— U.S. Citizen Abroad (@USCitizenAbroad) May 13, 2018
This post is motivated by the following Brock comment from “JC”. His comment concludes with:
So do we have a feature here on Brock to come up with stories about being proud Americans? So we may give them to Solomon.
Why not? Yes, let’s use this post to create a “Brock Feature” from expected comments. This can be the the “Isaac Brock Society” contribution to U.S. Tax Reform!
I realize that the Isaac Brock Society is not a site that is populated particularly by “Proud Americans” (am I wrong?). But, the idea of compiling a set of comments, about how U.S. tax policies have destroyed the lives of those who have attempted compliance could be valuable. They could be forwarded to all groups (RO, DA, ACA, FAWCO etc.) in this fight.
For once, let’s focus on those who are compliant!
I have a request though. Much of the focus on this and other sites is on people who have NOT complied with U.S. tax laws – usually because they have not bothered to enter the U.S. tax system. I don’t understand why those who have not entered the U.S. tax system have TAX problems. It seems clear that, those who have NOT complied, have NOT had their lives destroyed. They still have their pensions and their marriages. Noncompliant Americans abroad are in no danger of having their passports revoked (because those not in the U.S. tax system cannot have a tax debt). Noncomplaint Americans are in no danger of having their retirement savings stolen. Noncompliant Americans have no fear of crossing the border. But, I digress …
The reality of U.S. tax compliance for Americans abroad
It is those unfortunate people who have complied (with the assistance of the “very best” U.S. tax advisors), who have suffered the most. Think of all those who were ushered into OVDP. Think of those who entered “Streamlined” with their Canadian Controlled Private Corporations. After being assured that the “business earnings” were not subject to U.S. taxation, they are NOW retroactively subject to the transition tax. Think of the “transition tax” (punishment for your past). Think of GILTI (punishment for your future). Only those who have filed U.S. taxes generally and Form 5471 in particular are subject to the great “pension confiscation”. Those who have not complied will still have a happy retirement.
U.S. citizenship is primarily about penalties: Comparing the “penalties” for noncompliance with the “penalties” for compliance
Penalties for noncompliance: For years people have been forced to listen to a constant noise (that’s the problem with the internet isn’t it) warning people about the penalties for noncompliance. These are expressed in the language of either “tax crimes” or “form crimes”. Yes, the penalties for noncompliance are truly frightening! But, they are suffered randomly and sparingly. Let’s compare them to the …
Penalties for compliance: Nobody (don’t understand why) really talks about the “penalties” for compliance. They are real! They are NOT speculative! They are automatically assessed! Think I am kidding? Talk to anybody who is suffering the “transition tax” or somebody who has a real fear of “passport revocation”. Talk to somebody in Australia who has had problems with their Superannuation.
Americans abroad are subject to penalties no matter what they do. What were you thinking when you left the Homeland? You should be punished! And you are punished. Americans abroad are NOT subject to the same tax rules that Homelanders are subject to. They are subject to a different set of punitive rules. You should NOT be permitted to, simply leave the Homeland and expect those left behind, to pay your “fair share”! It is the duty of ALL Americans, wherever they may be, to support the Government of the United States (which as Cook v. Tait teaches – confers benefits to you wherever you may be).
Your experiences please …
Therefore, I think it would of great value to hear from those who have complied with – that Great Bible of American Life – the U.S. Internal Revenue Code (whether you have complied from inception/conception or whether you have recently come into compliance).
Remember that ALL U.S. citizens who were “Born In The USA” are presumptive “Tax Cheats By Birth”! This is because the USA confers citizenship by birth and imposes tax based only on citizenship.
Could you address the following 3 questions in your comment?
1. Why as a “nonresident” of the United States did you decide to enter the U.S. tax system? For example, did your accountant tell you do do it? Were you simply heeding “The Call Of The Condor?” Was your entry into the U.S. tax system associated with another significant life event (illness, divorce, etc.) Do you snap to attention when you hear the U.S. National Anthem?
2. How has U.S. tax compliance caused you specific damage (calling all “transition tax” victims and more)?
3. Will the proposed #TTFI bill (the one from Congressman Holding) solve your problems or not?
If you are not in U.S. tax compliance, you could comment on why you do not intend to enter the U.S. tax system. Were you lucky (probably) or clever (maybe)?
And now, turning it over to JC …