As a solution to the problems caused by FATCA, American Citizens Abroad (ACA) proposes that FATCA be tweaked by imposing on “US citizens” abroad a “Same Country Exemption with mandatory IRS compliance” (SCEWMIC). SCEWMIC is likely to make the unjust FATCA law even more harmful.
Go to the links below for info and also read: “Why ACA supports Same Country Exemption (SCE) rather than repeal of FATCA, and why SCE will work to correct banking lockout by Foreign Financial Institutions.”
If you don’t like SCEWMIC then tell ACA exactly what you think in an email.
E-mail Mr. Charles Bruce, ACA Legal Counsel, at email@example.com
You can ALSO comment at ACA’s FB site: https://www.facebook.com/americancitizensabroad
[OF COURSE, you can argue that an email to Mr. Bruce, or to ACA, will not change their minds on SCE, but are you really so certain that when an organization claiming to represent “YOU” makes a bad proposal that will cause you harm — the best way to proceed is to remain silent and not confront that organization? Those who feel that all U.S. laws are irrelevant should not read further.]
So… here’s what you would have to do to make the SCEWMIC election:
“…An individual would complete the election on a 1-page, front and back, IRS form providing the individual’s name, address, Taxpayer Identification Number [Everyone has one?], and country of residence, and listing the “Same Country” accounts (name and address of bank and name, number and type of account, i.e., depository, custodian, etc.). The individual would certify that this information is correct. Also, the individual would state that he or she is a resident of X foreign country and the bank(s) are licensed and regulated under the laws of X country of residence (the same country where the individual is a resident). One copy of the election would be given to the bank; a second would be attached to the individual’s federal income tax return; a third would be retained by the taxpayer [NOTE TRANSITION IN PARAGRAPH FROM “INDIVIDUAL” TO “TAXPAYER”]. Instructions would be included on the form. Taxpayers would be warned that filing the election does not excuse them from having to report any income on the account on their tax return or from having to file an FBAR, provided in both instances they meet the applicable thresholds…”
Mr. Bruce explains to Bob Stack at Treasury why the ACA proposal is a really good deal for the IRS:
“In addition to benefiting American citizens abroad and foreign banks, the “Same Country” exemption will benefit the IRS. Americans abroad, in order to get the benefit of greater access to banking services, will need to come forward and file their US tax return, with the “Same Country” election attached. This will help address the nagging problem of noncompliance.”
Read Mr. Bruce’s letter to Treasury and ACA’s SCEWMIC HERE and HERE.
— and take a few minutes to email your thoughts to Mr. Bruce…
Here are two responses just received from ACA regarding SCE concerns:
“Thank you for contacting ACA.
Same Country Exemption is not a replacement for Residence-based taxation.
ACA continues to advocate for Residence-based taxation (RBT). And, in fact, ACA is the only organization that has developed a proposal for RBT. None of the other overseas advocacy organizations, either non-profit nor party affiliated, have developed a fully written and considered proposal.
ACA’s RBT proposal has been cited in a variety of the tax writing committee reports; Joint Committee of Taxation, Senate Finance and Ways & Means.
See our complete proposal and work here: https://www.americansabroad.org/taxation/
ACA conducted a FATCA survey with the University of Nevada at Reno. The results of that survey indicate that Americans overseas believe that SCE would alleviate the problems of banking lock-out. See: http://acaglobalfoundation.org/PressAndMedia/3748196
As ACA has explained before, Repeal of FATCA would require Congressional vote. ACA does not believe that the Congress, in its efforts to combat tax evasion legislatively, will achieve the majority vote to repeal FATCA. SCE would help alleviate the bank lock-out problem and is achievable as it does not require Congressional vote but simply a regulatory change. This knowledge is a result of our long standing work directly speaking with Congressional offices and committees involved in tax evasion legislation.
As noted in our Mission statement, “ACA works to find practical solutions to resolve issues impacting overseas US Citizens and communicates results to constituents stateside and abroad,” (https://www.americansabroad.org/about/ ). ACA’s proposal for SCE was not developed solely with Europe or Americans living in Europe in mind. ACA does not believe that working toward repeal of FATCA is a practical way forward in getting Americans overseas immediate relief from FATCA. Please see our statement on this here: https://www.americansabroad.org/…/why-aca-supports-sce….
ACA as well has spoken with Foreign Financial Institutions (FFIs) on the viability of SCE to alleviate the bank lock-out problem and reported on our findings here: https://www.americansabroad.org/…/Treasury_Ltr_Same…
ACA regrets that you do not appreciate our work on behalf of Americans living and working overseas, however ACA will continue to support it’s efforts with RBT and SCE.“
The above ACA email was just posted on American Expatriates.
“Thank you for contacting ACA.
For a full explanation as to why ACA believes that Same Country Exemption is workable and why ACA believes that a repeal of FATCA is not achievable please see: https://www.americansabroad.org/…/why-aca-supports-sce…
The above ACA email was posted on: https://www.facebook.com/groups/citizenshiptaxation/
Here is the writer’s response to ACA (posted at the above website):
“Thank you, for your email reply. I have read the documentation you provided. My net takeaway, from your piece, “Why ACA supports Same Country Exemption (SCE) rather than repeal of FATCA, and why SCE will work to correct banking lockout by Foreign Financial Institutions,” is simply that rather than attempting to help American expatriates, by taking the more difficult road, the ACA would rather take the easy way out that does not rock the boat or risk displeasing the US political elites. So, I’m left wondering why the ACA calls itself “American Citizens Abroad.”
With whom, in what countries, and how many American expatriates has the ACA spoken, to come up with its SCE position? Why should American expatriates have to file anything with their banks or the IRS relating to what, for us, are our local bank accounts, when homeland Americans do not have to do this (even those hiding their assets in Delaware Corporations)? Why should we have any confidence that our being “locked out” of FFI services would improve? My reading, of your document, which may be incorrect, tells me that the ACA proposal might make the whole situation, with FFIs even more convoluted, and perhaps expose us to even more discrimination. I would think that you should include, in your paper, something from a significant number of FFIs (not just a few), from varying geographies, indicating that they endorse your views and will treat us more fairly. Did I miss this?
At the end-of-the-day, we expatriates simply want to be treated, in our relationships, with our local banks (which may also include, for good reason, banks in neighboring countries, just like US banks, in neighboring States) no better, nor no worse, nor no different than the relationships that our fellow homeland American citizens have with their banks in and across the US. That seems, to me, to be a pretty reasonable request for support, from an organization like the ACA. Isn’t the real problem that FATCA is an unjust attempt to circumvent the 4th Amendment to the US Constitution? I recall when I opened my accounts, nearly two decades ago (well before FATCA), having to sign a form authorizing my bank to give the IRS full access, to my accounts, upon production of “probable cause.” FATCA shifts the burden of “probable cause,” from the US government to the FFIs and finally to the expatriate Americans. This is an unfair and non-equal treatment of US citizens, under the US Constitution.
Your paper claims that, “ACA works to find solutions to problems facing the overseas community that can be easily implemented.” Sometimes, the less easy and more difficult road is the right road. I know quite a few American expatriates, who would rather take the risk of working for something right, than settle for something wrong, or just easy. That’s why I would rather the ACA work tirelessly for the best solution, as opposed to coming up with something that appears to me to be an easy convoluted way of maintaining the status quo. Having fought and lost is better than not having fought at all. What would have happened to the Colonists, had they just looked for an easily implemented solution to what were actually far smaller issues, back in 1776?
@CEB You are of course correct however in my humble view if no-one lodges objections then wrong conclusions are drawn. Once objections are lodged it gives opportunity for new directions to debate which may well result in revolution such as happened with BREXIT and is happening today with the TRUMPians. The widest spectrum of Harms must be voiced … few comment on the Harm to non US persons (I do) or to nontax related Harms (I do); I do these things in this post and in many others over recent years. Peace. Am on the outskirts of Hurricane Mathew presently so must run.
American Citizens Abroad (ACA) Quarterly Report
The plot thickens to keep money in the USA. Absolutely disgusting that US expats living abroad are “encouraged” to invest in the US only. This only deepens my resolve to never invest in the US and enjoy spending my social security payments in Canada. I would bet it might have this affect on others as well.
Terrible advice as by investing in the US there is no ability to use legitimate tax deferral vehicles in home countries … eg RRSPs in Canada.
Also ignores the cost imposed on non US citizens living world wide.
Lard knows we’re all sick to death of “taking action” in the form of petition signing, letter writing and comment making but if our efforts fade away, so do our chances of ever getting a positive resolution.
I wrote that yesterday on another thread but it fits here too because I’m so very grateful that you and others keep trying to educate the uninformed, warn potential victims and object vigourously to US overreach when it comes to taxing and data collecting beyond its borders. If we stop trying they’ll think we don’t care and then they’ll feel free to up the ante against us.
Invest in the US? NOT ME — EVER!
Interesting background information about the ACA and Mr. Bruce. They seem to have regressed into passive acceptance of CBT which is basically what SCE is all about. Pity, since they once put out a pretty good video advocating for RBT which is the REAL solution.
Invest in the US?
Thanks to FATCA and CBT, I chose to Divest from the US:
I don’t hold stocks in my savings accounts that are domiciled in the US.
I don’t hold any savings accounts in the US.
I don’t hold any real estate in the US.
I won’t license myself professionally in the US (I previously held a practice license in NY state) as I refuse to work in the US.
@ Charles Bruce “This [SCE] will help address the nagging problem of noncompliance.”
Ummm…. Maybe noncompliance comes from having something stupid and unreasonable to comply with. You don’t increase compliance by adding more stupidity and unreasonableness.
“.Maybe noncompliance comes from having something stupid and unreasonable to comply with. You don’t increase compliance by adding more stupidity and unreasonableness..”
The IRS just keeps coming up with reasons NOT to comply, ex.
………”…Rules for Obtaining a SSN
In order to get a SSN, one must first fill out the social security number application form, SSA-5, found here. For those older than 12 years of age, an interview may be mandated and additional documentation must be submitted in order to verify residence outside of the U.S since the date when the applicant departed the United States. Such documentation includes school transcripts, school records, driver’s licenses, employment records, marriage certificate, etc. Sadly, it appears that there is no universal standard for the necessary documentation, with different Consulates or Embassies (indeed, even different US social security offices) having varying requirements. For example, see the US Embassy Yemen requirements here. Unfortunately, many people do not save or have access to the documents which are needed, hindering their ability to obtain that critical SSN.
Those living in the Middle East have a very interesting problem in getting SSNs because the specified US Embassy for obtaining a SSN is located in Jerusalem, a city inaccessible to many Arabs because of political tensions in the region. Many people living abroad fly over to the United States in the hopes that the process of getting the SSN will be quicker, although by no means is this a sure thing….”