Liberty and justice for all United States persons abroad

The Isaac Brock Society

Monthly Archives: June 2018

The problem is not the petitions: The problem is lack of participation. Probably a good idea to target specific lawmakers

Posted on by Posted in Issues regarding US persons abroad 8 Comments

Greg Swanson of PurpleExpat.org created a change.org petition to abolish “citizenship-based taxation”. You can still sign it. But, as it stands only 700 people in the whole wide world – even though they have nothing to lose – signed this petition. The problem is not the effectiveness of the petition. The problem is that Americans abroad as a group will not stand up for themselves.

https://twitter.com/Keith__REDMOND/status/1009101233066598400

Mr. Swanson published an interesting post where he summarized the comments and added some additional commentary.

The comments include:

Continue reading →

Brock project: Is there a parallel between renouncing Indian status in 1958 and #Americansabroad committing #citizide in 2018?

Posted on by Posted in Issues regarding US persons abroad 2 Comments

I recently became aware of a fascinating article at CBC titled:

Why my grandfather dissolved the Michel First Nation and renounced his Indian status

The title suggests a discussion of two separate issues:

1. “Renouncing Indian status” – Is this analogous to U.S. citizens renouncing U.S. citizenship today?

2. “Dissolving the Michel First Nation” – Is this analogous to “tax residents” of other countries returning to the United States to avoid the indignities inflicted on Americans abroad?

For some time I have been interested in some of the parallels between the U.S. treatment of its citizens living abroad and the Canadian and U.S. Government treatment of their First Nations people. To be clear: I am NOT suggesting that the treatment of Americans abroad is of the same caliber as the treatment of First Nations peoples.

Nevertheless:

– First Nations people have historically been subjected to a separate regulatory regime – the Indian Act – by the Government of Canada. U.S. citizens abroad are subjected to a separate tax regime by the Government of the United States

– First Nations people are subjected to a separate financial reporting regime by the Government of Canada. U.S. citizens abroad are subjected to a separate reporting regime by the U.S. Government

– First Nations people have historically been subjected to policies that have resulted in diminished opportunities relative to other Canadians. U.S. citizens abroad simply do NOT have the same opportunities as those who are not U.S. citizens
Continue reading →

First a delay in payment – Is it possible that a legislative fix to the “transition tax” is in the works?

Posted on by Posted in Issues regarding US persons abroad 30 Comments

The above tweet references CBC reporter Elizabeth Thompson’s latest article on the U.S. “transition tax”. While reporting on the delay (referenced at the Isaac Brock Society here), Ms. Thompson’s article offers the tantalising possibility that the “delay” may be linked to a desire for a legislative fix.

Her article at CBC includes:

Brian Masse, an NDP MP who sits on the Canada-United States Interparliamentary Group, said U.S. lawmakers were very much aware of the tax reform’s unintended consequences when MPs and senators met with them in Washington last month.

Masse said he was told legislation to fix the problem could be introduced in the coming weeks.

“There seemed to be a genuine understanding and appreciation that these are victims.”

By the way, the comments to the article are (as usual) not off to a good start. (In fact they are indescribably ignorant.) It appears that the average Canadian:

1. Hates corporations; and

2. Hates U.S. citizens (even when they are also Canadian)

But, when you have (1) “U.S. citizens” (2) owing Canadian “corporations” these people lose any semblance of rationality. (You can actually see their abilities to reason and process information implode in real time.)

It would be helpful to add some comments (calling all Brockers) that would provide some balance and education. Seems like a number of commenters don’t believe that “dual” citizens (usually they call them “duel” citizens) are actually Canadians.

There are a couple of really good comments from one “Karen Alpert” (a familiar name) which includes:

Technically, yes. It applies to any US citizen who owned a foreign corporation when the tax reform bill was signed last December. Anyone who renounces after that point would be liable for the tax. However, I suspect that a number of affected Canadian citizens will decline to comply with this tax and will hide behind the tax treaty provision that states that Canada will not help the IRS collect in Canada on tax liabilities that arose when the taxpayer was a Canadian citizen,

Ms. Alpert is absolutely correct – the issue of the “Canadian citizenship” defence to collection was recently explored at the Isaac Brock Society here.

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Elizabeth Thompson’s article about the “transition tax” have been featured on Brock as follows:

https://isaacbrocksociety.ca/2018/05/05/brock-project-advice-on-how-to-explain-the-effects-of-the-ustransitiontax-through-a-question-in-the-house-of-commons/

and

https://isaacbrocksociety.ca/2018/04/28/be-on-the-lookout-bubblebustin-to-be-on-cbc-the-national-on-the-transitiontax/

New Accidental American Groups

Posted on by Posted in Accidental Americans 29 Comments

 
In the last little while, there are 4 new Accidental American groups which appear to be under the umbrella of Fabien Lehavgre’s group ( website , Facebook , Twitter . I don’t believe I have seen any of these mentioned here so want to be sure this information is available so people are aware of it.

For those of you on Facebook and Twitter, kindly share, RT and like these pages. Thanks.

 

UK

UK Accidental Americans Facebook Page

 
ITALY

Italian Accidental Americans Facebook Page
 
IRELAND

Irish Accidental Americans Facebook Page

 
BELGIUM

Belgian Accidental Americans Facebook Page
 

Interrupting our regularly scheduled programming: It appears that there is a delay to the June 15, 2018 @USTransitionTax payment

Posted on by Posted in Citizenship Issues, FATCA, Tax Treaties, Transition Tax 30 Comments

Update from “Accounting Today” – June 4/18 – 11:00 p.m. EST:

https://www.accountingtoday.com/news/irs-provides-penalty-and-filing-relief-on-transition-tax-in-tcja

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I haven’t had time to really read and digest this Bulletin from U.S. Treasury.

You will have to read and draw your own conclusions, but it appears that paragraph 16 speaks to this issue:

Q16: If an individual fails to timely pay his or her first installment of tax due under section 965(h), will the IRS assess an addition to tax for failure to pay? Will the taxpayer’s requirement to pay all subsequent installments be accelerated under section 965(h)(3)?
A16: If an individual meets the criteria in this paragraph and pays the total amount of the first installment on or before the due date for the second installment, the IRS will not assess an addition to tax for failure to timely pay the first installment and will not accelerate subsequent installments under section 965(h)(3). An individual with a net tax liability under section 965 is required to report the liability on his or her tax return for the year in which or with which the inclusion year of the deferred foreign income corporation ends and pay the full amount of that liability on the unextended due date of that return, unless the individual elects to pay the liability in eight annual installments pursuant to section 965(h)(1). However, the IRS has determined that, if an individual’s net tax liability under section 965 in the individual’s 2017 taxable year is less than $1 million, the individual makes a timely election under section 965(h), and the individual did not pay the full amount of the first installment by the due date under section 965(h)(2), the failure to make the payment will not result in an acceleration event under section 965(h)(3) so long as the individual pays the full amount of the first installment (and its second installment) by the due date for its 2018 return (determined without regard to extensions). For this purpose, the relevant due date generally is April 15, 2019. In the case of United States citizens or residents whose tax homes and abodes, in a real and substantial sense, are outside the United States and Puerto Rico, and United States citizens and residents in military or naval service on duty, including non-permanent or short term duty, outside the United States and Puerto Rico, the relevant due date is June 17, 2019, which is provided by Treas. Reg. §1.6081-5(a)(5) and (6). Although the IRS will not assess an addition to tax for failure to timely pay the first installment, a taxpayer will be liable for interest on such amount from the due date of the installment. See I.R.C. §6601.

If the IRS sends a taxpayer a notice of an addition to tax for failure to timely pay the first installment, and the taxpayer meets all the conditions for relief described above (including making the required payment by the due date for the second installment due under section 965(h)), the taxpayer should contact the IRS office that issued the notice and request abatement of the addition to tax for failure to timely pay the first installment in accordance with the provisions in these FAQs.

Posted: 06/04/2018

Note that this does NOT apply to all people (appearing to give relief only to small businesses).