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
Re: (@LM) “Social Security is yours no matter where you live […] However, there are forms that you need to send in every couple years to SS to let them know if anything has changed (e.g. address, bank account #, AND if you have renounced); these forms are short, mailed to you at the last known address and fairly straight-forward.’
Oh, yes. I am aware of all of this, and so is he. I was only mentioning it as an example of how worried even ex-citizens are these days about being in any way a part of the U.S. system.
@Wren
Right. Early on I assumed that an ITIN “should be” easier to get than a SSN, and posted that “advice” here more than once. People consistently posted that one had to get a SSN. I eventually read the instructions that you just quoted, and similar words elsewhere. Hence I reluctantly reversed the stance in my posts.
However, I still have my doubts and it’s worth the effort for you to phone and check. In fact, several people should call as we all know that answer you get may depend on who happens to take your call.
The reason I cling to my doubt is that everywhere I look, when reading DoS and other laws and documents, they are written from the point of view for people who are signing up for the long haul. The US officials are used to a long history of people lying and cheating to get US citizenship and benefits. It’s against their nature to even think that a person would ever renounce their citizenship. When I went to the Calgary consulate in 1978 to make sure my dual citizenship had “expired automatically”, the consul was taken aback and said “But everyone _wants_ to be an American, and everyone _should_ be an American”.
With that in mind, the statement that one must get a SSN not an ITN if they are eligible for a SSN makes perfect sense. It does not make sense for a person who is in the process of renouncing. Since the SSN comes with access to social programs and benefits, there is a potential cost to the US that the ITIN does not have. So “logically”, obtaining a SSN should be much harder.
I would think it’s a believable scenario that a person didn’t know of any IRS filing requirements until they read it on form DS-4081, Item #10 that they signed during their renunciation or relinquishment interview. It’s not clear to me if at that point you are still a US citizen. They say you are until your CLN is approved, but then your citizenship loss is dated back to the date of your interview. Since you find out at your interview that you have an IRS filing obligation, I don’t see a good argument if the IRS hassles you later for waiting a year for your CLN before applying for an ITIN as a non-citizen to file your taxes.
The timing is tricky and undefined. A full year is a long time to be in that Twilight Zone.
A best-case scenario may be that you can get confirmation from the SS people verbally that you don’t qualify for a SSN after relinquishing or renouncing, thereby having “permission” to apply for an ITIN without first applying for a SSN. I didn’t look carefully, but assuming the documents required for the two applications are somewhat different, it would be _worse_ to have to apply for both! Another timing issue: you will still be a US citizen at the time you make the phone call…
Form DS-4081 which is signed under oath says:
5. If I do not possess the nationality/citizenship of any country other than the United States, upon my renunciation/relinquishment I will become a stateless person and may face extreme difficulties traveling internationally and entering most countries and maintaining a place to reside.
I think people have posted that some (even most) consulates will refuse you if you don’t have another citizenship, but it doesn’t seem to be the law.
10. My renunciation/relinquishment may not exempt me from United States income taxation. With regard to United States taxation consequences, I understand that I must contact the United States Internal Revenue Service. Further, I understand that if my renunciation of United States nationality is determined by the United States Attorney General to be motivated by tax avoidance purposes, I will be found excludable from the United States under Immigration and Nationality Act, as amended.
Interesting that they say you have to contact the IRS. I haven’t seen anybody on IBS who relinquished prior to 2004 say they contacted the IRS. That’s the whole point of the good circumstance of a prior relinquishment. Don’t wake the sleeping dog.
Interesting that they refer to the Reed amendment which has never been enforced.
@WhatAmI,
I am also unconvinced and I do plan on making that phone call.
My endless searching resulted in a few answers to the question “Can I obtain a SSN if I am not a U.S. citizen?” but I have yet to find any that deal with the circumstance of being a former citizen.
Re: “Another timing issue: you will still be a US citizen at the time you make the phone call.” – Is it a requirement to provide my details when inquiring with a general question? I was planning on identifying myself as one who had already relinquished and who was just informed of the filing obligation.
Just for fun, check out SSA’s text on Types of Social Security Cards and in particular the maddeningly ambiguous bullet point under Type #3: [Issued to people from other countries] “Who need a number because of a federal law requiring a Social Security number to get a benefit or service.”
Here is a short and readable history of the Reed Amendment and the (so far) failed attempt of its revision as the Ex-PARTRIOT Act by Reed Schumer:
http://en.wikipedia.org/wiki/Ex-PATRIOT_Act
Again and I again I read quotes by Obama, former iRS Commissioner Douglas Shulman about how all these laws (including FATCA) are aimed at rich Americans abusing the tax system. Here’s a quote form Reed himself about the Ex-PATRIOT Act:
Reed stated, “American citizenship is a privilege. But it seems that a privileged few are trying to game the system by accumulating wealth and benefiting from the greatness of the United States and then renouncing their citizenship to avoid paying their fair share of taxes. They are welcome to leave our country, but they should not be welcomed to return without playing by the rules and paying what they owe.”
What? You say you accumulated your wealth living and working in Canada with a Canadian education? What, then, is your fair share of US taxes to be paid?
The introduction of the Ex-PATRIOT Act was motivated by the news that Facebook co-founder Eduardo Saverin had renounced his U.S. citizenship.[9] Saverin, a native of Brazil, lived in the U.S. from 1992 to 2009 before moving to Singapore.[10] While living in Singapore, he continued to pay U.S. taxes, as the U.S. is one of the only countries which imposes tax on non-resident citizens.[10][11] In January 2011, he began the procedure to renounce U.S. citizenship in favor of retaining his existing Brazilian citizenship.
Does anybody feel to be in the same league as Eduardo Saverin? They never mention minnows in these statements.
@WhatAmI, exactly. The system is designed for those coming into compliance long term. Having released the FATCA fiasco on to the world, they never envisaged that people would renounce/relinquish to avoid being financially crippled by it. Hence no contingency plan or even idea of how to make it simpler for us to obtain an SSN or ITIN so we could clear things up. It never entered their heads because they can’t grasp the concept of someone not wanting American citizenship, no matter how burdensome it’s become.
@Wren
I was planning on identifying myself as one who had already relinquished and who was just informed of the filing obligation.
That’s what I would do.
Just a thought:
Stick to your specific situation first and be sure to get that answered. Don’t jeopardize the conversation by confusing it with add-ons, but, if they are very friendly and helpful and seem knowledgeable (I’m guessing they will be all three) and indicate your circumstance fits with an ITIN, you might consider adding more questions after, such as “What about my friend who just decided to renounce but hasn’t yet? Can they too apply for an ITIN since they clearly aren’t after SSN benefits and will soon be a non-citizen?”. No worries if you don’t get to such extras. If you get a break-through answer from your question many others here may be inspired to call as well.
@WhatAmI,
Re: Approaching SSA regarding SSN/ITIN
Very good advice. Thank you.
Re: Reed Amendment
I was reading about the other day and my jaw dropped to the floor (yet again – it’s getting very sore by now). The U.S. made a killing from Saverin’s success while he was a citizen and it is my understanding he will be (or already has been) subject to the tremendous exit tax which must be millions. He didn’t abuse the system or evade taxes; it was all very much on the up and up. And now, based on this one case they are attempting to preemptively entrap anyone who even thinks of being successful in the U.S. It’s just backwards and stupid and the U.S. will pay mightily for it. I’m not even sure if it’s greed or just that they have such an over inflated idea about what it means to be an American that they can’t handle the thought of anyone wanting to live anywhere else.
@Wren,
Just a few days ago, my step-mother used the following reasoning to disinherit me:
So, I’m an American veteran who is being disinherited since I have a family, two mortgages and don’t live in the US. Thanks America! As you say, ” It’s just backwards and stupid”.
‘Expatriation, Expatriates, and Expats: The American Transformation of a Concept’
Nancy L. Green
The American Historical Review (2009) 114 (2): 307-328.
“………. Justice James Iredell left one of the more memorable expressions of the principle of expatriation, still quoted today: “That a man ought not to be a slave; that he should not be confined against his will to a particular spot because he happened to draw his first breath upon it; that he should not be compelled to continue in a society to which he is accidentally attached, when he can better his situation elsewhere, much less when he must starve in one country, and may live comfortably in another, are positions which I hold as strongly as any man, and they are such as most nations in the world appear clearly to recognize.13………”………….
“13 Talbot v. Jansen, 3 U.S. 3 Dall. 133 (1795) at 162.”
@SwissPinoy
Wow. I’m sorry. That makes no sense at all. Hard to even see which item on that list is the most nonsensical but “no longer a U.S. citizen” is definitely up there. I hope that’s something you can fight and win (if fighting is what you intend to do).
@Wren, unfortunately, Colorado law allows a step-mother to disinherit her step-children for any reason. My father is very old and simply stated that he abandoned his dreams, such as his dream of his home always being there for his children. With my step-mother and her son controlling his estate, there is nothing that we can do. The courts are already overcrowded with similar situations and a lawsuit would be very costly with almost no chance of winning. Thus, we are currently simply discussing the matter. Here is what my step-mother’s son wrote today in response to a friendly email written by my sister:
SwissPinoy,
I am so sorry you are going through all of this right now. I hope you can just let it all go; it’s evil. You can’t possibly be up for another one-sided fight! My god, I wish it were easier everything you’ve been going through. Take care.
I am in the process of relinquishing, but I have what I think is a very simple question regarding Form 4079.
Question 13(e) asks if I file US income tax returns. If I answer “no” (which I intend to do, since it is the truthful response), does the US State Department have the right to determine that I am attempting to relinquish/renounce just to avoid paying taxes, and as such deny my application?
TYIA. This website has been very helpful.
@CycleVancouver,
Are you claiming your relinquishment (a previous act, like becoming a Canadian citizen) rather than renunciation? You don’t want to have been filing US tax returns if you are going to claim a relinquishment (and having done nothing considered US since the date of that relinquishing act). Your relinquishment or renunciation appointment will have nothing to do with your tax compliance — that question on Form 4079 will help determine if you have been doing something “US”. If you have not been filing, you do want to correctly answer “NO”.
@CycleVancouver,
No, not at all. The idea of that form is to demonstrate that you intended to relinquish US citizenship when you naturalized in Canada, and that intention is demonstrated by having stopped all behaviour as a US citizen. If you answer “Yes”, they may deny your claim of having relinquished US citizenship since you’re saying you still “act like an American” by filing taxes (or voting, or renewing passports, etc).
TY for your prompt responses. I am claiming relinquishment from 2011 when I became a Canuck. I have not voted, held property, lived or worked in the USA since 2006 (when I moved to Canada). That was the last year I filed a tax return. My passport expired in 2009 or 2010 and I did not renew it, I waited instead for my Canadian one with my citizenship in 2011. I maintain family and social ties to the USA (naturally).
Hopefully it will go without a hitch; I’ll let you know how it goes.
CycleVancouver,
You do know that you will have a separate process of US tax compliance requirements and final Form 8854 http://www.irs.gov/instructions/i8854/ar01.html after your claim to relinquishment at a US Consulate and eventual receipt of Certificate of Loss of Nationality (CLN), especially if you are going to be “crossing the border to maintain family and social ties in the US”. Right? Good luck with your appointment for claiming your relinquishment when becoming a Canadian citizen. Do you have that yet — is it for Vancouver?
@CycleVancouver,
Just to be clear, there is no problem if you did “American things” (voting, passports, etc) between 2006 and naturalizing in 2011. You just don’t want to have continued to act as an American after naturalizing because it would go against your claim that you intended to relinquish US citizenship when you naturalized as a Canadian citizen in 2011. If you had, just by way of explanation, then you would have to renounce and pay $450. There is no other difference as far as anybody has ever determined. For example, your filing obligations would be identical.
Things become much more complicated (financially) if you are a covered expat.
@SwissPinoy,
This has been on my mind today. As someone who really strives to do what’s right, not just what’s best for me, I can’t help but feel rattled when reminded that there are people in the world who behave this way. I’m sorry you and your sister have been caught up in this person’s toxic cloud. It’s clear, though, that you’ve got your head on straight and priorities lined up right so no advice needed. Can’t be easy, though. I wish you the best.
@Swiss Pinoy
re: “Here is what my step-mother’s son wrote today in response to a friendly email written by my sister”
FWIW: A bitter situation. Sounds like an idea to keep copies of those correspondences with the idea that you have evidence to show your children if/when they one day in the future ask what happened. Other than that, time to move on and only try to keep in friendly contact with your father.
Does anyone know on here what addresses I have to send my final paperwork to? I realise I have to send my final 1040-NR/1040/8854 to the normal IRS addresses in Austin, Texas; but do I have to send copies to another address in Philadelphia too?? I didn’t know where this second address was and what I needed to send;
Was it just the 8854 or also a copy of the CLN and even tax return?? Was also unsure if I should also send a copy of my CLN with my tax return to Austin.
Thanks so much if anyone could help clarify for me. (@Atticus, @Trish,@Calgary, @Pacifica, etc.
@monalisa1776
Send your 1040, 1040nr etc and 8854 to Austin, and a separate copy of just the 8854 to Philly. The address to use for Philly is on page 2 of the 8854 instructions. No need to send them a copy of your CLN or anything else (golden rule: never, ever send the IRS anything more than is absolutely necessary).
You can have IRS London route all of this for you. Cheaper, safer, and more convenient. To do this, put the two returns (Austin and Philly) into separate envelopes and address as if you were going to mail them, then put both into another envelope with a little note saying ‘please forward these’ and mail that to the address listed at the top right of this page:
http://london.usembassy.gov/irs/irsoffice.html
I have routed my tax returns through London regularly for the past six years. And unlike recorded delivery to US addresses, which never seems to work right, sending stuff recorded delivery to IRS London gets you a useful delivery receipt.
@monalisa1776, glad you asked that question, I was also wondering exactly what to do also? But, my son was told to send it to Austin only, now I am quite concerned that he was not told to send to Phili.. hope this does not get him screwed up. You know you pay a accountant a lot of money and they gave him the wrong info.
When I send mine I will send to both Austin and Phili.
Thanks Watcher for the info!
Yes, @Watcher, thanks so much for the useful information! I am dismayed that my accountant didn’t seem to know about the additional requirement to also send a copy of my 8854 to Philadelphia but I’d imagine that they haven’t dealt with many expatriations.
It’s all so nerve-wracking when I don’t even feel that I can fully rely on the tax preparer to keep me safe. It’s such a jungle out there!! I can’t even begin to express how relieved I will feel to no longer have to be dealing with all these complexities. It almost seems as though everyone is being deliberately obtuse, almost so that I will slip up somehow and then have to rehire them to clear things up…it also occurs to me that I am frankly not of much concern to them as long as they get paid….:/