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.
@usxcanada
“The alternative tax regime does not apply to any individual for any taxable year during the 10-year period…”
It does mean what you think it means (spend just 30 days in the US and become US tax resident for that entire year!). But if you read up to page 36 you’ll see that this paragraph is part of the “Present Law” section. It describes the way things worked pre-HEART.
Page 45 contains the part of HEART that sweeps this away: “Under the provision, the present-law expatriation income tax rules under section 877 do not apply …”
There’s a lot of misinformation on this point lying around the web. Many sites, particularly ones that haven’t been updated in a while, still show pre-HEART rules. There’s also a common trope in the public consciousness that the IRS will tax you for ten years after renouncing. That used to be partly true; pre-HEART they would, but only on an expanded, but even then not all-encompassing, definition of “US source income”.
Now, with that cleared up, which rules apply to any one person depends on their date of relinquishment or renunciation. If after 2008, HEART rules. If between 2004 and 2008, the prior rules apply; non-rebuttable(!) presumption that you left to avoid tax. If prior to 2004 but after some other date, rebuttable presumption. And so on.
This has probably been answered before so I ask for your patience. As many of you know I will be asking for French citizenship and I find now that I am faced with an interesting dilemma. From what I have read I could (if I wanted to) inform the US gov ahead of time that my intent in becoming a naturalized French citizen is to relinquish my American citizenship. Is that correct?
To be clear I’m not sure I want to go this route but I am interested in knowing my options.
@Victoria: That’s my understanding, yes, but it would only have an effect after the fact. First you commit a potentially expatriating act, then inform State of the act and that you intended it to be expatriating.
If that’s the route you want to take.
The chapter and verse is here:
http://travel.state.gov/law/citizenship/citizenship_778.html
@CannotSleep
Just a question, did you then have dual citizenship at birth? How did you go about swearing the oath on a bible in 1988, what would that have been for and how could they or will they prove that? Just curious for my own issues as I am looking at ways to verify and confirm I have sworn allegiance to Canada, even though I may be a US Citizen from birth. (Mom was US, I was born in Canada)
Thanks
@Inanightmare: A Canadian passport renewal form has a perfectly good expatriating statement from the point of view of US law:
“DECLARATION—I solemnly declare that I am a Canadian citizen, that the photos enclosed are a true likeness of me and that all of the statements made in this application are true. I declare that I have read and understood the WARNING to all applicants at the top of this page.”
You are a wealth of knowledge, thank you for that! Of course, I still like to have some ammo if ever in need, and thats a great one. I suppose one could say tha was the oath they took to canada. Is that truely a offical allegiance to a foreign country. I assumed they only way to fight that one was an actual oath ceremony and or naturalization. Didnt think i would have a leg to stand on being I got my citizenship based on birth, so both are basically a “here you go” application process.
U.S. CODE
TITLE 8 > CHAPTER 12 > SUBCHAPTER III > Part III > § 1481
§ 1481. Loss of nationality by native-born or naturalized citizen; voluntary action; burden of proof; presumptions
(a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality—
(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years
Good point! I guess the way i understood that bologna is you would have to naturalize and take an oath, swearing your loyalty, yadda yadda. But, you make a valid point, by signing that passport, it is a form of a formal declaration of allegiance. I like that one!
@Inanightmare, broken man The only problem is that this passport oath is probably not one of the standard oaths that the State Department recognizes. You guys are thinking outside the box and that is great. Lovely idea. But the question if the State Department is able to think outside the box and I’d be pretty sure that they are absolutely unwilling to do so.
Perhaps a more promising route is to attend a citizenship ceremony and get a proof that you reaffirmed your oath of citizenship with the intention of relinquishing your citizenship. But there has to be proof on paper–when I went into relinquish they required the large, red commemorative certificate of citizenship as proof that I had become a Canadian. My oath was insufficient. They wanted proof that a potentially relinquishing act really did occur.
Darn…Thanks Petros for ruining that gleam of hope!!! ha ha
True enough and I understand that. It WAS a great idea.
This site is so great Petros, thanks so much for strtaing this and getting us all together to help one another and support. Its really encouraging!
@Inanightmare There are seven ways to lose your citizenship. I’m sure you will find a way.
We are all in this together, so no need to thank me. But I appreciate the sentiment. Cheers.
@Petros : It’s hard to know until it’s tried.
@Inanightmare: as Petros said, there is such a thing as a citizenship reaffirmation ceremony, and they do give you a certificate at the end. I guess one advantage is that it forms a more optimistic counterpart to the bleak and legalistic renunciation process.
http://www.cic.gc.ca/english/celebrate/menu-reaffirmation.asp
Unfortunately the certificate says ‘This document is not proof of citizenship,’ which lessens the effect a bit.
@Broken man This is how you find if it will work. Before I made my appointment at the US consulate in Toronto, Mrs. A told me on the phone to bring the full page commemorative certificate to prove that you’ve committed an potentially expatriating act. So I had plenty of time to discuss what I need to create the appointment I made. Now, if you want to try to make an appointment saying that the passport oath suffices, will they even set up the appointment for you? The Consulate had a very specific idea of the documentation they wanted. So until someone actually does a relinquishment based on a passport oath and gets an appointment with consulate–which the consulate takes seriously, I wouldn’t get my hopes up that that would work. But you are right, you don’t know unless you try–but I am guessing that you’ve got a do something that fits into their narrow, teensy-weensy box.
@Petros We’re both speculating, for all that that’s worth.
But in your case (correct me if I’m wrong) your expatriating act was becoming a naturalized Canadian, so they may have a specific template for handling that situation.
@biglemoncoke
Re using a US passport and relinquishing/renouncing:
as other posters have noted, and it is also my belief (I’m not a lawyer but I have “lived” with all this crap for six months now …) that using a US passport after becoming a Canadian citizen would almost certainly invalidate any claim by you that you had become a Canadian citizen with the intent of relinquishing your US citizenship. I think you, I and anyone can see State’s point on that. You can’t really “have it both ways.” Certainly the US isn’t about to let you do that.
FYI, whether you renounce or inform State that you committed a potentially expatriating act with the intent to relinquish, when you meet with State and complete/swear to either form 4079 (relinquishing) or 4080 (renouncing), the consular officer will require you to surrender your US passport and any other official US identification that could support a claim to US citizenship, at that time. State WILL check their passport records in Washington to see if you hold a valid US passport, and if you didn’t surrender it, they won’t issue you a CLN until you surrender it (and if it was a claim for reqlinquishment they may tell you that you will have to renounce instead, though given you’ve become Canadian in 2012 it doesn’t matter for tax purposes which you did, you’ll HAVE to complete form 8854 and five years of 1040s and FBARs if you ever want to cross the US border again, so you might as well renounce. Renunciation is not open to their questioning or interpretation or quibbling on any grounds other than have been done under coercion or mental incapacity/not being of the age of majority).
If it’s important or imperative that you be able to travel on a passport, my advice in your situation would be to continue to use your US passport until you become Canadian and get a Canadian passport, then at that time renounce (not relinquish which won’t work if you continue to use a US passport after becoming Canadian) your US citizenship. At the time of renunciation you’ll have to surrender your US passport, but you’d then have a Canadian one so why care? Though travelling to the US might (or not) be a problem until you get your CLN to accompany your Canadian passport which will show your US birthplace. (You can ask Passport Canada not to identify your birthplace on your Canadian passport, and they will comply, but they will warn you that some countries including the US, want to know where you were born before they’ll let you in, and if the passport doesn’t have that info you will get pulled into secondary screening and grilling for a couple of hours and could miss flight connections etc, or worse … and I repeat the US isn’t the only country which will take this attitude … so Passport Canada doesn’t recommend you do this, though under Article 15 of the Charter of Rights and Freedoms they have to respect your request if you make it. I know whereof I speak on this birth-identification-on-CDN-passport issue; I’ve corresponded with Passport Canada officials on this point in depth recently.)
Hope this helps you make your decision. If in doubt, or to get more reliable advice than my lay opinion, consult a cross-border or US immigration lawyer re your options.
broken man wrote:
I wrote about my experience here:
Specific template is a good metaphor. I was using small box. Either way it is very specific or very small. For example, Mrs. A said not to bring the small plastic proof of citizenship which the Canadian government said is the official proof citizenship (whereas the red one page certificate is not official but commemorative!). They have such a specific template that has so little regard for Canadian law, that they insist on the decoration instead of the actual proof! This is the state department we are dealing with, not something that is flexible or accommodating. So I consider my point not so much speculation as it is a reasonable deduction based on experience.
(switching topics to Form 8854)
I’m spending time trying to interpret the IRS’s Web site, a fairly thankless task that we’ve all spent too much time on lately.
The larger project is thinking through a manageably straightforward template for accidental Americans to shed their US citizenship with a reasonable minimum of bureaucratic hassle. This may not exist, but it would have a certain value in Life Credit Units if it did. I’m not a lawyer or an accountant – I’m a lay person trying to interpret a complex set of rules.
Specifically, I’m focused on Part IV (a)(6):
“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)? (y/n)”
http://www.irs.gov/pub/irs-pdf/f8854.pdf
I’d like to start a discussion on the consequences of saying ‘no,’ and if these are unacceptable, clearly showing why.
The instructions say:
Line 6
“Check the “Yes” box if you have complied with your tax obligations for the 5 tax years ending before the date on which you expatriated, including but not limited to, your obligations to file income tax, employment tax, gift tax, and information returns, if applicable, and your obligation to pay all relevant tax liabilities, interest, and penalties. 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.”
http://www.irs.gov/instructions/i8854/ch02.html#d0e664
Which I interpret as saying that if you say ‘no,’ you will be taxed on your whole net worth without the benefit of the $2M ceiling. (Please correct me if I’m wrong.)
So you’re a covered expatriate. What happens then? It explains here:
http://www.irs.gov/businesses/small/international/article/0,,id=97245,00.html#_Expatriation_after_June_16,%202008
“Under IRC 877A(a)(3), the amount that would otherwise be includible in gross income by reason of the deemed sale rule is reduced (but not to below zero) by $600,000, which amount is to be adjusted for inflation for calendar years after 2008 (the “exclusion amount”). For calendar year 2010, the exclusion amount as adjusted for inflation is $627,000. For calendar year 2011, the exclusion amount is $636,000. For calendar year 2012, the exclusion amount is $651,000.”
So if your net worth is under US $651,000, do you have to file the five years of returns?.
@Petros the reason they want the commemorative one is that on the very bottom, right-hand side, is the real date of citizenship. The small plastic card has a different date on it.
@nobledreamer- The card has not date, just the year. It took me a long time and some luck before I finally found my commerative paper copy.
Yikes! I don’t still have my commemorative copy–from 40 years ago. I did get a copy from an old personnel file last week. I also have the Bible I was given by Canadian Bible Society to swear my oath. It is stamped in the front with the date and place of my ceremony. (Do they still do that in our multicultural country?) I wonder it those two together would be enough.
On the excellent advice of Schuert, I also submitted a request under Access to Information to CIC for information in my citizenship file–including a copy of my signed oath and anything which confirms I renounced my American citizenship.
Schubert, is your wife going to formally relinquish or is she going to use the copy of the renounce oath to your financial institution?
@blaze- there was no Bible involved with my ceremony in July of 1999.
@recalcitrantexpat
My care shows month and date (2007 12) and my certificate the actual date of May 8, 2008. Some find that cause for doubt which I believe is why I was told to bring the certificate not the card.In fact, Mrs. A. reiterated it to me when she reviewed my papers before seeing the vice-consul.
@Tiger
I have three credit union accounts who do not offer US accts or mutual funds, securities, etc. I phoned one of them to specifically ask about Credential. Her answer was that there is no legal or financial bind between the companies. She was unaware of FATCAT and was going to ask the CEO. I keep intending to write and ask myself, just haven’t gotten around to it. But being renounced and having $ in credit union are the only ways I can think of, to try and protect our retirement.
@nobledreamer
I plan to renounce, I had to surrender my original card and citizenship certificate for a name change.
I have a current Cdn passport valid through 2014
old passport from 1984, and card dated 1997. Shouldn’t these suffice? for renunciation.
@ nobledreamer
Thanks for the info re Credential and the credit unions. It is making more and more sense to move my accounts from RBC (big U.S. connection) to a Credit Union in the Vancouver area.
The more research I do, I feel that I am going to be able to definitely show that I relinquished in 1972 when I took the oath of Cdn. citizenship. As I mentioned in a previous post, at that time, persons swearing the Canadian citizenship allegiance oath, also had to renounce all allegiance to any foreign state…. I have never done anything since that date in October, 1972 to indicate that I wanted to retain my U.S. citizenship ie. no U.S. passport, no U.S. tax returns, no verbal claim to dual citizenship. Other than short visits to family in the U.S., all my family and friends, past employers etc. consider me a Canadian.
I am just angry that I have to now prove this to the U.S.State Department or possibly have difficulty ever crossing the border again, and also possibly prove it to Canadian financial institutions.
@ Schubert 1975
I have downloaded the relevant forms re “Access to Information” to obtain the signed “oath of citizenship” from 1972. I must admit I have had some difficulty understanding the form. On the website, I noticed there is an office in Vancouver. Would it be faster, if I went to their office to fill out the request forms, rather than through the mail, only to find out that I have neglected to put in the correct information?