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
@Innocente
I think the ‘cost-benefit’ analysis Patrick Martin refers to is a comparison of expatriation (this is the benefit) with $450, the loss of right to work in the US, and for higher net worth folk a boatload of exit tax (these are the costs). So the total cost of the identical benefit is higher if you have higher net worth. Put differently, the benefit becomes less valuable as its cost rises.
He does put it rather oddly, though. And it is definitely better to renounce earlier in life rather than later. Before, rather than after, becoming successful, rich, etc.
@Em
Curious that you should mention stealing data. Many people have wondered where on earth that treasure trove of information from the British Virgin Islands came from (http://www.icij.org/offshore/secret-files-expose-offshores-global-impact). Here’s one interesting theory from Marcy Wheeler, who writes the excellent Emptywheel blog (http://www.emptywheel.net/2013/11/29/the-cayman-islands-agrees-to-share-tax-data-with-the-five-eyes-countries/). Apparently though, she was wrong about no US persons being included in the data trove since the ICIJ article says there were American dentists and doctors in the files.
Cruzing in Reverse: Letter/Article to Canadian-Cuban-Texan-American Senator Ted Cruz asking him to help us relinquish or renounce US citizenship “lickety-split” like he can renounce his “technical” Canadian citizenship.
If he doesn’t want to do it for his fellow Canadians, I suggested he do it to tick off his adversaries President Obama and Senator Levin.
http://www.opednews.com/articles/Cruzing-in-Reverse-by-Lynne-Swanson-Taxes-140108-477.html
Blaze,
Cruzin in Reverse is hilarious! Another grand slam article!
Thank you!
Your latest Op Ed News article is brilliant, Lynne. Now I’m going to show how stupid I am. I tried to sign up to comment there but the confirmation e-mail showed my e-mail address as my username The sign up page did not ask for a username (just e-mail address and make up a password). I do not want to confirm anything if this is the case. Has anyone else signed up at Op Ed News? Got any advice?
@Edelweiss that is a very interesting article:
…….”Earlier this year, someone leaked massive amounts of data on BVI’s tax shelter clients and habits (though curiously, no US persons were identified among the most prominent culprits). As far as I know, no one has ever discovered how that data got leaked, and there seems little concern from the powers that be about this leaker who, after all, was as audacious as Chelsea Manning or Edward Snowden.
Now, I’m not saying that the US and UK were already stealing Cayman Islands’ data. I’m only saying that doing so would be perfectly within the known practices of America and Britain’s spy agencies.” from http://www.emptywheel.net/2013/11/29/the-cayman-islands-agrees-to-share-tax-data-with-the-five-eyes-countries/#sthash.hvtcUYio.dpuf…”…
And intriguing questions you raise. Thanks.
I wonder if it would be leaked in aid of legitimating FATCA – as in rationalizing why ALL the world must be FATCAnized? And we heard nothing about Americans because they’re not supposed to spy on their own citizens? Or?
Hi all,
This is my first time posting here. I just found IBS a few days ago while Googling and I am so thankful to all of you here for sharing your invaluable experience and information. It has assisted me greatly in finally making the decision this week to renounce my U.S. citizenship after I first contemplated doing so over a year ago. I haven’t finished reading the comments on this thread yet (made it to page 50 so far), but I wanted to chime in with my story, and most importantly, my thanks for this community.
I was born in the United States to a US father and Canadian mother, and lived in the US from birth until age 13, when we moved to Canada. My mother was very smart and made a special trip to Canada with me when I was less than a year old for the sole purpose of securing my Canadian citizenship, so I was already a Canadian when we moved, and I have been aware my entire life of my dual status.
Fast forward to 2011 when, like many of you, my world was turned upside down and for the first time I no longer regarded my dual citizenship as a benefit, but rather a burden. I have not lived in the US since I was a minor, I have never worked there, and have never owned any property there. I had no idea I had any filing obligations. I quickly became compliant out of intense fear and anxiety, and backfiled 6 years of tax returns (no FBARs as I didn’t meet the minimum $10,000 required at that point), and have continued to file an annual return and FBAR ever since. Though I owed absolutely nothing, I easily spent over $3,000 on cross-border tax preparation help between 2011 and 2012 alone, and was about ready to pull my hair out. I finally found someone local in Calgary last year who only charged about $350 to prepare my 2012 return, which seemed like a bargain after the amounts I was used to spending at that point. I relaxed slightly, and I had almost accepted my fate as a dual, that I’d just have to get used to spending this money every year to file a useless return and FBAR. And really, if it was just the return, I might have been able to adjust, but the FBAR has always made me uncomfortable; and now with the implementation of FATCA I have realized that this nightmare that started for me in 2011 may never really end, and that every year things can and will only get worse for US citizens living abroad. I have to think twice about any investment I make, and as long as I remain a US citizen, good luck ever starting or joining a business venture as an owner or partner. I am only in my mid-twenties, so I have an entire lifetime ahead of me that I fully intend on building in Canada with my non-US husband – these are very real issues I have to consider in deciding whether or not it is worth keeping my US citizenship. I have determined I realistically will never return to the US to reside or work, so it is no longer worth it, and definitely now more of a liability than a benefit.
Anyway, since I have been aware of my citizenship my entire life, and am tax compliant for 5+ tax years, I have decided to go ahead with the renunciation process. My appointment has been made by e-mail for March 18 at the Calgary embassy. So far my communications with them have been extremely courteous and helpful – every query I have sent has been responded to within an hour. I was hoping my appointment would be sooner as I will be traveling to the United States in February to visit family, and I only have a Canadian passport, but I’m sure it will be fine, and I am just grateful that it’s still fairly soon, knowing how long some of the wait times have been at other embassy locations.
To expand a little bit on the passport issue, that is actually what started this whole debate in my mind again about whether to renounce or not, and what sent me on a Googling frenzy, as I will be traveling on my Canadian passport to the US in 7 weeks. I had read somewhere that as a US citizen I was required to use a US passport (which I do not have, and have never had) when crossing the border, and this was complete news to me, as I have always used my Canadian passport. The only remote bit of trouble I have had was at my last crossing at the Calgary airport in October 2012. The border guard was pretty snarky with me and after seeing my US birthplace on my Canadian passport, demanded where my US passport was. I was totally taken aback and told him I simply didn’t have one. When he asked why, I said I’d never needed one, that I am a Canadian, and have lived here since I was a kid. He let me through, but I was really put off by the experience. After this week’s research, I now know this isn’t an uncommon occurrence, but something I don’t need to be too concerned about for now. Hoping that I will be okay to get through the border one last time in February without much harassment.
All that to say, March 18 still cannot come soon enough, and I cannot wait for the day I receive my CLN. I have the appointment marked in my phone as “Freedom Day.” 🙂 I plan to file a 2013 return and FBAR this year, and then by June 15, 2015, I will file a partial return for 2014 for January 1-March 18 (assuming all goes well and I am able to renounce that day – I don’t anticipate any problems though), along with form 8854, and one last FBAR, even though I have read it can be argued that it’s technically not required. It’s the easiest of the forms and I’d rather just have it all done with for peace of mind.
I think that I have interpreted everything I have read and researched correctly, and am going about the process correctly for my particular situation – anyone care to chime in on whether or not I’ve missed anything? Thanks in advance, and thanks again for all of the priceless information you have shared.
Sounds to me that you have a PhD in this subject. You have learned what to do and are applying your knowledge with less fuss than anyone else here. Well done. Don’t worry about the border. The experience you had happens but is unusual.
A brilliant perspective:
@Canadian88, sounds like you did a lot of good research and are doing the best thing for your situation, which puts you in a similiar situation as myself and many others.
@Canadian88, you’ve gone about this in the right way, doing research and a lot of thinking about what’s going to be the best thing for you. At least this time around, if you get hassled by border control you can tell them you have an appointment to renounce in March.
I did my renunciation in March last year so just about to finish up the paperwork. You may need to check that you don’t need to fill in a 8938 form on top of the FBAR. Here’s the IRS’s comparison page to help you decide:
http://www.irs.gov/Businesses/Comparison-of-Form-8938-and-FBAR-Requirements
Good luck for your February trip and also for March. The renunciation itself is quite simple and straightforward; most of your time will probably be spent waiting for the next 5 minute section to come along. Get into embassy and wait, call up to the counter to check forms are right and wait, pay fee and wait, face consul and finally make renunciation.
Thanks for reporting your journey so far to the Calgary Consulate for renunciation of your US citizenship. Glad this site had a bearing on your final decision. Your wisdom in analyzing all of this and acting on it will open more opportunity for you. Best to you and your non-US husband in building your future together, unencumbered by anything US.
I received my CLN this week.
I was notified by email that it had been received by Calgary on Dec 6th while I was in Las Vegas to attend the Andrea Bocelli Concert…
Since I was travelling to Mexico through Christmas, I asked them to hold it until my return home so as I could sign the registered mail receipt.
I originally requested an appointment in Feb 2013 after having my investment accounts frozen because TD Waterhouse noticed my US birthplace on my Canadian Passport.
My appointment in Calgary was April 10th 2013. I argued that since I was naturalized in 1967 at the age of 10 WHEN the 1952 INA rules in effect suggested this was an expatriation act where a parent COULD expatriate a minor so long as dual citizenship was maintained until age 21 and THEN if the minor did not take the US oath by age 22 nor take up permanent residence in the US by age 25, US Citizenship was lost.
The consulate did not agree at first. They suggested I confirm the second method of expatriation applicable to me: ie. I worked for the BC Government.
I insisted on setting a precedent as the INA rules were not changed until 1986, at which time I was already 28 years old and had completed the requirements of expatriation (and was verbally recognized as such in 1979). ie: TEST CASE.
After waiting for 6 months, I insisted on some resolution as we were due to travel to the US and Mexico in December. I finally got a response in October. The OCS Lawyer insisted that “as a minor” I had no understanding of the ramifications of losing US citizenship at the age of 10, regardless of the fact that I never returned to the US nor did anything to suggest US affiliation once I turned 21. I then set my Lawyer into action to provide proof of my BC Government employment including the starting date of employment as the OCS Lawyer insisted this was the date of an ACT OF EXPATRIATION as required to issue a CLN. Difficult a this was after 35 years, I was able to collect the proof and provided it under affidavit.
They accepted the proof of BC government employment and issued a CLN with a relinquishment date of MAY 1st, 1978.
They operate using the 1986 INA rules which eliminated the PARENT rule and lowered the age of adulthood to age 18, and apparently they apply this retroactively which creates conflicts such as in my case where I had clearly lost US citizenship based on the 1952-1986 rules. While I do not agree with this and had my lawyer include a demand that they recognize my failure to take up permanent residency by age 25 (section 1, 1952 INA rules) in case I had to take this to a higher court, they did accept the proof he provided of my BC Government employment (section 4A of the 1986 INA) as the ACT of EXPATRIATION. The end result is my CLN was issued based on my government employment. I will have to leave it to someone else to take them to task on the improper “retroactive” application of the 1986 rules.
I also want to make people aware that my daughter (born in 1983) was never at risk of US citizenship since I only lived in the US until age 5 1/2 while the applicable rules say that US citizenship cannot be passed on if the parent did not live in the US for at least 10 years with 5 of those years being after the age 14 (obviously not applicable to me). This is now further reinforced by the fact that I lost my citizenship in 1978 before her birth.
I strongly suggest that people facing this situation spend time looking at all avenues available to them before succumbing to the pressure of RENOUNCING (as RENOUNCING was repeatedly suggested to me by the consulate when they thought I wouldn’t be able to provide proofs).
Wow. Congratulations, Benedict, on the research you did and the steps you took to successfully claim relinquishment! Yours will be very useful information for others’ research at Pacifica’s Consulate Directory. I’m so glad you were persistent; I’m so glad that persistence brought success. I’m glad that you were able to effectively use legal help. What a shame that many in a case like yours will not afford that option. My final gladness: you are at the end of a long journey to get where you now are. Thanks so much for sharing this with everyone here!
Woo-HOO! Congratulations!
Congratulations! Just wondering if you had to provide a signed oath that you worked for the government or was proof of a start date enough?
@Dianne
I believe the answer lies in the interpretation of Section INA 349 4A and 4B.
4A states working for the Government AND having that nationality (thus start date)
4B states working for the Government AND taking the required OATH (thus likely OATH date or start date)
I was confronted with an OCS Lawyer who at first questioned photographic proof of my public employment records, but then insisted on having the start date as a requirement to issuing a CLN as that was in accordance to him the date of the ACT of EXPATRIATION and then they would issue it based on 4A (as I was clearly a Canadian Citizen since age 10).
That is when I engaged my lawyer to act on my behalf and provide the proof that I was able to obtain as follows:
1) A blank copy of the BC Provincial Employees OATH (from the 1970’s)
2) A letter from the BC Provincial Government acknowledging that I worked for a specific program of a specific Ministry in 1978 and 1979 as provided in the Public records and that an OATH was required by all BC Provincial Employees.
3) A letter provided by my hiring supervisory manager confirming my hire date.
This was all provided by affidavit and submitted by my lawyer directly to the Calgary consulate.
@Benedict Arnold. Thanks for the info.
My sister’s only claim to a back-dated CLN is that she worked for the Post Office, a Crown Corporation, as a contractor in 1999.
Since that was after 1995, my understanding is that even with a back-dated CLN to 1999, she still has to back file 5 years of taxes (and 6 years of FBARs), submit the 8854, etc?
She was born a dual US-Canadian citizen, and doesn’t have much money, so there is no issue of her being a covered expat.
I’m wondering what benefit there is for her to try to get a back-dated CLN rather than just renouncing?
Sure, she’d save $450. On the downside, it’s a 5 hour drive for her to get to Calgary. If the CLN is denied months later, she’d have to make another appointment and return for renunciation. That could delay the process by a year.
I can’t really think of any reason why she should try to get the back-dated CLN instead of just renouncing. She already has an appointment for mid-Feb, which was requested for relinquishment.
Toying with the Idea of Renouncing My U. S. Citizenship
@WhatAmI
I’m not as knowledgable as others, but I would think that if she was born a Canadian, then there could not have been a relinquishing act.
@ Bubblebustin’,
There are a few relinquishing acts that can be performed by a person who is born dual, such as taking govt employment with the intent to relinquish 349(a)(4), just that they can’t relinquish by the more common 349(a)(1), naturalising with intent to relinquish.
@ Benedict Arnold,
Congratulations! That is super news. It must have been a great relief to finally get your CLN this week! That’s great that you stuck with it, to get a correctly dated CLN, despite consulate pressure to abandon your claim. Thanks for sharing the details, which will be very useful to others, too.
@WhatAmI, as she’s booked for a relinquishment I think she should try and see if she can do that. The staff at the embassy will assess her claim there and then and from what I’ve read here about what happens at other embassies if they don’t think she has a claim they’ll tell her straight away. She can then say she wants to renounce instead and hopefully will be able to do it on the same appointment. Make sure she takes filled in copies of the Oath and the Statement of Understanding so she has them if she needs to make the switch. Has she got any supporting documents for her contractor work with the PO? It doesn’t look as though she’d have to file back taxes if she can get a relinquishment:
http://isaacbrocksociety.ca/2012/06/19/if-your-expatriation-date-is-before-2004-the-rules-are-different/
Of course, even if the embassy says she’s okay to relinquish the State Department may refuse it later, but I think most embassies are pretty knowledgeable about what will pass muster and what won’t.
Thanks for reminding me about Petros’ “before-2004” posting. I read this and the “before-1995” articles some time ago. My interpretation was that the before-1995 clearly applied to prior relinquishers, but the before-2004 article applied to prior “renunciants”, covered expats and the “exit tax”. However, reading it again now, I think I can see that it might apply to relinquishers between 1995 and 2004.
The posting starts like this and clearly states the question asked of the IRS was about renunciants:
Must of the text following focuses on the 877A rules and covered expats, but here and there the words are more general and arguably includes relinquishers:
As MedeaFleecestealer suggest, I’m going to discuss with my sister the idea of attempting the relinquishing claim for 1999 as a government employee, but have the additional renunciation forms in her pocket if they indicate she has no chance.
I’m hoping for more opinions here about this point. Anybody? (Petros, are you reading this? It would be great to hear from you since you wrote the posts I’m looking at now).