OMG! IRS Wants Me!
We have all had our OMG Moment. Now that the FATCA rollout has begun, there will be many more “OMG Moments”. This past weekend, I heard about a particularly egregious, frightening and unfair situation (yes, some are worse than others). In response to this, John Richardson suggested that I post the following:
If you are newly in your OMG Moment, we hope this will help.You are among friends here. Thanks John!
You are experiencing one of the most terrifying, confusing and disorienting moments that you will ever have in your life. The range of emotions you are feeling are so difficult to manage that you are having difficulty responding.
1. You are NOT in a position to make any quick “commitments” which are NOT REASONED decisions but are REACTIONS to a frightening and confusing situation.
2. Only “U.S. persons” are required to file U.S. tax returns. You may NOT be one. Your first step is to take steps to determine your citizenship status.
A. Being born in the U.S. is NOT conclusive proof of U.S. citizenship. You may have relinquished it along the way.
B.There is NO presumption whatsoever that somebody born outside the U.S. is a U.S. citizen.
3. Since you have not been in the U.S. tax system you do NOT have a tax problem. Therefore you do NOT begin by calling an accountant/tax preparer/tax lawyer. (Once you are in the U.S. tax system you will be rewarded with “tax problems”. At the moment you have a “possible compliance” problem (if it determined that you are a U.S. person).
Accountants, tax preparers, your bank and the vast majority of lawyers are NOT qualified to advise you on the starting question:
“Are you in fact a U.S. person?”
4. The advice “What To Do Before Contacting A Lawyer” is important and applies to to contacting accountants as well.
5. You are NOT alone. Estimates are that there are at least one million Canadian citizens affected by this injustice and unfairness. Remember that you are NOT alone.
6. You have done NOTHING WRONG. The U.S. has never made any effort to educate Canadians of U.S. origin that their laws levy taxes on the basis of citizenship and those born in the U.S. begin life as U.S. citizens.
You did NOT choose where you were born.
7. Information sessions are available to you that you can attend anonymously at a very small fee.
Thanks for sharing that experience, mettleman. More evidence that so-called *US Persons* in Canada just don’t know — and just haven’t been educated as they should have been by the USA or by the Canadian media that this is happening to *US Persons in Canada.
I just finished leaving this related comment at MapleSandbox in a discussion there with ArcticGrayling: http://maplesandbox.ca/2012/renunciation-and-relinquishment-what-are-the-differences-is-there-a-difference/comment-page-24/#comment-53284
Oh, and if they lose any of your tax returns in that mountain of paper, they’ll claim you never sent it to them. No accountability + absolute power = corruption.
Sadly, I know you speak from experience. I so wish you could get resolution to your situation. Your prolonged treatment by the IRS is cruel and absolutely undeserved punishment.
Would you drop me a line, there’s something I’d like to share with you and the contact I have for you doesn’t seem to work anymore.
Thank you, EmBee.
Your friend probably had the same thought we did… We have/had a GC… we pay all taxes in the states if its generated in the states. we moved on… we made money outside the US… why would we think we owe any taxes on it since we paid taxes in the country where the funds were made and the funds were not made in the US. Here is the biggest kicker… I am a legal guest… I am not a citizen of the US… why would I think this would apply to me since the words… citizen is tossed around… there will be more & more people with OMG moments since I am sure there are lots of people with GC… expired or not… Canadians are fluid people… we move around easily with the gov’t waving us off to find our fortunes… Unlike the US… they toss a noose around your neck once u step foot on the so call holy land
That is why I try to avoid filing tax returns–in any jurisdiction on either side of the border–with a balance payable of zero. I always prefer to either owe or be owed a small amount because then the subsequent refund or bill that is generated is proof that a return was filed.
The IRS is losing tax returns that are part of so-called amnesty submissions.
Yes there may be circumstances when working towards becoming compliant where it isn’t possible to do what I suggested.
Are you sure, though, that they actually are losing it as opposed to just taking a long time to process it? I filed some old state tax returns for a state I no longer live in under an amnesty program (a state tax matter unconnected to FATCA). It took 18 months and I assumed they’d lost the returns but eventually they got around to processing them.