Ask your questions about FATCA.

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Ask your questions about Renunciation and Relinquishment of United States Citizenship and Certificates of Loss of Nationality.

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I found this paper today as I was researching another topic for the Flophouse and the title alone, Sharing The Spoils: Taxing International Human Capital Flows, intrigued me. So I had a look (Petros has probably already read it), thought it had some interesting ideas and so I offer it up to you for your reading pleasure. After all, it is Friday (the 13th no less).

For our purposes I thought the section four on Alternative Worldwide Regimes for Individual Income Taxation starting on page 25 is worth a read:
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This post is cross posted from Renounceuscitizenship.

See also:  Roger Conklin writes about why he left Brazil in 1977 ; The US trade deficit: Was it caused by greedy companies or greedy government?

We are living in interesting times. During all the years of my tax consciousness I have lived with the assumption of U.S. citizenship-based taxation. When the IRS began its “reign of terror” on U.S. citizens living  outside the United  States and many people learned about their tax filing obligations, the discussion about citizenship-based taxation began. The U.S. is the only Western democracy and of one two countries (Eritrea being the other) which taxes on the basis of citizenship. The rest of the world taxes on the basis of residence  or what is commonly referred to as “territorial taxation”. In a global world where:

See also:

Stop Citizenship-Based Taxation – Repeal FATCA
Citizenship-based taxation, the U.S. trade deficit and the destruction of U.S. capital

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I suspected something like this was brewing. There is a projet de loi here in France that is quite similar to FATCA though it is limited to trusts.

You can read more here. (Article in English)

Here is a choice quotation:

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This post has been cross posted from renounceuscitizenship.

See also:
OVDI Switcheroo: Canadian RRSP back in the penalty base
Re: OVDI Switcheroo: Canadian RRSP back in the penalty base

Those who entered OVDI understood (hopefully) that they were paying a fine based on a percentage of a base of assets. Obviously the lower the base, the lower the amount of the penalties. An interesting thread on this appeared on the Jack Townsend blog.

For Canadians who entered OVDI (for whatever reason) there has much been much concern over whether RRSPs would be part of the base for which the OVDI penalty was calculated. People have been asking: will RRSPs be included or not? Why won’t the IRS take a position? Now, what follows is just my thinking and interpretation. It is not legal advice (or any other kind of advice). But, here is how I think you should view this and the arguments you should make. Continue reading →

Note:  “ij” is a regular on Townsend’s blog.  He is, from what I gathered, originally from China (I think), spent some time in Canada, when he opened up an RRSP account, and then moved to the United States.  He entered the 2009 OVDP and has been very worried that an RRSP in Canada would be hit with a 20% fine.  To this day, the IRS has not given guidance on RRSPs.  If IJ is correct, and RRSPs will not be subject to OVDP fines, this sets a kind of precedent for all registered retirement accounts in the world, or so it could be argued, under the Equal Protection Clause.

From Just Me:

Just saw this here, and thought some Canadians might be interested.  Can’t vouch for it….

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Here’s the story:

Swiss Accounts, Insider Trading, Mortgages: Compliance

The date of the Bloomberg article is older, so this is most likely when Mr. Reiss was charged. He was sentenced on 11 Dec. 2012 for a 1,2+ million FBAR penalty. I could be wrong, but this appears to be the first DOJ case against a non-US Citizen working in America was charged. The rest had been mostly a few US born resident-nationals, and many foreign naturalized US citizens, some of who even earned their money abroad and paid taxes abroad, yet the IRS is desperate to get their piece.

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