Patrick Cain, Global News, August 21, 2014: Want to shed U.S. citizenship? Get in line.
UPDATE: August 27, 2014
State Department to hike renunciation fees to US$2,350; says “no public benefit” in respecting human right to change nationality
UPDATE: August 22, 2014
The Patrick Cain article itself can use some comments, which uses Facebook, Yahoo, AOL or hotmail. There are only four there — the last saying “Being little brother has its benefits. But it also comes with a cost.”
(Correct!: Costs to stay within the new Berlin Wall and cost to get over it.)
One comment (Innocente) reports:
When the US DOS set the renunciation price at $450 in 2010, it stated that it covered less than 25% of the cost. Will the new price be increased to $1,800 ($450/.25) or perhaps $2,250 ($450/.20)?
Also, see the reasoning for the subsidized $450 below:
“Schedule of Fees for Consular Services, Department of State and Overseas Embassies and Consulates
A Rule by the State Department on 06/28/2010
Documentation for Renunciation of Citizenship
The CoSS demonstrated that documenting a U.S. citizen’s renunciation of citizenship is extremely costly, requiring American consular officers overseas to spend substantial amounts of time to accept, process, and adjudicate cases. A new fee of $450 will be established to help defray a portion of the total cost to the U.S. Government of documenting the renunciation of citizenship. While the Department decided to set the fee at $450, this fee represents less than 25 percent of the cost to the U.S. Government. The Department has determined that it must recoup at least a portion of its costs of providing this very costly service but set the fee lower than the cost of service in order to lessen the impact on those who need this service and not discourage the utilization of the service, a development the Department feels would be detrimental to national interests. See 31 U.S.C. 9701(b)(2).”
Today I visited the consulate in Vancouver. … Both the clerk and the Consular encouraged me to renounce not relinquish as my relinquishment would be denied and I would have to come back later to renounce and then the fee would be going up to I think they said 2800.00 but it might be 2400.00 I stopped listening after they repeated no relinquishment one too many times. I insisted they forward my file to Washington.
So what will be the new fee that is a guaranteed right to renounce and when will it be implemented?
As is pointed out, in Patrick Cain’s article:
Pushing the appointment into next year doesn’t just frustrate the impatient, however – it adds an entire year to U.S. tax reporting. Someone making an appointment now to renounce in Toronto in January wouldn’t be able to log out of the U.S. tax system until June 2016.
However, people can work the phones and find a U.S. consulate that can give them an earlier appointment, Nightingale says:
“If Toronto is booked up, you can go somewhere else. You can go to the Montreal consulate; you can go to the embassy in Ottawa.”
The U.S. State Department estimates that about a million people considered American under U.S. law (who may also be Canadian citizens) live here. In theory, all of them, unless their income falls under minimum levels, are supposed to file tax returns with the IRS, and report their bank accounts to an arm of the U.S. Treasury Department called the Financial Crimes Enforcement Network, on pain of heavy fines.
In practice, few did until recently.
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How else will the United States keep its reputation as a serial human rights abuser? If they streamline the process, the control freaks would have to repress their power trips. See discussion here: http://isaacbrocksociety.ca/2014/08/14/why-dont-you-just-renounce/comment-page-3/#comment-2606804
“I swear I think my CLN fell into a crack behind someone’s desk.”
Different desk, different crack but that’s what happened to my I-407 (2012) which I gave up on over a year ago. (Follow-up letters were never answered.) But don’t give up on your CLN. It will come I’m sure. We’ve never had a case here of a CLN not arriving, only CLNs slow in arriving. If the DOS is so overwhelmed with CLN paperwork, think of how the IRS will be hit by FATCA fallout. They’ve got a form for everything but what they need is a request for a search for lost paperwork which includes pulling all desks out and looking behind them with a bright light. Here’s hoping you hear good news from the consulate very soon.
Atticus. ” Do something that really speeds things up rather than slow them down. ”
That’s not how bureaucrats work. The first job of every politician is to get re elected. The first job of every bureaucrat is to keep his job. And the Peter principle states that bureaucrats will reach their level of incompetence
I’ve been saying for a while now they need to delegate the power of approval to the local consulates. I don’t see why a high ranking mandarin mucky-muck in Foggy Bottom has to personally sign off on all the CLNs in the world. The more as US citizenship isn’t what it used to be. Heck, El Presidente can send one of his death drones after US citizens abroad on the basis of an internal DoJ memo and some NSA metadata, so how much is due process worth these days anyway.
USD 2,000 for CLNs? IMO the USG is trying to throw one stone to kill two birds:
1. Fleece more cash from expats on the way out the door a la Reichsfluchtsteuer.
2. Try to slow down the number people jumping over America’s Berlin Wall.
It won’t work, expats are saying enough is enough. FATCA is the straw that broke the camel’s back.
Carl Levin and Barack Obama, your legacies as socialists will be what they deserve to be — record breaking renunciations of US citizenship. Good job ole boys.
Someone over at Victoria’s site referred to the renunciation price increase as “CLN scalping.” LoL
I wouldn’t even be surprised to see the renunciation fee eventually rise exponentially again to even $25,000, especially if a $2500 fee failed to deter the surge in expatriations.
@Brockers, remember that 8 US Code only requires a CLN “Form” in regards to renouncing;
“(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State”
The traditional relinquish reasons do not require “such form;”
“The loss of nationality under this part shall result solely from the performance by a national of the acts or fulfillment of the conditions specified in this part. ”
8 US Code would have to be amended to require that a CLN be applied for top lose ones US Citizenship.
They would also have to amend or repeal The Expatriation Act 1868 because that states “expatriation is a natural and inherent right of all people, indispensable to the enjoyment of the rights of life, liberty, and the pursuit of happiness.”
Some legal eagle who drafted the IGA documents knew this and quickly changed the renounced language to relinquish and requires only a reasonable explanation.
If the State Department wants to charge a fee to document a relinquishment, I do not know how they will do this because expatriation is essentially an inalienable right under US Law.
But how does one square the logic required to charge $450 to renounce? You could say that 8 US Code under renouncing where it refers to “such form” has an implied expense.
But should an accidental who has exercised no evidence of US nationality after age 18/21 have to pay a renounce fee?
The more I think about this, the current US administration needs to have a streamlined renouncing procedure that is done through the post at no fee with a simple form that maybe has a witness/notary.
It should be as simple to obtain a CLN as it is to register to vote in the US since both are inalienable rights.
If a CLN is actually required to relinquish, to charge for it would be like charging for a ballot at the voting booth. So far the State Department has charged a fee for a CLN, only to renounce before a consular official–which I guess the justification is that it takes up her time, so it is only fair to charge you for it–which is lame and disgusting, but it is easier for everyone just to pay the extortionate fee than launch a lawsuit.
So far we have seen no actual examples of what would constitute a “reasonable explanation”.
Riddle me this–
If you apply for a US Passport but are not eligible, do they keep the fee?
What if someone who has relinquished in a solid relinquishment, applies in their home country for a US Passport and makes clear on the forms that they relinquished US nationality.
I would assume that they first send you the five page questionaire.
So you fill that out.
They either have to issue you a passport or deny it.
A person is not required to apply for a CLN because 8 US Code does not require it.
But will State issue a passport to someone who states on the application they are not a US Citizen and have relinquished? Will State take the position that because you do not have a CLN you are therefor entitled to a Passport and they are going to give it to you!!
It would create a “this does not compute” situation.
@Petros, “but it is easier for everyone just to pay the extortionate fee than launch a lawsuit.”
Too bad the numbers are too small otherwise a class action would have been viable.
@Petros, “So far we have seen no actual examples of what would constitute a “reasonable explanation”.
When you google reasonable explanation you get links to some memorandum that indicates something should be published on that also there is language that implies FIs should have a checklist they use to be consistent on what is a reasonable explanation.
8 U.S. Code § 1501 says that administratively, ” Approval by the Secretary of State of a certificate under this section shall constitute a final administrative determination of loss of United States nationality under this chapter, subject to such procedures for administrative appeal as the Secretary may prescribe by regulation, and also shall constitute a denial of a right or privilege of United States nationality for purposes of section 1503 of this title”
U.S. Code › Title 8 › Chapter 12 › Subchapter III › Part IV › § 1501
8 U.S. Code § 1501
Whenever a diplomatic or consular officer of the United States has reason to believe that a person while in a foreign state has lost his United States nationality under any provision of part III of this subchapter, or under any provision of chapter IV of the Nationality Act of 1940, as amended, he shall certify the facts upon which such belief is based to the Department of State, in writing, under regulations prescribed by the Secretary of State. If the report of the diplomatic or consular officer is approved by the Secretary of State, a copy of the certificate shall be forwarded to the Attorney General, for his information, and the diplomatic or consular office in which the report was made shall be directed to forward a copy of the certificate to the person to whom it relates. Approval by the Secretary of State of a certificate under this section shall constitute a final administrative determination of loss of United States nationality under this chapter, subject to such procedures for administrative appeal as the Secretary may prescribe by regulation, and also shall constitute a denial of a right or privilege of United States nationality for purposes of section 1503 of this title.
Regarding in the course of a passport application, if you review the FAM, the burden of proving loss of citizenship is by a preponderance of evidence on whomever claims it occured. I’d assume that if you claim a loss on a passport application, they’d adjudicate the case, and absent any other evidence, they’d apply the administrative presumption– I’d assume that if you claimed it occured via naturalization, oath, non-policy position, or serving in a foreign army, and nothing more (e.g. not submitting/signing a DS-4079), without further evidence, they’d deny your CLN and issue the passport (after a long wait). If you claim you did an act where the administrative presumption didn’t apply (serve in a policy position, hostile foreign army, treason), they’d issue a CLN and of course deny your application. FAM says denied passports don’t get fee refunds.
In addition, Regarding “for purposes of 1503 of this title”, the law is you do not lose rights as a US citizen until a CLN is issued. The courts have concurred as per below…
Alberto O. LOZADA COLON, Plaintiff, v. U.S. DEPARTMENT OF STATE, et al., Defendants
“Congress set forth the circumstances under which a loss of nationality certification would issue. Section 349 makes clear that expatriation depends not only on the performance of an expatriating act, but also upon a finding that the individual performed such act “voluntarily” and “with the intention of relinquishing United States nationality.” Id.; see also Afroyim v. Rusk, 387 U.S. 253, 87 S.Ct. 1660, 18 L.Ed.2d 757 (1967); Vance v. Terrazas, 444 U.S. 252, 100 S.Ct. 540, 62 L.Ed.2d 461 (1980)”
Werner T. HEUER, Plaintiff-Appellant,
UNITED STATES SECRETARY OF STATE, Defendant-Appellee.
Moreover, the presence of administrative proceedings is made evident by virtue of the fact that the Department of State must ultimately and necessarily determine when to approve and issue a CLN. Until a CLN is approved and issued, any act of expatriation, whether or not intentional, is simply an act without significance to nationality or status.We emphasize that until such an approval and issuance by the Department of State occurs, the United States national is recognized as such, regardless of what act of expatriation is involved, even if he wishes to disavow American nationality.
They will not refund the Passport fee if they deem you ineligible. When I had my appointment at the Consulate, there was actually a young man who was quite upset about this very point.
@RMA: If by your post above you are intending to suggest that a CLN is MANDATORY and that citizenship is not lost until it is issued, I would strongly disagree and the two cases you mention support my view. The statute is clear: expatriation occurs when the pre-conditions are met (action plus voluntary intent). See for example s. 356 “The loss of nationality under this chapter shall result solely from the performance by a national of the acts or fulfillment of the conditions specified in this chapter”. There is no requirement for a certificate to complete the process; rather, the certificate evidences the process but it is the ACT of the national that causes the loss of nationality. This is why, for example, “backdated” CLN’s are issued. The CLN itself is not backdated, it is merely evidence of the finding by the Secretary of State that the event has occurred.
Unrelated to citizenship is the tax code. In recent years (since the mid-90’s), the tax code has created a sort of “twilight citizenship” status. Not enough to get you a passport nor even (given the Reed Amendment) the right to enter the country. Just enough to keep the tax bills rolling. The current s. 877 creates the lovely status of “covered expatriate” which is a FORMER citizen who keeps being subject to the IRS’s exactions until such time as a CLN is issued AND the requisite exit formalities and payments are completed. By definition, s. 877 is applicable to NON-citizens (hence the term “covered expatriate”) who have the dubious privilege of once having been citizens or once having held green cards but have not paid the piper enough grease to shed the unwanted designation.
The correct link for the Heuer case is as follows: http://law.justia.com/cases/federal/appellate-courts/F3/20/424/523295/. The link provided in your post did not work for me. Heuer was a case involving a Venezuelan national born in the USA who successfully renounced in Venezuela at the Embassy. He later alleged it was not voluntary and the case turned on the limitation period applicable: did it run from the issuance of the CLN (that he himself applied for by renouncing) or from the (later) time the passport office turned him down. The answer was the former and he lost his case. The Colon case involved a Puerto Rican who tried to use the CLN process to renounce US citizenship and claim only Puerto Rican nationality. No debate on the anomalous quasi-colonial status of PR is necessary here – he was denied a CLN because, although he renounced, he continued to claim the right to reside (and be a national of) a US possession. As such, he was found to have lacked the requisite intent.
A CLN is obviously good evidence of non-citizenship, but it is only evidence. The government can revoke it for good cause if I remember correctly (subject to appeal rights of course). As far as C31 is concerned, there is no law (yet) re reasonable explanation for lack of a CLN. Until a Canadian court says anything on the point (and I strongly doubt it will EVER come up in court given the Charter Challenge and the directions issued by Finance for application of C31 and the IGA), the fact that a CLN is not and was not a requirement at the time of the expatriation ought to be a “reasonable explanation”, perhaps with a statement of non-performance of inconsistent acts since the expatriation. At the very least, such ought to be sufficient for an “old” expatriation (prior to s. 877 of the Tax Code which seeks to coerce people into applying for a CLN and notifying the IRS of the fact).
This is about a matter of administrative law application. I’m suggesting that per 8 U.S. Code § 1501 a US government agency, administratively, may not necessarily recognize an expatriation until a CLN is issued/finding is made. If/when a finding is made, it would be effective the date of the relinquishing act. How any given bank or foreign government chooses analyze or interpret a lack of CLN will most likely vary from jurisdiction to jurisdiction.
and by above, I raise the caveat that the effective date being whatever it is outside the the scope of http://www.law.cornell.edu/uscode/text/26/7701 —
26 USC 7701(a)(50) 50) Termination of United States citizenship
(A) In general individual shall not cease to be treated as a United States citizen before the date on which the individual’s citizenship is treated as relinquished under section 877A (g)(4).” and Michael Miller’s analysis.
@RMA – just be VERY careful in distinguishing between nationality per se and the Tax Code. Your reference to 26 USC 7701(a)(50)(A) above is part of the tax code and s. 877a. That is crypto citizenship: it won’t get you a passport and won’t get you in the country. A CLN is evidence of loss, it is not the instrument of loss of nationality. Application for a CLN is how the IRS finds out about it and brings s. 877a into the picture. However, if you have actually expatriated (performed a listed act with the voluntary intention of expatriating), you can truthfully certify that you are not a US citizen for every conceivable purpose WITHOUT having made an consular appointment to get a piece of paper evidencing the USG’s satisfaction with that fact. The IRS may still want things from you if you did it recently, but you are no longer a citizen.
@Anne Frank. Agreed, If you look closely at the wording “A) In general individual shall not cease to be treated as a United States citizen before the date on which the individual’s citizenship is treated as relinquished under section 877A (g)(4).” and Michael Miller’s analysis.
It’s not saying you’re a citizen. It’s saying they get to treat you as a US Citizen (i.e. US Person) under title 26 (i.e. for tax purposes) until you do the 877A(g)(4) requirements.
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The wait time was 5 months last week, now it’s 6. Americans Line Up to Renounce US Citizenship in Toronto, Matthew Little, Epoch Times, 27 August.