US Senate Finance Committee Submission–Richardson, Yates and Kish
Cross-posted from Maple Sandbox: US Senate Finance Committee Submission — Richardson, Yates and Kish
Here’s an excellent submission (Request for Tax Rule Changes) to the U.S. Senate Finance Committee.
This was written by *Toronto lawyer John Richardson, ***University of Toronto professor Dr. Stephen Kish and (this is huge!) **U.S. attorney Willard Yates. Mr. Yates’ involvement is significant because he retired from Office of Associate Chief Counsel (International) (ACCI), Internal Revenue Service after 31 years of service.
The 32 page comprehensive submission deals with everything from problems of citizenship based taxation to the financial and psychological costs of renouncing US citizenship. Despite the complexity of issues covered, it is quite easy to understand for most of us who have been around this issue for a while (although newbies may very well find it overwhelming and frightening).
The report is also posted at citizenshipsolutions.ca , John Richardson’s Canadian website designed to counsel US citizens abroad who find themselves having to live in a FATCA and FBAR world.
January 26, 2014 at 2:48 pm
This goes a long way to explaining why NZ should not go any further with a FATCA IGA:
US Senate Finance Committee Submission–Richardson, Yates and Kish
Perhaps a submission could include it, preface it, and add any other comments that the submitter felt needed elaboration or was specific re NZ?
There’s one problem banks can’t shy away from on the frontline. How do you ask your customers to prove they’re not a ‘US person’ without offending or raising suspicion?
Do you bury it in Terms and Conditions and hope for the best? Do you ask every single customer whether they’re US citizens? In short how to extract this information from your customer base without causing provoking a reaction?
Some of the customers will be easy (US place of birth), but how about those foreign born dual US citizens? How do you flush them out?
This FATCA witch hunt has to be brought under control. I wish people would start using the term witch hunt more and call FATCA for what it really is a witch hunt.
Take a look at KPMG or Deloitte and Touche guidelines for banks in the identification of ‘US persons’. There is a big compliance industry behind all this and the banks have complex flow charts to follow, even an old US address may raise flags. The 30% withhold is a BIG stick and when have the banks been shy of offending their customers? Duels with a non American birthplace may slip by but there is a lot at stake for the banks, so they may well ask all of their customers to confirm they are not US persons!
Friends, that submission finally brought me to tears. Maybe that is the consequence of this long ordeal. My friends, colleagues even family, do not have any idea how bad all this is. Nor would they imagine an individual like me could finally be brought to tears on something like this. I have been through a lot in my life and well this was it, the breaking of the back.
In the phases of grief, I think a few days ago I had gone into the maybe its not so bad with the local client base exception. But no as others have said, I/we want to live out our lives just like our neighbors! We are citizens of _________, living in our home countries, we want to live normal everyday and yes boring lives. When my neighbor opens an account at ________ down the street to get a certain perk, I should not have to be forced to go miles and miles away to the co-op or credit union which I could only join because I joined some club that is affiliated which then allows membership in the co-op. And then be fearful of a change in more extra-territorial rules.
A few years ago I relinquished in all manner except getting the golden ticket. Though my relinquishment is not one that seems to have ever come up on these boards and I have been lurking for a long time. Once I have the golden ticket and everything is put back in the right place, I will share my own journey. Blessings and prayers to all those that have shared so much. A special tip of the hat to swisspony as his comments, story were very close.
In the last few days, I took the first step and it seemed like a great plunge. I emailed the embassy requesting appointment dates. They do not have an online system, have yet to hear back but as the say the journey begins with that first step. That has allowed me to take a breath.
Very soon, I need to go back to the homeland for a month because of family. The bluebook is the only tie and thanks to these boards I understand the why I possess it, why I need to use it and why that alone does not defeat the relinquishment. Everything that others explained was deep down understood but the articulation by others was a glass of cool water.
I have always been and remain damn proud to be an American but an American is not necessarily a US Person, that is all. And this is a reminder that “Canadian Persons” are also American and I am proud to share that with all you guys in Ontario, BC, New Foundland and in between.
For my Christian brothers and sisters here at IBS, you are doing the Lords work helping everyone.
For those that are not Christian or not of Faith, thank you ever so much.
When I first went to the USA in the 70’s and first learned of the ideas put forward in the Constitution that those founding fathers like Jefferson had put in place, I was full admiration for their wisdom and fairness. I was not born an American yet I was proud to be part of that society and always ready to defend the US against many European critics.
Now I don’t recognize the place. I feel a great sense of loss but it is over ridden with a great anger. How could it have gone SO wrong?
George, I share your sense of loss, but you must always feel proud to be an American, its people are not at fault,
The Constitution has been eroded, ‘We the people’ means nothing anymore.
I hope that this submission inspires something in the Committee. If it doesn’t then they are driven by something other than common sense and compassion.
My least favourite line:
(Re: Tait v Cook judgement)
“government by its nature benefits it citizens”
– to me is kind of like suggesting that slavery is good for slaves, or that excess weight is good for obese people.
My favourite line:
“The fact is that U.S. citizenship is no longer compatible with living outside of the United States. This is the result of intolerable pressure coming from inside their country of residence and from the United States.”
Witch hunt is right and OVD is the drowning process that proves you aren’t one.
@ George – i shared and still share your emotion. like Monalisa1776 and all other “ex USPs”, we are, as you will still be, still AMERICAN in heart and soul and culture and history. All that has changed and will change is a little bit of paper. you are remaining true to the ideals of the founding fathers and of Him/Her upstairs. . you are the TRUE patriot. “greater love hath no man”.
keep up the spirits and the journey to freedom, one step at a time.
wow at first i thought hmmmm 32 pages on taxes and fatca….gonna be a dry read.
wrong…..thank you so much for writing such a simple document on such a dry and complex subject.
now we can only hope that the powers that be will actually take the time to read and understand what is being conveyed.
George, your heart-felt comment brought me to tears. I’m sure that is the same for many who have been going through this horror, reading your words.
I’m a tough old broad, but my experience was the same as yours:
re; “Witch hunt is right and OVD is the drowning process that proves you aren’t one.”
And holding on to US citizenship abroad has become like holding on to a hot iron http://en.wikipedia.org/wiki/Trial_by_ordeal http://www.jstor.org/discover/10.2307/205237?uid=3739448&uid=2129&uid=2&uid=70&uid=3737720&uid=4&sid=21103349650597
and I heartily agree with you re; “My least favourite line:
(Re: Tait v Cook judgement) “government by its nature benefits it citizens”” What a claim – with no qualifiers. Do the ‘benefits’ not vary wildly with the NATURE of the government?
The US demands a free lunch (it exists, therefore we abroad must pay for it to exist) and that is its convenient rationale.
“Do the ‘benefits’ not vary wildly with the NATURE of the government?” So true.
As many of us can attest to, the US government by its nature enslaves its citizens abroad.
January 28, 2014 at 7:54 am
There’s one problem banks can’t shy away from on the frontline. How do you ask your customers to prove they’re not a ‘US person’ without offending or raising suspicion?”
They will ask you to sign a document or a W8 if you have US indicies
from UK Facta agreement
If none of the U.S. indicia listed in
subparagraph B (1) of this section are
discovered in the electronic search, then no further action is required until
there is a change in circumstances described in subparagraph C (2) of this
section with respect to the account that results in one or more U.S. indicia
being associated with the account.
3.If any of the U.S. indicia in subparagraph B (1) of this section are
discovered in the electronic search, then the Reporting United Kingdom
Financial Institution must treat the account as a U.S. Reportable Account
unless it elects to apply subparagraph B (4) of this section and one of the
exceptions in such subparagraph applies with respect to that account.
4.Notwithstanding a finding of U.S. indicia under subparagraph B (1) of this
section, a Reporting United Kingdom Financial Institution is not required to
treat an account as a U.S. Reportable Account if:
a)Where account holder information unambiguously indicates a
U.S.place of birth, the Reporting United Kingdom Financial Institution
obtains or has previously reviewed and maintains a record of:
(1)a self-certification that the account holder is neither a U.S.
citizen nor a U.S. resident for tax purposes (which may be on an
IRS Form W-8 or other similar agreed form);”
The question in Canada is lying on a US tax form punishable in Canada?
In addition I think the French agreement allows the Banks togo further if they believe the certification is a lie.
Wow, what an excellent summary of the issues that is! Let’s hope that it is a “game-changer” with the U.S. Senate and leads to the necessary changes. Although I am no longer a U.S. citizen, having gone through a stress-filled year of obtaining a CLN to document my relinquishment, I hope for the sake of all the others who are going through this incredible nightmare that in a couple of years this will all be behind us.
Meanwhile, as an answer to any of the ignoramuses who still favour FATCA and CBT and who wonder what all the fuss is about, a brief reply with a link to
I am sure that the German Jews in 1940 absolutely bought into the argument that “government by its nature benefits it citizens”.
I am sure that the Siberian Gulags were full of people who bought into the concept that “government by its nature benefits it citizens”.
I am sure that the original English settlers fleeing England in the 1500s onwards bought into the argument that “government by its nature benefits it citizens”.
I am sure that the folks who fought in the American Revolutionary war thought that “government by its nature benefits it citizens”.
I am sure that the Cherokee and the Sioux all bought into the argument that “government by its nature benefits it citizens”.
I am sure that the Cambodians under Pol Pot bought into the argument that “government by its nature benefits it citizens”.
What an absurd argument. What an UN-AMERICAN argument indeed. The Founders of the USA designed their system to have a minimalist Federal Government ! Of course the folks that came after have step by step torn down the wonderful construct that the Founders had bequeathed to them.
January 28, 2014 at 11:20 am
Wow, what an excellent summary of the issues that is! Let’s hope that it is a “game-changer” with the U.S. Senate and leads to the necessary changes”
Sure 26 Democratic senator and 130 Democratic House member are going to vote against their Presidential veto. sarcasm off
How about a thread about the response from the government to the Liberal MP questions. It may be helpful to people who are interested in practical solutions.
True, but for many of us the nature of our government did not cause us to flee, it’s only by leaving did we realize that we must either flee, or return to it. The profile of the American abroad is about to change very dramatically when those considering leaving do so under these newly realized restrictions.
Re: “government by it’s nature benefits it’s citizens”. Not only is that statement dead wrong, it implies the government owns “it’s” citizens. Nothing could be further from the founding principals of the United States. The framers of the Constitution and the Declaration of Independence were painfully aware that government was often the enemy of the people. What was that court thinking? That court should have tossed CBT and said instead; “citizens by their nature benefit the government, if the government deserves it”.
I’ve often thought that in a perfect world governments would have to compete for citizens. The government that was able to provide the best services for the least tax, the most individual freedom, the best regulation and order would get the citizens. The oppressive, despotic, tax and spend governments would be left with no citizens to govern, tax or abuse.
What a fantastic piece of work by these three men. I do feel some hope that the injustice and insanity of CBT & FATCA will end. We must keep up the pressure on our government to stand up to the US, even if we are the only country in the world to do it.
@GeorgeIII, I understand your cynicism about the likelihood of the US changing its tax laws as the Richardson, Yates, Kish submission recommends. But at least, with that submission before the US Senate Finance Committee, we can no longer consider ignorance (of the effects of US tax laws on US expatriates) as a factor in the continuation of current US tax policies. If, despite being made aware of the negative effects of CBT and FATCA on US citizens living “abroad”, and despite cogent recommendations on how to change US tax laws, the US government is unwilling to change those laws, then I will lose whatever remaining hope I have about the future of the US.
Je concur. It’s one thing to do things because of ignorance (inexcusable ignorance nonetheless), but to dismiss or ignore the persecution of its own citizens is inexcusable. I think most of us can predict the long -term outcome, and it won’t be pretty, but it might be somewhat amusing to watch for those who’ve lost all vestiges of love they had for their former country.
Please correct one of those MP’s e-mail addresses for me. Erin O’Toole’s address should be email@example.com. The apostrophe messes up e-mail addresses apparently. It shows up in black amongst the blue links.
I apologize for putting up a comment with so many links in it. I was just reworking my list last night, getting ready for an IGA announcement, and thought oh I think I’ll share this. Sometimes a person should not be “working” way past midnight. 😉
Fixed. Thanks for sharing all these useful links!
That gave me a good idea. I copied your list to its own page at the “FATCA Fact Sheet and Protest/Publicity Materials” link on the sidebar. If anyone has other lists (other countries’ Parliaments, journalists, etc), there could be a permanent page for them too.
Thanks for the quick fix, pacifica777. When I saw the going into moderation message I thought oh no I probably broke the whole system. I’m not up to a marathon individual MP mailing again so I needed to get set to do a mass mail. I’ve never Bcc’d before so I don’t know yet if I have to break those big groups into smaller groups or not. I’ll find out pretty soon I reckon.
A masterful document. Thanks.
“How do you ask your customers to prove they’re not a ‘US person’ without offending or raising suspicion?”
Easy……The freedom loving Canadian government should make us all wear a patch like this one