A shocking appropriation of the inherited wealth of two U.S. citizens living in New Zealand
For those who imagine that FBAR penalties are proportionate to the amount of tax owed on the contents of non-reported “foreign” bank accounts, here is your answer!
SEAT members Laura Snyder, Karen Alpert and John Richardson recently published the following article in Tax Notes.
The Department of Justice is suing to recover the FBAR penalties. Here is the claim:
As President Reagan was fond of saying:
“Facts are stubborn things!”
If only Members of Parliament would have heeded the concerns over FATCA that were expressed by Jim Flaherty, Canada’s Finance Minister at the time the FATCA IGAs were signed !
Now, the World is subject to: COOK v. TAIT, (1924) – https://www.law.cornell.edu/supremecourt/text/265/47
Will the Government of New Zealand confiscate the money and give it to the USA?
The real question, of course, is whether any of these penalties are collectible. Will this unfortunate couple even attempt to defend themselves, or will they simply remain in New Zealand, with all their assets, and not respond to any paperwork sent their way by the US government?
@Ron, Trump would likely punish New Zealand with 100% tariffs if they don’t extract this money from this couple. It is a criminal enterprise, and that’s how criminals behave.
Interesting paper. Thanks John.
Takeaway points for me are to never engage with the US tax system and to identify myself as Canadian only when dealing with my bank.
This question is for John:
Should the US govt obtain the judgement it is seeking, will the NZ govt cooperate with enforcing the judgement? I am guessing some of those accounts may have deferred taxes which would be due if they were liquidated (eg, for capital gains, for tax sheltered investment accounts). The NZ govt would understandably be first in line for taxes due before allowing the capital to leave NZ.