Liberty and justice for all United States persons abroad

The Isaac Brock Society

Debate: Citizenship & Worldwide Taxation: Is It Morally Justified or Unjustified, John Richardson vs. Edward Zelinsky, Friday 17 May

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A debate/discussion on Citizenship And Worldwide Taxation: Is It Morally Justified Or Unjustified? between John Richardson and Edward Zelinsky will take place Friday May 17, 2019,  14:00 EDT (18:00 UTC), hosted by TaxConnections, live on YouTube.   It will run for an hour-and-a-half.  

CBT is morally unjustified:  John Richardson (Lawyer, Citizenship Solutions, Toronto, Canada)

CBT is morally justified: Edward Zelinsky (Law Professor, Cardozo School of Law, New York, USA)

 

 

Click here for full information, to see the questions which have been submitted, to pre-register, and/or to submit questions   (P.S.: Note at the bottom of this page videos of people who we know.)

TaxConnections Posts which inspired this event:

The United States Imposes A Separate And Much More Punitive Tax On U.S. Citizens Who Are Residents Of Other Countries, John Richardson, TaxConnections.

 TaxConnections and CitizenshipSolutions Posts by John Richardson, Laura Snyder and Edward Zelinski written after this event was announced: Continue reading →

Disappointing May 2, 2019 Response From Pierre Moscovici, Member of European Commission, to FATCA Complaints of Sophie in’t Veld

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[The link to the Moscovici letter can be found at American Expatriates FB site and on a tweet posted by Sophie in’t Veld. There is also a response to the Moscovici letter from Fabien Lehage.]

There are efforts targeting FATCA at the European Union (EU) level. The link above shows a May 2, 2019 response from Pierre Moscovici (EU Commissioner of Economic and Financial Affairs, Taxation and Customs) to a letter complaining about FATCA from Sophie in’t Veld, an EU Member of Parliament.

In her April 5, 2019 letter Sophie says: “…Why has the Commission decided not to take an initiative and take this responsibility after ongoing problems that the extraterritorial application of FATCA pose to EU citizens?… the association des Americains Accidental brought a legal action before the Conseil d’Etat to contest the intergovernmental agreement between France and the US…it becomes clear that in the Netherlands and France, in the European banking sector and the European Parliament, the problems that Accidental Americans are facing because of FATCA are being taken seriously. It is high time that also the [EU] Commission, especially in its role as guardian of the Treaties, starts taking these problems of EU citizens seriously, and stops hiding behind excuses that it has given in the last year… With European elections in sight…”

Here are some excerpts from the letter of EU Commissioner Moscovici, responding to Sophie in’t Veld:

— “You raise a number of points on the topic of “Accidental Americans” … Nationality ties, even when acquired by “accident”, come together with the existence of reciprocal and duties, and this is at the centre of the issues you raise vis a vis the United States…”

[No, don’t agree — for example, the plaintiffs in our Canadian FATCA lawsuit dispute this as U.S. citizenship was attempted by a foreign country (US) to be imposed on these Canadians without their consent and in the absence of any meaningful relationship with the foreign country. As such, there is no legitimate or rational argument justifying this unwanted and unaccepted “citizenship” or any “duty” associated with this bogus “citizenship”. Although born in the U.S. they are not “accidental” or any kind of “American”.]

— “As regard access to banking facilities by dual EU/US citizens, I understand from the response given at the PETI meeting that only one national authority has signalled having received, albeit very few, relevant complaints, and that the analysis of the national implementation of the Payment Accounts Directive did not find any evidence of discrimination against “accidental Americans…”

— “…no figures [on the number of accidental Americans] have been provided, making it difficult to establish how many citizens are in this position…”

— “On the topic of a possible mandate to negotiate an EU FATCA agreement with the US, I remain open to any support for this from the Council. However, I do not think it useful to formally request one as to date there is no sign that Member States would support such an action…In any event, given the global approach to tax transparency, and future (re)negotiated agreement would be likely to maintain the requirement for individuals who are taxable in the U.S., including joint EU/US citizens, to provide their US TIN when they open a bank account in the EU…”

— “With regard to the recent developments in France and Netherlands, I look forward to learning how these actions develop…”

— “In the case of FATCA, like you, I very much regret that the amount of information that flows from the US to the EU Member States under their bilateral agreements is less that flows from the US to the EU. But, this does not mean that the information should not be provided to the US…”

— “To conclude, I believe that there are two main issues which are often overlooked when discussing this subject. The first concerns sovereignty. All states have the sovereign right to determine who they tax individuals and, in the case of the US, the international community has accepted double Conventions that the US reserves the right to tax its citizens, rather than only its residents. The second concerns the recent worldwide movement towards tax transparency in an effort to ensure that tax avoidance and evasion can be reduced and that every taxable person pays their fair share of taxation…”

[The Government of Canada lawyers in our FATCA lawsuit in Federal Court made in court the very same points as Moscovici in the above paragraph. Will Justice MacTavish agree with Moscovici or with plaintiffs Gwen and Kazia who insist that the Canada’s FATCA “agreement” with US violates their Charter rights (sections 8 and 15) and Canada’s sovereignty and that the FATCA IGA legislation goes too far?]

Ms. in’t Veld responds to the Moscovici letter in an article by Helen Burghof:

— “…I was not surprised by the commission’s refusal to take action – to my regret, I note that is consistent with their attitude so far – but I was surprised by the denigrating tone of the letter…The real problem is of course the blunt refusal by member state governments, with the exception of the Netherlands and France, to stand up for the rights of their citizens…File a complaint, with the data protection authorities, and/or the banking oversight bodies; join one of the associations that has been formed, inform your MP and/or MEP, use social media and traditional media, to make the message heard.”

US GAO Report: Foreign Asset Reporting: Actions Needed to Enhance Compliance Efforts, Eliminate Overlapping Requirements, and Mitigate Burdens on U.S. Persons Abroad

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The US Government Accountability Office has released an 83 page Report to Congressional Committees, “Foreign Asset Reporting: Actions Needed to Enhance Compliance Efforts, Eliminate Overlapping Requirements, and Mitigate Burdens on U.S. Persons Abroad”.  Thanks to JC for posting this link on the Media page.

Related Brock post:  April 2019 Report From GAO is evidence of how #FATCA and Foreign Asset Reporting is viewed in the Homeland by USCitizenAbroad.

Brock Pub 04: Narrative Fallacy (1)

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We like stories, we like to summarize, and we like to simplify, i.e., to reduce the dimensions of matters. The first of the problems of human nature that we examine in this section … is what I call the narrative fallacy.  (It is actually a fraud, but, to be more polite, I will call it a fallacy.) The fallacy is associated with our vulnerability to overinterpretation and our predilection for compact stories over raw truths. It severely distorts our mental representation of the world; it is particularly acute when it comes to a rare event.

The narrative fallacy addresses our limited ability to look at sequences of facts without weaving an explanation into them, or, equivalently, forcing a logical link, an arrow of relationship, upon them. Explanations bind facts together. They make them all the more easily remembered; they help them make more sense. Where this propensity can go wrong is when it increases our impression of understanding.

Nassim Nicholas Taleb (emphasis his), The Black Swan

The news media always tells stories. When it comes to the IRS problem that so-called USA citizens abroad have, there is a majority narrative fallacy, which has come out ever so clearly in the recent stories about the Duchess of Sussex and now her baby, who not yet born is already owing the IRS his loyalty and taxes. CNN has spread a particularly egregious narrative fraud based upon the testimony of David Treitel, who has a conflict of interest since his livelihood and his wealth derives from helping overseas taxpayers come into IRS compliance:

That’s because as US citizens, both Meghan and her baby — who will be seventh in line to the British throne — will be liable to pay US taxes, which could potentially open up the notoriously private royal accounts to the Internal Revenue Service (IRS)

“The United States has — unique among nations — a citizenship-based taxation (system), so as long as Meghan is a citizen of the United States she is taxed,” explained David Treitel, the founder of American Tax Returns Ltd., which provides taxation advice to US expats.

The law means US tax inspectors could scrutinize Harry and Meghan’s royal wealth, and the income of their newborn child.

The article goes from bad to ridiculous, claiming that Merkle and her baby will have to pony up taxes on such things as their home in the UK and the Crown jewelry. To summarize some of the main points of this narrative fraud:

  • The Duchess of Sussex must pay USA taxes because this is what the IRS requires.
  • There is no escape except to renounce.
  • The only law that matters is USA law.
  • UK law is by implication irrelevant.
  • The Royal family will be exposed to the IRS tax man.
  • There is by implication nothing wrong with this obligation.
  • By implication also, if the Royal Family can’t escape the IRS, you can’t either.

One reason for the existence of the Isaac Brock Society  is to provide a counter narrative to this fraud. I would respond with the following Brock narrative:

  • The unborn baby will have a say regarding what citizenship he (or she) will have. He will be born in UK to the Royal family and that means he is completely out of reach of foreign governments, not least of all the USA, just because the Crown will protect him.
  • USA law applied  not just to the Royal family but also to most other so-called USA citizens abroad is a gross overreach and done only in violation of international laws and conventions.
  • The IRS and the compliance industry are bad players, two branches of a well-organized crime syndicate, and they are acting in a manner which is immoral.
  • CNN receives advertising dollars from the compliance and the banking industries and therefore has a conflict of interest that skews their fraudulent reporting.

 

Brock Pub 0003: Preying on the weak

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https://youtu.be/3YMTAZBe6cA

Jordan Peterson accuses the government of preying on the weak, those who can easily become addicted to gambling and thus provide revenue for government coffers. In the meantime, gambling exacts an untold price upon the health of society. The government in Canada thus plays the role of organized crime in administering a vice that makes victims of the weak. We see from this that we should not look upon the government as a benevolent entity, but as a threat to our well-being.

Similarly, the IRS and compliance condors prey on the weak.  On Dec 15, 2012, at the FATCA Forum organized by John Richardson, I argued that the Canadian government’s stance, that it would not collect FBAR fines, meant that those of us affected by the threat of the IRS draconian FBAR fines would have to stand up for ourselves–we had to be Clint Eastwoods–and that left the IRS to prey upon the weak and vulnerable residents of Canada who feared what the IRS could do to them if they failed to enter the OVDP/OVDI, i.e., the last, best chance for people to get right with God. When innocent benign actors (the non-Clint Eastwoods) entered the ODVP, the IRS exacted many LCU (“life credit units”) and made their lives hell.

Remember to gamble responsibly. That’s the government’s message. And when it comes to the IRS, you are on your own.

Brock Pub 0002: On fraud and regret

Posted on by Posted in Citizenship Issues, Ethics, Issues regarding US persons abroad 74 Comments

It is now 2019, and it’s been eight full years since I was a USA citizen. My date of relinquishment was 28 February 2011, but the IRS thinks erroneously that my date of relinqhishment was 7 April 2011. That means its been over six years since I last filed taxes and the statute of limitations for the IRS challenge my tax returns has expired, at least according to criminal law. However, if the IRS wished to claim that there is fraud on my tax returns and to attack me according to civil law, there is no statute of limitations.

In the case that one of the three exceptions does apply, the IRS has an unlimited amount of time to audit and charge penalties and interest.

Specifically, the IRS’s civil division can pursue taxes, penalties and interest indefinitely, and without any time limitation, if any one of the following three situations has occurred:

1.         The Taxpayer Filed a false tax return,

2.         The Taxpayer willfully attempted to illegally evade paying taxes, or

3.         The Taxpayer Failed to file a tax return.

Of course if you are a Democrat candidate for President of the USA, fraud is not really a problem. Consider Elizabeth Warren’s attempt to pass herself off as American Indian minority, which circumstantial evidence shows that it helped to land a well-paying academic post at Harvard Law School. She had no more proof of her minority status than family anecdote and high cheek bones. Academic cheating is a serious enough problem that armed Federal Agents went to the home of Felicity Huffman,  hand-cuffed her and took her into custody. So if you use the mail system (mail fraud) to bribe your child into Harvard or Yale, you get roughshod treatment from the FBI, but if you use fraud (and the mail system) to get a position at Harvard, you can become a Democrat candidate for POTUS.

Do former Americans regret renouncing their citizenship of a country where they are constantly threatened with jail time while their politicians get away with fraud? John Richardson says, “They almost all “regret” that U.S. laws have forced them to renounce U.S. citizenship (they wish they could have remained citizens of the country of their birth); but [t]hey NEVER feel that they made the wrong decision.” I think that Mr. Richardson must have spoken with me and a few other Brockers before he wrote that.

Brock Pub 0001

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Brock Pub is where you can ask your questions or make somewhat off-topic comments.

US Supreme Court Rules Unanimously Against Excessive Fines

The excessive fines clause doesn’t prevent the federal government from actually threatening to fine you in multiples of your actual financial worth (in the case of FBAR, over 383% of your financial accounts). I’ve not seen FBAR fines applied at the rate of 300% but that doesn’t stop the IRS from threatening it. I called it a bluff. They would scare the crap out of you so that you would enter a voluntary disclosure program where you voluntarily handed over 25+% of your wealth.

A Wisconsin cruise ship passenger faces years in Cayman Islands prison after a gun was found in her luggage

A lot of Americans are apparently unaware that you shouldn’t put guns or ammo in your luggage if you are travelling to other countries.

California gas station clerk fired after ranting against woman speaking Spanish

An American gas station attendant loses her job after being rude to a bilingual woman speaking Spanish and asks her to prove that she was born in the USA. Apparently she is unaware that California used to be part of Mexico. I.e., Spanish speakers were there slightly before Trump supporters.

And a Canadian bonus:
Jody Wilson-Raybould and Jane Philpott kicked out of Liberal Party caucus

King Justin has kicked out JWR from caucas, hoping that Canadians actually believe it is less unethical to lie than it is to expose lies with an undisclosed voice recording.

Event: Congressman Holding, Proposed Changes for Taxation of Americans Abroad, London, UK, 24 April

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Republicans Overseas is hosting an event, with House bill co-sponsor Congressman George Holding, Solomon Yue and John Richardson on the Taxation Fairness for Americans Abroad Act bill, London, England, 24 April 2019.

“There is a bill to fix citizenship-based taxation for Americans! Come learn all about it from its sponsor, Representative George Holding!

Representative George Holding (R-NC) will be walking us through his bi-partisan bill that introduces residence-based taxation for all American expatriates, titled Tax Fairness for Americans Abroad Act. This could mean the end of filing income taxes for non-US residents. He will discuss the ins and outs of his legislation, and how together we can get it across the finishline!

Solomon Yue, Global CEO of Republicans Overseas, will be here again to discuss the global grassroots efforts and necessary action items for the expatriate community.

John Richardson, Canadian tax lawyer of Citizenship Solutions, will be joining us again to explain why he endorses this legislative solution from a professional perspective.

. . . . “

Full details and registration at the EventBrite site.

 

Brock Project: April 2019 Report From GAO is evidence of how #FATCA and Foreign Asset Reporting is viewed in the Homeland

Posted on by Posted in Canadian Government, FATCA, Issues regarding US persons abroad 16 Comments

Question:

The above tweet links to the a report from the Government Accountability office. It is extensive but generally interesting. A quick perusal reveals no evidence that the Government views FATCA and foreign asset reporting as tools to enforce worldwide taxation on people who live outside the United States. Yet, that is the purpose of FATCA and foreign asset reporting in general.

The “Fast Facts” page includes:

How does the government prevent tax dodgers from hiding income in offshore accounts?

A 2010 law requires Americans and foreign banks to report more information to IRS about Americans’ foreign assets. Implementing the law, however, has raised some concerns.

For example, close to 75% of taxpayers reporting foreign assets to IRS also reported them separately to Treasury—indicating potential unnecessary duplication.

Also, some Americans living abroad can’t get services from foreign banks that find the law too burdensome.

Our recommendations to Congress, Treasury, and other agencies address challenges related to foreign asset reporting.

The 2010 Foreign Account Tax Compliance Act, known as FATCA, created new reporting requirements for taxpayers with specified foreign asset

Continue reading →

Announcement

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There has been a lot of dissatisfaction expressed in recent months, on the site and in e-mails to the moderators, regarding irrelevant/off-topic comments. It’s also important that Brock provides a place for people to express their thoughts.  To strike a balance, we have installed a “move comment” function, with which we can move a comment to a different thread.

This should help keep things more focused while, at the same time, the person’s comment still appears on the site and discussion can ensue without overwhelming the original, unrelated, thread.

Moving a comment from one thread to another keeps both threads more useful to persons seeking help or information or simply having a coherent discussion on a topic.

We do not intend to eliminate thread drift from the site, just to keep certain threads focused, such as a post that deals with a project or a post focused on a specific type of information but someone posts a comment way off-topic; say, consulate problems on the FATCA thread.

Many topics overlap a lot, so don’t expect perfection — and every one of us undoubtedly has a different sense of just where “on-topic” ends and “off-topic” begins (can’t please everyone all of the time), so you may still see some comments you feel are out of place but to a lesser degree.

Thread drift is inevitable on a site that values sharing of ideas and opinions.  It can be pesky and annoying, but sometimes it’s a good thing which expands discussion; and exchanging thoughts is important part of the Brock community.  We don’t want to quench that!  But this should keep parts of the site on target.