Category Archives: Issues regarding US persons abroad

Given the trend of governments requiring their citizens and residents to report nearly everything (even Russia has now begun to require duals to register their 2nd citizenship), it’s amazing no one has come forth with a requirement to file a SpouseBar. Think of the normal approach the U.S. takes to anything foreign. “Alien.” Most countries have more benign terms in use for their non-citizen residents. “Permanent resident.” “Landed immigrant.” “Alien”- as if there were no similarities between an American and a human being that just happens to be from another country. “Foreigners” – being seen as some form of animal, wild, untamable, unworthy of freely mixing with the Homelanders but somehow, needing to be contained. And what are the three aspects the US always takes toward something foreign?

• First, the US hates anything FOREIGN.
• Second, the US hates anything regarding DEFERRAL.(Remember, “if you see the word foreign, the word penalty, is sure to follow”
• Third, the US hates LEAKAGE (for anything to get outside the US tax system)

After all, without a reporting requirement, that door undoubtedly opens far and wide to tax evasion. And certainly, the richer a couple is, the greater the risk of not meeting that noble goal of “paying ones fair share.”

The citizens of no other country have that privilege. Understand these disclosures are necessary to preserve freedoms of #Americansabroad https://t.co/7DLeRGqFov

— U.S. Citizen Abroad (@USCitizenAbroad) November 24, 2016

Keeping this in mind, President-Elect Trump has finalized the main appointments that will make up his cabinet. We looked at how many FBAR marriages there are currently (and still examining earlier unions). After all, some of these people are among the richest in the world. While there is a disturbing amount of physical abuse (allegedly in some cases) committed on the part of the males, so far we have found two couples that include an “alien spouse.” First of course, is President-Elect Donald J Trump. And then, of course, just as we had TurboTaxTimmy, our new Treasury Secretary may have some tax issues he is not taking care of.

Most expats have come across the issues of the gift and estate taxes, if for no other reason when trying to figure out what the value of an asset is (gift tax) vs how it is to be taxed (estate tax). Then there is the issue of an expat trying to get under the 2 million asset-test by gifting.

Just to remind, the relevant issue here is:

• an annual exclusion amount per donee per year There is no limit on the number of people that can be gifted to. There is no gift tax involved and no need to report
• US citizens and domiciliaries can also “gift split,” allowing married donors to exclude up to twice the annual exclusion amount per donee per year. Gift splitting is not permitted if either spouse is a non-US domiciliary and of course, there is IRS Form 709 to file. After all, we’re still talking about Form Crime
• An unlimited amount can be gifted to a spouse who is a US citizen
• There is an annual exclusion for gifts to non-US citizen spouses

So how will these rules affect our incoming members of the executive branch?
Continue reading →

Here is the video of the meeting that took place this past Monday, December 5, 2016 at the Atwater Library in Montreal. Once again, John Richardson and Andrew Grossman meet up to discuss, analyze and muse over the situation expats find themselves thanks to the complexity to the U.S. tax code. Bizarre!

Super thanks to David Zimmerly for making the trek (through snow), setting up/videoing, and already having the finished product!

ENJOY & please share widely!

 
A set of posts form a perfect companion set to this video. On John writes:

This series of posts developed from my “Educational Outreach” program for Americans abroad. It is an effort to respond in a practical way to the questions that people have.

“When in Rome, live as a Homelander” does, when elsewhere, live as they live elsewhere.”

Chapter 5: Living Clean – How to live outside the United States in an #FBAR and #FATCA world

Results of search: "US citizens abroad come clean" https://t.co/MfcAU1EDPK … … – Q: Are #Americansabroad? Filthy, dirty, sweaty or grungy?

— Citizenship Lawyer (@ExpatriationLaw) April 19, 2015

Americans abroad are constantly told that they should “come clean”. They should file their U.S. taxes. This assumes that they are somehow “unclean” or perhaps “dirty”. The life of an “American abroad” is about three things:

1. “Thinking Clean” – The importance of “thinking clean” while living abroad.

2. “Coming Clean” – Atoning for the sins of “living abroad” and entering the U.S. tax system; and

3. “Living Clean” – Living as a Homeland American outside the United States

Whether you have yet to decide about coming into compliance or you have filed (but are unsure whether you or your tax compliance firm has actually done all that is required), check out this set of posts to get a taste of what’s involved:

“Coming Into Tax Compliance Book” – How Americans can come into U.S. tax compliance in a FATCA world

You can’t make this stuff up!

As requested by the Obama regime, 7000 suspected U.S. citizens were recently identified by the Kuwaiti government, assumed guilty of crimes unless proven to be innocent.

Under the U.S. citizen locating program called FATCA, 7000 suspected U.S. citizens have been rounded up in a database of names now stored centrally in the Kuwaiti government, as reported by the Arab Times.  Those suspected U.S. citizens await an unspecified fate.

These citizens had previously been living undisturbed in the country amongst other nationalities. However, the recent Obama legislation has required the government identification of U.S. citizens in every country of the world.

In Kuwait, it is identified that each American is worth approximately $328,000, although it is not specified as to how that value might be realized by other actors.

The Kuwaiti government now has the addresses, telephones, and asset values of all U.S. citizens that it was able to locate. The files are stored in ways that are not specified and are transferred over the open internet without encryption. It is not specified as to how many lower level I.T. contractors or politically connected managers have access to the information.

Some of the information collecting Kuwaiti organizations are Al Hilal Islamic Fund, Noor GCC ISLAMIC FUND, Al Durra Islamic Fund, and Kuwait Insurance Company. The collected information is delivered to the Kuwaiti government under Operation FATCA.

http://www.arabtimesonline.com/news/7000-kuwaitis-2-3bn-fatca-reveal/

Global U.S. Citizen Target

When some politician or media gives that standard line “#FATCA’s unintended consequences” — think twice about whether you should be pacified by the author’s pandering.

Michael Parenti, in “To Kill a Nation–The Attack on Yugoslavia” describes also the “unintended consequences” of the actions carried under orders of the 1999 leader of the executive branch after having been caught with his pants down.  During this time, the to-be-FATCA-implementing Secretary-of-State was hiding in embarrassment from the U.S. public, but this SoS-IGA-implementer-to-be was known in the targeted villages and cities at that time as The Mistress of the War.

Parenti enlightens us: “Top policy makers are intelligent, resourceful, and generally more aware of what they are doing than those who see them as foolish and bungling. US policy is not filled with contradictions and inconsistencies. It has performed brilliantly and steadily in the service of those who own most of the world and who want to own all of it. That some critics may not know what policy makers are doing does not mean the policy makers themselves do not know what they are doing. That Western leaders make misleading statements about their goals and intentions does not denote confusion on their part but a desire to confuse their publics as to what interests they are really serving. That they are misleading others does not mean that they are themselves misled, although of course there are times when they make mistakes and suffer bafflement in regard to tactics and timing.”

When the law tries to paint us all “offshore tax evaders”, and it turns out they are talking about us, there are lessons to be learned as to how the media and politicians operate to accomplish a mission. Whether you are ready to hear this author’s entire premise or not, it gives a valid lesson as to how a population of diaspora can be used to accomplish a political and economic goal.

http://michaelparenti.org/ToKillANation.html

Don’t allow yourself to be pacified by the talk of “FATCA’s unintended consequences” and plan your strategy knowing that it wasn’t an unplanned attack.

Information Session

Of particular interest is the issue of the Australian “Super.”
While all expatriates worldwide experience country-specific problems, this one is perhaps one of the worst. By law, Australians are required to contribute to their own retirement; this system is unique among government-sponsored retirement planning. Why on earth should the U.S. be able to tax these?

Online Renunciation Information Session with John Richardson – 9 Jan 2017

Presented by: John Richardson is a Toronto citizenship lawyer, the co-chairman of the Alliance for the Defence of Canadian Sovereignty as well as the Alliance for the Defeat of Citizenship Taxation. He is a member of the ACA Professional Taxation Advisory Council. He holds the degrees of B.A., LL.B., and J.D. He is a member of the Massachusetts, New York and Ontario bars. His law practice focuses on “Solving the Problems of U.S. Citizenship” including relinquishing and the “Exit Tax”. He gives programs for expats all across Canada and Europe. He writes extensively at citizenshipsolutions.ca

WHEN: Monday 9 January 2017
10:00 AM AEDT (Sydney, Melbourne);
9:00 AM AEST (Brisbane);
9:30 AM ACDT (Adelaide);
7:00 AM AWST (Perth);
UTC: Sunday 8 January 11pm. Convert to your time zone
Program will last for one hour

REGISTRATION: HERE

If you are interested, leave your email address here and in early January we will send you instructions on how to join the information session

What’s this about?

Since Australia agreed to the FATCA IGA in 2014, Australian financial institutions have been asking ALL new account holders and some existing account holders whether they are U.S. citizens. Many have no idea of the consequences of admitting to U.S. citizenship, a U.S. place of birth or being born to U.S. parents. In this one hour session, John Richardson will address the following topics:

Who is a U.S. citizen?

What about those born in Australia who
a) were registered with the consulate and have U.S. passports, but never lived in the U.S.;
b) were NOT registered with the consulate and do NOT have U.S. passports.

Look before you leap!!

• The pitfalls of entering the U.S. tax system – a brief overview of what it really means to be “U.S. tax compliant” in Australia
• Can the U.S. really tax my super?
• The ATO says tax treaties “eliminate double taxation,” so why can the U.S. tax my Australian income?
• How do I relinquish/renounce U.S. citizenship?
• Is a CLN necessary? How can I document loss of citizenship without a CLN?
• How is relinquishment different from renunciation?
• Didn’t I lose U.S. citizenship when I became an Australian citizen?
• There’s an EXIT TAX???

Other topics

• How renouncing U.S. citizenship may put your superannuation (and other savings) at risk
• How to renounce and exit the U.S. tax system cleanly and avoid being a “covered expatriate”
• I have just learned about the FATCA problem! The difference between “responding” and “reacting” – things you should NOT do!
• I thought I lived in Australia! Why do I have to follow U.S. law when I live in Australia?
• What can the U.S. do if I’m non-compliant?
• If my bank has identified me as a U.S. Person, can I satisfy the bank without entering the U.S. tax system?

 

THIS SESSION IS OF A GENERAL NATURE. IT IS NOT INTENDED TO AND SHOULD NOT BE UNDERSTOOD TO OFFER LEGAL ADVICE OF ANY KIND.

I agree with others that Jim Jatras’ words in The Hill is important for its own post.  Thank you, Mr. Jatras, saying that…

FATCA’s only beneficiaries are the army of lawyers, accountants and software vendors who are making a fortune on it, with the costs passed onto consumers. 

I started my journey regarding US tax compliance almost ten years ago. I have paid dearly from my retirement savings and, although compliance has ended for me (but will that ever change?), the absurdity has not ended for my US-deemed Canadian-born son who has a developmental disability and, without requisite mental capacity, who would be trapped into such ongoing, never-ending costs of US tax and reporting compliance.  Again, I will say that it is not only for my son that I have come forward in this fight but for that of any person / family with the same entrapment.  My son will not be the only one so affected and for them this injustice to continue, year after year, to benefit that described army of lawyers, accountants and software vendors who are making a fortune on it, with the costs passed onto him and others like him.

I chose to go the route of having these professionals help get my family out of this US citizenship-based taxation nightmare, but have found it is impossible.  I don’t want any special work-around for my son.  I want this to end for all such sons and daughters.  Personally, I want the end result to be US residence-based taxation so no *accidental American* faces this injustice.  If there is the exceptionality of US CBT rather than RBT of the rest of the world (save Eritrea), then, in my eyes, there should only ever be an OPT-IN to US citizenship if the facts permit, never an OPT-OUT where some, the most vulnerable, are entrapped into, by US tax law, never-ending US tax compliance and reporting.

FATCA needs to go.  The unconstitutional IGAs need to go.  And the US needs to change to the same and much fairer residence-based taxation as the rest of the world and end the unconstitutional “warrantless seizure of personal financial information without reasonable suspicion or probable cause.”

I continue to be incensed that my chosen country of citizenship, Canada, and the country in which my son was born and raised (and never registered as a US citizen abroad) chose to honour the US in agreement to sign the extra-territorial IGA with the USA.  I continue to say that the words of Prime Minister Trudeau that *A Canadian is a Canadian is a Canadian* were political rhetoric, untrue and audacious. It is discriminatory that some Canadians, those with some US connection, however meaningless, do not fit with his faux words.  I don’t know what will take away the injustice for many.  I continue to feel betrayed by both my chosen country and the country in which my children were born and the country of my birth.

Again, thank you for this article, Mr. Jatras.  I have included it all below.  (If there is a problem for this site with quoting all of it, I will update to remove part of it.  I think it important for all to read the article in its entirety.)

The Hill, Contributer: Jim Jatras, November 16, 2016 — Dumping Obama’s faux foreign tax legislation should be high on Trump’s to-do list

President-elect Donald J. Trump.

President Trump

The NYT title says it all:

Donald Trump Is Elected President in Stunning Repudiation of the Establishment

Donald John Trump was elected the 45th president of the United States on Tuesday in a stunning culmination of an explosive, populist and polarizing campaign that took relentless aim at the institutions and long-held ideals of American democracy.

The surprise outcome, defying late polls that showed Hillary Clinton with a modest but persistent edge, threatened convulsions throughout the country and the world, where skeptics had watched with alarm as Mr. Trump’s unvarnished overtures to disillusioned voters took hold.

I watched basically all day as I did other things. It seemed to start slowly enough but once it was clear he had won Ohio, it seemed to me, that the entire dynamic changed. You could hear the puzzlement of anchors as they spoke, realizing everything they expected to see, was not happening. It wasn’t disappointment or disapproval but more an absorption, a wonderment, as to how this could be happening. Questioning how the pollsters and pundits could have gotten it so wrong. Some had no problem allowing that to have a positive edge; you could see them mentally re-arranging their thoughts. John King was the first I heard say, long before it was a given, that things were not going well for Hillary. He seemed to have a feel for it, to see the pattern present itself and then play out, state by state. It was fascinating to watch him go through each one, accurately assessing which pockets had yet to be counted, which ones would go to Hillary but as things progressed, would still not be enough.

A long long wait to get the final counts for Wisconsin, Michigan and Pennsylvania (which earlier in the evening, had seemed clearly in the Democrat’s pocket). Trump had 244 electoral votes with 9 states to go. It was pretty obvious how it was going to work out in the end.

An ugly argument took place between Van Jones and Corey Lewandoski once John Podesta announced that there would be no announcement from Clinton’s end until all the votes were counted. In a very undignified and ungracious way, Lewandoski pounced on the fact that Trump had been roundly criticized for saying he might not accept the results of the election. He did not listen when it was suggested that if Trump were in Hillary’s shoes, he likely would have waited too, until every vote had been counted. I believe in that exchange also came the statement that Hillary would be investigated for all of her alleged issues.

That aside, the DOW fell 1000 points the last time I checked. The USD was worth $0.75 CDN. Just like that. The Senate remains Republican; thank God Chuck Schumer, will not be the Senate Majority leader. (What a nice taste of revenge for expats.) Let’s hope we see some of what was in the Republican platform, though I expect it may take some time to get to it. At least we can envision tax reform. This time, we will be speaking to a more receptive group.

So, the American people have chosen to strike down the establishment. It is not difficult to understand. In spite of some of Mr. Trump’s less-than-dignified ideas/statements about Muslims, women, Mexicans, et al, the American people said “Enough” to the useless bureaucracy of Washington. I don’t blame them.

FINALLY, IT’s OVER!