O Canada! Who stands on guard for thee?

6 thoughts on “O Canada! Who stands on guard for thee?”

1. @Petros,
   re; ..”Everyone who reads this blog and is a Canadian citizen has sung this oath many times. When we Canadians sing it, we vow to protect the rights of all Canadians…”…

   Very interesting perspective – I hadn’t thought of it that way before. Thanks for the insight.

2. Thanks for the heartfelt post Petros. I can’t hear O’Canada anymore without feeling a sense of betrayal.

   Last Canada Day was a sad one for me, and that was before we had a signed IGA. I think there will be many of us that wished we could take a vacation out of the country for the next Canada Day since that will be a double whammy as it is also the date that FATCA takes effect.

3. Thank you, Petros. The hypocrisy would bring me to tears as well.

   In pondering the advice at http://blogs.angloinfo.com/us-tax/2014/02/17/help-i-want-to-expatriate-but-they-wont-let-me-part-ii/ (also at taxconnections.com), I think:

   So, more money for proper advice since the country in which my son was born, Canada, will or can do nothing to protect him? In fact the Government of Canada just waived my son’s rights in signing an IGA with the US. (And the rights of others like my son; and the rights of other persons who may have a “mental incapacity” like someone with age-related dementia.) The person with Mental Incompetency Issues is even lesser than the second-class Canadian citizenship that all other ‘US Persons in Canada’ now have with the US IGA, compared to “all other Canadians, no matter where their ‘national origin’ or the ‘national origin’ of their parent ( s ).
   

   ***OR, am I to assume that the advice is I SHOULD NOT Hold a Canadian Registered Disability Savings Plan (RDSP) for my son? Besides an RDSP not being a good investment for a US Person, he doesn’t deserve to have the benefit of such a plan — it is not for those the Government of Canada now deems a ‘second-class citizen’ by virtue of an arbitrary, unregistered NATIONAL ORIGIN by birth to a US Person IN CANADA, because I was still a US citizen at the time. Swallow hard and cash in the RDSP, turning back to the Government of Canada the bonds and grants they contributed to the RDSP and on which I have already paid income tax to the US. Too bad about the amount I paid to a US accounting firm to correctly report to the US my son’s RDSP on my behalf. How can one so-called US Person in Canada have made so many mistakes in life planning 101 and trying to best provide for my son when I am no longer alive?

   Thank you, Andy Grossman for offering your comment which makes me / us think / try harder for a solution for this “injustice” — for my son (others like him with a ‘mental incapacity’) AND those other “Accidental Americans” born in the US only by “accident of where their parent(s) happened to be when they were born — another country than their real home country.

   Any further thoughts on Mr. Grossman’s thought-provoking comment?:

   A few points:

   (1) There is a “rebuttable presumption of alienage” (non-acquisition of US nationality) in the case of persons born abroad, at least in non-criminal cases. The State Department allows its consular offices abroad to issue reports of birth abroad of a citizen only up to age 5, after which all cases must be referred to Washington. https://secure.ssa.gov/apps10/poms.nsf/lnx/0200302535 Especially in cases of doubtful qualifying residence (or for non-marital children, mother’s unbroken presence) in the United States, this presumption may be useful. The IRS after all has no status to bring an action to establish nationality. (There is substantial case law on “doubtful nationality” cases, many of which have been collected in the Gordon, Mailman, Yale-Loehr & Wada Immigration Law treatise.)

   (2) While International Law reserves to each state to the right to determine who are its nationals, it does not compel recognition of that nationality by other states in exorbitant cases. The concept of “dominant nationality” widely accepted before WW II fell into disuse as dual nationality became common (partly because of gender equality) (viz. the 1992 Micheletti case of the ECJ); but the paramount national interests of other countries whose “ordre public” might violated by US PFIC and citizen-tax rules just might revalidate it. Provisions of tax treaties notwithstanding (“For the purposes of this Convention, the term ‘resident’ of a Contracting State means any person that, under the laws of that State, is liable to tax therein by reason of that person’s domicile, residence, citizenship”).

   (3) The State Department’s views on loss and renunciation of nationality are here: http://travel.state.gov/content/travel/english/legal-considerations/us-citizenship-laws-policies/renunciation-of-citizenship.html These are not unqualified statements of law but rather agency interpretation. Statistics alone suggest that large numbers of persons who may be counted as its nationals abroad have disregarded their status and obligations. Many lack the means and sophistication to be compliant. Some forego CLNs and rely on pre-1980 expatriation or on their own interpretation of the expatriation statute. In the sad cases of mentally-incompetent individuals disadvantaged (i.e., for PFIC and tax reasons obstructed for benefiting from foreign tax-sparing allowances and trusts) some rely on the points in paragraph (2) above.

   (4) That said, Big Data and new tools (the TECS database of passports, green cards, visas, travel reservations and border crossing) and the occasional use of “ne exeat republica” injunctions puts at risk those who, like Ronald Anderson, once thought they could visit the USA undetected http://uniset.ca/other/news/wp_ronaldanderson.html

   (5) Ronald Anderson was a Vietnam war era Army deserter. Such people relied on sympathetic foreign governments (which often gave them residency and eventually naturalized-citizen status). Other cases highlight the policy conflicts that dual nationals encounter. FATCA and other aggressive foreign assertion of jurisdiction by the USG may be acceptable when they relate to US residents. How conflicts will be resolved when dual- (and multi-) national individuals are targeted within their other country of nationality remains to be seen.

   (6) Most countries of the world have permutations of “nationality”, sometimes based primarily on ethnic or cultural priorities. The USA rather has something else: English Common Law “allegiance”, as in “Pledge of” and in “Ligeance of the King”. For Americans expatriation has typically had within it a whiff of apostasy. (The US still has “grades” of citizen, with 14th Amendment citizens born in the 50 states compared with territory-born citizens and foreign-born “jus sanguinis” citizens (and beyond that pre-1924 Indian Citizenship Act Native American protégés, pre-Cable Act women, American Samoa “noncitizen nationals” and a few other anomalies.)) This may explain a certain lack of sympathy for Americans abroad faced with the kind of conundrum you have written about.

   (7) The US often holds other countries to a higher standard than it holds itself in international-law matters, the Nicaragua case before the ICJ being only one example. Although other countries have “expatriation taxes” (France, Denmark, Canada…) and Eritrea (and until 1999 the Philippines) have levied tax on their diaspora, the main conflict has been in military conscription. Some countries (Greece, for example, except with respect to its Muslims and ethnic Slavs) have had no provision for loss of nationality. One might hope that a multiplication of cases of conflict between the USA and foreign nations will lead to a clarification and perhaps an alleviation of hardship in some cases of reluctant and “accidental” Americans.

   Advice from the author, Virginia La Torre Jeker J.D.:

   Parent or Guardian (or Trustee) – What Should You Do?

   US tax planning in the kinds of cases discussed is ever critical. If the individual cannot expatriate currently, it is very important to structure his affairs to minimize any US tax bite during the time he remains a US citizen and in planning for a future expatriation. ******If the individual is under a permanent mental incapacity such that renunciation will never be possible, then proper planning of US tax matters becomes even more critical. A well-meaning parent or guardian may often look to trust structures to ensure the continued care of the child or mentally challenged individual. However, setting up a “foreign” (non-US) trust for such an individual may well be the worst action to take from a US tax planning perspective! The stakes are high. Get proper advice.******

   …do I just do nothing and ***HOPE*** that ***they*** (whoever they is: local CANADIAN “foreign financial institutions” or the Canada Revenue Agency or the US Treasury or IRS [ who has the information on my son in my FBARs (Foreign Bank Account Reports) ] will not take action? I refuse to register him with the US and the abyss of cost of administration of compliance of a US citizenship never registered / never asked for (the only purpose for which would be the ability to renounce, which he can’t). It’s a circular conundrum.

4. Thank you Petros. Your post made me very emotional indeed.

5. Thanks Petros – I’ve been very conflicted these last couple of weeks about the entire notion of patriotism and the role of the nation-state.

   Could the far-too-easy capitulation of more and more countries to the US be a true bellwether of a coming One World government, or perhaps of a coming world war? It seems to me that the other shoe(s) haven’t even begun to drop yet to answer that question. I find it impossible to imagine that EVERY government around the world will cave-in as easily as the G-8 seems to be. What then? What new dynamic will be at play when the dust settles and half the world has signed-up for FATCA/GATCA and the other half refuses to play along? When that stage is set, I believe we’ll have an entirely different outlook on the concept of country and nationality and patriotism – and I don’t think it will be at all pretty.

6. “Oh CBA, we stand on guard for thee”.