Category Archives: Issues regarding US persons abroad

I’m making this morning’s comments to another thread part of this separate post so more of those affected will realize there needs to be certainty for them about this issue.

From USCitizenAbroad, and I agree:

There is ONLY one clear answer from the USG that is acceptable and that answer is:

People born abroad are NOT automatically U.S. citizens.

This would clarify the position of the USG.

If they say:

People born abroad ARE automatically U.S. citizens – that is their position but it is (in my opinion) as a matter of law wrong. Eventually the validity of their position will be tested in court.

Now, what is more important than the clear position of the USG, is that the persons affected by this take a clear position on their own.

That clear position: I am not a US citizen and therefore NOT a member of their “Tax, form and penalty club”.

Finally, I would be very surprised if the Consulate writes back and says people born abroad are not automatically U.S. citizens.

Some people make things happen.

Some people watch things happen.

Some people ask “What happened”

By featuring this prominently it will force the issue. This is extremely important for FATCA IGAs (if they happen).

But if the IGAs don’t happen, the banks will probably enter into agreements with the IRS. Now, the question becomes:

Who are they looking for? If it is U.S. citizens then the ONLY question that is relevant is:

Were you born or naturalized in the U.S.?

If the answer is Yes, then the logical next question should be:

Have you relinquished your U.S. citizenship?

There is no other question that is even relevant.

We need keep a very close eye on this.

Now, of course IF THEY ASK THE ONLY RELEVANT QUESTION, the banks are moving closer and closer to HUMAN RIGHTS VIOLATIONS.

This is as my frustration abounds. I still have not gotten a reply from Sylvia D. Johnson from the US Embassy, Ottawa.

Nor have my comments to the “The Accidental US Citizen” blog gotten out of moderation: Comments Still Awaiting Moderation — Flott & Co. PC — The Accidental US Citizen.
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Moodys Tax Advisors Blog, July 4, 2013: Blog Renouncing your US citizenship: New law may keep you out forever! by Alexander Marino JD, LLM (US Tax)

…
Under the proposed amendment, a renouncing individual who would be classified as a Covered Expatriate under §877A, must prove to the Department of Homeland Security by “clear and convincing” evidence that he or she did not renounce for tax avoidance purposes. The burden of proving this negative falls on the renouncing Covered Expatriate if he or she desires to ever re-enter the US.
…
In a nutshell, all Covered Expatriates will now have the burden of proving that tax avoidance was not a primary purpose of their renunciation. Under the original Reed Amendment, the burden was with the US government to show that the renouncing US citizen did so to avoid US tax. This shifting of the burden of proof is enormously important and greatly increases what is at stake for a Covered Expatriate. Under the original Reed Amendment the advantage was clearly with any renouncing US citizen (whether a Covered Expatriate or not). It can be very difficult for the US government to meet its burden of proof regarding tax avoidance motives. Under the proposed Reed-Schumer Amendment, the advantage would be squarely with the US government when dealing with a Covered Expatriate.

Under the newly proposed regime of the proposed Reed-Schumer Amendment, the importance of avoiding the US exit tax under §877A could be even more important than before. Not only will the repercussions of being classified as a Covered Expatriate under §877A result in a deemed disposition of the renouncing individual’s worldwide assets under the exit tax rules, but the burden to prove that a primary purpose of the renunciation was not to avoid US tax, falls on the Covered Expatriate and not the US government.
…
CONCLUSION

The Reed-Schumer Amendment is not law yet, but the danger of inadvertently being barred from the US while also being hit with the US exit tax are real concerns for those considering renouncing if it becomes law. Any US citizen, who renounces their US citizenship with either the original Reed Amendment or the proposal Reed-Schumer Amendment regimes in place, needs to understand the repercussions and timing of this decision.

Click HERE for a summary of filing and reporting obligations required by US citizens residing in Canada.

Here is a question:  Do Canadians have the Fourth of July?  Yes, but they don’t celebrate it.

I just want to express my congratulations to the growing list of Brockers who have received their Certificates of Loss of Nationality.  For you, the Fourth of July is just another day of the month of July.

We are celebrating our Independence Day.  Not independence of the United States of America from the British, but independence for expat slaves from the United States of America.

Peter Spiro at Opinio Juris mentions our own Victoria:

This July 4th, Exploring Paths Away From Citizenship

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Further to Just Me’s “HR 2299 Calls for Withdrawal of FATCA IGA Reciprocity Tool (DATCA lite)”,

Blaze reports:

We’re not free yet, but check Maple Sandbox for breaking news out of Washington.

James Jatras is reporting a “death knell” for IGAs and possibly for FATCA

Maple Sandbox — It’s Official, No American Reciprocity

Thanks, James Jatras. Thanks, Blaze. Thanks, Petros. Thanks to every Brocker who posts and comments and has added to this important discussion. We stand together against what is not right!

Listen to Mr. Jatras once again: FATCA Fact Finding Forum – Part 7 of 9 – James Jatras – How FATCA Can Be Defeated

From Maple Sandbox:

Do they really see that FATCA is not the panacea — at great cost all round, that it would not rope in the true tax evaders, just the small minnows — and more US collateral damage?

Now, if only the US would come to their senses and change to Residence-Based Citizenship… and if we could all live in peace in the countries of our choice, reporting our incomes and paying our taxes to and for the countries that give us our benefits.