Media and Blog Articles – Part 7 of 11 (Year 2020)
2021.01.01. This thread is now closed. It continues at Media and Blog Articles Open for Comment – Part 8 of 9 – Year 2021.
This is a continuation of the Media and Blog Articles Open for Comments thread (part 6 of 9).
Part 1 covers up until 26 May 2015. Part 2 is from 27 May 2015 to 1 January 2016. Part 3 is 1 January – 31 December 2016. Part 4 is 1 January – 31 December 2017. Part 5 is 1 January – 31 December 2018. Part 6 is 1 January – 31 December 2019. Part 8 is 1 January – 31 December 2021. Part 9 is 1 January – 31 December 2022.
Media and Blog Articles
EmBee suggested that it would be good if there was a thread for new articles, so that people would be aware of where to comment. So, I created this permanent page. I’ll make a permanent list of links posted here and keep adding to it, but not deleting, so we’ll end up having sort of a “bibliography” of FATCA/CBT articles. [Note: Some articles are not open for comments]
For more articles on FATCA, enter FATCA into Google then click on the link “more news for fatca” just below the most recent featured article.
Notes:
From JC: To see #FATCA on Twitter for latest breaking news. JC finds that is quite a good source and there even are some international articles that one may read using Google Translate. Others may help certain tweets and articles remain in elevated position by retweeting them.
From Badger: On an important archival note, please use the Internet Archive Wayback machine https://archive.org/web/ (see bottom right ‘Save Page Now’ box to enter URLs of webpages you want saved for posterity, and try to save backup copies of articles and other items of interest in some other form – such as a datastick or external drive. Some important and very significant webpages and the fulltexts of articles are no longer available (although some can be retrieved if someone using the Wayback machine saved them).
Be sure to read the comment stream for this thread — there are often very recent articles mentioned since this list was updated.
How the IRS Prioritizes Compliance Work on High Income Non-Filers Through National and International Enforcement, IRS, Tax Connections.
2020.12.02
Constitutional lawyer Joseph Arvay remembered as tireless defender of the underdog, Bethany Lindsay, CBC, Canada. (Mr. Arvay was lead counsel for the ADCS constitutional challenge of the FATCA IGA legislation at Federal Court (Trial Division), 2014-2019.
2020.11.02
Goodbye, USA: The story of how I left the USA. Larry Salibra, Larry Salibra, Hong Kong.
2020.10.31
How the coronavirus made it nearly impossible to tenounce citizenship,, Adam Taylor, Washington Post, US.
2020.10.16
More Americans Are Renouncing Their Citizenship, Jo Craven McGinty, Wall Street Journal, US.
2020.10.15
Would I Ever Renounce My Citizenship?, Evan Edinger, YouTube.
2020.10.07
McAfee Founder Accused Of Evading Taxes While Allegedly Earning Millions, Reese Oxner, NPR, US.
2020.09.15
Toronto Star virtual event: US Election 2020: Why votes from abroad matter, and explaining the battle to overcome voter suppression, Toronto Star, Canada. (Event occurs 2020.09.22)
2020.09.07
Republican group calls on Donald Trump to change Fatca [sic], Cristian Angeloni, International Adviser.
Geld aus den USA fur viele Pensionisten, ORF, Austria.
Comply vs. non-comply might come again but I just can’t resist linking to this video featuring some of my favourite people.
Federal Register is out (late again) for the last quarter on 2019 .
I make it around 260, much lower than usual.
https://www.federalregister.gov/documents/2020/02/11/2020-02632/quarterly-publication-of-individuals-who-have-chosen-to-expatriate-as-required-by-section-6039g
Is India considering a kind of CBT?
https://www.mondaq.com/india/Tax/898066/Shocker-For-India-Citizen-Overseas-Major-Changes-On-Tax-Residency-Laws-May-Adversely-Impact-Indian-Citizens-Working-Overseas-
It looks like the IRS might have made some exceptions to the need to file 3520 for various foreign accounts for retirement and disability etc:
https://intltax.typepad.com/intltax_blog/2020/03/rev-proc-2020-17-exemption-from-filing-forms-3520-and-3520-a-for-applicable-tax-favored-foreign-trus.html
Thanks, Neill.
More on it from Virginia La Torre Jeker JD.
https://us-tax.org/2020/03/04/foreign-pension-plans-irs-seeing-the-light/
and from John Richardson at TaxConnections:
https://www.taxconnections.com/taxblog/treasury-exempts-applicable-tax-favored-foreign-trusts-from-the-form-3520-and-therefore-form-3520a-requirement/?
…and from Moodys: https://www.moodystax.com/reporting-relief-for-us-citizens-residing-in-canada/
One more in the collection of accounting firm responses to the Revenue Proc 20-17 issue and From 3520 Relief – This one from Cadesky https://mailchi.mp/cadesky/forms-3520-and-3520-a-filing-relief-finally
TaxConnections, March 10, 2020 – A Thoughtful Proposal Regarding Expatriates Foreign Trusts And Retirement Savings: Will Treasury Listen?
Written by John Richardson
https://www.taxconnections.com/taxblog/a-thoughtful-proposal-regarding-expatriates-foreign-trusts-and-retirement-savings-will-treasury-listen/?
The IRS epiphany re RDSPs and RESPs mentioned above are long overdue.
Their historical maltreatment of our RRSPs was an even longer and tortuous path to be deemed not taxable foreign trusts and be freed of ‘form crime’ and its associated penalties https://www.chamberlainlaw.com/assets/htmldocuments/2015%20Canadian%20RRSP%20Article.pdf . Might we see some small semblance of reason re our TFSAs in about the year 2035? I paid far more for assistance with the torturous 3520, 3520 A, 8891, etc. than the ZERO US tax assessed. I paid more in fees for help with the incomprehensible and labyrinthine forms than I made in any interest accrued.
The abuses of ordinary people by the IRS/US Treasury via the Form 3520 and 3520A are egregious and of longstanding, including the tormenting of those with Canadian registered savings by the IRS;
https://www.taxconnections.com/taxblog/shocking-behind-the-scenes-story-tax-professionals-advocating-for-taxpayers-on-3520-a-irs-penalties/
And even professionals in the compliance industry have tried to get the IRS to listen to reason re 3520s;
https://www.aicpa.org/advocacy/tax/foreign-trust-documents.html
The IRS also abused taxpayers with repeated erroneous 3520 penalty threat letters;
https://www.taxconnections.com/taxblog/foreign-trust-irs-penalty-notices-for-late-forms-3520-a-are-scaring-innocent-taxpayers/#.XYn_Pi5KiJA https://www.taxconnections.com/taxblog/foreign-trusts-irs-continues-to-issue-bogus-form-3520-a-penalty-notices-my-letter-to-the-irs/ which even the Taxpayer Advocate noted in one of her annual reports to Congress.
And Canadian registered savings are still subject to the FBAR / now FinCen Form 114 online reporting annually to the ‘Financial CRIMES ENFORCEMENT network’ as ‘foreign’ ‘offshore’ accounts.
https://www.taxconnections.com/taxblog/shocking-behind-the-scenes-story-tax-professionals-advocating-for-taxpayers-on-3520-a-irs-penalties/#.XmnZhGbTjOo.twitter
Reading the comments, it becomes clear that the ones hurt the most are those who tried to comply or were persuaded by their accountant to comply with the arcane 3250 rules. More evidence that the best rule is ‘don’t tell them anything they don’t already know.
This has been obvious for quite some time, and extends to most forms of compliance.
Well for those of us schmucks who comply, it’s a step in the right direction.
In a sense, its a problem created by the compliance industry because they were the ones who insisted on filing those extra forms as a protective (i.e. “cover their ass”) measure in the first place. The IRS certainly never told anyone they had to be filed. In fact, the IRS was and still is totally ignorant about most foreign tax-deferred accounts and was almost totally silent on the matter. In the absence of any clear guidance, the condors were reduced to guessing what the IRS required and, in so doing, opened up a can of worms.
Foreign tax-advantage accounts are square pegs that don’t fit into any IRS round hole and those who simply reported the accounts like ordinary savings accounts, declared the income, and paid the tax didn’t have any issues. Same for those who chose “selective” compliance and skipped reporting them at all because they weren’t going to be reported under FATCA and the IRS had no way way of knowing about them. The whole thing has turned into a stupid, pointless exercise and now everyone is scrambling to clean up the mess. Small comfort for those who were unlucky enough to receive one of those $10,000 penalty letters.
I remember a past participant here at Brock (Norman Diamond) who once said that above all else when filing a US return it must be “processable” by the IRS. That was paramount and was far more important than being accurate or complete because the IRS pretty much had to take the filer’s word and had almost zero ability to verify the information being reported.
Looking at thisfrom another perspective and playing the devil’s advocate,it could well be that the compliance industry filled in the missing dots purposefully for the IRS ,as a kind of assistance,so to speak, and definitely good for justifying their very existence . IMHO, they are really in synergy,working together to create more confusion than they possibly create working on their own.
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#RR
I would apply Occam’s Razor in this instance.
Putting the razor aside, they may or may not be collaborating, the point being that the result is mutually beneficial .The confusion ,ambiguity,fear works well for both. In fact it results in a special client-lawyer (IRS-US tax lawyer in Canada) synergy.
Well, its not working out very well for US tax practitioners that didn’t know that the filing deadline for Form 3520A was March 15th rather than April 15 like Form 3520. Now they are having to deal with an onslaught of calls from justifiably pissed off clients who got a $10,000 penalty letter for a late filed 3520A.
Nobody in their right mind will ever pay a penalty like that and the knock-on effect is that their cozy little system is now blown up. Once you refuse to pay a penalty, there is no point in filing or paying anything.
Just more people learning that compliance isn’t a safe option option either, not even through a CPA that is supposed to know what they are doing. As all here know, compliance will very often be the fastest way to being punished.
Excellent post from John Richardson today on Quora.
https://www.quora.com/If-US-citizens-abroad-get-a-105-900-allowance-before-having-to-pay-US-taxes-why-do-they-complain-and-renounce-citizenship-so-much-over-it
https://news.bloombergtax.com/daily-tax-report-international/stranded-foreigners-could-become-involuntary-u-s-taxpayers
@Neill
https://news.bloombergtax.com/daily-tax-report-international/stranded-foreigners-could-become-involuntary-u-s-taxpayers
Yes, these poor people who are involuntarily held in the United States against their will and therefore become U.S. tax residents because they meet the substantial presence test:
1. Become U.S. tax residents
2. Have to file the foreign information returns which will
3. Alert the IRS of their assets
4. Subject those assets to penalties and confiscation
The very fact that this possibility is described at all (by Bloombergs) is proof positive that in the United States:
Honestly, whoever wrote that should find something productive to do during their lockdown.
There is a medical exemption condition to the substantial presence test.
I would imagine this would apply in the covid 19 situation, but no mention of it in that article!
“If you exclude days of presence in the U.S. for purposes of the substantial presence test because you were an exempt individual or were unable to leave the U.S. because of a medical condition or medical problem, you must include Form 8843, Statement for Exempt Individuals and Individuals With a Medical Condition, with your income tax return. If you do not have to file an income tax return, send Form 8843 to the address indicated in the instructions for Form 8843 by the due date for filing an income tax return”!
The article is significant not because of the test for tax residency, but because part of the response to the crisis is a consideration of how it impacts tax residency at all. I don’t know whether the author of the article is worse or the people quoted in the article. Another issue is, once alerted to this as a possibility, where would the average person go to get clarification on the rule? Is it possible that a tax preparation service would advise someone to file 1040s under these circumstances?
Remember ,it’s in Bloomberg after all. Any canadian still in the US is either there permanently ,or someone who foolishly thinks that their insurance will take care of any health problems that may ensue. But,then again, it’s Bloomberg,after all.