettleman, then you might be lucky – if you have no SSN, have never filed US returns and your foreign bank has no idea that you’re American. Given that SSN’s are issued at birth in the States now it’s more and more unlikely that an Accidental born there won’t have one.
bjorn. I suggest you pay attention to Mettleman, BC Doc ,Our plaintiffs Ginny and Gwen and many others
@ Medea Fleecestealer i do have a ssn thanks to my parents getting me one when i was born
i believe that uncle sam has lost track of me and millions of others as “we” have never had to notify uncle sam as to who or where we are unless you are in irs compliance which of course millions of us are not
if we do not out ourselves by coming in to compliance, entering america and having to get a pass port or having our banks report us how is he ever going to find us?
again i refuse to comply with a foreign gov’ts request of me since i do not consider my self a citizen of the united states of amerika but rather a canadian citizen.
when i obtained my canadian citizenship in 1980 it was with the intent to lose my american one as there were the sabers rattling of a coming draft due to the the iran hostage crisis.
i never had an obligation to notify americka of how i was proceeding my life.
they did not care in 1980, i do not care in 2016
i will never come into compliance nor will i ever enter amerika again. and as for the banks i will lie my a@@ off to them because it is none of their business where i was born.
the majority of my banking is done with a “local client” based credit union as well
@mettleman, I say good for you! If you’re happy and don’t worry, lose sleep over it, etc, then it’s the right choice for you. But bjorninusa1 may feel differently. It’s so much a personal choice. As said he needs to research all options very carefully and not rush into any decisons. Only when he’s done that and knows the choice he makes is the one he can best live with should he proceed.
@Medea Fleecestealer
absoutly agree 110% with you
we each have to read and then read some more and make the most informed decision that is RIGHT ONLY FOR US as an individual.
each circumstance is different and each choice is a very personal one and only we can make the right choice for ourselves.
@mettleman
It really does depend on somebody`s circumstances. Lets say you wanted to get a job somewhere else- or were forced to. Or say a promotion or a partnership in some company in Spain or where ever ( I chose this because a guy I known was kicked out of a real estate endeavour in Spain because of the 4 members involved – he had a US passport) – then things just look different for the “hiding” decision. Or maybe you inherit a bag of money and want to invest wisely so you get a return on it. Which stocks and bonds can you then buy or not? These are things to consider if one wants to remain that flexible and have such options. If however one`s life path is already decided and one has a job and lives on those wages and there are no other options- no travel, other investments etc- then perhaps going into hiding is more simple.
But of course this all depends on if FATCA is here to stay or not. I also think that many decided to hide because they truly believe that there will be light at the end of the tunnel and FATCA will go away, so the laying low will only be for a while.
@medea
I think with trepidation about technologies that haven’t even been discovered yet. Just about 25 years ago nobody could have imagined the internet.
@ polly
“I also think that many decided to hide because they truly believe that there will be light at the end of the tunnel and FATCA will go away, so the laying low will only be for a while.”
i think you are 110% correct with this statement.
in my situation i am comfortable where i am at for the time being. stable job, house paid for (i have been in this house for 25 years just out side of vancouver), no need to travel for business or pleasure to amerika, able to put money bi weekly into my various rrsp’s and no problems with my place of birth from the banks or finacial advisors. (yes i have been asked and yes i have lied) why would i want to wave my hand to the uncle and say here i am?
i am content for the time being to wait out our law suit and see how things turn out. several years down the road i may have to doing something different but for now were a letter to arrive in my mail box from a three letter agency from south of our border it would end up on the bottom of the bird cage!
@medea
25 years ago the internet wasn’t something nobody had imagined – it already had 60000 hosts in 100 countries, with major growth in .com users outstripping .edu and .gov entities. The worrying technologies are not so much the technologies that haven’t been discovered yet, but the technologies that are here but not yet fully deployed by the IRS, Department of State, DoJ etc., These are the technologies that track your movements e.g. by face recognition, cellphone GPS .., read your messages, look at your transactions and finances, etc.
Does anyone know how many of the up-to-10 million US persons outside the US don’t know about, do know about and are ignoring, or are trying to comply with the US laws. We know that in 2014 the IRS sent 855,000 notices and letters to U.S. taxpayers living in other countries. I have filed every year and the IRS only once sent me a letter and that was in 2014 when one of the signatures on a joint return was missing. No doubt many of the other 849,999 letters in 2014 were about tax returns, but how many were warnings to non-filers. At least one of them would have been the tax demand to Boris Johnson after selling his London flat. Without more detail it’s almost impossible to get a handle on the risk of coming to the attention of the IRS for the first time. If you do it might be OK or not OK to ignore them, depending on individual situations and the difficulties associated with retaining US citizenship as discussed in these postings already.
As has been posted at IBS, the IRS is NOT looking for anyone. Instead, they have implemented at least four (4) methods to find out about you.
FATCA is not the IRS looking for or coming after you. FATCA is a penalty regime for you if you do not come to them and for your bank if they do not turn you over to the IRS. FIs are not charged with the responsibility to solve the question of a client possibly being a US person, only fined if they do not turn over all who might be US persons. FIs are also not fined for turning over data on non US persons. The IRS is going to end up with data on a lot of people that they are not entitled to know about even with FATCA.
Then there is the whistle blower program where others are rewarded from what the IRS claims you owe for turning you in. No action by the IRS nor any money from their budget is needed.
In the highway bill, the same legislation which allowed for the revocation of passports over money owed to the US, is the provision for the IRS to employ private debt collection agencies for collection of back taxes. As these too are paid soley on what you are said to owe and they believe the myth that we are all multibillionairs, I am sure we could see some mighty crafty people looking for us. Personally, if I were engaged in such an activity, I would pick a year and look at records of births to foreign nationals in the US and track the SSNs of these children. If there is no activity, I would contact the branch of my debt collecting agency in the country of the parents and track them down there. Again, the IRS are not the ones looking for you.
The details of the fourth are not as clear to me as they would not apply to me, but it has been reported that the data security firm that won the contract to store the CRA’s (or some other entity charged with collecting this data) data is an American firm and that they will be storing your data within the borders of the US, where Canadian privacy law will offer you no protection.
There is no way to know the future, this is true. However, by studying the past, we CAN get a very good idea of what the future holds. There should be no doubt as to the Intentions of the IRS. There should be little doubt over our countries of residence ability or even will to stand up to the IRS. If the Canadian government believed that a Canadian is a Canadian is a Canadian, then there would be no need for the lawsuit.
Other points to consider. While IRS audits are down overall, audits of overseas USCs are up. Despite budget cuts and reduction of its workforce, the IRS collected a record large amount of revenue this year…and the US deficit STILL increases. So, expect the deficit spending additcted US to continue to employ increasingly rurthless tactics in its search for every penny it can grab to fund the gov. benefits its citizens have become dependent upon.
@fno
Well then 30 years ago or 35. You get my point- technologies keep advancing. But you make a point too. What is already there could be enhanced.
I just realised another reason why I renounced. I didn’t like having somebody else have POWER over me. Especially not a rogue government which is not interested in my welfare.
I totally share your distaste for the extraterritorial taxing power the US claims; it ‘s so contrary to the principles of natural justice. I wonder how the US would react if a foreign government declared it had the power to tax incomes and assets of US-resident US citizens and resident aliens because those residents or their parents were born in the foreign country and still considered to be their citizens? Maybe then the US would see the injustice of CBT and how it’s equivalent to theft.
Then there is the matter of the IGA’s the USA forced on many countries, Canada included. This was done under threat of huge financial sanctions in the form of withholding taxes on any US pass through payments for FFI’s, in the event of noncompliance with a US law.
At least by renouncing, some of us have ended a toxic relationship with the US IRS. I feel I can move on with my life that way.
Someone in the Canadian government said that the FATCA IGA is “merely information sharing”, or something to that effect. Sounds about as benign as a live grenade.
I haven’t heard of anyone outside the US receiving correspondence from the IRS as a result of FATCA, but then we don’t know how foreign banks produced those information slips. Mine were produced only because I signed W-9’s with the banks that reported me.
Can or will the IRS ignore information slips on suspected US taxpayers just because the account holder lives in another country?
“FATCA/FBAR is like a reverse fish net -catching the little fish and letting the big fish swim away.”
An apt description from the chair of Democrats Abroad France to John Podesta.
Don’t let yourself be a little fish.
I find it interesting on here when people refer to foreign banks. As a Canadian citizen my entire life, only ever having lived, worked, and banked in Canada I think of US banks as the foreign ones. I’ve never applied or wanted a US passport, likewise, I’ve never applied or wanted an SSN and don’t have either today.
If my Canadian bank doesn’t know that the US considers me a US citizen (I do not consider myself a US citizen either) then nothing will get reported under FATCA. The bank has never asked me to to sign any paperwork so I am thinking they don’t know. That leaves the only record of me being connected to the US, my place of birth on my Canadian passport and my old birth records from the 70’s. I am doubtful they will come after me but aware it may happen at some point in the future. I am planning on taking a wait and see approach until I have money worth protecting at which time I will also have money to resolve my status.