We already have Witnesses for our Canadian FATCA IGA lawsuit, but are now seeking a few more. If you are a Canadian who supports the major aim of the lawsuit (to return Canadian sovereignty back to Canada) and are interested, see below:
The May 31 2017 Canada Federal Court Order gives us 60 days to comply by providing additional information to Government as part of our lawsuit.
This delay may give us time to provide to the Court additional evidence, from new witnesses, of harms caused by the Canadian FATCA IGA enabling legislation. If:
— You are a Canadian resident (and possibly a U.S. person as well) who has experienced difficulty, uncertainty, or perceived risk of personal harm, in acting as an executor of the estate of a U.S. person in Canada, or you are someone who has refused to act as an executor for the estate of a U.S. person in Canada because of the risk of harm; or
— You are a Canadian citizen and resident who the U.S. deems a U.S. citizen, and you would like to renounce your U.S. citizenship and tax citizenship, but cannot because you would have to pay a U.S. “exit tax” because of the value of your assets (see link) — or you renounced and DID pay an exit tax; or
— You are a Canadian citizen and resident and a U.S. citizen who had your bank account information turned over to CRA/IRS and the U.S. IRS has now contacted you about your account.
AND you are willing to provide a written, public (your name will be disclosed) affidavit to Canada Federal Court explaining your situation,
– please contact me at Stephen.Kish.Chair@adcs-adsc.ca
Further request:
The Federal Court order asks for a list of all specific harms caused by the Canadian FATCA IGA enabling legislation, that contradict our Canadian Charter rights and nation’s sovereignty (our Claim) that have been or are certain to be experienced by our three Plaintiffs but also by “anyone else” (i.e., I interpret this to mean other Canadian residents).
We already have Witness affidavits detailing harms that cannot be disclosed publicly at the present time. But if you have experienced a harm or know that you will experience a harm related to the above legislation, that you suspect that we might not have addressed, AND ARE A CANADIAN CITIZEN AND RESIDENT WILLING TO FILE A WRITTEN AFFIDAVIT TO FEDERAL COURT THAT WILL DISCLOSE YOUR NAME, then please contact me.
From a practical point of view that I have to deal with, making suggestions is fine, but we need to provide the Court with written affidavits of harm in which your name will be disclosed. If you can’t disclose, perhaps you know someone who might. The time opportunity for this is short.
Seeking a few additional Witnesses over the next few weeks.
Although this does not currently affect me, am for repeal of fatca. Can an argument be made that tax and retirement planning under current statutes will result in HARM that is not hypothetical as individuals and businesses engage in financial planning in the ordinary course of events.
Are these guys deliberately confusing IRS generated FATCA letters with FATCA letters from the bank?
…”The degree of threat from the IRS in these letters varies. Some direct the recipients to disclose their American status, while others are requesting a person’s tax ID. Some letters require the recipients to verify whether or not they are compliant with the IRS. Still, others simply inform the recipient that their information will be accessed”…
…”So, if you have received a FATCA letter from the IRS lately then don’t wait around and think the problem will just go away”…
http://www.groco.com/article/how_to_respond_to_that_fatca_letter_you_just_received_in_the_mail.aspx
Olsen appears to be an ex-IRS agent.
http://thehill.com/policy/finance/270902-ex-irs-agent-unusual-that-trump-has-been-audited-for-12-years
Maybe he left before the FATCA memo came round. 🙂
Harm comes in the form of substantially changing the incentives offered to all other Canadians, to the extent that certain courses are not pursued or pursuit is substantially modified. Disability savings account. What other savings accounts/mutual funds/investments that may be classified PFIC? One wants to save for kids college, then RESP vs saving outside RESP.
Also not to forget the substantial compliance costs with the U.S. tax overlay of the 76,000+ page U.S. tax code on top of the Canadian code. Extra compliance = harm.
My usual contrarian slightly unhelpful view. If you don’t have US income or assets or property (as, for example, an accidental dual in Canada) then it’s difficult to prove harm because you can jsafely ignore the US and it’s asinine taxes and penalties. Lie to your bank – they won’t validate your answer. If the IRS finds you, so what? They can send you all the letters they want, but they can’t collect a dime. As long as you aren’t being denied banking services (in this case Canada is much better than Europe and elsewhere) then FATCA is toothless.
@Nononymous: believe me I agree. I live in Europe though and have that US birthplace inked in all my documents. It’s now impossible to open a bank account without them putting a restriction of some sort (eg no investing). But back to Canada: can you still open bank accounts with no ID? How in practice do you hide a US birthplace? That said, I’d take your argument a bit further along your lines and argue that having to resort to hiding one’s origin (of sorts) is a form of harm – it creates stress. Even if you are guilty of nothing and owe nothing this is a stressful situation for most people. Chronic stress is medically proven to be harmful.
@Nononymous
Guess it is NOT harm for people to essentially go into hiding.
Guess its not harmful to have to lie to your bank.
Guess it’s not harmful to be assessed U.S. taxes and penalties and have to rely on the tax treaty to protect you.
Guess it’s not harmful for people to have to live with fear and uncertainty.
Guess it’s not harm to learn that you do NOT have the rights that the Charter guarantees to other Canadians.
Guess it’s not harm for the Canadian Government to turn a certain number of Canadian citizen/residents over to the USA.
Guess it’s not harm for certain Canadians to be denied the opportunity to participate in normal financial and retirement planning.
Guess it’s not harm for Canadians to be forced to pay the U.S. an “Exit Tax” (which is actually one point of the post).
Guess it’s not harm to be forced to renounce to be have permission to NOT be treated as a U.S. citizen.
Guess it’s not harm to worry about the USA retroactively defining who is a U.S. citizen.
Guess it’s not harm to be forever defined by where you were born.
Guess none of these things are harm, right?
Guess if NOT everybody has experienced the SAME harm then there could NOT have been any harm.
Yup, guess there is no harm.
The experience of a narrow part of those Canadians subject to FATCA (accidental dual citizens, especially those without a U.S. place of birth) is NOT the experience of the whole.
@Stephen Kish
What were you thinking in organizing this lawsuit? There is clearly no harm of any kind here.
My point is simply that I could not prove harm to myself because, in practical terms, there hasn’t been any. I’ve chosen to ignore FATCA and US taxes and thus far have suffered no adverse consequences. Nor do I expect to, but of course that’s a prediction on my part, not a certainty.
Yes, perhaps this is a source of anxiety about the future, but it’s only one of many in life, and certainly not the biggest for me.
Others have experienced harm, I agree, though generally not in Canada, and primarily through denial of banking services. (On that note, Canadian duals are perfectly free to invest in TFSAs and RESPs etc. They only have problems if they choose to report those accounts on US tax forms. So don’t do that.)
@Fred – As far as I know the ID required to open an account in Canada need not show birthplace, nor has that data generally been recorded by banks. Post-FATCA we simply self-certify whether we are US persons, or not. But there seems to be little or no attempt to verify the truthfulness of those statements.
@Fred:
“I’d .. argue that having to resort to hiding one’s origin (of sorts) is a form of harm – it creates stress. Even if you are guilty of nothing and owe nothing this is a stressful situation for most people. Chronic stress is medically proven to be harmful.”
Stress isn’t always harmful. Some might get a buzz from lying.
Guess it’s not harm when the first someone hears about their US tax obligations is from the IRS itself, denying that someone the ability to enter any of the available IRS amnesty programs – a reality that would not have existed had the Canadian government not handed that someone over to the IRS.
Is this why no US persons living in Canada have heard from the IRS as a result of FATCA data collection? If not, what else is stopping them when there’s clearly gold in them thar hills?
Guess I’ve NOT been harmed because there aren’t any detectable blood or bruises. Now if you looked into my brain you might see some damaged neurons but I can’t prove they’re there. How do you quantify and qualify the harm caused by feeling I can no longer speak about my US connection with anyone I don’t trust with that information … which I’ve decided is pretty much everyone. Not only that, I have to hope that any mention I’ve made of this in the past gets forgotten by friends, family and neighbours. I feel ill at ease having to tread this carefully, but I prefer it to paying one very evil foreign piper. That would irreparably harm by soul.
We’ll never be able to determine this figure, of course, but I’d be very curious to learn what percentage of the Canadian accounts reported under FATCA (over the two data shipments thus far) belonged to non-compliant US persons – i.e. to individuals not already filing US taxes or otherwise known to the IRS.
I have a hunch that the number of non-compliant “off the radar” accidentals reported to the US is extremely small.
I’m not saying I like FATCA or that I don’t want the IGA to be shot down. Rather just pointing out that it may be difficult to prove harm specifically to Canadians when we can so easily ignore both reporting requirements and the consequences of not reporting.
I am a US tax compliant US person who was FATCA reported by Canadian institutions where I signed a W-9. The harm I have endured is that it was not necessary to allow the CRA and IRS unprecedented access to my banking info (info that any other Canadian would not have turned over without a court order) to facilitate my tax compliance and reporting.
I suppose the IRS might want to compare my FBARs to what my bank accounts have in them, but the information slips report what was in the account on the last day of the year, not the highest balance.
Finally, to the crux of the problem.
US citizenship and tax law causes all sorts of harm to those living outside the US. No doubt about that. But US law is not something the Canadian FATCA lawsuit will change.
FATCA causes harm in two ways: (1) it identifies previously unknown US persons, who then may be subject to all the grief that US citizenship can cause them; (2) it causes the denial of banking services to US persons in their country of residence.
In Canada, harm #1 is pretty minimal because the US is toothless to collect penalties or taxes owing. Furthermore, all those tax-protected savings accounts like RESPs and TFSAs and RDSPs are not reported under the IGA; the IRS won’t find out about them unless they are voluntarily reported, so US persons in Canada are free to take advantage of them provided they’re willing to remain non-compliant with US taxes.
And thus far there’s no indication that harm #2 is an issue in Canada. Particularly given that banks make no effort to validate whether customers truthfully report US personhood.
The stupidities of CBT and renunciation fees and exit taxes and all that can be harmful. FATCA can facilitate that harm, but in Canada, at least, it doesn’t do so very effectively. Hence my not feeling harmed.
@Nononymous
Is there some particular reason you come on to a post (requesting witnesses who may demonstrate a different area/level of harm) with arguments to derail the point of the post? I could understand if this were simply arguing concepts or something but not one where we are looking to actually do something.
Your situation is yours and that’s fine. Not all people’s situations fit the criteria you are using to dismiss any harm as being demonstrable, Nobody knows what FATCA has turned up from Canadian reporting. You can claim FATCA has only two ways of harm, I bet others would differ. Not everybody would be comfortable lying. etc etc
Your argument reminds me of Judge Rose in the Bopp lawsuit where he claims the US government is not responsible for any bank’s decision to close an account refuse to open one and so on. A five year old could easily see the problem with this logic. (I am referring to the judge, not you).
Bubblebustin’s situation brings up another dubious application of the IGA. Nowhere does it say that the CRA may use this information for their own purposes. Another layer of discrimination. The bank is prohibited from sending the same information on anyone who is not a “US Person.” This results in both tax agencies pursuing those people in a way they cannot apply to anyone outside the target. This is clearly wrong.
At any rate, the point is that based upon the Charter, no government may take action that causes discrimination based upon place of birth. This is what will take this case to SCOC (not my opinion but Hogg, May Cullen, Rankin etc).
Re one of Bubblebustin’s points above,
Could someone please provide me with a link to a statement or position of IRS that if information on a previously unreported account is turned over to IRS by FATCA reporting, the person who failed to report would not be allowed into an IRS amnesty etc. program or would likely suffer other negative consequences for not reporting the account.
@ Patricia Moon
Actually I think Nononymous has given us the opportunity to try to articulate here or ruminate to ourselves how we are being harmed by FATCA and specifically FATCA being implemented in Canada. It’s been helpful in that sense. And now thanks to Bubblebustin I know that a bank FATCA report to the CRA and hence to the the IRS will not likely match an FBAR being filed by a compliant USC. This could result in extra FinCEN/IRS scrutiny (not a pleasant thing) where there would not have been any before FATCA. This is particularly acute since FBARs are now electronic (easily scanned and retrieved) and not just filed in piles in a dusty storage place somewhere.
Stephen, This is probably another grey area. What the IRS actually say is that someone is ineligible for an amnesty program “if the IRS has initiated civil proceedings “. Not precisely the same thing.
https://www.irs.gov/individuals/international-taxpayers/streamlined-filing-compliance-procedures
“Returns submitted under either the Streamlined Foreign Offshore Procedures or the Streamlined Domestic Offshore Procedures will not be subject to IRS audit automatically, but they may be selected for audit under the existing audit selection processes applicable to any U. S. tax return and may also be subject to verification procedures in that the accuracy and completeness of submissions may be checked against information received from banks, financial advisors, and other sources. Thus, returns submitted under the streamlined procedures may be subject to IRS examination, additional civil penalties, and even criminal liability, if appropriate.”
Use the condors. The WSJ has just published an article explaining that people with “undeclared foreign” accounts should be “very afraid”. This, and the many publications like it are terror inducing to people who have their data indiscriminately published. Terror is an undeniable type of harm, justified or not. Build up a file of all the articles. The crippling fines and penalties promised by the IRS add to that, even if they are not used in practice. They have no equivalent outside of america and are not understood by civil servants outside of the us. Nowhere else in the world can you be fined several times your net worth for anything. That is terror inducing and the standard modus operandi of the us judicial system: scare you to death, then plea bargain. Somebody who verbally threatens your life can go to jail for several years even if they had no intention to carry out the threat. An entity that threatens to take all that you have can inspire terror and harm you even if they can’t actually do it. You can include the new fear of having your passport taken away if it’s the only one you have. I also still believe we should give more importance to the fact that there is no easy exit, to me a far greater sin than whatever a country can impose on its citizens. Having to pay up to 30% of our total assets, including unrealised pensions, to not be american anymore is what keeps us in slavery.
All I’m really getting at with these occasional contrarian posts is that, to me, it’s a pretty high bar for a Canadian citizen in Canada to prove what I would call real practical harm due to FATCA at this point in time. (As opposed to some fairly abstract harm in the case of banking information being revealed to CRA for one class of citizen but not another.) Not that it isn’t worth trying to prove harm, but it’s not going to be easy. That I suppose is my perspective. (I also have the lingering concern that if the lawsuit succeeds we might be worse off without the IGA due to the reporting exemption for RRSPs etc, but that’s a separate issue.)
I agree that FATCA is not going away. One way or another, our accounts will pretty much be in the public domain sooner rather than later. Now, the problem is the size of the risk. Imagine that Canada was asked to publish a list of all Saoudis caught drinking, having sex outside marriage or stealing. They would not be in too much danger in Canada, but how would they feel considering that they had just been outed on crimes bringing, in order, flogging, beheading and amputation? They would probably have trouble sleeping. Finally, of course, If a bank or the CRA make a mistake reporting an account, they can cost years of grief to completely innocent people. Over 350,000 reports, it has probably already happened.
FATCA is unenforceable without the IGA because the banks would be breaking the privacy laws. With the IGA, it is the State breaking the privacy (and non-discrimination) laws and it is being sued for it. There are many other analogies such as the Saudi one where privacy is primordial, even when irrelevant in a country of residence. How much would an Ugandan enjoy being outed as gay, a major offence in his country of origin? A non excised Somali girl? A North Korean refugee? America is sort of OK with gays and drinking but it is a terrifying place to be for tax enforcement. Nobody wants to be outed.