I was born in the States and lived half of my growing-up years (with many good memories) on each of the East and West coasts. The present U.S. is not the country I grew up in however. I am retired from the work force and presently 71 years old, wanting to live a simple life without the stress the issue of U.S. citizenship has brought.
My then-husband and I moved to Canada in 1969 and both became Canadian citizens in March 1975, completely believing (as we were warned of it at the time by the U.S. Consulate) that we relinquished our U.S. citizenship by taking the Oath of Allegiance for our Canadian citizenship. We chose to live and work in Canada, pay our taxes in Canada and, especially, raise our children (born here) in Canada.
In 2008 I was made aware that the rules had changed (without anyone in the U.S. giving me any notification or a choice to opt in or opt out) — I was still a U.S. citizen and was not in compliance with filing U.S. tax returns — I am NOW compliant for years 2005 through 2012. The Canadian accountant that I had used for so many years and who knew that I was born in the States referred me to a Calgary cross-border accounting firm as he was not trained or licensed to deal with doing my back U.S. returns. It was confirmed by that respected cross-border accounting firm that I was required to back file and so at that time they helped me make a ‘quiet disclosure’ for three years of returns and (Foreign Bank Account Reports) FBARs. In November 2012, I renounced my US citizenship, having paid US tax lawyers, US tax accountants and US immigration / nationality lawyers over $42,000 in compliance fees, accounting and advice regarding the possibility of my son being able to renounce an automatic U.S. citizenship because of his birth in Canada to U.S. citizen parents.
Besides the U.S. legal and accounting professionals I hired for U.S. tax compliance and filing final Form 8854 after my 2012 renunciation, I paid $3,661 in actual US taxes — all related to the Canadian Registered Disability Savings Plan (RDSP) that I hold for my adult son who has a developmental disability. The Canadian tax payer helps pay for bonds and grants that are contributed to RDSPs by the Canadian government, so Canadian taxpayers have indeed had some of their Canadian taxpayer money as well go to the US IRS.
My biggest concern is for my adult son for whom I hold the RDSP (and others like him!). Since the U.S. considers the RDSP a foreign trust (as they do the Canadian Registered Education Savings Plan and Tax Free Savings Account), gains are subject to tax and this negates for him the same benefit that other Canadian citizens with a disability receive under these same plans. Neither of my children were ever registered by their parents as U.S. citizens with a U.S. Consulate. I never considered them anything but Canadian citizens. I also do not want the IRS to take one penny of my kids’ inheritance that I have worked and saved so hard for – in Canada.
Here is the advice I got from US Department of State, Legal: http://isaacbrocksociety.ca/2014/06/01/its-time/comment-page-72/#comment-3097016
From: Kavaler, Howard
Sent: Wednesday, May 07, 2014 9:55 AM
Subject: RE: Question re US Citizenship never registered with the US
If your son was born in Canada to two U.S. citizens, at least one of whom had a residence in the United States prior to his birth, your son is a U.S. citizen pursuant to Section 301(c) of the Immigration and Nationality Act. Your understanding of U.S. citizenship law is absolutely correct. U.S. citizenship is a status that is personal to the U.S. citizen and may not be renounced by a parent or a legal guardian. If your son seeks to renounce his citizenship, it will be incumbent upon him to demonstrate that (a) his action in renouncing his U.S. citizenship is the product of his own free will and (b) that he fully understands the consequences attendant to the relinquishment of his U.S. citizenship.
…which agrees with the information from an immigration / nationality lawyer in Washington, DC, to confirm my son’s US status and give possibilities for his renunciation. The result was that my children were US citizens from the moment of their births. The following is information from that lawyer based on his conversations with the US Department of State: DOS persons have “sympathy” for such cases. However, the developmentally disabled person will have to have FULL understanding of what he’s doing; if any question of lack of comprehension and grasping meaning and importance of ramifications, they could NOT approve such a case. From DOS point of view, US citizenship is precious and they have therefore established fundamental requirements for “compelling reason”. Even though there is the risk that a person’s financial resources could run out before his/her life was over, they will never approve a renunciation for financial / economic reasons. DOS has NEVER had such a renunciation case approved due to “compelling circumstances”. I could sue but persons this immigration / nationality lawyer talked with at DOS are SURE no one would ever win such a case as the courts view the discretionary action that DOS has would take precedence.
My Canadian-born son, never registered with the US (didn’t have to — he was US-defined US citizen from his moment of birth to two then US citizen parents, which we had no idea of), never lived in the US, never had any benefit from the US and cannot renounce because of his lack of requisite ‘mental incapacity’ to understand the concept of citizenship. The U.S. Department of State states that a parent, a guardian or a trustee cannot renounce on such a person’s behalf, even with a court order. He and many others without ‘requisite mental capacity’, including others perhaps with a brain injury from accident or stroke, age-related dementia, etc. are effectively ENTRAPPED into U.S. citizenship and the consequences of that with U.S. citizenship-based taxation law (while the rest of the world, save Eritrea, tax based on residence). The only way not to be so entrapped would be for the U.S. to practice residence-based taxation. Some say, they never will (so, though never may not be, it will likely not be in my lifetime this will change).
Support / continue to support the Canadian litigation: http://www.adcs-adsc.ca/.
Intelligent forum conversations at IsaacBrockSociety.ca and MapleSandbox.ca with other U.S. citizens in Canada and around the world have helped me retain some degree of sanity in all of this. I am grateful for the perspectives of others in similar situations in helping me make necessary decisions that will lead me back to a normal life – one where I can again be a contributing member of Canadian society.
I will continue to support Alliance for the Defence of Canadian Sovereignty in a suit brought against the Canadian government for signing an intergovernmental agreement with the US to allow foreign (US) law to override Canadian laws, including the Charter of Rights and Freedoms, making US-defined *US Persons* in Canada second-class to any other – no matter what their or their parents’ or grandparents’ national origin.
Help fight this injustice for one million so-called *US citizens* in Canada plus their children and their business partners, etc. — and about 7 million US citizens around the world. http://www.adcs-adsc.ca/