Amid IRS Abuse, Record Number of Americans Give Up U.S. Citizenship http://t.co/OH7V8SkhRB – Who could have known?
— U.S. Citizen Abroad (@USCitizenAbroad) December 12, 2013
This is a great post about Americans renouncing citizenship which cites a number of interesting sources.
McClatchy news highlighted the plight of Oklahoma-born Ruth Anne Freeborn, who has lived in Canada with her Canadian husband and son for over three decades. Because of FATCA, her foreign bank was required to hand over all of her family’s financial information to the Obama administration, which her husband, of course, opposed. So, after carefully considering her options, Freeborn eventually decided to renounce her U.S. citizenship in September rather than subject her family to intrusive prying by the IRS and the federal government.
“My decision was either to protect my Canadian spouse and child from this overreach or I could relinquish my U.S. citizenship,” she told the news service, which reported that growing numbers of Americans were “ditching their U.S. passports out of frustration and fear” over FATCA. “It was with great sorrow I felt I had to relinquish, but there was no other choice for me and many like me…. My husband cannot understand why Americans are so offended by having their personal emails and phone calls monitored by the NSA yet are very comfortable requiring a Canadian to hand over their bank account data.”
The increasingly byzantine and oppressive regulations, along with more aggressive government efforts to enforce them, have also led a growing number of banks and financial institutions around the world to refuse to do business with anyone subject to Uncle Sam. As The New American has been reporting for years, Congress and the IRS have essentially made U.S. citizens into pariahs around the world in many respects. In some cases, the U.S. government has even gone so far as to terrorize and threaten governments and nations that refuse to bow to the will of Washington’s political class. Switzerland and the Swiss were among the most recent victims.
For Americans living overseas, it is becoming increasingly nightmarish. “Many banks, foreign financial institutions, are just turning Americans away — it’s easier for them not to have American clients,” explained Marylouise Serrato, executive director of the group American Citizens Abroad, in comments about the effect of FATCA and IRS regulations. “For some people it [renunciation] becomes a solution. But it’s done with a very heavy heart.”
This of course makes one wonder:
Why is the United States so cruel to U.S. citizens abroad?
I believe it started out as an oversight, but because lawmakers now know about it and have done nothing to stop it, their intention is to punish us.
What the Marquis de Sade would call a “happy mistake”.
Collateral damage gets a shrug. The awareness is peripheral. But there is unawareness too and that makes it too close to call. It’s parallel to the abysmal homelander unawareness of world geography. They can’t locate most countries on a map.
Not only world geography but their own. I remember a very old post (here, on Brock) that cited a study where a very high percentage of California high schools seniors could not identify a basic fact about the Pacific ocean. It was stunning. Going to go find that. It was unbelievable.
Re: the Poll. Can there be a selection for “all of the above”.
Is it time for Canada and all other nations to strip those citizens of theirs that decide to emigrate to the United States of their respective secondary citizenship? After all, loyalty should be to one country only. Maybe the en masse stripping of Canadian citizenship of those Canadians who move to the United States and get a green card will result in retaliatory measures by the US in stripping the United States citizenship of the American expats in the various countries that implement this procedure. Should we force their hand?
“Why is the United States so cruel to U.S. citizens abroad?” — It’s a combination of a lot of ignorance and a fair amount of vindictive punishment, but I think most of all it’s cynical exploitation of expatriates by extorting as much money from them as possible.
@renunciation and wait for CLN
Could there somewhere on IBS be a listing where persons who have renounced and are waiting for their CLN toarrive can put renunciation date and present waiting time? I was told about 4-6 weeks at the embassy I renounced at – now over 4 months later I am still waiting. I suspect there is a big backlog and I believe it is important to make this more widely known as it does affect the statistics on renunciations. I am also beginning to wonder what to do if I still haven’t received my CLN when it it file to file the hopefully last US tax returns.
@ Tricia
I think I may have posted that. It was from a 2002 National Geographic survey of 3,000 18-24 year olds in Canada, France, Germany, Great Britain, Italy, Japan, Mexico, Sweden and the United States (http://news.nationalgeographic.co.uk/news/2002/11/1120_021120_GeoRoperSurvey.html). You have to feel sorry for the 11% of US 18-24 year olds that can’t identify the US on a map.
“About 11 percent of young citizens of the U.S. couldn’t even locate the U.S. on a map. The Pacific Ocean’s location was a mystery to 29 percent; Japan, to 58 percent; France, to 65 percent; and the United Kingdom, to 69 percent.”
“Particularly humiliating was that all countries were better able to identify the U.S. population than many young U.S. citizens. Within the U.S., almost one-third said that population was between one billion and two billion; the answer is 289 million.”
“In the highest-scoring countries—Sweden, Germany and Italy—at least 70 percent of the young adults had traveled internationally in the last three years, and the majority spoke more than one language (in Sweden, 92 and 89 percent, respectively).
In the U.S. and Mexico only about 20 percent had traveled abroad during the same period and the majority spoke only one language.”
@ Allou,
There is a list of CLN delivery times in the Appendix of the Consulate Report Directory, pages 144-151, arranged by zone and country. I just realised the page numbers have “disappeared” from the directory. You can click on the link for the Appendix in the Table of Contents, or scroll to about 10 pages from the end of the document. (I’ll fix the page numbers and footers after work today.)
@pacifica777
Thank you, I did see that list some time ago, I suspect the waiting times have increased considerably in the past year.
…and, Allou and Pacifica and all,
I have to apologize for my negligence in not keeping up the Relinquishment and Renunciation database which had a good account of CLN’s received by country, how long it took, etc. It has slipped away away from me. Perhaps one week I’ll have enough time to put some effort into remedying that. In the meantime, Pacifica has kept up her part of what we were doing and her contributions are pretty well up to date and accurate.
@ Calgary,
Absolutely no need to apologise. You’ve been really busy doing so much recently on several fronts in this battle at the same time. Thanks!
I left my country in Africa to escape a dictatorship. I find out by pure accident about FBAR reporting. I now have to pay over 90,000 dollars for a reporting violation I did not know about, hear or read about until 2011. I have tried reason with the IRS and sought help from the TAS all to no avail. All accounts were open years before coming to the states, no new assets were bought outside the country whilst living here. I was not allowed to shut up shop in my country of birth and bring my assets with me to start again. The IRS does not want to hear the truth. It merely by decree says you are guilty and you must pay or opt out to a more potentially devising situation with possible higher Penalties and jail time. This whole ex excise is a revenue generating scam and has nothing to do with compliance. I am going to try to go through my congress person next and if I have no success, going to go public using social media, etc. is anyone else interested in seeking true justice and wants to join me with going public?
@calgary411 and pacifica777
Thank you both for your huge contribution of information and experience to this website. No need at all to apologise. I was just wondering why there are such differences in the length of time it takes to get the CLN. The embassy where I renounced says they have emailed several times to try to get my case completed but there seems to be some backlog on the US side. As for the IRS filing, I never heard a peep after filing for 2012 plus 6 years of past returns and fbars including letters of explaination for all years. This is I suppose what is called a “noisy disclosure”, which is what the IRS helpline advisors told me to do.
allou,
Pacifica may have more insight into the differences in times for getting back CLNs.
I don’t think that any of us have gotten any indication (as with Canada’s CRA for instance) of anything resembling a ‘Notice of Assessment.’ It’s as if our IRS information has gone into a black hole (and we must somehow trust that our financial information is safe in that black hole).
You can initiate a response from your end. I’ll look for that information.
Thanks for your kind words. Sometimes there’s not enough time in the day. Saying that, Pacifica always finds time in her busy, busy schedule. Hats off to her.
@Nick: Wishing you the very best. Regret I’m not in a position to help you directly, but I surely hope others may be. It’s an appalling situation, especially after what you’ve already been through. Will be praying you find people who listen sincerely and act for justice.
@all: In a (very) small act of reaching out to US homelanders, I had the opportunity to include the following in a Christmas letter to trusted friends living in the US, which I hope may be understandable to them. Perhaps some of it would be of use to others here for a similar purpose???
“When I first lost my mother, as you know, my aim was to find work at once. What I had no clue about then was how much US tax law had changed since 9/11. The treatment of expats under the present system of penalties is so harsh that the same person in my same situation would, if stateside, owe neither tax nor return, but if living abroad could face hundreds of thousands of dollars in penalties for paperwork errors or lateness!
“The situation is so unbelievable, that few people except tax experts have any clue as to what is going on, but since those are the very people who benefit from the situation, they are hardly likely to oppose it, unless they have a great deal of integrity. To give an example, one woman in Canada who actually owed no tax at all had to spend more than two years’ total salary on the paperwork to prove that she owed nothing – even though she hadn’t set foot in the US for decades and all her income was earned abroad!
“Things are set to get worse as FATCA takes hold, as it will bring into the net people who have lived abroad their whole lives, many of whom have no clue they are considered “US persons”, and yet can still find themselves required to pay 5 percent of their entire net worth in “reduced penalties” to the US. Others have faced penalties exceeding their entire net worth, penalties which cannot be released even by bankruptcy, even though the actual tax due was minimal and the penalties were only for failure to file forms.
“So it became for me a choice between spending my time working for – probably – minimum wage – and then paying upwards of $2,000 for tax preparation each year, or devoting hours each day to studying the situation and communicating with others affected and trying to get the situation improved. Fortunately, if extremely frugal, I can just get by, so this was the route I chose.
” It’s an enormous task, as I’m sure you can see. I could write a great deal more about it, as you can imagine, but that would hardly be fair to you, when I’m sure you must be very busy!”
Sad-in-the-UK,
What an effective and well-worded message to go with your holiday greetings to friends and family in the US. Thanks for sharing. I’m sure it will help others to do the same.
All the best to you!!
@Sad-in-the-UK and @Calgary, I must admit that I have deliberately chosen not to mention anybody this except to close family and friends. I personally feel that it’s not something that could be easily explained, especially in a Christmas card; plus, this is supposed to be a cheerful time of year…
Of course, I admire the activism on here and strongly disagree with how draconian the US is becoming about taxes. But I also partially blame myself for not having kept better informed of all the reporting and filing requirements. It’s also true that the US failed to adequately communicate these requirements to Expats, thus essentially entrapping them.
To be honest, I don’t expect most others to approve or understand who aren’t directly affected by it. Consequently, I continue to post upbeat, even pro-American stuff on Facebook. Perhaps I’m cowardly but prefer to keep a lower profile about all this, at least until my statutes of limitations will have all closed, which will be Autumn 2017 at the earliest (and possibly as late as Autumn 2020)…
@monalisa1776: I understand. This was to people who knew me well, trusted my judgment over many years, and had recently inquired as to what I was doing now. It certainly wouldn’t fit into every Christmas stocking. Nonetheless, I thought that some of the wording might come in handy to others….(:))
@monalisa1776
A lot of Americans take great pride in all things American. The objective would be to have other Americans see the value in Americans being able to thrive while living abroad vs a diaspora that’s severely disadvantaged – or worse, non-existent. There may be ground to gain should Americans realize that the rest of the world has a competitive advantage over them and that their citizens are considered pariahs just for being American.
monalisa, I think there is a big difference between taking responsibility, which we’ve all seen you do so well in the actions you’ve taken, and blaming yourself.
I will not blame myself and in the process hide the hypocrisy going on in the government of a country so many ‘look up to’. But then, I’m a stubborn old broad and just how will people know? By the good work of the media?
@Nick, I have talked to many congressional assistants, and although they are absurdly hesitant to change any law, it seems to me that they do help with individual cases. I also think that immigrants like you have a better chance of being heard than Americans abroad. I’m not personally affected by these issues so I don’t have anything to “go public”, but if you need some help in other ways, you can ask a moderator for my email address.
@allou, I recently was told the wait for a CLN for someone relinquishing in Canada was 8-9 months.
Shadow writer. Thank you for for your words of support. How may I ask would you be able to help. I for one am now 60 years old and although pretty savvy with electronics for my generation I am not that good at maximizing the social media to get my and thousand and I believe millions of others story out so we can make people wake and listen to reason.