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
Another shameless plug for Phil Hodgen’s expatriation knowledge services for those that might find them valuable. You don’t have to buy everything (or anything!) he is selling, but he has been putting on forums that could be helpful for those who learn best by ‘hearing’, rather than just reading here.
Below is his latest email. I don’t need the services, but just passing along for those who might find them helpful.
Usual disclaimer this is not an endorsement or service offering that I have any vested interest in.
Jell-O-Shot email.
Hi, it’s Phil Hodgen, international tax lawyer and reformed Viking. This is my monthly email newsletter, called a Jell-O Shot because it’s fast, effective, and tasty. Like the drink. 🙂 If you don’t want to get these emails anymore, you can unsubscribe instantly. I don’t want to bug you.
TL;DR
Hit “Reply” and type “lunch” if you want to hear me talk about expatriation on February 14, 2014. In person in Pasadena or dial in on a telephone call. Noon Pacific time.
Hit “Reply” and type “questions” if you have questions about expatriation — I will use them for my multi-part, nitty-gritty, in-depth, line-by-line workshop on expatriation that will be coming up soon.
International Tax Lunch – Expatriation Discussion – February 14, 2014, Noon PST
From noon to 1:00 pm-ish Pacific Time we are hosting the third monthly bring-your-own-lunch session for anyone interested in international tax topics. This is a monthly event. You can come to our offices in Pasadena, or you can dial in and participate via a conference call. (Hint: we have limited capacity in our conference room but if you come to Pasadena we will buy you lunch.)
This month it is The Expatriation Show, and I am the speaker.
This is more or less the same presentation I did in December at the California Society of CPAs International Tax Conference, but abbreviated to leave some time for questions. Yes there will be a handout for people who attend–the presentation materials I used in December.
I am not sure how we can handle questions from the dial-in audience, so it would be best for you to email questions to me ahead of time. Or afterwards. This is a technical limitation of the conference call system.
If you want to attend — in person or by conference call — just hit “reply” and tell me. We will put you on the list.
For those of you who want to dial in, we will send out the conference call number a couple of days before the event. But I can’t send you the dial-in information if you haven’t told me you want to listen in. Hint hint.
For the future. I have a special mailing list to get regular updates on upcoming lunch topics. Sign up here. You will get regular notifications well in advance of each month’s session.
Why not sign up so you will get early information about who next month’s speaker will be (Rufus Rhoades) and what he will be talking about (a gift from Congress called the “portfolio interest exception” that is highly useful for nonresidents investing in U.S. real estate).
Please send expatriation questions: what is puzzling you?
Yep, it’s coming. In fact today our office at lunchtime our entire team will be brainstorming the outline of the course: what are all of the things that we need to cover for a person who wants to expatriate and is fairly confident that he or she is NOT a covered expatriate? More on the workshop later.
Since we’ve seen it all — from net worth of $60,000 to hundreds of millions, we have a pretty good sense of what happens. 🙂 We’ve done everything from the State Department’s paperwork to the tax returns. (Tax returns are the way you talk to the government about money. That’s why–when we put out a (tax) fire in someone’s life–we do the tax returns.
But I want to know what problems you are facing right now.
-You might have specific assets that you are worried about–how will this pension be handled if I expatriate?
-You might be wondering if you might be a covered expatriate.
-You might be wondering about past tax transgressions (oh, I love those KJV words) and what to do about them prior to expatriation.
-You might be wondering if expatriation is the ejector seat button you need to push in order to extricate yourself from the flaming, twisted hulk plummeting towards earth that is the U.S. tax system’s kung fu grip on your personal life.
(Sorry about going overboard on the metaphors.) (Heh. Do you see what I did there?)
Email me your questions. Anonymously if you like. Go sign up for a random throwaway account on GMail or Yahoo and send your question.
I will build them into the workshop I am preparing for people who expatriate. The objective is to give highly specific answers to normal people so they can either have a “do it yourself” expatriation tax return preparation festival, or (more likely) be exquisitely well-informed shoppers when they kick the tires at their local tax advisor’s shop. So to speak.
Over the weekend I am going to post a bunch of questions I have already received from people — as a blog post. You can add your question there as a comment, too, if you want.
Workshop: we’re designing it now; file for an extension
If you expatriated in 2013 and you want to attend the workshop before filing your 2013 tax returns (the dual status tax return for 2013 and Form 8854), file for an extension right now.
Your filing deadline for all things expatriation-tax related will be April 15 or June 15, 2014, depending on how your life is configured and where you live.
File Form 4868 to get an extension to October 15, 2014. As part of the workshop we will show you how to get a further extension of time (if you need it) to December 15, 2014 to file your 2013 expatriation-year tax paperwork.
This will give you enough time to attend the workshop and figure out what you need to do in order to leave the U.S. tax system cleanly.
Important: to leave the U.S. tax system cleanly your prior five years of tax returns must be squeaky clean. You might have a massive cleanup job ahead of you. Give yourself plenty of time to get that all squared away before filing the 2013 tax returns. Those of you with “interesting facts” in your past–you know who you are!–will want to be especially ready for this task.
Sign up for the Expatriation Only mailing list
I have a mailing list for expatriation information only.
Sign up here. You can unsubscribe at any time.
You will get information about the upcoming workshop in addition to snippets of useful information on dealing with expatriation. Because of our client base we tend to live at the bleeding edge of expatriation–every new project seems to bring a new “aha!” moment.
Thanks
Thanks for reading, and tell your friends. I hope you attend the International Tax Lunch next Friday (February 14, 2014, noon PST). I REALLY hope I hear real-life expatriation questions/comments from you. And as always please call or email.
Phil
w +1 626-689-0060
The CRA notes on the FATCA IGA have a question on old relinquishers (those who took Canadian citizenship back when you automatcally lost your US citizenship):
17. Does the Agreement require Canadian financial institutions to report to the CRA on any individuals who were told that they relinquished their U.S. citizenship when they became Canadian citizens?
The Agreement does not require Canadian financial institutions to report on any individuals who have relinquished their U.S. citizenship and are not residents of the U.S.
Individuals who have relinquished their U.S. citizenship may be asked by their financial institution for documentation to this effect.
Apparently banks are not required to go after them, but may require documentation. That leaves two questions:
1. What documentation? Will it be sufficient to produce your certificate of Canadian citizenship with a date showing that you became a citizen at a time when everyone was told they automatically relinquished? Or will a CLN be absolutely required?
2. Does “not required” mean they can go ahead and report you anyway?
There seems to be a lot of “not requireds” in these notes.
CLN decision between a rock and a hard place. Do I get more trouble with it or without?
@badger
Thanks for the link to the article in Canadian Tax Journal about taxation of America. expatriates.
( http://www.ctf.ca/ctfweb/CMDownload.aspx?ContentKey=4fa01c65-281b-437c-8099-bae25c4fbca6&ContentItemKey=11eb8ece-4a53-4f1a-a676-cb888fe67ed5)
One discouraging point in it. They make no mention of the rules being different for people who committed an expatriating act before 1995.
I have every reason to believe I could get a CLN backdated to the 70’s, but a copy is sent to IRS. If they don’t recognize the backdating, is there a realistic chance of them trying to come after me? If they don’t recognize that the law is different for that category, what recourse is there?
One the one hand I have a below ten thousand bank account, and only need to worry about some idiot at the bank deciding to get birth places from small accounts (they aren’t required to but nothing says they can’t) and maybe other FATCA type problems in the future if they get more drastic.
On the other, the CLN takes care of the future, but might throw me to the wolves if IRS tries to collect for the five years previous to notification.
Either way, I will never travel to the US or invest there.
How to decide?
@ Petit Suisse,
Yes, it’s not explicitly mentioned. But have you read these articles?
Pre-1995 Relinquishers and the IRS: Three Recent Legal Opinions (may also be relevant if you performed your relinquishment act between 1995 and 2004)
Michael Miller Paper on the Exit Tax: Applies Prospectively
Michael has also made this comment:
• Michael J. Miller says Aug 25, 2013 2:12 pm http://hodgen.com/relinquishing-u-s-citizenship-and-expatriation/
“For persons whose CLN shows a loss of citizenship date that is on or before June 3, 2004, section 877A should not apply. Even if the CLN is received today. I’ve discussed this with people at the IRS and they’ve informally stated that they agree.”
KalC, Mr. A, MedeaFleecestealer,
Thanks for the input! Doing nothing right now sounds good to me.
This might be a possible avenue to get some questions answered about the tax implications of expatriating : http://hodgen.com/real-questions-about-expatriation-for-our-workshop/#comments
Caveat: I am posting this link only for information purposes. The author is one who has offered valuable information on certain issues related to expatriation, like the 8854 form http://hodgen.com/when-to-file-form-8854/ , and for those in certain circumstances, – the exit tax http://hodgen.com/category/exit-tax-book/ . Although the post linked below is primarily to gather questions for the for-fee workshop the author is advertising and compiling material for, the blog entry also goes on to say: ” … you can use the comments on this blog post to write your question or vent about the problem you are having with expatriation.
I cannot guarantee it, but it is highly likely that as a reward for participating your precise question will be answered to the best of our ability. 🙂 “……….” http://hodgen.com/real-questions-about-expatriation-for-our-workshop/#comments
Might be worth a try. Make sure not to include personal identifying information in it though.
oops, sorry all, my post above re the Phil Hodgen blog is somewhat redundant, as I didn’t see that Just Me has beat me to it.
@Pacifica777
Yes Pacifica I have read through those articles about pre-1995 relinquishment. My fear is the potential nightmare if IRS decides to use the info it gets on CLNs to harass relinquishers anyway. I mean, they will have our addresses. Even if they are legally in the wrong, the hadassment could be unbearable.
On the other hand, I fear the future of FATCA reporting…will banks widen the scope? The guidelines I’ve seen so far don’t seem to prohibit a bank deciding to make real nice with the Americans by reporting below the thresholds.
One thing that would be a relief to old relinquishers would be for guidelines to be issued by CRA that a sufficient explanation for not having a CLN would be proof of having obtained Canadian citizenship at a time when the Americans automatically revoked your US citizenship.
Basically now I reassure myself that one way or another IRS can’t collect in Canada.
As an aside, like very many ex-Americans who relinquished before 1995, I am old and at risk for senile dementia (already diagnosed with cerebral arteriosclerosis). I feel terribly depressed at the thought of my Canadian-born husband, whose English is limited, having to handle all this while I’m in my second childhood.
@Petit Suisse
I totally agree…In fact in my case, I would say a CLN should not have been required as the pre-1986 INA rules clearly state that I had relinquished my US Citizenship as I have repeatedly outlined…It is the incorrect retroactive application of the 1986 rule changes which caused misinterpretation of retention and therefore re-instatement according to parties who do not understand past facts can’t be altered. (the deed was done).
Another example would be anyone taking out Canadian Citizenship before April 2, 1973 when the Canadian Oath clearly stated a renouncement of any other Citizenship (as was also the case for me in 1967 albeit as a minor) – (I hereby renounce all allegiance and fidelity to any foreign sovereign or state of whom or which I may at this time be a subject or citizen.)
You would think that anyone taking out Canadian Citizenship prior to April 2, 1973 would automatically have a claim to 4 3(a) below:
http://www.fin.gc.ca/drleg-apl/2014/can-us-eu-0214l-eng.asp
@Benedict Arnold
You mention changes to INA rules in 1986. Could you be more specific as to when the changes were made and as of when they applied? I became a citizen in 1986. I have also seen other later dates where changes were made once again (maybe 2004). All is not clear.
@Voyons
Back in July 2013, WhatAmI and I had a discussion where we linked the following:
The 1952 INA…notice the highlighted rule regarding NATURALIZING minors: (also note age 21)
http://tesibria.typepad.com/whats_your_evidence/1952_Immigration_and_Nationality_Act_66Statxx_TitleIII_Chapter3.pdf
The 1986 INA rule changes: (refer to section 1481 – then look at amendments – 1986)
http://www.gpo.gov/fdsys/pkg/USCODE-2010-title8/pdf/USCODE-2010-title8-chap12-subchapIII-partIII.pdf
Notice they inserted Voluntary, cut out the Parent Rule and lowered the age to age 18…
Also, does anyone know about the status of form DS-4079, Request for determination of loss of citizenship? Online the document I find says that it expires at the end of 2013, Is there a 2014 version? or are they using the 2013 version?
Does anyone have any very recent experience with the US embassy in Ottawa? On their site it says:
If you… require notarial services, or Social Security or taxpayer identification applications. NOTE: This is not to be used to book appointments to renounce or relinquish U.S. Citizenship
For information on how to renounce or relinquish U.S. Citizenship at the United States Embassy in Ottawa, please send your request to OttawaACS@state.gov.
I wrote a week ago and so far haven’t had a response of any kind.
Is there anywhere else that they are separating relinquishing/renouncing from notarial services?
@ Voyons
I can’t answer your Ottawa questions but I can tell you that my husband requested his relinquishment appointment right after his citizenship ceremony in Sep. 2013 so the 4079 he filled out and e-mailed to them was obviously a 2013 form. Actually they e-mailed him the blank form to begin with. The earliest appointment date he could get in Calgary was last week and they didn’t make him do a 2014 form instead. Everything was completed in less than 3 minutes (although security and wait time was 1.5 hours). Ottawa might be swamped right now so give it a few days and then e-mail them again. Be a polite but squeaky wheel to make sure your request for information gets a response. I hope the staff there are as efficient as they seemed to be in Calgary. Good luck!
@Voyons,
The Vancouver Consulate also no longer uses Notarial services for appointments for renunciation or to report a relinquishment.
@ Benedict Arnold
Thank you very much for the text. The date appears to be November 14, 1986. I became a citizen in August 1986 – before.
@Em
I am finding it hard to be patient with Ottawa since I heard that someone in Toronto contacted the Toronto consulate after the FATCA IGA announcement and received info and booked an appointment. I had emailed Ottawa before the IGA news. Friday I re-sent my query – 2nd try. I might try Montreal if I don’t get at least a we-are-very-busy-right-now-but-your-business-is-very-important-to-us answer. But I will practice breathing in and out. Could come in handy.
The decision to renounce USC is not an easy one, in my view. A number of people have strong opinions about the U.S. government, how it operates and the value of USC in the 21st century. All fair enough – but there are so many different factors that should be taken into consideration. This is from someone with a multi-national family with members around the world. I have tried to compile the most comprehensive resources available about renouncing USC or abandoning LPR status. These include re comprehensive media reports, resources as published by the US Department of State and IRS, legislative history and original sources of the tax law (soon to include comprehensive sources of the INA), a proposal to eliminate USC based taxation, among others. I hope it is helpful. At the end of the day, everyone has to make their own decision of whether the benefits outweigh the burdens in my opinion. To state the obvious, it is a decision that should not be taken lightly. It’s not like a tattoo that you can simply “un-do” what you did – by getting it removed after you have had lots of time to sleep on it.
http://tax-expatriation.com/
@Voyons, Bern in Switzerland doesn’t either. You have to e-mail them separately for renunciations/relinquishments. And definitely keep breathing – it will help, honestly.
@ Voyons
You’ve got 3 choices — Ottawa, Toronto and Montreal — so if travel isn’t a problem try one of the others. My husband only had one choice because it is too far to drive to Vancouver in the winter. It was hard enough getting to Calgary. We drove through a ground blizzard — absolutely bizarre with oncoming trucks and cars just looming up out of nowhere only a few feet in front of us. Nice trip back though. I used to be an x-ray tech so let me just say, “Take a deep breath in … now hold it, hold it … okay breathe away.” Haven’t done that in many, many years. 🙂
@Patrick W. Martin. Re: “It’s not like a tattoo that you can simply un-do”
That’s got to be the understatement of the new century! If only losing US citizenship were that easy.
By the way, I checked out your website—very interesting. If those figures in the chart are anywhere near correct, (30,000 returns filed from something like 1,000,000 USPs in Canada) with FATCA going live June 1, it’s gonna get ugly.
@Patrick W. Martin
I disagree that the decision to renounce is not an easy one. People need to protect themselves and their families from the USA. For the vast majority of those living oustide the USA with no reason to return, that means renouncing or relinquishing. Having US citizenship has become an existential risk for USPs abroad, so the decision making process is quite simple and clear cut. Granted, for those who have never been part of the system (e.g. accidental Americans), the decision may be more difficult, since renouncing entails first getting into the system before getting out, which of course puts one at a high risk.
I am both a French and US citizen. I currently reside in the UK. I would like to reilinquish my US citizenship. Does anyone out there know how I can find a good attorney that can advise me of the “do’s” and “don’ts” of the process of relinquishing/renouncing my US citizenship?
Thanks in advance.
@Patrick W Marin,
I don’t have a tattoo. I have a branding…you know, like the kind that cattle get.
@Michael Jones, you don’t need an attorney so don’t waste your money. Firstly, how are you a dual national? Were you born with both nationalities? If so you can only renounce your citizenship.. You do this by making an appointment at the US embassy in the UK to stand in front of the Consul and take the Oath of Renunciation.
http://www.state.gov/documents/organization/81606.pdf
He’ll also make sure you understand exactly what you’re doing with this form:
http://www.state.gov/documents/organization/81607.pdf
Once you’ve sworn/affirmed your Oath/Statement and signed both documents, that’s it. All the paperwork will be sent off to the State Department for final approval, but effectively from that moment you are no longer American.
If your US tax filing is up to date you just need to do any final filing to cover up to the date you renounced and then file an 8854 form.
If you gained French citizenship by applying for it, then you might have a case for relinquishment (note the different use of the two words). In this case you would need to also make an appointment, but this time the form used is this one:
http://www.state.gov/documents/organization/97025.pdf
Along with supporting documents (citizenship certificate, French passport, etc) the consular staff will assess your application and if they say it’s okay, again it will be sent off to the State Department for final approval.
That’s it, the whole process for either renouncing or relinquishing your US citizenship. No need for an attorney at any point in the process.
@MedeaFleecestealer @Michael Jones
Isn’t there still the potential of having committed a relinquishing act (for example, serving in a foreign army) even though someone might be born a citizen of two or more countries?
@Patrick W Martin
I found your link to the table showing just how many people file US taxes to be extremely valuable. Thanks.
Your tattoo analogy would be best applied to someone considering becoming a US citizen. Being a non-resident US citizen is more like being in a costly marriage with an abusive partner who’s threatening to stalk you if you leave.
Have you seen this link? http://we-are-not-a-myth.tumblr.com