#FATCA in 9 minutes http://t.co/GcdyLi16Va
— Patricia Moon (@nobledreamer16) November 5, 2014
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FATCA: An Introduction for Americans to the “Worst Law Nobody Has Ever Heard Of”: Part II
The Crash of 2008 and the 2010 Hiring Incentives to Restore Employment (HIRE) Act
In 2008 the world endured the most disastrous economic event since the great depression. It was largely caused by foolish banking practices (subprime mortgage lending resulting in the collapse of the real estate market, etc.) in the United States. At the same time America had an influx of veterans returning from service in Iraq and Afghanistan and many were ending up unemployed and homeless. In response to this crisis, in 2010 President Obama signed into law the “Hiring Incentives to Restore Employment (HIRE) Act” which, on its surface, appeared to be a necessary and humanitarian piece of legislation. However, within its pages, and largely unnoticed, unread or ill-considered by Congress, was a section relating to the matter of how the provisions of HIRE were going to be paid for. This section was, and is, called:
The Foreign Account Tax Compliance Act (FATCA)
FATCA was inspired by the US government’s “takedown” of the Swiss bank “UBS” and was supposed to enable the US government to recoup money it was losing to overseas tax havens. However, in addition to catching big fish living in the US who have actually hidden money offshore, by virtue of CBT (citizenship-based taxation) it has trawled in all “Americans” of every ilk who are just normal, middle class folk living their lives in countries outside the United States. Continue reading
What corruption lies below the surface when US politicians and bureaucrats openly cash in on favours?
I had the most interesting comment to my post that pointed out that OVDP is a money-laundering program in which the IRS takes a piece of the action (e.g., Walter White puts meth money into a foreign account and launders it through OVDP):
Yeah, it’s an amusing story; but so far-fetched, I don’t see where the humor connects with reality. Far from being “so right on”; …transferring 600’000 cash offshore, letting it sit for a while, then entering the OVDI is so impossible and far-fetched these days, that one might as well have included aliens in the story too.
Sorry, Forrest Grumpy
I really like this comment because it expresses my own doubts about what I wrote. It seems very far-fetched indeed.
Nevertheless, I’ve been personally oppressed by the policies of the Treasury Department. I’d never committed a felony until about four years ago, but now I fear to return to the country of my birth because the Bank Secrecy Act has become an instrument to extort money from me and other innocents. This oppression has opened my eyes. But still I doubt. Would government officials dispense with truth, justice and equitable application of the law? Is that really far-fetched? What is in it for them?
My November 4, 2014 Conversation with Toronto Consul-General of US: New renunciation appointments (all “LOW-PRIORITY”) extended to September 2015
This evening I attended a Toronto meeting of students, Democrats, Republicans, and Toronto US Consular officials which was sponsored by the Munk School of Global Affairs. U.S. Consul General James Dickmeyer gave a short speech and I had conversations with the C-G and two Consular officials on the wait time to obtain a renunciation meeting in Toronto.
Consular Official “R” — I pointed out to R that there are many Canadians in the Toronto area with unwanted U.S. citizenship who need to renounce this citizenship. R advised that the wait time is now up to September 2015, in part because of a three week or so delay caused by the Pan AM games (yes, you heard that right). Continue reading
FATCA: An Introduction for Americans to the “Worst Law Nobody Has Ever Heard Of”: Part I
I am a US-born Canadian citizen who is personally impacted by the Foreign Account Tax Compliance Act (FATCA), a US law that was passed in 2010. The Canadian perspective will dominate this article but the reader should be aware that FATCA affects the entire world. The full brunt of this ill-considered addition to the US tax code falls heavily upon people who live outside the United States. For this reason I ask the reader to take a few moments to stand in the shoes of a person who is associated with the United States, in my case through citizenship conferred by birth, and whose life has taken her to live elsewhere.
Canada, like the United States, is a land of immigrants. From diverse backgrounds we have come together here in North America and made our lives, having contributed to and benefited from our wonderful countries in a myriad of ways.
Like Americans, many Canadians have maintained family ties with the lands of their heritage and many have made visits to their ancestral homelands. We have probably never questioned our right to return providing we did not immigrate from countries with despotic or totalitarian governments. Within our countries we take for granted our right and ability to move freely from one state or province to another.
Now, imagine for a moment that you were born in Pennsylvania and moved as a young child to Illinois. You grew up in Illinois, prospered there, raised a family and retired there. Then one day over the dregs of your morning coffee your eye is riveted on a small headline in the back pages of the newspaper that says “Native Pennsylvanians in Illinois Beware of Little-Known Tax Law”. To your horror you read that everyone born in Pennsylvania, even if they haven’t lived there for decades must file Pennsylvania tax returns and “out-of-state bank account reports” annually for life. The penalties for not doing so are draconian and could include jail time unless you enter a special “amnesty program” which would reduce the “failure-to-file” penalties from 50% to 27.5% of your assets and allow you to skip your stay as a “guest” of the state.
It sounds like a bad plot for a novel yet today this ridiculous domestic scenario is actually playing out on the international stage for people who are unfortunate enough to hail from one particular nation. Sadly, that nation is the United States of America.
The following will help to explain what is happening and why the issue so desperately needs the serious attention of everyone.
Citizenship-Based Taxation (CBT)
To understand the origins of our current situation we need to explore the concept of “citizenship-based taxation” (CBT). Continue reading
Is the Offshore Voluntary Disclosure Program (OVDP) Walter White’s money laundering dream?
In the five season series Breaking Bad, Walter White earns an untold amount of cash through the production of blue crystal methamphetamine. In order to launder this money, his wife, Skylar, insists that they buy a car wash, through which she produces false invoices for cash sales. But in this scene Skylar shows Walt the cash that he’s brought to the car wash. She has moved it to a storage locker. She says she can’t launder this much money–not in ten years or even a lifetime.
What Skylar could not do through a car wash with less than a million dollars of gross revenue per year, the IRS has made possible through Offshore Voluntary Disclosure Program. First, one transfers the funds to an offshore account. Second, one enters the voluntary disclosure program and pays all back taxes, fines, interest and a in-lieu of FBAR fine of 27.5%. The money is now freshly laundered and can pay for Walter White’s childrens’ education, the legal costs for the defense of Skylar against criminal charges, and his extended family’s escalating health care expenses.
How Much More Money will have Exited USA due to FBAR, CBT, and #FATCA?
Realizing the only thing that USA acts upon is money, they need to know that they are going to have less of it. The heck with voting, and pleading with congresspersons and media for favorable treatment. Since 2010, there has been little effect. Now is the time to show the US extra-territorial tax system (with FBAR, CBT, and #FATCA) for the Loser it really is.
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The intention of this post is to share information about how money has been and will be leaving USA as a result of Citizenship-Based Taxation, the FBAR requirements, FATCA, and the US media’s negative image of its own citizens overseas. The information can be classified as to whether it is directly attributable to those actions, or to some level of “probably” attributable to the actions of one of the above. This post can be a reference and any info can be used to show FATCA, FBAR, and CBT and their authors as true Losers.
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I can note a few items. Firstly, the US induced a huge problem upon the world’s financial systems. With its greed for $8.5-$8.9 billion, it unleashed a $200 billion compliance program upon the world. A huge global loss created by a bunch of zeroes. These costs are directly attributed to FATCA and are quantified.
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In the short-sided FATCA greedy grab, the expectation is for millions of useless FBAR forms to be processed by FINCEN and the IRS. None of these forms are meant to collect IRS revenue. Each additional form probably creates 0.5 to 1 working hour. And with the IRS attributing each hour up to $200, the amount of money being sucked up by the IRS paper-pushers must add up to far more than the $8.9 billion. And the IRS is warning the public that its FATCA and Obamacare systems are going to sink their already incompetent, corrupt, and overloaded system. This is money directly lost by the imposition of FATCA and FBAR and CBT.
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Recently, Singapore and China signed a currency deal to further bypass the US-reserve currency system and trade their own currencies directly to up to $470 billion. This cuts out the US currency middleman. The decision to do this was a combination of factors, with the US FATCA system likely being a final straw and creating encouragement for these countries to make this deal, which is obviously much smarter than having to use US financial systems and the burdens of their FATCA system.
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Another personal item, is that I looked at FBAR requirements and FATCA, and I determined that the US is a very unsafe place to invest. Whereas, in the first part of my life, I had been investing my savings and retirement funds in US financial institutions, I decided to eliminate these US investments and move over to other avenues. Everything that I had gained and saved until I was 40-some years old is now removed from USA. This amount represented 1/4 to 1/3 of my investments. For reasons of security versus certain NSA tracking, I won’t further quantify this.
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Not only have I consciously removed these items from US products, the US’ has consciously decided to bar myself from investing in US products. Shortly after removing myself from Fidelity, Fidelity informed me that they don’t want any of my investments. I have been happy to oblige them. As soon as I am able, I will also divest myself of the IRA investments which are stuck in the USA. Perhaps I must wait a few years or perhaps I must decide to take the IRA penalty simply to get my assets outside the reach of USA. Soon, all of my US retirement income will be gone and outside of USA and all of my investments will be fully removed from USA. Soon, the definitive number for my investments in USA is ZERO.
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Another US self-induced problem is a law equally stupid as FATCA—the Securities Act of 1933, which disallows US citizens from purchasing US financial products from their local bank in their country of residence. Since this stupid law has not been addressed during the last 81 yrs, the US itself has lost its own money. Now with the awakening of FATCA and FBAR, all the banks of the world will certainly be required to enforce this stupid law and make absolutely certain that none of the 7.6 million US citizens and countless other US persons do NOT invest in US products wherever they are located. More money draining out of USA. No doubt, there is much more than $8.9 billion of US investments wrongly held by US persons overseas. FATCA will make sure that the stupid law is followed and that these US investments are eliminated.
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What is critical for the US to realize is that it has already lost more than its greedy $8.9 billion grab. This should be made obvious to them. Where have you seen money leaving USA?
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How can the US be informed of this exodus of investments from USA?
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How can you make absolutely sure that your investments are as far away from US as possible.
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How much more future investment is likely to move out of the US system?
Our Tricia Moon on Canada AM
Canada AM: US tax backlashApproaching GATCA? “Foreigners” (and not just U.S. foreigners) in Israel finding themselves ensnared …
…He was asked to sign a declaration that the account and all the money in it had been reported to the tax authorities in his home country and he had paid everything that was due on it.
The man refused and then came the next surprise: The bank refused to let him withdraw his money. He explained that he didn’t speak Hebrew and wanted the declaration to be read and translated by a lawyer. He reminded the bankers that he was a client of long standing and had been told when he opened his account that he would not be asked questions like that. It was all to no avail.
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Related (from another Brocker):
I remember reading a lawyer wrote that all the g7 wanted fatca type reporting…the u.s took the lead…the rest will follow..the Israel has fatca type arrangements with Europe…probably the igas crush everything related to privacy so it’s easier now.
Here is the fax of Bank Hapolaim, an Israeli bank, requiring Canadians and EU member residents and/or immigrants (or CFCs) from those locations sign away their rights similar to US citizens: Israeli Bank(s) Declaration — shall apply with respect to any existing Account and any future Account, if relevant
The Real Intent of #FATCA: You are not “Collateral Damage” — You are the Target
Telling your Congressman or your media contact that you are “Collateral Damage” has no effect. Your Congressman doesn’t give a sh_t—because you are not collateral damage—you are the target.
This article is a cross post from: http://samuelclemmons.wordpress.com/2014/10/27/the-real-intent-of-fatca-you-are-not-collateral-damage-you-are-the-target/
The term “collateral damage” shows up in all the articles, all the pleas to Congress, and in the Talking Points of Lemmings Abroad. It’s not really a damaging label—unless you believe it to be true and don’t plan otherwise.
Let’s stop talking about FATCA’s “collateral damage” and start discussing real intent. FATCA is the enforcement tool to collect IRS taxes and penalties from non US residents receiving no standard government services (schools, roads, education, or social welfare). FATCA talking points contradict the administration’s own statements upon FATCA intentions.
FATCA funded the 2010 Jobs for Mainstreet Act–a domestic jobs bill. It purports to collect $8.5-$8.9 billion of tax and penalties over ten years, by identifying previously-undertaxed US citizens overseas. It demands the world’s banks to aggressively identify their residents who are US citizens, forwarding their identities to the IRS for taxation and penalties.
FATCA aggressively enforces the US’ globally-unique taxation system, which uniquely taxes-up its non-resident US citizens to the highest of the tax rates of their residence country or US. This includes any previously under-taxed non-US retirement products, unemployment benefits, home sale gains, and anything above $95,000 earned in countries like UAE (UAE’s high corporate tax eliminates personal tax).