Category Archives: Issues regarding US persons abroad

The U.S. Department of State (DOS) recently increased its renunciation fee from $450 to $2350 because DOS and the U.S. Congress hold in contempt any U.S. citizen who would renounce citizenship. One argument used is that the fee increase is necessary for national security.

The Alliance and our attorney, Jim Butera of Jones Walker, believe that the fee increase violates both the United States Administrative Practices Act and the Expatriation Act of 1868 and consequently filed a complaint (see below) with DOS.

Some of you also complained to DOS (thank you!) by responding to a request for comments on the fee increase at the Regulations.gov website. However DOS made the decision (after the submissions?) not to post any comments that were emailed to the government site. I enclose below some comments that one of Mr. Butera’s colleagues discovered for us on the website. I also show a submitted comment (from @EmBee) that will never be published, and a “response” from DOS.

My understanding is that U.S. courts prefer that, when there is a dispute, both sides attempt to resolve the dispute without going immediately to court action. That is what we have all done, by submitting our complaints and rationale why the fee increase is unreasonable and violates U.S. law.

During the next few months I expect either no response, or a negative response from DOS.

Assuming a negative response, the NEXT STEP would be to initiate litigation. There is zero possibility that any U.S. political party would litigate to make it “easier” for U.S. citizen-voters to renounce citizenship, so we would have to come up with the money ourselves.

The ballpark (don’t hold me to this) cost of getting to the first court would be about $50-$75k AND the odds do not appear to be in our favour that we would be successful. What is obvious to us may not be obvious to the courts — but there is some chance of success.

If there is any potential donor reading this, and willing to fund a very high risk venture aimed at freeing humans from unwanted U.S. citizenship, let me know.

THE COMMENTS CAN BE FOUND HERE:

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UPDATE: December 23, 2014

Stephen Kish says:

The Republicans may or may not introduce legislation to kill citizenship-based taxation during the next two years. Even if introduced, it is uncertain whether such legislation will be successfully passed into law.

An alternative approach is litigation. However, a lot of money will be required to sue in U.S. federal court with a citizenship-based taxation constitutional challenge.

The ballpark estimate I have received for the legal cost is about $200k.

If there are any potential donors who might consider funding a significant portion of the legal cost for such a court challenge please contact me at: http://www.adcs-adsc.ca/ContactADCS.html.

Stephen Kish
Chair, Alliance for the Defence of Canadian Sovereignty

Shadow Raider says in a recent comment:

@all, I want to believe that Republicans Overseas are being honest, but they are way too focused on FATCA. I can’t help thinking that they are doing this more for the banks and wealthy US residents with actual foreign bank accounts, and using Americans abroad as an excuse. But I wouldn’t be surprised if they are just misinformed and disorganized, as Republicans usually are. I’m not sure.

I’m still against FATCA even for US residents, because it’s disproportional, unilateral, ineffective and unnecessary. But to me CBT is worse. My main constitutional argument is based on discrimination, and I have also written one based on the general power to tax. The courts could easily rule against either one, but I think the discrimination argument is stronger.

Addition of very relevant USCitizenAbroad addition:

@Shadowraider

Excellent 14th amendment arguments. A long time ago I wrote a post on the issue of “citizenship classifications” and the 14th amendment. You will find the complete post here:

http://renounceuscitizenship.wordpress.com/2013/07/03/cook-v-tait-11-who-should-americansabroad-be-compared-to-for-tax-purposes-even-u-s-citizens-are-entitled-to-equal-protection-under-the-14th-amendment/

(This is part of the series of Cook v. Tait posts which are listed at the beginning of this post:

http://renounceuscitizenship.wordpress.com/2013/07/03/cook-v-tait-11-who-should-americansabroad-be-compared-to-for-tax-purposes-even-u-s-citizens-are-entitled-to-equal-protection-under-the-14th-amendment/

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December 19, 2014 — “Money @ Omaha.com”: IRS chief supports simplifying tax system, says it’s ‘beyond the pale of making any sense’

“This system is really beyond the pale of making any sense,” Koskinen said on a conference call with reporters, held in front of a gathering of tax preparation groups to help people choose good tax preparers and avoid scams and fraudsters.

He said fewer people will get answers to tax questions via telephone because of the budget cutbacks. The agency’s $11 billion budget is down $1.2 billion from 2010, including a $346 million cut this year. For the first time, taxpayers will be required to report whether they have health insurance, and some will have to calculate new refunds or payments based on their insurance.

Koskinen has a law degree from Yale University, studied in Cambridge, England, was CEO of a management consulting business and has headed the IRS for the past year.

“I wouldn’t think about trying to fill out my tax return, and I don’t have a very complicated tax situation,” he said.

Although changing the tax code is up to Congress, he said, his office is ready with information and technical assistance for lawmakers who want to simplify the system.

From back in 2010 came this in “The Hill” on January 11, 2010: IRS commissioner doesn’t file his own taxes:

IRS Commissioner Douglas Shulman does not file his own taxes in part because he believes the tax code is complex.

During an interview on C-SPAN’s “Newsmakers” program that aired on Sunday, Shulman said he uses a tax preparer for his own returns.

“I’ve used one for years. I find it convenient. I find the tax code complex so I use a preparer,” Shulman said.

Pressed on how he would make the tax code simpler, Shulman responded, “I don’t write the tax laws. Congress writes the tax laws so that’s a whole different discussion.”

…

Later in the C-SPAN interview, Shulman downplayed his use of a tax preparer, saying he has used one for 10 years. He noted that he and President Barack Obama are proponents of simplifying the tax code.

Here’s some advice for whoever is responsible for the continuing absurdities: “Tax Foundation” on December 17, 2014: The IRS’s Long Reach Doesn’t Just Apply to Corporations — The IRS’s global reach also extends to personal income as well.

The trend of inversions and renounced citizenships is alarming. It speaks to a simple principle of economics, is membership worth the price? Americans abroad and corporate executives are resoundingly saying no and opting out.

For the most part, the drop in demand for American membership has been missed by the U.S. Congress, but in the recent report on tax reform from the Republican staff of the U.S. Senate Committee on Finance, they suggest moving away from a worldwide income tax system to a residence based system, matching other OECD countries. This has given many expatriates cause for hope.

Tax burdens should be tied to the public services a tax payer uses. Paying one’s “fair share” only makes sense if one is using a fair share. American citizens abroad don’t use American public services and thus should not be responsible for the provision of those services.

Maybe it is time we admit that the IRS is truly over-reaching.

Is Nina Olson, National Taxpayer Advocate, as well being heard? When will her next Report to Congress be released? Her last one, National Taxpayer Advocate Delivers Annual Report to Congress; Focuses on Taxpayer Bill of Rights and IRS Funding was on January 9, 2014.

Neill says:

My expat question has been accepted by WSJ.

Bubblebustin comments:

@Neill

That’s great news. When it’s published, do you mind posting it on this other tread also for easy reference?

https://isaacbrocksociety.ca/brockers-making-news/

They’re really hot to trot to tell our stories at WSJ Expat, aren’t they? Maybe some of the journalists we’ve been talking to there were listening when we said we needed a voice in the media. They need our support in return. I don’t believe that the WSJ Expat has been advertised on Brock. Would one of our moderators mind making a new post of it?

http://blogs.wsj.com/expat/

You can follow them on Twitter and friend them on Facebook too.

*********************
From some of the prior related commentary:

Vote (Do you think the U.S. needs to rethink its taxation rules for nonresident U.S. citizens?) and comment on this new “Ask An Expert” “EXPAT” article:
Wall Street Journal, December 16, 2014: U.S. Expats Find Hope in Senate Finance Tax Reform Proposal

AND: Wall Street Journal, December 16, 2014, Jonathan Lachowitz EXPAT Opinion: Senate Proposal Could Aid ‘Marginalized’ U.S. Expats

About Expat

Expat is The Wall Street Journal’s hub for expatriates and global nomads – spanning the globe in expat hotspots like London, Paris, Hong Kong, Beijing, Sydney and many more.

Here you’ll find stories about expat living – housing, education, healthcare and more – expat jobs and managing your finances abroad. Whether you’re an expat in Dubai or Delhi, Sao Paulo or Singapore, Tokyo or Tel Aviv we’ll bring you stories the world over.

Share your expat stories with us at expat@wsj.com.

************
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This seems to be a class action suit, based in Delaware, against FATCA.

http://armstrongeconomics.com/2014/12/16/class-action-lawsuit-forming-against-fatca/

Martin Armstrong may be brilliant. He also spent seven years in prison for contempt of court relating to security fraud charges, only released in 2011. Delaware of course is a notorious tax haven. Do we want to approach him, be associated with him? Maybe, maybe not. Such an association could confirm our enemies in their opinion that we are tax evaders.

OR…is he just forwarding contacts to the lawsuit already underway in DC?

Elves: Make Blaze’s Christmas wish come true. Help Santa fill Ginny and Gwen’s stockings!

With the dearth of seriousness that pervades most of the topics we slog through, day after day. it seems a little fun is in order, especially when something unusual has been created! This post grows out of a comment being posted as a post and again, as a comment becoming a post.
Would see an abolute shame to see this gem of Embee’s get buried away; without the post it refers to, it wouldn’t make sense.
So here it all is, in complete form.
 

FORM PEOPLE

to the tune of “Goldfinger”
 
Form People
They’re the ones
The ones with a vampire’s bite
A scary sight
Such a cold people
Beckon you to enter their world of fines
You must decline

Bafflegab they will pour in your ear
But their words can’t disguise what you fear
For the clever ones know how bad this ends
It’s the kiss of death to befriend
Form People
Clever ones, beware of their deeds untold
Their hearts are cold

Bafflegab they will pour in your ear
But their words can’t disguise what you fear
For the clever ones know how bad this ends
It’s the kiss of death to befriend
Form People
Clever ones, beware of their deeds untold
Their hearts are cold

They love only forms
Only forms
They love forms
They love only forms
Only forms
They love forms
 

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Hello Brockers!

Special for the holidays I have created a Greedy Giver campaign to raise extra money from those who don’t feel that this issue is about them. This is for you Brockers to share with friends and family who feel that giving to this campaign “doesn’t get them anything”.

Well now it can and will for a short time. (Click above pic or below coupon to take you to the campaign).

Please share this far and wide via email, Twitter, Facebook and whatever other means you can think of.

An example of a coupon that can be purchased on Greedy Giver to fund our campaign:

Too many coincidences for me not to enter this post about what a friend of Brock proposes as “CATCA”.

Today, Furious AC commented:

The IGA Canada signed could have been simply had a word or paragraph change as well to protect Canadian Citizens and Permanent Residents and was proposed several times by other than Conservative MPs and it was rejected out of hand with the phrase “Congress has spoken”.. well Congress actually did not speak nor did they vote for a senate majority stamp of approval, yet our government pushed through this monstrosity KNOWING how easily it could be changed to actually do what it pretends to intend. That’s how Ottawa works!!

Yesterday I got an email with a *CATCA* proposal — see it below*. I had just read a comment from GwEvil:

How’s this for extreme irony?

http://www.theglobeandmail.com/news/politics/ottawa-threatens-to-block-buy-america-rules-in-canada/article22079182/?click=sf_globe

“The application of these protectionist trade restrictions on projects on Canadian soil by a foreign government is unreasonable,” said Max Moncaster, Mr. Fast’s press secretary.

This comment at the Globe and Mail article had a relationship to the *CATCA proposal* just below:

A year ago I was invited at their expense to present some research to american government people in Washington DC.
They offered to book my flights through a third party agency that is contracted by the State Department and a few others.
Fine I said give – me two options and I’ll pick one.
They came back with two options both of which were on US based airlines
Both bookings had me flying from Ottawa to DC normally a flight of around 80 minutes, going via US regional hubs making the flights about four hours each one way.
I sent them an itinerary for An air Canada flight – direct and cheaper.
They told me it doesn’t matter – buy american rules obligate them to book through US airlines regardless of price or efficiency.
I declined the offer to present my research in the usa for this reason and will do so again.
They came back with two options both of which were on US based airlines
Both bookings had me flying from Ottawa to DC normally a flight of around 80 minutes, going via US regional hubs making the flights about four hours each one way.
I sent them an itinerary for An air Canada flight – direct and cheaper.
They told me it doesn’t matter – buy american rules obligate them to book through US airlines regardless of price or efficiency.
I declined the offer to present my research in the usa for this reason and will do so again.

The *CATCA proposal*, introduced by email as:

So now I’d like you to consider (and then let me know what you think about) my perspectives on dual-citizenship, border controls, sovereign rights and international relations evolving from past history to modern-day enlightenment. Three things to get started:
.
First, it is well established in history that every sovereign nation has an absolute right to control the movement of people across its borders — and there is nothing in today’s world to challenge this (barring major Treaty accords like the European Union’s right of free movement).
.
Second, as a general principle a traveler cannot be denied entry into the country of his citizenship — and again, there is nothing in today’s world to challenge this
.
Third, if that person happens to have another citizenship, then the country to which he’s seeking admission can require him (upon entry and stay and exit) to present himself only as a citizen of that country (and not the other one) — namely the issue of Boris Johnson, Ginny Hillis and many others like them.
.
However, the latter principle is open to challenge because in today’s world, most modern democratic enlightened countries no longer raise a fuss over it — for example, an American citizen entering the UK with a US Passport showing a British birth-place generally encounters no impediment. Therefore, the United States with its appalling treatment of visitors like Boris Johnson and Ginny Hillis needs to face some push-back (with very sharp teeth) from other countries.
.
This is what I think Canada can do to hit back at America over FATCA and the “Accidental” Dual-Citizen problem — that is, if Harper’s successor has any guts:

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