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
I don’t have time to write an essay on this, but the relevant bits of the CRA guidance on FATCA are very informative, and reassuring. See particularly various bits of chapters 7, 8 and 9.
https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/enhanced-financial-account-information-reporting/reporting-sharing-financial-account-information-united-states/guidance-on-canada-s-enhanced-tax-information-exchange-agreement.html
Key takeaway: “It is the responsibility of account holders to determine whether they are U.S. persons.”
Also: “A financial institution should assume that an account holder is not a U.S. citizen unless the account holder self-certifies that he or she is a U.S. citizen, or provides documentation that either identifies himself or herself as a U.S. citizen (such as a U.S. passport) or reveals an unambiguous indication of a U.S. place of birth.”
However: “A self-certification or documentary evidence cannot be relied upon if a financial institution knows or has reason to know that it is incorrect or unreliable.”
Nowhere that I can see does the IGA or the CRA guidance require Canadian FI’s to enquire about birthplace, or request to see passports. FATCA compliance relies almost entirely on self-certification.
This is the model FATCA/CRS form the Canadian government has provided for FI’s to use, though they are free to create their own forms or even use W-9 and W-8 forms.
https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/rc518/rc518-17e.pdf
Note the wording of the second checkbox: “I am a tax resident or a citizen of the United States.”
I was asked by my ISA provider about US citizenship. NatWest have never asked me, but this might be because I opened my first bank account with them back in 1986. I have sent a copy of my CLN to the ISA provider, and they’ve confirmed that they’ve marked their records that I’m no longer a US citizen. I don’t plan to chase up NatWest!
Let’s see…
Birthplace is the worst and most outrageously unfair question because as you’ve mentioned in many countries it’s a part of one’s legal identity and impossible to keep private. Almost impossible to lie about. And all the CLN’s of Arabia won’t make it go away.
Nationality isn’t part of one’s identity in the UK. I don’t know about other countries. (Maybe Canada asks about nationality because of CRS, not FATCA?)
So birthplace – the question Canada doesn’t ask – is the question all IGA1 countries should be stopped from asking. Then a person who doesn’t want the citizenship could self-relinquish and truthfully answer no to the nationality question.
Nononymous:
“I don’t have time to write an essay on this, but the relevant bits of the CRA guidance on FATCA are very informative, and reassuring. ”
Yes, thanks, that’s indeed informative and reassuring. UK on-boarding guidance for FATCA is very different.
Time to write another letter to my M.P., I think.
What I find “reassuring” – in a making-the-best-of-a-bad-situation sense – is that the default bank behaviour, as prescribed by CRA, is to believe customer self-certification unless there is good reason to think otherwise. And nowhere does it mention sanctions against untruthful customers, other than treating their accounts as US-reportable.
Nononymous:
“Canadian banks do ask about nationality (and/or tax residency) but they do not ask about birthplace. Subtle but important difference if you are a US-born liar.”
Or a Canadian citizen who doesn’t consider himself/herself to be American and doesn’t act like an American.
Nononymous:
“nowhere does it mention sanctions against untruthful customers, other than treating their accounts as US-reportable.”
That’s all the IGA1 allows. The sanction that is most harmful is the one the banks can’t (under current UK / EU law) be stopped from using: refusing accounts to new customers if they have a US birthplace.
‘If you (generic you) are a law-abiding citizen of another country, you can tell the truth and shame the devil.’
The devil feels no shame. 2 days ago I received another letter from them reminding me that they penalized me for telling the truth.
===
‘You have a right to renounce, and it’s not conditional on being able to remember dates. Putting “approx” or “est” shows you’re not deliberately lying.’
That’s exactly one of the things that gets you penalized if you do it on a US tax return. You can’t help it if you have to estimate (e.g. when your employer issues a falsified certificate of tax in the country where you live and work) but you’d better not say “approx” or “est”, you have to sign the preprinted jurat without alteration no matter how false you know it to be. But yeah, the renunciation department was different; they accepted declarations like “forgotten dd – forgotten mm – 1975” etc.
“Decades ago, the BIG Personal computer was the Comadore 64 with a whooping 64 K memory.”
Yes, but real institutions used real computers not Personal computers. For example I used some that had more than a megabyte of memory. One even had almost a gigabyte of disk storage, spread among 8 disk drives, each drive the size of a refrigerator.
“Decades ago the technology required to IMPLEMENT FATCA simply did not exist to the extent needed.”
Yes it did. Banks and the IRS had computers bigger than the ones I used.
“Gee, I wonder why the IRS didn’t use etech to really go after expats back then?”
Paper worked fine. The IRS sent letters by postal mail and ignored replies that came back by postal mail. As the IRS didn’t yet use 800-phone numbers (businesses did but the IRS didn’t), the IRS’s letters didn’t instruct taxpayers to make toll free calls to numbers where the IRS contracted with ATT to block those calls, the IRS’s letters instructed taxpayers to call IRS phone numbers listed in their local phone directories. My local phone directory didn’t contain any such number (not even a number for the nearest US consulate since that city wasn’t included in my local directory) so I sent a letter which the IRS ignored. Also if you go back 33 years you reach the time when the IRS hid returns in places like ceiling panels because the IRS felt overwhelmed, but that’s not the only time the IRS mishandled returns.
“How big an issue was ID theft decades and decades and decades ago?”
Right, when Congress enacted the Privacy Act of 1974, I wondered why. But 30 years when you and I came to Japan, in Japan we both learned the reason why we have to try to protect against identity theft.
Or rather – accountholders who don’t supply their SSN (“refractory” accountholders) are to be treated as reportable.
This would presumably include an accountholder who the bank had reason to believe was a USC, but who denied USness and didn’t supply a SSN or TIN.
It’s not really a sanction. FATCA (and the IGAs) place obligations on FIs, not on accountholders. The bank is supposed to report accounts with indicia or accounts held by a person the bank knows or believes to be a USC, unless they can get a copy of a CLN.
They may not tell you they’re reporting your account, though the IGA says they should. Whether they might pretend to accept your self-certification, while quietly flagging your account as reportable (if they think they have reason to think you’re US-born), I don’t know.
(The situation doesn’t arise here in the UK, since birthplace is known and can only be “cured” by a CLN. US-born + CLN-less = reportable.)
@plaxy
Actually I did see something in there about a possible $100 fine (payable to whom, it did not say) for any admitted US citizen refusing to supply or obtain an SSN.
There is a vague “thou shalt not lie” warning on the bottom of the self-certification form, but no specific threat of penalty. Moody’s “perjury and tax fraud” warning is utter bollocks.
May I make an impassioned plea to the moderators to cut off the pages upon pages of irrelevant conversations which have taken over this topic? When I first found IBS, I zeroed in on this thread to read about other people’s questions about renunciation and the authoritative answers on the topic. I’d be hard-pressed to find such topics now without scrolling back through at least twenty pages of windy (and repetitive) dialogue that are at best peripheral to the actual topic. It has now devolved into a FATCA discussion, nothing to do with renunciation.
I am concerned about newcomers who will find it increasingly difficult to use these forums to quietly seek answers. We really need a separate “coffee shop” thread for these kinds of unstructured discussions. Nothing wrong with them; they just don’t belong in this or other threads meant for specific issues.
““Decades ago, the BIG Personal computer was the Comadore 64 with a whooping 64 K memory.”
Yes, but real institutions used real computers not Personal computers. For example I used some that had more than a megabyte of memory. One even had almost a gigabyte of disk storage, spread among 8 disk drives, each drive the size of a refrigerator.
“Decades ago the technology required to IMPLEMENT FATCA simply did not exist to the extent needed.”
Yes it did. Banks and the IRS had computers bigger than the ones I used.“
Not to the extent needed. As recently as a few years ago I tried to wire money home to finalky pay off my school loan. Told it would take 6 to 8 weeks. Long story, but in the end could not and had a huge sum, for me, floating around the ether for three months before I could get it back.
Going back to my time in college here in Japan, the computers you speak of the banks having may very well have existed in banks in Japan, but only in Tokyo, perhaps Osaka too, who knows. But any exoitc banking, cashing a cashiers check for example, had to but done through the main bank in Tokyo and the provincial banks requiring over a month to accomplish. A few years after this, while studying in Tokyo, I had to send cash in an envelope to my girl friend working a part time job in a hotel over the winter break. Her account was not accessable in the town she was working in, despite banks and ATMs there. Tons of other examples from my time traveling about Japan. Some quite recent.
@Barbara
You may find it hard to believe, but I agree with you. The problem is, blanket statements that while being true for some are false for others. If these are not pointed out, the a newcomer can be lead very far astray if they later move from the one part of FATCA coverage to another without knowing that this issue is much larger with many more facets than generally discussed here.
@Japan T: Then the person wanting info about FATCA can look at the FATCA thread. I’m sorry but I find it incredibly NON-enlightening to come to the Renunciation thread and end up reading about Japanese bank computers.
I think IBS is being spoiled by these endless scrolling rambles of bla-bla-bla. I enjoy coming here a lot less than I used to.
And now I’m guilty of polluting this thread too. See how easy it is? Somebody give me a call when any useful information is posted here. Over and out.
Nononymous:
“Actually I did see something in there about a possible $100 fine (payable to whom, it did not say) for any admitted US citizen refusing to supply or obtain an SSN.”
Could you post a link? The UK guidance doesn’t require anything of the accountholder, so that’s an interesting difference.
Found it.
https://www.canada.ca/content/dam/cra-arc/migration/cra-arc/tx/nnrsdnts/nhncdrprtng/us-eu/gdnc-eng.pdf para 8.82
That cites Subsection 162(6) of the ITA (https://laws-lois.justice.gc.ca/eng/acts/I-3.3/section-162.html)
This little difficulty (banks being required to obtain an accountholder’s SSN but having no power to compel the accountholder to provide it) was temporarily resolved for EU banks by the IRS agreeing to suspend the requirement for the time being (until 2020, I think). It will be interesting to see what happens after that.
Thanks for a (to me) very informative discussion. I’ll be quiet now. 😉
But will just make one further comment sotto voce:
The fact that the IRS agreed to suspend a FATCA requirement which EU banks were unable to comply with due to local law, may suggest that the IRS could suspend the requirement to report accountholders purely for getting themselves born in the wrong place, should a court rule that pernicious demand illegal. Fingers crossed!!
@Barbara
Someone here is concerned about having the infirmation the put on a form cross checked against data held elsewhere. They are being told not to worry because this has not been decades and decades ago. Things have changed. Data sharing capblity has greatly expanded in recent years due in part to technology and to changes in laws allowing this tech to be used in such fashion.
See Barbara, I have been a victim of people telling me not to be concerned about this or that only to get royally burned down the road. May not happen in this case, but anyone in this position should know that much of the advice being offered here is based on the realities of decades and decades ago.
@Bird Person, Heidi, Portland, Em Bee, plaxy, Nonymous. Got an e maill back from US Embassy about periods of resident dates and reply was ” The onus is on the applicant to provide this information you only need to include dates you were physically living there. Please provide the periods of residence to the best of your knowledge, you may just list the main periods of residence it does not have to be every trip.Tthese dates must come from you and to the best of of your knowledge” Not sure this helps me much in the problem that may be encountered if the dates are not accurate but looks like that is the answer. Em Bee. I do remember the song “Snowbrid” and very good too thank you. Nonymous maybe I am overthinking this but its natural to think OMG what if some part of the the form I am completing is worng as the date s maybe way out not just months but years and what are the consequences. I will take the forums advice and put approx.
PS Moodys Gartner had a full page spread in one of the UK’s news papers saying ” do you want to remounce US citizenship” so it looks like they are advertising big time their services!
Kabby:
“Moodys Gartner had a full page spread in one of the UK’s news papers saying ” do you want to remounce US citizenship” so it looks like they are advertising big time their services!”
Yeah they do that a lot. I daresay it pulls in a lot of money for them.
@ND
Didn’t exist to the extent required for FATCA. 30 years ago, how would you have transfered that 8GB of data from Japan to the US? Last week, a new app ate up all 7GB of my monthly data plan in a couple of hours. How long would that have taken 30 years ago?
@Kabby
You have your answer from the horses mouth
“to the best of your knowledge”
Is there anyone like friends, relatives, work, whom might be able to help you remember the year?
Otherwise please believe reports from others who have gone before that it is not a problem and will not effect your right to renounce or get you in trouble!