Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
Please note that the guidelines for this discussion are published here.
Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.
Please note that the guidelines for this discussion are published here.
Johnpg: Very similar to us. I was in the US with a green card (moved as a kid with my family from Toronto); married my Boston-born wife and we headed back north in 1969. Technically, they want me too, but under place of birth on my passport it says UK so the odds of them even asking the question at the border are pretty low. I was a spiritual draft dodger rather than a technical one because I never became a US citizen — had a UK passport at the time. We did consult a lawyer, who said she thought I’d done enough to “abandon” my green card that I shouldn’t be at risk — but they still see my wife as a US citizen and could well throw her in jail the next time we try to cross. So we won’t try.
Oh — yeah — we wouldn’t owe any tax either — but in my wife’s words –“I’m not giving those a**holes ANY opportunity to try and pick my pocket, and I’m not going to take any action that in any way looks like I am granting them any jurisdiction over me or my affairs.”
Good luck with your venture. If you are successful I think that would be a breakthrough and might set enough of a precedent that many many folks like us would then give it a try. You are brave.
Arrow, I love the term “spiritual draft dodger.” That describes me because as a female was not subject to the draft, but the whole Vietnam and “America: Love It Or Leave It” attitude was what influenced my decision to move north.
I don’t think it’s a coincidence this is happening now. 250,000 young Americans came to Canada in the late 1960s and early 1970s. Most of us stayed and became proud Canadians (In fact, many of my Canadian-born friends say I am more patriotic than they are!). We now are approaching retirement and have more assets than we will ever have. I believe it is literally payback time.
Canadians think I am paranoid with this payback theory. My younger sister and her same sex wife (who live in US, but who came to Canada to get married) think I am bang on. (and they hardly remember Vietnam era as they are 12 years younger than I am). In fact, they suspect it has been planned for a long time because there are many Vietnam vets working for IRS and DOS, but they have held off until we accumulated the resources we would need for retirement.
John, you and your wife are now leading the Isaac Brock warriors into a new battle by openly going to Consulate for CLN. Like Arrow’s wife, I am lying low and hoping to dodge this one. My only concern is my ability to visit my 89 year old mother who is still in US.
Blaze: First let me say I love your alias. Second, I agree that some of us naturalized Canadians are often more patriotic. I chose this country, and I will die defending her–from the United States if it comes to it, just like Isaac Brock gave up his life.
I agree that it is payback, but it is aimed not at the people who left during the Viet Nam War or those who left more recently for diverse reasons, but it is payback aimed at rich folks. renunciationguide.com tells the story, starting in the Civil War period, about how extra-territorial taxation became a way to show those rich folk who left that they still had to pay taxes in the United States. The demos (i.e., the masses and their Congress) of the United States perceives Expats also as rich and wanting to evade paying their fair share. Just read James Fallows triology of articles on the subject at the progressive Atlantic, and you will see him and a congressional aid say, look, it’s hard for the people in the United States to feel sorry for you, you have over $50,000 in a bank account; you are perceived as whiners.
The desire to punish those who worked hard and saved their money is class warfare and I fear, this kind of demagoguery always leads to tyranny. Already we are seeing it as some of us cross the border and are asked, “Have you been filing your taxes?” What does that have to do with cross border shopping or going down to visit my folks? This is progression towards a police state–Ron Paul said once the USA should not build a wall on the Mexican border because it will soon become a barrier to keep people in the US, like the Berlin Wall (he was ridiculed for this statement). But when border guards become tax enforcement agents, the United States falls into a severe type of tyranny, and I weep for a once great nation.
Petros: Are there specific examples of people having been asked about their tax status at the border? It would be interesting to know because we more or less decided that when THAT starts happening, then the odds of us having a problem crossing go up dramatically. My wife was once asked if she was dual, and she said no (that’s what she believes to be true) and the border guard let us through with out any more questions. I wonder what would have come next if she’d said “yes.”
Blaze: I firmly believe that staying below the radar is the only option that makes any sense right now. If you front up to these guys you are tacitly conceding that they have jurisdiction. My theory is I’ll let them try and establish that in a Canadian court, if they can find a way to get us there.
My wife and I have crossed the border a couple of times since August, by car, and my wife went through US customs in Newark last month. We only have Canadian passports (both of which show US birthplaces) and we’ve never even been queried about why we don’t have US passports, though we know people who have been hassled about that.
I doubt the border people are going to be asking questions about tax status, if ever, before they start querying everyone who has a Cdn passport with US birthplace about why they don’t have a US passport and where’s your CLN if you don’t, or trying to turn you back without a US passport. (Not even clear that would be legal, though the delay could be a problem with connecting flights.)
The bigger radar problem for some folks is going to be FATCA, if and when banks get serious about citizenship and proof thereof, and of course people like my wife who strongly wish to be able to continue to cross the border to visit close (and ailing) family members without fear of hassle, arrest or whatever.
to put things in context — I got a CLN in 1976, though I never started carrying a copy until this summer when things hit the fan, and so far I’ve never had to show it. I’m a former draft-dodger, and I’m almost certain State and probably Homeland Security have computer entries on my expatriation and CLN (just a hunch but I can’t say for sure). I’ve never had problems crossing the border so far, have crossed an average of at least once a year (sometimes by car, sometimes by plane, always with my Cdn passport) since 1978.
But who knows what can happen in the future? Except for my wife’s concerns, frankly if I ever couldn’t cross the border again, I’d tell my family to come visit me in Canada instead – like all other draft dodgers I made my peace with that option back in 1969 (in my case) and lived with it for eight years, never expecting I’d ever be able to go back. One gets used to the idea, so do most family members (all family members in my own case), eventually. Also any true friends will accommodate, anyone who doesn’t wasn’t really a friend anyway as it turned out, so no big loss.
I’m trying to figure out whether, if your assets are below $636,000, you can afford to check ‘no’ on Form 8938 to the question “Do you certify under penalties of perjury that you have complied with all of your tax obligations for the 5
preceding tax years (see instructions)?” In other words making yourself a covered expatriate, but below the exemption, so you wouldn’t have to pay anything.
The answer seems to lie in page 4 of the instructions (http://1.usa.gov/iftGBN)
“You will be subject to tax under section
877A if you have not complied with
these obligations, regardless of whether
your average annual income tax liability
or net worth exceeds the applicable
threshold amounts.”
What I can’t make out is whether that means that the $636,000 threshold is removed.
Schubert, you’re lucky you got a CLN. I didn’t when I became Canadian in 1973, even though I signed a document with a Consular Officer. I’m just too scared to call Consulate to see if there is a record–don’t want them to know where I am.ve
I have never been turned away at US with passport which says US place of birth. But twice I’ve been told I should enter as US citizen and get passport. The first time, I questioned it, the other time I just smiled and went on my way.
Like your wife, I have an ailing mother in US who can no longer visit me for health reasons. After her death, I will no longer go to US.
I would like to get enhanced driver’s license (does not give place of birth), but I lost my citizenship card (Yikes!) and CIC says it will take 10 months to get a new one (Double Yikes!) I sent in my app today for replacement.
“Luck” is exactly right. I had no idea such a thing existed, how one could get it, or why one might ever need one. I wrote an anti-war screed to Henry Kissinger as a Bicentennial gift to the US on July 4, 1976, in which I mentioned I’d become Canadian and had thereby “renounced” (I’d never heard of using the word “relinquish” or I’d have used it) my US citizenship thereby. I also mentioned the fact that on my mother’s side I’m a descendant of a solider in George Washington’s army and that 200 years after America’s declaration of independence from Britain I was declaring my independence from te US and was returning to the bosum of the British Commonwealth, a little knife-twist I was quite proud of. The response was a declaration form asking me to confirm what I’d done, which I thought was silly unless Kissinger couldn’t read simple English in my letter, but filled it out and returned it. Four months later I got the CLN in the mail. Total cost to me was two postage stamps (one for the letter to Kissinger and one to mail the declaration form to the embassy). When I got the CLN I thought it a joke but fortunately stuck it away in a folder with my university transcripts and forgot about it until last September when in a panic I went through my personal papers hoping I had something to prove I wasn’t American, and found the CLN which I’d utterly forgotten for 35 years (and which is now in my safe deposit box with multiple copies elsewhere).
Sometimes writing angry letters to politicians has unexpected payback years later. That CLN is literally worth more than its weight in gold to me today. Kissinger or whoever at State did me a huge favour by sending it to me, though I’m sure that was never their intention.
There’s a lesson in here somewhere …
One lesson I see is that you insisted on your freedom and the US relented by punishing you with the CLN. Punishing you. Now it is a reward really. Please send me that punishment now, Mrs. Secretary Clinton–today if you don’t mind. I’ve been waiting since 7 April.
I am also insisting upon my freedom. I feel my situation is analogous to yours back in those days. Will I ever be able to see my Dad, brother and sisters again? Well I could afford to bring them all here to Canada with their families quite often for what the FBAR fines would cost me. So no, I’m not going to file any FBARs. And I’ve said it aloud in visible protest on this site and others.
See the comments in this stream, where I go back and forth with our esteemed friend, Roy A Berg:
http://renounceuscitizenship.wordpress.com/2012/01/05/the-taxpayer-the-irs-and-the-professionals-where-to-go-from-here/ (pay attention to date and time, the comment at the bottom of the page actually predates some others).
Wow. I wish we had thought of that. All I did was mail my selective service card back in 1969 with a little note telling them I wouldn’t be needing it any more. Being just a green card holder, I guess they decided I wasn’t worth the effort. I wish I’d also sent them the green card, but I think that got chucked in the garbage.
I’ll be watching closely to see how the consulate responds to John’s request for a back-dated certificate. If he gets it, my wife might try that approach too. Meanwhile, duck and cover.
@416: You always get the $636k exemption. But there’s still other disadvantages to “covered expatriate” status. The main one is §2801 (if you make gifts to US persons, or include them in your will, then whatever goes to them will be gift-taxed/estate-taxed at the highest rate). This could catch you out, e.g. if you’re supporting elderly parents or nieces and nephews in the US.
I have a question about the need to complete form 8854 and a person’s expatriation date. It says in the instructions for form 8854 that the date of expatriation is, “the later of the date you notified the relevant agency of your expatriating act or the date form 8854 was first filed in accordance with these instructions.”
Yet I read in some other information that was given on this site that the DOS is obligated to date the day of expatriation based upon when the expatriating act was committed. In other words the date of expatriation would be back dated.
Now my question is which of these rules is the one that applies when it comes to the requirement to complete F8854? This is an important question because if one’s date of expatriation exceeds any of the currently listed time periods on F8854 then is one still required to complete the form? In my case my date of naturalization as a Canadian goes back to 1999. Since 1999 isn’t one of the years that is listed on F8854 does that absolve me of any obligation to complete the form?
I would appreciate it if someone has an answer to this question.
Excellent question Recalcitrant! Form 8854 only assesses expatriating acts prior to 2004. Mine was in 1973.
Why would they only be asking about expatriating back to 2004? Does that mean that they automatically recognize that those of us who expatriated and relinquished our citizenship prior to 2004 are recognized as not having filing obligations and we are not considered US Citizens or even US persons?
The more we learn, the more convoluted, confusing and complex this becomes!
Oops–My above posting should have said 8854 only assesses expatriating acts AFTER 2004. Big goof on my part–and I certainly don’t want to confuse anyone more that they are already confused. Many apologies!!!
@Recalcitrant — you may need a lawyer to help you out on this one. I may be wrong, but my understanding is that Form 8854 applies to everyone whose expatriating action took place after February 6, 1994, or possibly 1995 but I’m not clear on that, in which case “for tax purposes” (i.e. Form 8854) the IRS interprets your date of expatriation as the date you notified State about it, regardless of what State says on your CLN as your date of expatriation. This includes persons who committed expatriating acts between 1994 and 2004, I THINK BUT I’M NOT SURE. If you read the directions, it’s not at all clear, especially when you also consult IRS Publication 519 at this link http://www.irs.gov/publications/p519/ch04.html#en_US_publink1000222370 and go down to “Expatriation before June 4, 2004” which specifically refers to adjustment amounts (for the income tests) after 1997, which obviously includes 1999. Also if you follow the link in that section under “expatriation tax” subheading you’ll see they still insist on dating your expatriation “for tax purposes” from the date you notify State and jump-start you to the 2004-2008 section for God knows what rationale, if any.
I’m not saying this is legal or even constitutional (given Article 1 Section 9 prohibition of ex post facto laws), but I think this is what IRS is trying to pull over on you and others. As far as I can read their filthy little minds.
If in doubt you really need to consult a lawyer familiar with cross-border taxation and citizenship issues on this, don’t take my interpretation as I’m not a lawyer and sometimes have trouble interpreting IRS’s turgid prose (as do probably most folks). But my reading of Form 8854 instructions, Publication 519, and IRS Notice 97-19 Section X which is where I get the February 6, 1994 date, suggests to me that if you expatriated in 1999 you probably will have to complete a Form 8854 and back-file five years of tax returns from the year before contacting State (likely 2011 in your case, which means forms for 2007-2011 inclusive).
Maybe you or someone else wants to be the guinea pig to pay a lawyer to challenge them in court over this? (That raises the issue of one law for those who can afford expensive legal battles and a separate law for those who can’t, making a pile of manure of the “justice for all” phrase in the US Pledge of Allegiance, but that’s a whole ‘nother screed we shouldn’t get into on this particular thread …)
@Recalcitrant — you may need a lawyer to help you out on this one. I may be wrong, but my understanding is that Form 8854 applies to everyone whose expatriating action took place after February 6, 1994, or possibly 1995 but I’m not clear on that, in which case “for tax purposes” (i.e. Form 8854) the IRS interprets your date of expatriation as the date you notified State about it, regardless of what State says on your CLN as your date of expatriation. This includes persons who committed expatriating acts between 1994 and 2004, I THINK BUT I’M NOT SURE. If you read the directions, it’s not at all clear, especially when you also consult IRS Publication 519 at this link http://www.irs.gov/publications/p519/ch04.html#en_US_publink1000222370 and go down to “Expatriation before June 4, 2004” which specifically refers to adjustment amounts (for the income tests) after 1997, which obviously includes 1999. Also if you follow the link in that section under “expatriation tax” subheading you’ll see they still insist on dating your expatriation “for tax purposes” from the date you notify State, after they jump-start you to the 2004-2008 section for God knows what rationale, if any.
I’m not saying this is legal or even constitutional (given Article 1 Section 9 prohibition of ex post facto laws), but I think this is what IRS is trying to pull over on you and others. As far as I can read their filthy little minds.
If in doubt you really need to consult a lawyer familiar with cross-border taxation and citizenship issues on this, don’t take my interpretation as I’m not a lawyer and sometimes have trouble interpreting IRS’s turgid prose (as do probably most folks). But my reading of Form 8854 instructions, Publication 519, and IRS Notice 97-19 Section X which is where I get the February 6, 1994 date, suggests to me that if you expatriated in 1999 you probably will have to complete a Form 8854 and back-file five years of tax returns from the year before contacting State (likely 2011 in your case, which means forms for 2007-2011 inclusive).
Maybe you or someone else wants to be the guinea pig to pay a lawyer to challenge them in court over this? (That raises the issue of one law for those who can afford expensive legal battles and a separate law for those who can’t, making a pile of manure of the “justice for all” phrase in the US Pledge of Allegiance, but that’s a whole ‘nother screed we shouldn’t get into on this particular thread …)
I want to thank both Blaze and schubert1975 for taking the time to read my question and give their response.
I am new to the Isaac Brock Society. I have a question on determining whether you are actually a U.S. citizen. I was born in the U.S., married a Canadian and “landed” in Canada in 1964. I became a Canadian citizen in September, 1972. At that time, I was required to relinquish my U.S. citizenship. I voluntarily did this. In addition to the desire to be a Canadian, I also truly no longer wanted to be an American. I have not filed a U.S. tax return since 1964; in fact, I only ever filed two U.S. returns – 1963 and 1964 as I was a student and not working. Other than short visits to the U.S. to visit family, I own no property there nor have any ties with the country. I have always filed in Canada when required to do so. Most years between 1964 and 1989, I would not have to file as I had no income. I have not believed myself to be a “U.S. Person” since 1972.
My question to those of you on this blog – does the IRS still consider me an American. I do not have any piece of paper from the State Department saying I have renounced or relinquished. However, I do remember signing a piece of paper at the Toronto Citizenship Ceremony in 1972, stating that I was voluntarily renouncing my citizenship or something like that.
@tiger Your question implies two questions: (1) Am I still a US citizen? (2) Does the IRS still consider me a US citizen? The problem is that you are not a US citizen, but the IRS and the State Department have retroactively bestowed it upon you. Please read the posts in “our resources” on relinquishment; also ex post facto (search blog). The current policies are self-contradictory and unconstitutional.
Tiger, your situation is almost identical to mine. The difference is I became Canadian an 1973, a year later than you. I also signed a document with a US Consular Official at my citizenship ceremony in Vancouver, confirming I understood i was renouncing (or maybe the word was relinquishing) my US citizenship. Like you, I never thought US income tax requirements applied to me because I thought I was no longer US citizen.
For almost 40 years, I have believed (as have my employers, colleagues, family, friends, neighbours, etc. etc.) I was no longer U.S. citizen. Now suddenly, it seems US wants to relclaim me and my money. Of course, they didn’t care about that when I was 22–because I didn’t have any money. Now that I am 60 and close to retirement, with RRSPs, TFSAs. a pension plan, etc., they could see me as a tax grab.
I’m terrified to call US Embassy or Consulate to try to resolve this for fear they will track me. Johnnb is in the same position (including becoming a citizen the same year I did), but he doesn’t think he signed the form. I think it is next week he and his wife are going to Consulate in Halifax to get their Certificate of Loss of Nationality. He’s far braver than I am.
Try to scan through this thread and see comments from jJohnnb, Arrow and me, along with Petros responses and advice.
I am so relieved that you remember signing that document. Others on here or friends who became citizens around the same time don’t remember doing so.
It ticks me off that US Consulate never gave us the form confirming we were no longer Us citizens, but the IRS can penalize 50% of our assets because we didn’t file a form!
Thank you Petros and Blaze for your responses. I find this site a wealth of information. I have read the info on Relinquishing and am appalled that the U.S. government feels they can “move the goal posts” so to speak. How can rules of 1990 apply to an act of 1972?
I believe I am not a U.S. citizen and I do not plan on contacting the IRS, either through their “amnesty” program or “quiet disclosure” as to do so, in my opinion, says to them that I am in fact a U.S. citizen and should have been filing. I refuse to do this. I am also prepared, if necessary, to not return to the U.S.A and have already told my siblings that I would not be visiting them.
My main concern is that under FATCA my bank may feel they must report me to the IRS. They are aware that I was born in the U.S. but they are also aware that I believe myself to not be an American. My concern is that their compliance officer will feel they either need to drop me as a client or report me to the IRS. I have thought of moving my accounts but understand that all Canadian banks opening new accounts must ask perspective clients their place of birth.
As I was always a “stay-at-home” mother, any monies I may have today were earned by my late husband, a Canadian, who happened to marry a young American 20 year old. Any income earned on that money should be taxed only in Canada. To tax it in the U.S. is obscene in my opinion.
I believe our federal government needs to do more to assist both those people who might be dual citizens and others like me who certainly feel they relinquished or renounced their U.S. citizenship. This site is invaluable and I remain hopeful that changes in FATCA might still occur.
@tiger, You can protect yourself in the following ways. Tell your bank that you are not a US citizen and that if they give your info to the IRS, that you will take your funds out.
When my bank (TD) gave me an ambivalent response, I moved my accounts to a credit union. If you move to Duca in Ontario, tell them I referred you.
End all investments in US investment products, stocks or mutual funds. Sell your condo or other real estate in the US if you have any.
When you go to a new institution, do not fill out any W9 forms or let them have your social security number if you have one.
And last of all, political activism. We have to get the Canadian government end this FATCA nonsense.
Tiger — a couple of things:
1. We just transferred both our RRSP accounts from RBC Dominion (which has US assets) to a local Credit Union with no connection to the US. They don’t care about our citizenship, and didn’t ask the question. I’ve now instructed our new financial adviser to do an ethnic cleansing to remove all US equities, bonds, etc, — as well as any Canadian equities with US assets — from our portfolios. The goal is to get that done within the next six months. You might want to look into that as a possible vaccination. Personally, I think any non-American anywhere is nuts to own any US investments — they will trigger a monumental IRS headache down the road and it will sure as hell cost a lot of money — 30% of any US-source income as a bare minimum.
2. We too became Canadians in 1974 – me as a former green card holder, my wife as a US citizen. And we fully believed that was the end of our involvement with the US (and the US consular officials said as much). As Petros has pointed out, the IRS and the State Department want to retroactively reinstate us all so they can pick our pockets. I believe this will only be sorted out when some brave soul makes a legal challenge to the IRS/State Department position in a US court. That, unfortunately, requires a visit to the US and a fair degree of faith (which I certainly don’t have) in the US justice system. And of course it is fraught with peril — they can lock you up and throw away the key now.
As I’ve said a couple of times now, our position is to act as though we are Canadians, and NOT US persons. Trying to “come clean”, as the media likes to portray it, does nothing more than grant the US the jurisdiction it claims, and undermine your own legal position.
I am surprised that the Credit Union has not asked any questions. I understood that they would also fall under the jurisdiction of FATCA because their trading partners ie Credential Securities etc will have to meet FATCA requirements.
I certainly agree it is a good idea to rid our portfolios of any U.S. securities etc.
@Arrow / Tiger The trust in the US justice system is a bad idea. Conrad Black, despite what people may think of him as an arrogant rich person, with all his resources, is an innocent man that sits in jail–only two of I think of an original 14 charges still stand, and he is in jail for obstruction of justice: he took boxes out of his Ontario office–i.e., he did something in Canada and it was caught on video. Well I do lots of things like have bank accounts that somewhere in the world it is illegal. I’m just saying, if a country will do this kind of extra-judicial prosecution, there is no trusting the system. Personally, I think it would be better for Canada to sue the United States for this violation of its sovereignty.
The measure of moving all assets out of the United States is excellent. It takes your assets out of reach of the IRS. My lawyer also suggested to move my accounts to a Credit Union or other financial institutions with no assets in the United States, in order to keep the IRS from using the banks US assets as leverage against its US client. Credit Unions do not have assets in the United States. Ask when you go. Duca has no assets except in Ontario. TD has branches all over the United States, and is still looking to acquire more. My new motto is: Get the United States out of Canadian Banks, and Canadian Banks out of the United States.
Six month is probably good enough cushion. Though, when 19 trillion dollars is heading for the exits, you don’t want to be the last investor out of the door. I think the crash in the United States start to happen as the foreign investment capital flees, but I’m not sure when.