The following are ramblings as I wonder the group most represented here, those who are so ‘gobsmacked’ and talk about their similar reactions after their OMG moments and the reality of what the U.S. requires of them.
This largest group of us seems to be:
– 50 years and up,
– generally financially responsible, and
– ALL here, completely tax compliant where we live.
This experience for us has dispelled ALL our beliefs and assumptions, ALL of them. What an awakening, our OMG moments.
This experience is so hard for this group of people to deal with. As people who have tried to follow the rules, we don’t comprehend how we are being most hurt. We see our lives being destroyed at the hand of the country we once believed in. We are at the end of the building of our lives and planning for leaving something to our offspring. We also have the burden of realizing (as most of us didn’t know) we have passed onto our children a U.S. citizenship — an automatic gift, rather than a claim to a U.S. citizenship from their birth to parent(s) who had been born in and lived in the U.S. for a requisite number of years. We feel a whole lot of guilt about that — and our children are actually the other group most affected by the realization of U.S. tax and reporting responsibilities. For them (and for us, their parents), it is almost incomprehensible.
I, like most of this group, felt in control of my life, knowing I had saved and planned responsibly for what I would leave my children when I’m gone. I, and perhaps we, cannot believe that control over life has gone, now being determined by congresspersons of a country we may not have been part of for decades. For someone proud of having worked hard and of putting one foot in front of the other to overcome other life challenges, anything I now do to insure my future proves futile. At 70 years of age, I cannot start over. There is no consistency; my life has up’s and down’s; hope and despair in the long wait to learn how my Government of Canada will protect my family from a foreign country being able to come into Canada and effectively categorize me and my family members as second-class Canadians. Why have I lost that sense of joy I once had? Why can I not now plan or spend from savings and enjoy some of my retirement years? Why am I now afraid of future costs I will have related to my son’s U.S. matters? Why do I continue to be so angry?
There are obviously many of the million or so of us in Canada who are not affected this same way. I ask myself why that is. I ask myself if there are different types of personality, rendering some persons more resilient and able to live in denial of what is happening to them.
Most of this group have fond memories of the America in which they grew up, were “taught about” in American schools and pledged allegiance to at the start of each day. I now recognize that as a soft form of brainwashing that we believed, as the homelanders now, America is a special place you can count on: exceptional from other countries of the world.
This group of us generally was taught and believed that fairness and justice correlated with law and lawyers. We tried to live up to being good citizens, believing the U.S. to be the most moral country with the justice of law carried out by law and lawyers — they were equated with our concept of morality.
Our young minds were molded based on that ‘U.S. entitlement’ and belief that law is basically moral. Most of this group has believed and some may still believe that lawyers are basically honest; we trusted that it would be with their help we would be able to do whatever we needed to do to bring ourselves into compliance with the U.S. that we honestly had not known was required. All would turn out OK. The extent that some lawyers have taken advantage of many is almost incomprehensible to us. In most cases they have exacerbated problems. Distrust of lawyers is now extreme. There are, however, those that abhor what is happening to us and do want to effectively help. Most people now think all lawyers (even the ones many absolutely need) will take advantage of them. We feel rather helpless, then, to find solutions by ourselves.
That molding of minds is the basis for which we ask ourselves, “Why did I not know?” and blame ourselves because we did not, although we should have.
‘No fool like an old fool’ comes to mind as we now realize what fools we were to buy into any of that concept of American exceptionality. We feel a strong and justifiable sense of betrayal of the country in which our lives started. We have and are losing a lot of responsibly saved and invested money — and it has nothing to do with tax evasion.
This experience disrupts our very relationship with ourselves. We no longer understand ourselves – and that’s what is a real problem. We see some caught into a place where they blame themselves and cannot move on. Even those of us who think we don’t blame ourselves, probably do in more minute ways.
I did not know there was any difference between the citizenship-based taxation of the U.S. (and do not remember having ever learned of that concept in any US civics class) and that of other countries, which is based on residence. I never became aware of that citizenship taxation concept during my adult years, so finding that I WAS still considered a U.S. citizen and had U.S. tax return and reporting responsibilities the whole time I have lived in Canada, was unbelievable to me. I ask myself why would I not have known of this as the media asks the same and calls me a U.S. tax evader, or at least a U.S. tax avoider, and a US traitor for choosing to live in Canada. I only knew that I had decided to stay in Canada and raise my family here and in 1975 felt a responsibility to Canada to became a citizen here. At that time I was warned by the U.S. Consulate that I would be relinquishing my U.S. citizenship by doing so — WARNED as that was the message at that time. Message taken; should I blame myself for never again checking in with the US on what my tax responsibility might be? In my mind, I just changed my responsibility to my new country, Canada, and paid the U.S. no more attention, except that I still had family there. Why did I not know — self blame?
I do know that I and we feel so betrayed. THIS IS ALL ABOUT BETRAYAL!!!
One of my favourites that helped me understand myself, I recommend to you: a piece that said what my mind was thinking is My Wound is Geography. I could absolutely relate.
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I wonder what is the difference between this most affected group and those who have the same definition of U.S.ness but are not here discussing this with us? What allows some to stay in denial? Is it that different personality types handle all this differently? Is there a relationship between personality types and the damage this has done to us?
Are those of us in discussion and working at advocacy here the same who ARE tax compliant and many of whom have made our decision to renounce or claim the relinquishment of our US citizenship? Do you feel, as I do, a real need to carry on as a voice for the many of our brothers and sisters who will be affected by FATCA and U.S. citizenship-based taxation coming to the countries in which they chose to live.
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Then, there is the group of “Accidental Americans” who have lived their whole lives outside the U.S., with absolutely no connection to the U.S. Pure incredulity that the U.S. can tell them they have to file U.S. tax returns and FBARs and will penalize their not having done so by draconian fines. Why?
There is one lawyer I am aware of who is advocating for common-sense solutions for these persons.
[ UPDATE: I am reminded by Em’s comment below that it would, of course, be a best solution for the US to change from citizenship-based taxation (CBT) to residence-based taxation (RBT). That would solve so much of this injustice for U.S. Persons Abroad. “After multiple delays, it seems that the Republican leadership has finally authorized the Ways and Means Committee to go ahead with tax reform…” Will the U.S. consider that or (yes, cynically) is it more likely they won’t as continuing with CBT gives the U.S. IRS such an effective means of collecting tax on passive income that is not subject to the Foreign Earned Income Exclusion (FEIE)? Is the time right for tribute from the “foreign” retirement savings of so many in the 50 and above age group? ]
From Mr. Flott’s letter to IRS Director of Individual International Compliance About Tax and Financial Account Reporting by Long Term Non-Resident Dual Citizens.
The context within which I ask you to consider the enclosed proposal is based on the following categories of US citizens that generally follow those outlined to the Commissioner in March 2009:
1. US citizens and permanent residents who live in the United States;
2. US citizens and permanent residents who are on temporary work assignments outside the United States or who work for US government agencies overseas;
3. US citizens, not covered by Category 2 above, who have resided outside the United States continuously beginning on or after January 1, 2003;
4. US citizens who have resided outside the United States continuously for more than ten years as of January 1, 2013 and continue to reside outside the United States;
5. US citizens who were born in the United States, but moved from the United States prior to their 18th birthday and have resided continuously outside the United States since that time; and
6. US citizens born outside the United States who have never resided in the United States.The OVDP exists for people in categories 1 & 2, and is a good option for such people to bring themselves into compliance with their US tax and bank reporting obligations.
The SFCP is probably suitable for people in category 3 with several minor modifications as noted below: (1) changing the eligibility requirement to “on or after January 1, 2003”; (2) fixing a hard tax liability amount ($1,500 is too low for many reasons); (3) setting a fixed number of tax returns to be filed and clarifying the tax year for which returns are required (e.g., three years counting from the most recent year for which a return is delinquent); (4) maintaining the number of FBAR’s to be filed at six years, counting from the most recent year for which an FBAR is delinquent; and (5) removing “simple” before tax return in the eligibility criteria or providing a more definitive description of what constitutes “simple”.
The enclosed proposed new procedure is for people in categories 4, 5 and 6. In a nutshell, it creates a “noisy” alternative for taxpayers who can establish that they fall within one of the last three categories listed above by answering a detailed questionnaire, the purpose of which is to provide a basis on which the Service can determine their culpability for being delinquent.
I want to be in tune to what will come of this lawyer’s plea to the U.S. for common sense on behalf of these ‘U.S. citizens’ who had no choice; they automatically obtained a U.S. citizenship with so many costs and no benefit (although there could be benefit if one so chose, for instance more easily accepting employment and living in the U.S.). That could be remedied by CHOICE, an option to claim a U.S. citizenship at adulthood if somehow these persons inherited the qualifications.
So, my question again, what are our personality types that give us or deny us resilience?
In the meantime, let’s all of us give up blaming OURSELVES for any of this!! We are not BAD people, no matter the bad that is happening to us because of our having lost (or won for some who wish to choose that) the U.S. citizenship lottery that now equates, for U.S. Persons Abroad or Green Card holders within the U.S., to toxicity. No matter what we tell ourselves; no matter what any others may tell us, we are just more collateral damage of more bad U.S. law.
What’s a normal response to betrayal and indifference to suffering? Anger, remorse and retaliation. I’d say that’s the stage many of us are in. The anger and fear are palpable, and difficult to move past when there’s so little hope of reconciliation, yet moving on is what many of us must do in order to restore our sense of security, which will bring normalcy back into our lives. For many of us the danger is still imminent, so restoring our sense of safety is impossible, especially since we aren’t confident our safety will be protected by those responsible for protecting it. What you refer to, Calgary411, is the breaking of the social contract between citizen and state when the citizen perceives himself as acting in good faith and in return is punished, dismissed and demonized. I have no idea how and if faith can ever be restored without some serious effort on the part of the offending party, yet many of us continue to feel as though we are entitled to it. Perhaps if the sense of entitlement diminished the pain would also? It might be something worth considering in trying to let go of the pain.
“Holding on to anger is like grasping a hot coal with the intent of throwing it at someone else; you are the one who gets burned.”
-Buddha
With all due respects to that lawyer’s “common-sense solutions” — no, no, no and NO. The ONLY common sense solution is to abort CBT and adopt RBT. Stop creating categories with varying degrees of culpability and stop creating more bloody paperwork for people, even though I’m sure the “Service” would love to get a big budget boost to make it possible for them to handle all that bloody paperwork. Now about that wondering …
You have done some serious musing there, calgary411. I can’t answer the question of how it is that some people can continue on as though the FATCA monster does not exist, even after they have been warned. You are not going to hear from any of them because they will not have the curiosity to explore the matter any further. Fear is a factor too. I’ve often wondered actually, where has all the curiosity gone? Why do people accept what is thrown at them by what we know is a propaganda catapult and not even try to dig a little deeper to find more information. I can understand why that was so in the past when the digging was nearly impossible for most people but it is not that difficult to do these days, thanks to the world wide web. Maybe it is just that simple — no curiosity, no motivation to seek the truth — but more likely it is way more complex than that.
Once the internet was at my finger tips I let my curiosity take me to whatever dark corner of the American deception that I could find and as a result I have strong feelings about the US government and all its attending apparatus … and none of them are good believe me. It also bothers me that Canada all too often falls in step with the US hegemon, going short on morality and long on concern for corporations.
Of course I share many of your feelings, calgary411, but never having been an American I don’t have any warm fuzzies about anything except the people we once knew down there in the USA. While living there I was too busy trying to survive to assimilate any of that American love of itself. Frankly American politics baffled me — all that right-left jargon. And American patriotism bemused me — all that razzle-dazzle. Why?
It has turned out that I walked into a trap when I drove across the border to begin what I thought would be an adventure in a foreign country. I know I can never go there again but knowing what I know now I do not want to go there anyway. I do not feel completely safe in my own country but I would feel completely and absolutely unsafe in the USA. The greatest terror there lies within the US government itself. The FATCA fatwa is just one facet of this.
I don’t want to become a cynical person. I still think that FATCA and the whole CBT system are part and parcel of the ill considered shambling of the oafish American giant. I don’t think there is conscious intent to victimize me. Like humanity itself there is both the wonder of America and the horror of it. And in America’s case, both of those are very large. Outsized in scale. American legislative mistakes sprawl far and wide and smear us with their goo.
Beyond all the hype and fiction something remarkable did happen. John Adams and his ilk were exceptional men and what happened in the formation of the nation advanced the cause of freedom and the value of the individual in ways that reverberated for the good of the world. That is the wonder of it. A few of my ancestors gave their lives in that cause. But of course there is the horror of America too. The prejudices. the slavery, all the things that people have enumerated here.
My non-American wife always comments favorably on the Americans we meet through our business. There is a sense of magnanimity, openness and warmth. Something positive and free.
This is the essential heart of America that is massively betrayed by the government with its slipshod legislation and draconian penalties administered without humanity, without thought for the broader consequences or even self interest.
When my parents took me as a 10 year old to New Zealand in 1959 there were no other Americans and certainly no information about taxes. I am certain that in all the years overseas (the rest of their lives) my parents were never compliant. How were they to know? How was I to know?
When I started a business with my wife I called the IRS regional office in the Philippines because I was at a loss to fill out an IRS partnership form. We had only transacted a few hundred dollars and that first year was a loss. The form and instructions utterly bamboozled me. “Oh, yes” said the IRS on the phone “you can’t fill that form yourself. You’ll need professional help.” That was 20 years ago. Where was that to come from?!! Nobody knew about US taxes on the island where I lived. And we did not have a razoo to pay for it, even if it had been available. So I did the best I could thinking that because I was not trying to avoid tax, if it ever came to a crunch I would simply point to the tax treaty which I assumed to be rosy. Surely the reciprocity that must be in the treaty would clear up everything. And I went blithely on for years . . . until 12 months ago . . . when someone emailed a link about FATCA and the FBARs. It caught my attention in a big way but it was 2 or 3 weeks before it actually tweaked that it applied to me. And then, oh yeah, it really was OMG. I can’t talk about it at home any more because early in the year I drove my poor wife nuts with my laments. But like you say here my American children and their spouses while they are empathetic, are not letting themselves be bothered. I guess like me following that phone conversation 21 years ago, they think this could not be right, it will fix itself. Sanity will prevail. I treasure much about America . . . but I doubt that. I suspect horror will prevail over the wonder of America and homelanders will be oblivious.
This has been a huge, cumbersome folly by the U.S. government. I can only imagine without some revisions and amendments that it will get even worse for all involved.
My experiences so far with all of this have been mixed. Every IRS agent I have dealt with on the phone has been really kind with one woman even saying “this is wrong, this is wrong what is happening to you.” I know she probably wasn’t supposed to say that but, given that she did I was grateful. So far my impressions of them are that a lot of them think this goes too far but, to them they must carry out what they are told to do. Some of the official releases from them early on do not jibe with my one on one experience which leads me to believe the higher ups perhaps aren’t talking that much with agents who deal directly with expats. I must say it’s a strange feeling. You’re dealing with people doing a job but, neither you nor they think this is the best way to go about things and it shows. Quite bizarre really. I often think a good book might one day down the road come out about this but, not while we have this particular POTUS or congress. Unless a miracle happens and they’re willing to admit there were WAY too many mistakes in this legislation.
From a personal level I DO feel remorse and sadness and I always will. I was born and raised in the U.S. and yes, I feel resentment. I don’t think anyone should have been put in the position I and many others were put in of having to choose. Your primary family where you reside or your country of birth but, not both? From day one as soon as they knew of such situations there ought to have been a hold on FATCA and amendments made asap. In fact I was pleased to see ACA, Nina Olsen and others trying to address this and hopeful for a time that such amendments may come. Well, they didn’t come and now I’m looking at possibly trying to get my son to go renounce.
The other issue was that they did a horrible job of letting people know what their obligations regarding FBAR’s were. I never heard of that paper even though I had called the IRS off and on when I wanted to make sure i was still doing as I should. It was never mentioned at all whatsoever. It was also never mentioned at any consulate I ever visited.
The other thing they did a bad job with was with regard to our children born abroad. I read the State Dept. website and elected to not register my son as an American. I felt that should be HIS decision upon reaching age of majority. As far as the information I could read on their website over the years it seemed that if I did not register him and he did not elect to claim such citizenship then he was not a citizen. Now with FATCA coming into play it looks like he may well be just by virtue of having me as his mother. He is not taking this any too seriously and I worry what will face him down the road when ferreting out our kids becomes a bigger part of their process regarding FATCA implementation.
As I’ve been forced by FATCA and the impossible situation it created in my family to relinquish my U.S. citizenship I’d like to be done with all of this at some point. After all I’ve paid a very high price to be able to be done with it and to keep my spouses information his own as a Canadian citizen.
These are the days of one hand not really cooperating with the other. State Dept bent over backwards to make my relinquishment a kinder,gentler experience. They were very, very good about it and even made remarks that “we have another one.” “Oh, we know what this is about, your spouse won’t go along?” When the officer came out she even went out of her way to mention that sometimes there are legitimate reasons to relinquish and it cannot be helped and that there was nothing wrong with that. What a change from how it must have been in previous years before FATCA! At any rate I was grateful to them too as I might not have been able to get through it.
I don’t think most people in the U.S. are “bad” and I don’t hate or dislike them. I have a lot of family there. What I do think is that the government there has completely lost it’s way! There is no way on earth something this complex and impactful should have been tacked on to any other act or bill. It should have had a full going over. It should have had discussion, cost/benefit analysis should have been completely done. The commission to study the issues of expats should have gone FIRST rather than come after this legislation. That’s the biggest mistake of all. They have passed something without knowing who it impacts or how it impacts them. We’re experiments! Except that we’re not. We’re people with average lives. They need not have had this be such a big mess. I am not hopeful any longer that the government there is even capable of doing the right thing anymore. It’s all become so cumbersome and is lurching from one bad policy to the next at train wreck speeds.
If you are talking about doing the right thing? Well, in fantasy land they’d apologize to us, offer anyone who lost their citizenship over this it back should they wish to take it and then DO the cost/benefit analysis and set about with the commission to study expats. Something like FATCA with RBT or even limited RBT could THEN go ahead. But that is fantasy land and they are not going to do it. Especially not with this particular government in place. I have noticed that this POTUS doesn’t like admitting to or doing major corrections to mistakes made.
The majority of Americans haven’t felt for some time that they are fairly represented in Washington. That goes double for expats who really don’t have ANY real representation. How ironic the position we are in is that we are come after in the same way the Brits went after the early Americans without representation and due to this situation we are having to lose our citizenship connection with them.
I personally intensely dislike being a part of this historical situation and would rather have never heard of this. Now that the train has begun to move there is little way to deal with it as an expat except to try and get off the train.
What I’ve learned after all these years due to FATCA is that the U.S. would rather its citizens never move anywhere else. If you do they plan to make things quite difficult for you and yours to the point you may be encouraged to stop being one of them any longer. That’s what is really at the bottom of it all. It’s a dislike for the fact that you don’t live there. Hence the implication that you must be “up to something” and “we’re going to ferret you out.” I was here all along and wasn’t hiding. No one else I know here was hiding…ANYTHING.
Thinking about all this is stressful and tends after a while to make my physically ill due to other health issues I have so I take it in small bits these days. I just want to get through it, perhaps make others aware of the situation, help someone else and move on. I still will visit my family there but, it wont’ be with great joy anymore. Crossing the border to go back to a place where I was born and that was once my childhood home as a former citizen does not bring happiness to me whatsoever. We are just an example of how badly things are off the rails down there with regard to their out of touch government. In some ways we are lucky because we live in other places. The people who have to stay there as this out of control train continues down the rail blindly won’t have a choice in the future. As I have said before none but, the very, very rich will be able to live outside the U.S. AND keep their citizenship if FATCA continues as is. That’s a loss to the U.S. but, the government cannot and will not see that until it becomes blatantly obvious. Politicians are so out of touch with the people down there these days that it’s astounding to watch them. This is what corporate controlled government looks like and we’re just part of the fall out of that.
Hellooooo George Orwell ……… the world you envisioned in the 1940s is now upon us …. a decade or three later than your predicted 1984 …. YET IT IS HERE NOW, being tooled up with a massive data server farm in Utah and to commence in earnest in 2014 capturing the financial lives (and the money of course through penalties for non compliance with rules the people were not even conscious of .. not even mentioning the immorality of the existence of such rules in the first place) of all people worldwide – whose communications by phone, email, text or other electronic method have already been captured together with their constant GPS location data and their interrelationships to other persons, real or imagined
A new world indeed. A world of slavery to Big Brother. I say again that I am so happy that I am not a young person starting out in life that will have to endure this sort of abuse for a lifetime. My only regret is that the little savings that my whole family are jointly surviving off are being destroyed by Government behavior …. whether FATCA, Money devaluation through Printing by the Fed (running at some $85 Billion per month presently) and so forth. And further the loss of all privacy ! I so resent that. As one ex spook said on TV not so long ago (paraphrased) …. “You might think that you have nothing to hide … but that is irrelevant … it matters not what YOU think nor even what the facts are … but what some analyst in spook city chooses to think and how that analyst chooses to interpret your electronic trail”. Once you are labelled I suspect that it is almost impossible to clear your record … and you are put to huge cost even trying to get that record cleared … if you even realize that you have a record at all …. all you might know is that doors close to you and your computer camera and microphone turn on mysteriously and without any lights being switched on. Then I read a news report from Florida of a widow who runs her home ” off the grid” – does not buy electricity or water I understand – who made the mistake of doing some media interview discussing being off the grid and now whose home has now consequently been labelled uninhabitable by some local Government agency. Where has Freedom gone?
Thank you so much for your work and sharing.
More on-topic than it may at first seem: http://world.time.com/2013/12/15/final-farewell-to-mandela/
“Mandela wrote that it was only when he discovered his freedom was an illusion, taken from him by the apartheid authorities, that he began to hunger for it.”
And (from another source, and abbreviated) the words of JFK: “Each time a man stands up for an ideal … or strikes out against injustice, he sends forth a tiny ripple of hope and … those ripples build a current that can sweep down the mightiest walls of oppression….”
Good on you all!
Good on all of us — you included, Sad-in-the-UK. Thanks for the relevant and encouraging quotes!
Thanks to each of you for your well thought-out comments on this. Those tie in with this excellent commentary: Lynne Swanson’s latest article is published in Global Tax News “U.S. Citizenship Based Taxation: Unique or Outrageous?”
Why should the US be unique with its citizenship-based taxation when the rest of the world (except of course Eritrea) have fair tax laws for the people who reside in their countries?
If U.S. legislators cannot or don’t want to see that their U.S. citizenship-based taxation uniqueness is harming innocent people and families outside the U.S. or, even worse, don’t give a damn, then I call it more U.S. entitlement and something expected of a dictatorship. The harvesting from other countries’ treasuries will be seen for what it is, a money grab because the U.S., with their might and CBT, can make it happen.
The least the U.S. could do is say is, you’re right – it’s not about tax evasion. It’s about U.S. bully superiority – we’ll show you our muscle and who runs this world. Inequity with U.S. CBT makes uniqueness a dirty word and very outrageous.
I like the title of the article and hope readers will better see the absurdity.
Bravo, Blaze!
@All
I took a glance at this post yesterday but I was having a FATCA holiday, mostly… This post Calgary411 has made has stirred my emotions very much.
Lately my head has felt like it is ready to explode, my feet feel like concrete blocks put on by the Godfather and my heart is ready to break. I get angry and also cry alot. I have not felt like this since my son died and then my husband, 8 months apart. I thought the course of Dying and Grief was to be my last big Earth school course and then I would have lighter courses. But FATCA has really been thrown on me…It is a course I did not expect nor want.
Yes, I am 50 plus years old, financially responsible, and tax compliant. I came to Canada in 1969 and filed US taxes as well as Canadian . In 1993 I became a Canadian and so my last US taxes filed were for that year. I never heard of Resident based and Citizen based taxes until I asked my older son when he moved to England did he file his Canadian taxes.. He told me that he did not have to as he would be working in England and Canada did not expect that. I was quite surprised It clicked when I found out months later about FATCA. All the time I filed my husband and my US taxes I never filed FBARS. I was never informed by IRS that I was doing anything wrong, even when they sent me a tax refund cheque of over $2 THOUSAND dollars. I returned it after calling and wrote a registered letter when I sent the cheque back. I heard nothing from IRS. I also did those tax returns MYSELF, without a computer.
I feel resentment, betrayal, anger , distrust and hate. I know it will burn and hurt me as Buddha says but it is there. What is does bring back memories of those same feelings when I saw the Kennedys and MLK shot, my classmates going to Viet Nam and coming back in body bags. I felt that when Watergate surfaced and there was some hope there when Gore ran but the counting of the ballots crushed that. I felt sympathy on 9/11 but was not surprised. You see I did and still read..There was so much under the covers that most Americans are not told about. so to me 9/11 was not a surprise.
The internet is my library. Having meningitis when I was a baby took 75 percent of my hearing so reading was my connection to the world. You know how you have moments in time frozen in your memory? Well climbing up the public library steps at the age of 7 is frozen in my mind.. I can still see it, feel it and smell it . My parents were not readers. I was told by my mother I was weird because I would go to my room and read.
I grew up watching the sanitized US history of Walt Disney….It did get me to be interested in History and Geography. I traveled the world in my mind while never going further than 2 hours drive away from my hometown. Then I fell at first sight in love with my husband and we married in 24 days of knowing each other and moved 1600 miles south of where I lived. A little more than a year later we moved to Canada. I felt so much a belonging to Canada. I felt like I came home..
Unfortunately our present Canadian government and politicians are betraying us. This I can not comprehend. It is such a shock for me. Their answers to my emails are so cold and robot written. The 64k dollar question will they throw us under the bus?
The present Potus in my mind is no different than the others. None that I recall have ever admitted to any mistakes or corrected them. That last Iraq war was a big mistake – made on lies. Well, Jimmy Carter did grant amnesty for dodgers and deserters but the mistake of the military CONFLICT that lost over 50k American lives was not his in the first place.
I have no ties, no desire to go back to the USA. I know many here do have family but not me.
There was a time when I thought of buying property down in Florida but when FATCA came it killed that thought. There is a whole world out there for me to explore. I saw the USA’s desert, grand canyon and California coast. Went to Disney World and Las Vegas. Been to NYC many times. and along the whole Eastern coast and all of Florida. I spent my money and helped the US economy. Now it is time to put my money elsewhere. I imagine others are thinking the same thing.
I see things in pictures…. when I read this post I had flashes of The Alamo and Bunker Hill.. Funny eh? I see us here on Brock in those fights. Are we doomed? I hope not but we will do what we got to do.
I am committed to fighting FATCA. I will stick with it through good news and bad news. I have faith we will succeed in bringing it to the attention of everyone we can. We are here together and together we are one big snowball that will create and avalanche.
People that are unbelieving will start to believe. We must not give up
True we are in a Orwellian world. Corporations now are in control of the world. That is what TPP is all about.
Many of our own family and friends are ignoring FATCA and think it is too outrageous to believe or that there is nothing we can do about it. Like my 82 year old friend who is a American but living in Canada for 50 years and not a Canadian citizen believes that End Times are upon us and she is praying and not being concerned with FATCA. My son is not concerned and says it won’t happen. My bf and friends all think I have gone off my rocker.
But I got you all to give me strength, inspiration, knowledge and hope. We are all on this path and journey together. Kind of like those who were on those wagon trains going out west in US history..We are all different but we all have that FATCA goal…defeat and end it.
“First they came for the communists; and I did not speak out -because I was not a communist;
Then they came for the socialists, and I did not speak out -because I was not a socialist;
Then they came for the trade unionist; and I did not speak out because I was not a trade unionist;
Then they came for the Jews, and I did not speak out-because I was not a Jew;
Then they came for me -and there was no one left to speak out for me”
-Martin Niemoller
There are many instances when we as Canadians have had the opportunity to speak out on behalf of fellow Canadians confronted by the abuses of Government. Our failure to so demonstrates our approval for these actions. Did we speak out against the Chinese head tax, Japanese Internment Camps, Native Residential Schools, The Sixties Scoop and the mass murder of aboriginal women?
I’m afraid given this Government’s track record that the best we can expect is a very hollow apology.
In response to the previous comment stating most of us in this battle are over fifty, I assume the younger set are juggling trying to earn a living, get supper on the table, homework, hockey practice, cleaning up and get ready for the same thing tomorrow.
When I attended the Occupy Protest in Calgary, many if not most of the crowd were over fifty.
Interesting discussion. My immediate thought is that the financially responsible over-50’s are the largest demographic here because they are most acutely affected. The financially irresponsible (of any age!) and the under-30’s, for the most part, won’t have enough assets built up for CBT skeletons in the closet or the ‘exit tax’ to be a large threat.
I am an outlier here at IBS. Not, and never was, a US citizen. I held a green card for some years (and still boggle at the thought that I could be subjected to an ‘expatriation regime’ since I had no ‘patriation’ from which to ‘ex’). I ditched both the green card and US residency in response to HEART, and my view is that I dodged a bullet by not taking US citizenship when I qualified for it.
My own sense of betrayal stems from having saved into a US retirement plans for over a decade under one set of rules, only to have HEART change them at a stroke with retroactive effect. HEART turned my retirement plans from a benefit to a detriment, so that I would have been better off not to have saved into them in the first place. But… the years I spent saving into them cannot be lived again and differently. If the US govt can change rules like that on a whim, overturning tax treaties as it goes, what idiocy might it unleash in future? (Of course now I have my answer: FATCA, with a possible later large dollop of Ex-PATRIOT.)
I have thought a fair bit about why I don’t just let this go and move on. I always stayed fully on top of the issues, to be sure that I was compliant with every US tax law going (no simple task). I made certain that my plans were watertight. And yet congress simply changed the rules, blindsided me, and invalidated my plans overnight anyway. That at least is a common thread between myself and others here — the belief that I had done the “right thing”, only to find that the US had, behind my back and with scant or no notification, invented a different set of rules that made it no longer the “right thing”. That takes a lot of getting over, and clearly I haven’t succeeded.
I don’t expect the US to change its ways at all; congress will continue its current idiotic path no matter what I want to happen. I can however influence people who might otherwise find themselves as I did. In Just Me’s ‘comply, complain and warn’ framework I focus on the ‘warn’. Sure, I comply and complain; after all I must wear section 877A’s IRS ankle bracelet for several more years. But primarily I want to warn folk immigrating or considering immigrating to the US that the US govt cannot be trusted to uphold either its end of tax treaties or the property rights of non-citizens. And I want to warn folk in my own country who have no US connection whatsoever that FATCA will still make their financial lives more complicated, more expensive, and less secure, even though they think themselves unaffected.
@northernstar, re; “But I got you all to give me strength, inspiration, knowledge and hope. We are all on this path and journey together.”…
Glad to have you and other Brockers on this journey – you are remarkable.
@Watcher
What is HEART? You have a situation I would not want to be in. I am like you . Once I get my CLN I will not stop. I want to warn as many people as I can. My ideas are percolating….
You have claimed your relinquishment of 1993 and await your CLN. This should not apply to you, northernstar. But it is good to know about this in passing on this important information to others.
Here is a good explanation of the HEART Act: http://www.deloitte.com/assets/Dcom-UnitedStates/Local%20Assets/Documents/us_tax_ExpatHEARTAct_080808.pdf (and why we fill out IRS Form 8854 to not be deemed a “covered expatriate”):
And then we intimately know about the HIRE Act that stealthily brought in FATCA: http://en.wikipedia.org/wiki/Foreign_Account_Tax_Compliance_Act
@northernstar, my beef with HEART is described in this short article:
http://robertschon.wordpress.com/2008/06/24/the-heroes-earning-assistance-and-relief-tax-heart-act/
“On my analysis if A is a UK citizen and say gives up his/her green card and triggers the exit tax, s/he will currently get no UK step up in basis for his/her US tax paid on exit. This is real double taxation.”
So, either retirement-destroying double tax on my supposed “tax efficient” retirement savings (because HEART tramples the US/UK tax treaty), or leave the US forthwith. I chose the latter. As calgary411 notes, this probably won’t affect you; as I said, I’m an ‘outlier’. It is however a real indication of the cavalier attitude congress has towards its tax treaties with other countries (and yet, the UK still went ahead and signed an IGA anyway — how blinkered is that?!).
Just heard from a “Shadow Brocker” who reads here faithfully and who wanted you all to know that though she does not post she is grateful to this site and is reading you all! I’m sure there are many, many more.
For whatever reason I can’t open the Archive section today to find a better thread to add this to so I’ll tack it into calgary411’s musings about basically why are we in this bizarro world in which CBT was conjured up. Lynne’s latest article calls CBT outrageous and so it is.
http://www.tax-news.com/articles/US_Citizenship_Based_Taxation_Unique_or_Outrageous___571149.html
This isn’t as succinct and punchy as Lynne’s article. It’s just my way of carrying her theme into another hypothetical nightmare scenario. It’s an update of a comment I made somewhere, some time ago.
CBT is insanity. CBT stands for citizenship-based taxation, a tax model which has its roots in the U.S. Civil War. It was designed to punish Americans fleeing their homeland. (Imagine that — people wanting to get out of a war zone!) CBT gained a great deal more complexity through the years and continues the punishment to this day. The only other country to use this tax system is a tiny little country in Africa called Eritrea. It adopted a much more benign and considerably simpler version of CBT to tax its diaspora in order to help rebuild following a war with Ethiopia. Eritrea was soundly condemned for this … by the U.S.A.! All other countries in the world use residence-based taxation (RBT) so it would be safe to say that RBT is the international norm.
Most people who move to other countries do so for adventure, for love, for family, for work, for a better future or for all manner of reasons which have nothing to do with taxes. That is recognized by all the countries of the world, EXCEPT the U.S.A. and Eritrea. But what if other countries decide to adopt CBT because they see the U.S.A. successfully cashing in on its diaspora? Let’s picture a world in which ALL COUNTRIES HAVE IMPLEMENTED CBT and then consider the following hypothetical scenario — A Tale of Two Citizens.
An American marries a Canadian. The newlyweds have to choose one country over the other because they can’t afford to live in both. They choose Canada. They only seek a happy life together but thanks to CBT they are now filing taxes in TWO countries — Canada and the U.S.A. The Canadian and U.S. tax codes do not mesh so the couple try to keep their finances uncomplicated (simple savings and checking accounts only), otherwise they would need to hire a tax specialist. (Investments and retirement savings plans would not be a wise choice for this couple.) The cumbersome, complex U.S. tax code is fraught with pitfalls and huge penalties for foot faults. An innocent error or omission on a FBAR or 8938 form, for instance, threatens them with thousands of dollars in fines … and these forms have nothing do do with calculating any tax owed. These forms are detailed reports of all their financial assets in Canada which must be sent to the IRS annually. Their Canadian banks must supply the same information to the IRS through FATCA reporting. Luckily the newlyweds left no assets in the U.S.A. but if they had, Canada would expect a full report on those accounts and any earnings would be subject to Canadian taxes.
A few years later an extraordinary job opportunity arises in New Zealand so the couple moves there to work, live and begin raising a family. Remember, in this scenario, ALL countries use CBT. Now this couple is paying and filing taxes in THREE countries (New Zealand, Canada and the U.S.A.) because neither wants to give up his or her birth citizenship. They grimace and bear all the added paperwork and expense involved. A professional tax preparer is definitely needed at this point to attempt to reconcile three sets of tax codes, with the U.S. tax code being, hands down, the most complex and punitive of the three.
More years pass and the extraordinary job in New Zealand unexpectedly turns into the agony of a layoff. Now the couple have a New Zealand born child to consider as well. Their search for work in New Zealand proves futile but the couple tries to hang on while their savings rapidly dwindle away. Soon they no longer can afford to make a move back to either Canada or the U.S.A. to start all over again. New Zealand has won their hearts; it’s the birth country of their child; and it’s where they truly want to live — at least for the foreseeable future (perhaps until aging parents in either Canada or the U.S.A. need their help). They have permanent residency (PR) cards for New Zealand and have begun the process of becoming New Zealand citizens which would give them dual status with their birth countries. Their situation is dire.
Then, just in the nick of time, a good job offer comes up but unfortunately it is in Australia. Luckily the company offers to pay all their relocation costs. So the family moves to Australia, by necessity, but they know they will eventually return to New Zealand, just as soon as the job market turns around there. They leave behind a mortgaged house which they were unable to find a buyer for. They reluctantly rent it out. They decide to maintain their New Zealand PR cards as long as possible but they have to temporarily stop the process of obtaining New Zealand citizenship. Now this poor couple must prepare taxes for FOUR countries: Canada (by citizenship), the U.S.A. (by citizenship), New Zealand (by maintaining their PR cards) AND Australia (by residence). Now their tax preparation expenses are wiping out a major portion of their income, even though taxes owed to the three countries they are not living in are reduced considerably by foreign tax exemptions. Paperwork is consuming their lives page by page by page. Meanwhile their Australian tax specialist is happily building a college fund for his children and a retirement fund for himself.
Luckily this scenario is hypothetical but what if other countries do follow the U.S. lead and switch to citizenship-based taxation, using something like the U.S. FATCA hammer for enforcement? The world would soon become one in which emigration and immigration would be so hideously cumbersome that everyone (except the very rich) would essentially be prisoners in their home countries. Families with mixed citizenships would be torn apart. Global commerce would be severely affected. The cost of record keeping and data transfer for financial institutions and government tax agencies would reach unimaginable heights. The tax compliance industry, however, would flourish. CBT is a dysfunctional system which cannot be allowed to go viral. When will the U.S.A. finally accept that the international norm is residence-based taxation (RBT)? When will the U.S.A. abort CBT and adopt RBT … for sanity’s sake?
Thanks, Em. Lynne’s article is great — and so is your resurrected similar analogy!!
BTW, I did an update to the text of my post:
I suspect those who are older would be less likely to have run across info online about the requirements for US citizens abroad. When we first moved abroad in 2003, I was on various expat message boards, as a way to learn about and ask questions on a variety of topics. One of the message boards was about Finances for Expats and that’s how I learned about what we needed to do. If we had moved abroad 10 years earlier when the internet had not yet exploded, I woudn’t have been online and would have been dependent on accountants to tell me what’s required (and many of them advised wrong)
@Em
I thought of your hypothetical scenario while I was reading Lynne’s article. Both are excellent. Thanks for posting it again. The more people who point out the absurdity of CBT, the better off we’ll be. BTW, have you sent it to the Senate Finance Committee? CBT is an abomination.
Older expats have generally been out of the U.S. longer too. FATCA or something like it isn’t so tragic if you’ve just left or will only be gone two years. It’s those that left in their 20’s and are now in their fifties who have built an entire life outside the U.S. who are being hit hardest. It’s not the money. It’s that they did such a BAD job of informing people. I still know people like my local cab driver here who thinks he’s just going to ignore this because they can’t really mean to harm people like him with fines and penalties! I have really, really tried hard to impress upon him that yes, they DO mean you. There are many more just like him. What I’m reading online is that a lot of really young expats out of the country short term DO now know about FBAR. Really it’s the FBAR that has made this entire thing so bad and of course rolling over average every day people into program processes originally meant for criminals. That too was a really bad thing way to handle this situation.
I do wonder what the outcome of the commission to study the impact of U.S. policy on expats will be. It’s pretty clear they are going to reach same conclusions about things we already know. Most expats are not uber wealthy and are not “hiding” money.
I really wonder why this situation couldn’t have been dealt with better. It seems they believed if a huge big stick was not used no one would do what they needed to do. Some of the responsibility for telling people their duties was neglected very badly. And then there was the fact that some people simply could not comply if they wanted to. Even Nina Olsen pointed this out. FATCA and CBT do not fit well together in a working knowledge sort of way at all. Revisions will come and come again. The biggest mess up was not doing the study to find out who expats are exactly before trying to implement a huge program like FATCA.
Oh and that cab driver is in his seventies. Still driving cab. Worked at a factory for years but, got hurt. After his Canadian wife died he still needed to work and has been up here for well over 30 years. He’s from Alabama. His folks were POOR. People in the U.S. need to get it that you do NOT need to have a ton of money to move elsewhere due to marriage or for other reasons. You do need support but, then if you move for family reasons usually you have help. Just as if you moved from one state to the other in your twenties to marry a person from that new state.
This could have been managed from the top down in a much better way.Do the study first, then adjust the law to reflect who is a “tax cheat” and who is not. Good heavens. To be honest, I bet their isn’t an IRS agent who wouldn’t agree with that who has had to deal with this one on one with all these expats. After all their work would have been far easier and much less wasteful! Who wants to have to deal with a seventy year old cab driver who you know isn’t going to have any money and hasn’t been “hiding” anywhere! Much of the issues with FATCA could have been totally avoided.
*there*
Thanks, Atticus.
Common sense is surely lacking. How much of the USA declining resources will be spent on chasing innocent people — that neglected cost/benefit analysis? As well, it is not often that the US admits it is wrong (well, some are US general who opened Guantanamo prison says shut it down but haven’t seen much more), as we can see in this, I think, related NSA data gathering.
@Atticus, I completely agree. What further scares me is how so many could be hit hard with fines for mere technicalities, which is why I still feel vulnerable. At the recent ACA meeting in London I was told that the US authorities are already very aware of Isaac Brock and consider this essentially a tax protestor site. It occurs to me that the Individual IRS agents, along with Nina Olsen, are aware of our dilemma; however, the government could still try to use reprisals against people being outspokenly critical.
It’s as if they can’t admit they’ve screwed up with all the collateral damage…If FATCA is fully implemented, who’s to say they won’t use it as a weapon to go after anyone they particularly dislike?? It’s why I feel it’s especially imperative to have squeaky clean tax returns if planning to renounce, etc. And yet, there’s always inevitably some sort of technicality whereby they could still hit some one trying to be fully compliant.
With all the NSA surveillance, they shouldn’t really even need FATCA and FBAR; It thus makes me believe they will use it not only on tax evading whales, but also on people they really don’t like as a means of control.
monalisa,
While we all have to decide what to do in our own individual situations and some feel they must remain in fear of reprisal for a number of years, I will not accept from anyone at an ACA meeting or anywhere else that “the US authorities are already aware of Isaac Brock and consider this essentially a tax protestor site.”
Is that really what most participants here think? I do NOT see Isaac Brock as a tax protestor site. Far from it.
I, for one, am not here to cave to the fear-mongering of the US and reiterate from excellent bubblebustin’s comment:
I’ll say that until what I consider the bad guys come to carry me away for practicing my right to free speech and challenging what the US is doing and the collateral damage it is creating with US citizenship-based taxation combined with FATCA.
@Calgary, and I agree with you! 🙂
I need to go out and get some mince pies and sherry, and get more into the festive spirit…I realize I need to try and stop worrying so much. My problem is that the internet makes everything at my fingertips so can look up everything at the touch of a button, even on the go. 😉