cross-posted from citizenshipsolutions dot ca
So much publicity! So little relevance!
The New York primary was this week. Both Donald Trump and Hilary Clinton extended their leads and moved one step closer to their respective party’s nominations. (Mrs. Clinton with the approval of the Democratic Party and Mr. Trump with the disapproval of the Republican Party.) Interestingly both Mr. Trump and Mrs. Clinton have higher disapproval ratings than approval ratings. Yet each of them appears likely to represent their respective parties in the upcoming Presidential election. One of them will win the election (this is not the same as having been elected). Will the eventual winner make a positive difference in the life of any individual? Doubtful. Watching the political process contributes to a sense of negativity about human nature.
But, wait! The World Is Full Of Good People!
Starting at the age of 7 or 8, I participated in four seasons of organized sports. To be truly effective, organized sports are highly dependent on adult volunteers. I well remember a guy named “Bob D.” Although I thought of him as old, he was probably somewhere between the age of 20 and 25. Anyway, “Bob D” was helping with baseball. “Bob D.” was helping with basketball. “Bob D.” was helping with football. “Bob D.” was always volunteering his time and coaching. I have a memory of my father noticing “Bob D.” and commenting “There are a lot of good people in this world”. So true. I don’t believe that “Bob D.” received a lot of recognition or a lot of gratitude. Yet year after year, season after season, week after week, day after day. “Bob D.” showed up. He clearly made a positive difference in the lives of others.
The Unsung Heroes of Life
You will find people like “Bob D.” in every facet of life. They do things for people, just because they want to. They contribute to their communities, just because they want to. They provide mentorship for people, just because they want to. They put their kids through university because they want to. They are the true “Unsung Heroes of Life”. I once thought of writing a little book about these “Unsung Heroes of Life”.
Although, I can’t do a book. I can offer this “Bedtime Story” …
A “Bed Time” Story …
Instructions to readers (who are likely examples of “Unsung Heroes of Life”):
Please read as a “Good Night” story to an angry person in your life or to an “American abroad” trying to cope with FATCA, FBAR and CBT.
Once upon a time in a “far off land”…
Once upon a time there was a lawyer who lived in the Middle East. She was a well known lawyer (major blog), with a particular expertise in a topic of relevance, to the only peoples of the world, subjected to a specific type of obligation, based on “place of birth”. The “obligation” is “Taxation-based citizenship”. You guessed it. She was a U.S. tax lawyer.
But, before jumping to any conclusions (I hate lawyers just as much as the next person), understand that this tax lawyer, was much more than a normal U.S. tax lawyer. Although, she understood what forms to complete, she knew what the forms meant. Although she gave FBAR advice, she also understood how unjust FBAR was. Although she understood how FATCA worked, she knew how unfair FATCA was to Americans abroad. Although she understood the dangers of non-U.S. tax compliance for Americans abroad, she understood the dangers and difficulties of U.S. tax compliance for Americans abroad. In short, she truly understood the evil and immorality of “taxation-based citizenship” AKA “place of birth taxation”.
She was Detective Sherlock by day …
By day, she used her research skills to uncover the solutions and to help solve the “Puzzles and Problems” of Taxation-based Citizenship”. She used her “detective skills” to uncover the secrets of the Internal Revenue Code and FBAR. She understood trusts, the U.S. hatred of “all things foreign” and “foreign trusts”. She was highly respected and known as the “Sherlock” of U.S. tax lawyers. If a solution could be found, she was sure to find it.
She was Detective Sherlock by night …
By night she played a different role. She continued to wear her “Sherlock Hat”. She used her detective skills to solve the most difficult problems in peoples lives. By, night she helped people of all races, creeds, religions and nationalities. Whether subject to “Taxation-based Citizenship” (U.S. citizens) or NOT subject to “Taxation-based Citizenship” (normal people), she helped solve their problems. She believed that all people, regardless of their place birth, should have the rights of equal protection with respect to access to Detective Sherlock. She believed that no person should be denied access to Detective Sherlock except by “due process” of law.
A real and documented story of the life and times of Detective Sherlock …
New York City – April 15 , 2016 – A most serious problem unfolds!
A young boy’s small dog had been lost in the far off land of America. The dog was eventually found, running loose WITHOUT his IRS TIN (“Tax Identification Number”) micro chip. The dog was off the IRS radar. From the perspective of the U.S. government, the dog (assuming a “U.S. place of birth”) was nothing more than a wealthy tax cheat (probably had not filed his FBARs).
Middle East – April 16, 2016
Real Time: The Detective Sherlock files …
After spending a day of solving CFC and PFIC problems for a middle Eastern family subject to U.S. extra-territorial abuse (one of the children was accidentally born in the USA), Detective Sherlock prepared for a quiet evening. Suddenly her solitude and relaxing moment was interrupted by an URGENT message and video from America!
The message was that a “stray dog” had been found. A video of the dog accompanied the message. It was clear that the dog had been separated from its owner. The dog was in distress. Without a TIN it was impossible to determine who the dog was. (Maybe the dog was even an illegal immigrant!) Without a TIN, the dog did not exist. The dog was under close watch and supervision in a “safe house” far away from the eyes of the U.S. Government!
Detective Sherlock’s mission, should she accept it, was to discover:
1. Without a TIN number, who could the dog possibly be?
2. Who was the owner?
3. How to unite the dog with the owner?
When it's "Mission Impossible" call the "Detective By Night" https://t.co/hZMn7plMEd
— Citizenship Lawyer (@ExpatriationLaw) April 24, 2016
Real Time: Detective Sherlock sprung into action …
She began sleuthing the internet using the term:
“Lost dog in Brooklyn possibly NOT tax compliant”
The results included a Facebook page devoted to identifying animals that had been running loose without their TIN number. Amazingly, a possibly “non-compliant dog of interest” was located. The picture of this dog was a 98% match with the Dog in the video.
Real Time: New York City – April 17, 2016 …
The possible owner of the “non-compliant dog of interest” received a text message from Detective Sherlock in the Middle East.
The message said:
“Non-compliant dog” found – presently in “safe house” – away from IRS in Brooklyn. To confirm “match” please reply with dog’s name.
Real Time: Middle East – April 17, 2016
Detective Sherlock received the following reply text from the possible owner:
“Non compliant dog responds to name of Phoebe – please do NOT notify IRS – FBAR penalties feared!”
Detective Sherlock replied to the possible owner with the following text:
“Not to worry – your secret is protected by lawyer client privilege – will notify New York “Safe House” of name “Phoebe”.
Real Time: New York City April 17, 2016
“Safe House” in New York received message from Detective Sherlock saying “non-compliant dog” responds to name “Phoebe”.
“Safe House” people address mystery dog by name of Phoebe. Safe House representative calls out to Dog, addressing Dog by the name “Phoebe”. Dog responds positively with noticeable relaxation. Name of Phoebe positively associated with dog.
And then …
Representative of “safe house”, locates suspected owner and returns Phoebe to that owner. Owner noticeably relieved and and grateful.
Real Time: New York City April 18, 2016
Young boy gets Phoebe a TIN. Believes the TIN is the best protection a dog could have from every becoming permanently lost. Takes first step to bring Phoebe into U.S. tax compliance and files 6 years of back FBARS for Phoebe. Hires high priced New York City Criminal lawyer to write “reasonable cause” letter for Phoebe.
Real Time: Middle East April 18, 2016
After reuniting Phoebe with owner, Middle East Tax Lawyer, reviews “reasonable cause” letter for Phoebe written by NYC criminal lawyer. Approves “reasonable cause” letter with few changes. Notes Phoebe unaware that FBAR required, if aggregate of “offshore dog accounts” exceed $10,000. Notes also that Phobe was not owned by a lawyer and therefore Phoebe had no reason to know of FBAR law.
FBAR penalty NOT imposed. Phoebe receives “warning letter” from IRS.
The moral of the story? Happy endings?
The young boy gets his dog Phoebe back. Phoebe gets a TIN number. The IRS gets its FBARs. Middle East Tax lawyer receives “official recognition” for being a true “Unsung Hero of Life!”
Yes, it’s all true!
Congratulations to Detective (and U.S. tax lawyer) Virginia La Torre Jeker for her role in “The Great Facebook Dog Recovery” and on the occasion of her induction into the “Unsung Heroes of Life” Hall of Fame). Whether interpreting the Internal Revenue Code or reuniting lost dogs with their owners, she is a true “Unsung Hero of Life!” The young boy (Phoebe’s owner) will NOT remember Donald Trump or Hilary Clinton. He will NEVER forget the efforts and kindness of Virginia La Torre Jeker!
Have you heard how a US tax lawyer organized the "Great Facebook Dog Recovery" https://t.co/Cxn4WFD0K8 – One of those #UnsungHeroesOfLife
— Citizenship Lawyer (@ExpatriationLaw) April 24, 2016
In conclusion …
If you would like to nominate somebody for induction into the “Unsung Heroes Of LIfe Hall of Fame“, please contact me.
Poor dog. I think she was better off running free without that TIN number. Now she’ll live the rest of her life as a form slave and she’ll be penalized for every form faux paw, no matter how unintended. Not a happy ending, in my opinion, so this bedtime story will not bring sweet dreams. I know I’ll get howls of protest about this. It will be said that the dog, having been brought into the system, has more security now but I just see her as having less freedom.
Dear EmBee – Don’t be sad. If Phoebe did not get into compliance I fear that a worse fate would have befallen her than becoming a form slave. Remember that Phoebe lives Stateside, in the very heart of the Land of the Free. The dog catchers would have eventually caught up to her — inserted their own microchip branding her noncompliant (which mark would follow her forever and lead to possible regular audits and home visits), fined the owners and if they could not pay up , this could lead to revocation of Phoebe’s US passport. Never again could she blissfully roam the streets of Brooklyn with a carefree spring in her step!
Dear Virginia La Torre Jeker;
Thank you not only for being the savour of this dog and reuniting it with its family, but for all the valuable information you share so generously with the readers of your blog. Many is the time that your clearly written explanation or raising of an issue has saved one of us laypersons from committing inadvertent ‘form-crime’ and thus you kept us out of the special IRS hell reserved for ordinary people with US citizenship/status living outside the US, but who don’t have the resources or skills to themselves become US extraterritorial tax specialists and are just trying to keep themselves and their family and their local legal savings out of the ever growing quicksand that we find ourselves in – solely by virtue of having a US parent or US birthplace – often many decades ago.
I myself am no longer a UStaxablecitizen, but I still check your blog in order to help and alert other people who have just learned of the jeopardy they’re in.
Thank you very much for your help.
Dear Badger – thank you for your kind words. I am very happy to know that my blog posts have helped keep some “ordinary people with US citizenship/status” out of the doghouse. 😉
Whoever nominated Ms. La Torre Jeker for this award I hope read her latest article where she discourages people from becoming witnesses for the ADCS lawsuit.
dear Ms. La Torre Jeker
In a nutshell – the Courts will uphold FATCA, its IGAs and FBAR reporting. None of it is going away; the transparency trend will simply continue to grow. Live with it.
I call B.S. on that statement.
the court case may be dead in the good ole us of a but the fat lady has not even begun to sing here in CANADA.
I refuse to “live with it” in that it is a foreign law of a country I am no longer a citizen of.
the brown shirted jack booted thugs will have to come and find me and drag me away in handcuffs before I even begin to “live with it”!!!
In her post, she says she believes that FATCA is here to stay, that the courts will uphold FATCA, its IGAs and FBAR reporting. Based on the context of her post, it sounds like she is referring to US courts, no reference to law or cases of other countries.
I don’t see any mention of the ADCS or its lawsuit at all in her post. For that matter, the ADCS lawsuit is not aimed overturning FATCA (a US law, over which the Canadian courts have no jurisdiction) but is aimed at overturning the Canadian implementing legislation.
For me, it’s too big of a leap to read into this that she is discouraging people from becoming witnesses for ADCS or dumping on ADCS.
She refers not just to FATCA but the FATCA IGA’s which ARE being challenged be ADCS.
I get that, but my take from the article is she’s referring to US courts. Different people can interpret an article differently and that’s my interpretation.
I have no opinion on whether or not Ms. La Torre Jeker would discourage the ADCS lawsuit. Maybe she will write an article about that sometime. I just didn’t like the inference in this “bedtime story” that the uncompliant are bad dogs for not accepting the CBT leash and trying to dodge the FATCA lash.
Virginia La Torre Jeker is no Jack Townsend. If she reports that US the US’s 4th and 5th amendments are dead, it doesn’t mean she considers that killing them was the right thing to do.
Dear Readers/Commenters, thank you for all your comments. My post was not intended to discourage you from your ADCS lawsuit; nor was it intended to be viewed that noncompliant dogs are “bad” dogs; that CBT is equitable; that the 4th and 5th Amendment to the US Constitution should die and so on. I absolutely do believe that FATCA is here to stay, whether one likes it or not; I absolutely do believe that that the trend toward transparency will continue worldwide. Sorry to say, but all signs point in this direction (e.g., this Ohio court decision; GATCA; government responses to Panama Papers). Whether or not you may agree, I think (and last I heard, I am still entitled to think and have an opinion) one has to be ready for this very realistic premise and see what can be done about it. Maybe it means looking forward! What do I mean by this? Here are some thoughts – after appropriate advice is taken — consider separating assets formerly owned jointly between US and non-US spouses to limit reporting? Re-examining assets and gifting to non-US spouses and family members? Discontinuing all nominee arrangements when a US person has been the nominee on a foreign financial account or asset? Coming into compliance (or not, provided you fully understand and accept what this means for you) and then expatriating? “Doing nothing” when you fear you might still be a US citizen even though you think you expatriated 50 years ago? Everyone must make their own decisions, but I think it’s wise to look at the tools available to you as you are in battle. Maybe the tools can help you prevent further injury “just in case” FATCA and its progeny remain in place and (gasp), even proliferate.
“I absolutely do believe that that the trend toward transparency will continue worldwide.”
But surely you know not to believe that when the US is the one doing the hiding?
Now since I’m mixing true irony above with rhetorical irony below, to avoid confusion I’d better put in this sarcasm marker.
“and last I heard, I am still entitled to think”
Even if the US still has a 1st amendment, the freedoms it guarantees do not include thought.
@ other Virginia
“Doing nothing” when you fear you might still be a US citizen even though you think you expatriated 50 years ago? Everyone must make their own decisions, but I think it’s wise to look at the tools available to you as you are in battle. Maybe the tools can help you prevent further injury “just in case” FATCA and its progeny remain in place and (gasp), even proliferate.
I am doing something, though you might call it “doing nothing”. I looked into the tool chest, and decided along with Gwen that the best thing I could do on behalf of those of us caught up in a foreign law, now adopted by my own country, was to hold my country, Canada, to the crucible of fire. That’s my way of dealing with future injury ” just in case”.
Thanks for helping that dog find its way back to its family, by the way.
I have a great dog in this fight. He’s a brave wee Scottie, is my Barclay. He’s my constant companion while we work daily on this matter. Born in the USA as well. I bet the USA thinks he should pay a dog license fee too since he hasn’t renounced. He’s been non compliant for ten full years. He’s as stubborn and determined as I am. When he travels in the USA he takes his small dog passport certifying he has been vaccinated for rabies. He knows he needs to comply with their laws when he is there. When he is back home in Canada, he doesn’t give a Hoot Man, nor do I about American laws. He’s glad you don’t think he is a bad dog.
@Canadian Ginny Ginny – no dog is a bad dog! When they are mistreated, though, they will gnarl and bite. All the best to you and brave little Barclay.
I am not trying to be overly argumentative however, I must strongly disagree with the statement FATCA is NOT going anywhere. Just to state one possibility which you yourself suggest is likely which is that Canadian Ginny and the other ADCS plaintiffs succeed in the lawsuit against the Government of Canada and the Canadian FATCA IGA. If they are successful and I emphasize IF as I or no one else has a crystal ball I see two possibilities happening. One is the US FATCA legislation remains in place but effectively becomes a pure revenue generating withholding tax against the Constitutionally required non compliance of Canadian FFI’s or FATCA is substantially modified or rolled into a “residency” based system based on the OECD CRS model in line with many decades of traditional information sharing between the IRS and CRA>. In either of these scenarios which you yourself admit are possible FATCA as we know it to today will be “going away.”
Or to put it another way if the Supreme Court of Canada rules in favor of Canadian Ginny FATCA WILL be going away.
“the trend toward transparency will continue worldwide.”
Methinks the American has forgotten American exceptionalism.
@Tim Tim, you are correct — No one knows what will happen down the road. My view is that FATCA and its progeny will continue. Certainly I don’t know in what shape or form. IMHO when dealing with such unchartered terrain, planning for “the worst case” is a good idea.
This post might interest you http://blogs.angloinfo.com/us-tax/?p=4184. Let’s see where that goes. And just in case you haven’t read this one, it might also be of interest http://blogs.angloinfo.com/us-tax/?p=4175 You should follow Peter C’s work. He is brilliant.
OK, right now, I have a Maltese-US crossbreed in my office that needs rescuing, so I have to sign off.
As Virginia La Torre Jeker JD says:
One has to be ready for this very realistic premise and see what can be done about it.
To boil her eighteen sagacious words (including the one magic word) down to a fabled three:
Sauve qui peut!
I believe that FATCA is eventually going away. I cannot predict when though and I cannot predict what the outcome of any particular legal case will be. It is difficult so far to find witnesses who have suffered “real” (as “real” is defined by the courts) harms because it has only been about seven months since the first data was turned over. Sooner or later, though, people who have suffered “real” (again, as “real” is defined by the courts) harms are going to come out of the woodwork and fight this–whether as witnesses in the present action or as witnesses or plaintiffs in a future action.
Right now people are afraid to come forward as witnesses because they are afraid of losing what they do have. Eventually though–if FATCA continues–it will harm some people sufficiently that they have nothing left to lose and those people are much more likely to come forward as witnesses.
So if you say @Virginia that FATCA isn’t going away I say to that that the fight against FATCA isn’t going away any time soon. If FATCA continues, it will keep hurting more and more people in more and more tangible ways and the pool of people willing and angry enough to fight it will only increase. FATCA isn’t capable of doing anything other than harming people and so it is only a matter of time before a critical mass of people needed to defeat it forms.
I make no prediction, though, about exactly when that will happen. I don’t know much about how the present search for witnesses is going so I cannot say whether this will happen in the present lawsuit. But I can say with virtually 100% certainty that sooner or later a successful challenge to FATCA will be launched. FATCA is simply not a sustainable.
Now–since we don’t know exactly when that happy day when FATCA is defeated will arrive–should people use whatever tools are available to defend themselves in the meantime? Of course. But that doesn’t mean that FATCA is going to survive long term.
Great perspective. As long as FATCA exists, the fight against it won’t go away.
I also think I get get what Virginia’s saying. FATCA isn’t going away any time soon doesn’t necessarily mean capitulate, but for those who rested their future on a US court defeat – you may want to open a new line of defence.
Many of us are now resting our futures solely on the outcome of the ADCS lawsuit, but in the meantime FATCA will take its victims. This is bitter-sweet, as the success of the ADCS lawsuit now seems contingent on FATCA taking those victims.
AAPL has $181B offshore tax havens but the IRS is getting criminal convictions against Cayman banks with big fines https://www.linkedin.com/pulse/you-ready-storm-coming-your-way-cayman-islands-bahamas-tax-havens