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
@Stressed:
Turbo Tax looks pretty straight forward. I haven’t filed in the US in years but I did play around with this years current version. It was easy to navigate. I would suggest trying the free current year online version– plug in some dummy numbers and see what you think. If you’re working life is fairly straight forward, you would save yourself some hefty accounting fees by foregoing the accountants.
stressed You have 3 choices. None of them good.
1. TFSAs are foreign trusts . It is not possible to do the accounting properly. Mutual funds are pfics. It is almost impossible to do the accounting properly. In order to do a RRSP properly you are supposed to file the right form ‘in a timely manner’ or it doesn’t count. Trying to do this will cost mucho dinero.
2. File using something simple like turbo tax but ‘forget’ to include the above.
3. Don’t bother filing.
Duke of Devon:
I grew up not too far from Walden Pond. In the spirit of Henry David Thoreau’s “Civil Disobedience”, I like your option two!
Thanks, Duke of Devon and BC Doc…
http://en.wikipedia.org/wiki/Civil_Disobedience_%28Thoreau%29
Resistance to Civil Government (Civil Disobedience) is an essay by American transcendentalist Henry David Thoreau that was first published in 1849. In it, Thoreau argues that individuals should not permit governments to overrule or atrophy their consciences,
and that they have a duty to avoid allowing such acquiescence to enable the government to make them the agents of injustice.
Thoreau was motivated in part by his disgust with slavery and the Mexican–American War.
Thanks Calgary. It seems many of us should consider becoming Thoreau acolytes.
Did my 8854 and last 1040 today. I wanted to get my Canadian tax return first to show taxes paid in last year in Canada (I use for 1116 to deduct with the result of a minus $4000 owed to USA), and it took Revenue Canada only 4 days to process it and post results on the web! Meanwhile the IRS is a black hole. I hope my 8854 does not enter the event horizon.
@ Duke of Devon,
Do you mean it will cost a lot in accounting fees (which I already know), or in penalties (even with the streamlined approach?) ?
Any ideas where Canadian EI would go in 1040? I have put it under American EI and it’s not looking so good for taxes.
Anyone out there just not file the 8854 and taxes and never been contacted?
Mostly accounting fees. I’m guessing $3-7 K.+ Penalties are an unknowable unknown.
There was a very smart poster here about a year ago by the name of Dan. He said ‘never tell them anything they don’t already know.’
Does anyone here know if being registered as a Canadian born abroad would qualify as a relinquishing act? I was born in the U.S to two Canadian parents, moved to Canada in 1963 when I was five and was registered as a Canadian born abroad in 1964. In the 50 years since, I have never lived or worked in the U.S., rarely travelled there, have never voted in a U.S. election and never held a U.S. passport. I do have a SSN, which I applied for when I was in my 20’s. That was back when I was actually proud of my American connection. Not like now, when it’s become an exhausting dead weight, sucking all the joy out of my life.
On that note, I do want to urge everyone to give yourself regular breaks from this…..take long walks, deep breaths, get out in nature, hug your dog, buy yourself flowers, lose yourself in a great book, take some time away from this site and remind yourself that despite all of this frustration and stress we’re going through, we will get through this and life can still be wonderful. Don’t let this eat you up. When you find yourself worrying, ask yourself if the worrying is helping. If the answer is no, give yourself permission to not worry. Or only allow yourself to worry for five minutes every day and then put it away. The stress and anger and frustration are the real killers in this. Let’s try to help each other keep those at bay.
Thanks so much, and take care everyone. I’m so grateful to all of you and for all the information on this site :).
@Molly,
My history is identical to yours except I was born 4 years earlier and moved home to Canada 3 years later.
I’ve never seen or heard anything to indicate that the registration of a birth abroad is a relinquishing act.
Nobody that we know of here who naturalized as a Canadian, oath and all, while under the age of 18 has been successful in claiming their naturalization while a minor as a relinquishing act (although some are still trying and we are hopeful) even though it was legally a relinquishing act back in the day. Regardless of whether the changes to the INA in 1978 and 1986 were retroactive or not, the DoC seems to only accept what is the law today for past relinquishing acts. The FAM states that they don’t even accept INA 350 prior to 1978 even though the law was repealed prospectively only. I haven’t read of anybody trying to claim INA 350 in the last two years that I’ve been here on IBS.
Have you ever worked for a crown corporation, or any public service job at the municipal, provincial or federal level? So far, this has been the only successful way for born-dual citizens to claim any past relinquishment.
The US made a mistake when they repealed INA 350. They should have left it in place, and simply given the choice of intent to relinquish to the individual like they did for the actions under INA 349 (renouncing or working for a foreign government).
@WhatAmI…….Thank you. I worked for CBC for five years. Would that qualify as a relinquishing act?
@Molly,
That could do it! Heck, it must have been like working for the Liberal party itself! (Sorry, couldn’t resist…). The CBC is a crown corporation. There was a woman here last year who worked for (IIRC) the Atomic Energy Corporation, also a crown corporation. I don’t recall hearing if she ever made an appointment to claim it as a relinquishing act (INA 349 (A)4(a)).
I forgot to ask, did you start before June 4, 2004? If you started later, you don’t get out of dealing with the IRS.
That’s great advice Molly. If you don’t allow yourself to take a break from the stress and anxiety, your body will eventually demand you do – often at the least opportune time.
@Molly, Yes, such great advice!!
@WhatAMI…….Yes, I started with CBC in 1998. I will definitely investigate this further, and if anyone else knows more on this subject, I would be very grateful to hear your thoughts.
Thanks again everyone, and have a wonderful weekend!
@Molly
That’s great news! A few points in case you haven’t come across them yet.
You’ll need a confirmation of employment letter from the CBC, and it must specify the exact date that you started employment there.
Some consuls will tell you that such employment “doesn’t count” as a relinquishing act, but people have politely insisted that their file be submitted to the DoS in D.C. and the claims have been accepted.
Some consuls insist that you needed to sign an oath as part of your employment. If you read INA 349(A)4(a) and (b) it’s clear that the oath is only a requirement for (b), for those who are not already citizens of the “foreign” country. If you signed any sort of oath, be it a duty oath or confidentiality agreement etc, it doesn’t hurt to have a copy of that as well, even if it is just a blank sample copy and not one dated 1998 with your signature.
I am personally going this route of claiming foreign employment.
If you’re new here you should read and read and decide if this is what you want to do. Nothing is guaranteed, and every option has some amount of risk. For example, if you are ultimately denied a CLN based on this employment, the US feds will now know who you are. Some will tell you not to do anything at all, that the US doesn’t care about you as a small person. Then there is FATCA, which may or may not (be able to detect and) rat you out to the IRS if you try to lay low. If you ultimately have to renounce and you are a covered expat (see form 8854), there will be hell to pay.
@ Molly,
Here’s a link to s. 349(a)(4) of the Immigration and Nationalty Act, which is about government employment as a relinquishing act. You might want to have a look at this document from State Dept: Loss of Nationality and Taking up a Position in a Foreign Government. Also in the Consulate Report Directory, reports in the Calgary section by BenedictArnoldBeMe and PrairieGirl, who relinquished due to taking government employment. And there’s some info about tax in the Sidebar, under “Links by Subject,” “Important! If Relinquishment before June 4, 2004.”
As Molly is a dual Canada/US citizen from birth and has lived essentially her whole life in Canada (while paying Canadian taxes), I believe that she will be exempt from the expatriation tax (providing she files the 5 years of tax returns before or after renouncing should the CBC relinquishing argument be denied).
See “Tax Consequences Resulting From Renouncing US Citizenship” by Lacey E. Strachan in
Taxlitigator.com Aug. 9, 2013.
Molly, great advice about the stress busting techniques – I would add going to the gym and working out to the point of total exhaustion!
@Mr A
Thanks, good catch! Of course she would be exempt from 2 of the 3 “tests” for covered-expat-ness. That applies to me as well, but I got carried away with the general warnings in my post.
Yes, there is a lot here for Molly regarding Form 8854 certification that all US tax requirements have been met. I’m going out now but will reference a comment I made a few days ago when I’m back.
Molly, yes, those were good strategies for us to take care of our stress. Mr. A, working out to the point of total exhaustion sounds like a good mind-numbing strategy. Mind numbing is all that works for me. There are many of us here that feel we will never again regain the joy we once had in our lives. I am one of them.
My situation is essentially the same as Molly’s, although I don’t have a SSN – dual from birth, life in Canada, only as a Canadian citizen – there are a number of us like this on Isaac Brock.
Calgary, I trust that you will feel joy in your life again – we must hold out hope, which can come in many ways and we will get through this together.
My mother (a born and raised American who also became a Canadian citizen in the early 1980’s – and who has never filed US taxes! lol – and never knew she was supposed too) is a member of Democrats Abroad – she just showed me a recent email newsletter from them that stated their complaints about FATCA – they are planning action with Congress in trying to get FATCA changed and hopefully repealed – they listed specific Congressmen/women and are going on a “Door Knock” campaign to get American politicians to become aware of the problems that FATCA etc. is causing for Americans around the world.
@Mr A
That’s good to hear about Democrats Abroad, that they’re going door to door to call for changes to FATCA, but from what I’ve read in their statements, they aren’t pressing repeal. Republicans are. This is going to cost Democrats votes from abroad.
“US federal debt levels and funding needs suggest that it is not realistic to expect the US Congress to give serious consideration to residency-based taxation in the near term nor for the IRS to ease up on its implementation of the law.(5)”
https://www.democratsabroad.org/group/fbarfatca/fbarfatca-task-force-page-updated
These are not words many Americans living abroad want to hear.
@bubble
Yes you’re right, I should not have used the word repeal, which is not mentioned in their Feb/14 newsletter.
They use the terms “legislative action” and “regulatory relief”. The newsletter can be read on their website. It mentions the unfairness of FATCA but they still talk about “tax compliant” Americans. Hopefully their actions will have some beneficial effect. It is high priority for them in their lobbying efforts this year.
Sent my last 1040 and hopefully the only 8854 to the black hole today (located in Philly) via registered mail. I do all this stuff by myself without software or lawyers. I fill in the minimum on 1040 just using the PDF from the IRS website, as I always have zero tax due to Uncle Sam. The 8854 apparently can be a landmine if not filled out properly. I went over it five times but now I have a recurring nightmare that I left out a page.
kermitzii,
Did you send your 8854 both to the Philadelphia black hole and as an attachment to your 1040 (I hope)?