Liberty and justice for all United States persons abroad

The Isaac Brock Society

Federal Register lists 1,379 people who didn’t want to wait for U.S. election results

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The folks over at the Federal Register have put the “Internal” Revenue Service’s Q3 2016 Quarterly Publication of Individuals Who Have Chosen to Expatriate up for public inspection. I count 1,379 names of newly-minted ex-U.S. citizens in this list, making it the second-largest list ever published (beaten only by the Q3 2015 list, which had 1,426 names).

The list is scheduled for official publication on 10 November, eleven days later than the 30-day deadline specified by 26 USC § 6039G(d). Obama’s Treasury Secretaries have only managed to meet the list’s deadline eight times out of 31 during his term as president (three so far for Jack Lew, and five for Tim Geithner, assuming we count the late Q4 2012 list as being his fault). However, Bush’s appointees didn’t have a much better track record: Hank Paulson only published one list on time during eleven quarters, while John Snow holds the all-time delay record of 516 days for the Q3 2005 list.

Who are the people in this list?

The latest list was published just after the news broke that Donald Trump won the U.S. presidential election, but contrary to media hype, there’s very little connection between that news and people who choose to give up U.S. citizenship. After every U.S. election you can find all sorts of hysterical Internet surfers claiming they want to renounce their citizenship and flee the new regime, but for the most part these aren’t the people who actually move abroad, let alone go to a U.S. consulate and pay $2,350 for State Department bureaucrats to push renunciation papers around.

First and foremost, all of the people in the Federal Register list already live in other countries, and have been living there since long before the election. This latest list includes people who are known from media reports to have given up U.S. citizenship as recently as July, though most probably made their final visit to the U.S. consulate late last year or early this year.

Some were self-identifying Americans abroad who saw cutting off their legal ties to Washington, DC (and its coterie of self-serving revolving-door bureaucrats who pretend they don’t know that they’re ruining our lives) as the only way to survive all the damage that previous presidents and Congresses inflicted on the diaspora. They’d reached their breaking points long before anyone knew who’d even be on the ballot in November, let alone how long it would take the next administration to follow through on its promises to make things right.

Others considered themselves primarily as citizens of other countries, and saw U.S. citizenship as a barrier to their lives in the country they considered home. They didn’t have any stake in who’d be U.S. president — but instead of making it easy for these de facto non-Americans to become de jure non-Americans, the U.S. government put all sorts of unnecessary barriers in their way, turning what should have been an amicable split into a bureaucratic nightmare.

Why isn’t my name in there?

In addition to being late, the Federal Register list is widely recognised as being incomplete too. Aside from the IRS, the FBI also maintains a list of renunciants in the National Instant Criminal Background Check System gun control database (NICS), in order to enforce provisions of federal law (18 USC 922(g)(7)) barring renunciants from purchasing firearms. They don’t make the names public, but each month they publish a report on the size of the database; according to those reports, the FBI added 4,240 renunciant records from the beginning of this year until 30 September (growing from 32,666 to 36,906).

In contrast, the Federal Register only gave us 3,046 renunciants and relinquishers over the same period (509 last quarter, and 1,158 in Q1). And that’s not even mentioning the tens of thousands of people who abandon green cards each year, whom the Federal Register list misleadingly implies are included as well (“[f]or purposes of this listing, long-term residents, as defined in section 877(e)(2), are treated as if they were citizens of the United States who lost citizenship”).

As always, after the jump please find an updated table of people who are known from media reports to have given up U.S. citizenship recently, including whether or not their names have appeared in the Federal Register.

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Now’s the Time – Here’s What They Promised – Let’s Hold Them to It

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UPDATE SUNDAY NOVEMBER 13, 2016

REINCE PRIEBUS CHOSEN TO BE PE TRUMP’S CHIEF OF STAFF

EXCERPTS:

WASHINGTON — President-elect Donald J. Trump on Sunday chose Reince Priebus, the chairman of the Republican National Committee and a loyal campaign adviser, to be his White House chief of staff, turning to a Washington insider whose friendship with the House speaker, Paul D. Ryan, could help secure early legislative victories.

But as chief of staff, Mr. Priebus will be the one who has several hundred White House staff members reporting to him. He will be the primary gatekeeper for Mr. Trump and the person most responsible for steering the president’s agenda through Congress. That role will be especially critical for Mr. Trump, who has never served in government and has few connections to important political figures.

As Mr. Trump denounced the Republican primary process as rigged and, on occasion, threatened to quit the party and run on his own, Mr. Priebus remained neutral. And when Mr. Trump secured the nomination, Mr. Priebus stood by his side.

Mr. Priebus worked with Mr. Trump on the nuts and bolts of presidential politics, trying to smooth his rough edges and staying in close contact as a bare-bones campaign prepared to go up against the Clinton machine.


PRESS RELEASE VIA MR. PRIEBUS JULY 2015

RNC PR NO FATCA

**********

I found myself wondering just what it is expats will want to focus on now, that the Republicans have the Presidency, and control of the House and the Senate. As Stephen Kish pointed out, this could change in two years (well, really just a bit more than a year as once the campaiging for the interim elections in 2018 start, we will likely have lost our chance to get this done quickly. What we do in the next year is critical to dumping FATCA and CBT.

I started thinking about what they promised and have gone through the Platform. I am going to list the main things I found that relate to our issues; if anyone finds more, please post. I also have two documents that focus specifically on FATCA and RBT as well as the link to Republicans Overseas Resolutions posted long ago on their FB site. It would be helpful if others want to isolate points and phrases to focus on in communications to the Republicans.
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The American People Have Spoken

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President-elect Donald J. Trump.

President Trump

The NYT title says it all:

Donald Trump Is Elected President in Stunning Repudiation of the Establishment

Donald John Trump was elected the 45th president of the United States on Tuesday in a stunning culmination of an explosive, populist and polarizing campaign that took relentless aim at the institutions and long-held ideals of American democracy.

The surprise outcome, defying late polls that showed Hillary Clinton with a modest but persistent edge, threatened convulsions throughout the country and the world, where skeptics had watched with alarm as Mr. Trump’s unvarnished overtures to disillusioned voters took hold.

I watched basically all day as I did other things. It seemed to start slowly enough but once it was clear he had won Ohio, it seemed to me, that the entire dynamic changed. You could hear the puzzlement of anchors as they spoke, realizing everything they expected to see, was not happening. It wasn’t disappointment or disapproval but more an absorption, a wonderment, as to how this could be happening. Questioning how the pollsters and pundits could have gotten it so wrong. Some had no problem allowing that to have a positive edge; you could see them mentally re-arranging their thoughts. John King was the first I heard say, long before it was a given, that things were not going well for Hillary. He seemed to have a feel for it, to see the pattern present itself and then play out, state by state. It was fascinating to watch him go through each one, accurately assessing which pockets had yet to be counted, which ones would go to Hillary but as things progressed, would still not be enough.

A long long wait to get the final counts for Wisconsin, Michigan and Pennsylvania (which earlier in the evening, had seemed clearly in the Democrat’s pocket). Trump had 244 electoral votes with 9 states to go. It was pretty obvious how it was going to work out in the end.

An ugly argument took place between Van Jones and Corey Lewandoski once John Podesta announced that there would be no announcement from Clinton’s end until all the votes were counted. In a very undignified and ungracious way, Lewandoski pounced on the fact that Trump had been roundly criticized for saying he might not accept the results of the election. He did not listen when it was suggested that if Trump were in Hillary’s shoes, he likely would have waited too, until every vote had been counted. I believe in that exchange also came the statement that Hillary would be investigated for all of her alleged issues.

That aside, the DOW fell 1000 points the last time I checked. The USD was worth $0.75 CDN. Just like that. The Senate remains Republican; thank God Chuck Schumer, will not be the Senate Majority leader. (What a nice taste of revenge for expats.) Let’s hope we see some of what was in the Republican platform, though I expect it may take some time to get to it. At least we can envision tax reform. This time, we will be speaking to a more receptive group.

So, the American people have chosen to strike down the establishment. It is not difficult to understand. In spite of some of Mr. Trump’s less-than-dignified ideas/statements about Muslims, women, Mexicans, et al, the American people said “Enough” to the useless bureaucracy of Washington. I don’t blame them.

FINALLY, IT’s OVER!

November 2016 Status Report on ADCS-ADSC Canadian FATCA Lawsuit

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I want to give you a status update on the Alliance for the Defence of Canadian Sovereignty (ADCS-ADSC) “FATCA IGA” lawsuit against Canada’s Justin Trudeau Government.

Our lawsuit argues that the Canadian legislation that enables the U.S.-Canada FATCA “agreement”, made under threat of financial penalty imposed by the U.S., violates Canada’s Charter of Rights and our Constitution.

The Case Management Judge who is handling the logistics of the lawsuit has asked for a status update from Plaintiffs Ginny, Gwen, and Kazia. Our Vancouver litigators responded on their behalf on November 4, 2016 and said:

“We can advise that counsel for the Attorney General has advised counsel for the Plaintiffs that the Attorney General will be filing a motion for production of documents and particulars within the next two weeks.

The Plaintiffs intend to file a summary trial motion and supporting materials by December 2016. The Attorney General takes the position that a summary trial cannot proceed, even with respect to setting dates for service of materials in response, until the Attorney General’s motions have been resolved, any resulting orders satisfied, and examinations for discovery of the Plaintiffs have been completed.”

This means that our litigators expect to provide the Court with the submission for the Constitutional-Charter FATCA IGA trial (including expert testimonies and witness affidavits) by December 2016.

However, there is ongoing back and forth between Government and our side regarding timing of the production of “documents” (I can’t go into the details). These disagreements will have to be sorted out by the Court and could result in a delay in the trial, which will be held in Federal Court next year.

I know that litigation moves slowly, will keep you posted on developments, and thank you for your patience.

The Claims can be found HERE.

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US Intention to Pursue Enforcement in Spite of Foreign Laws

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Philadelphia Tax Conference Wednesday, November 2, 2016:

“We will pursue enforcement of a Bank of Nova Scotia summons when a domestic entity has dominion or control over records located outside the United States, even where the domestic entity asserts that production may be a violation of foreign law, if our interest in combatting tax evasion substantially outweighs the interest in foreign jurisdictions in allowing banks to preserve the privacy of their customers.“

 
Bank of Nova Scotia summons

V. CONCLUSION

Absent direction from the Legislative and Executive branches of our federal government, we are not willing to emasculate the grand jury process whenever a foreign nation attempts to block our criminal justice process. It is unfortunate the Bank of Nova Scotia suffers from differing legal commands of separate sovereigns, but as we stated in Field:
In a world where commercial transactions are international in scope, conflicts are inevitable. Courts and legislatures should take every reasonable precaution to avoid placing individuals in the situation [the Bank] finds [it]self. Yet, this court simply cannot acquiesce in the proposition that United States criminal investigations must be thwarted whenever there is conflict with the interest of other states.
In re Grand Jury Proceedings. United States v. Field, 535 F.2d at 410.

For the reasons stated above, the judgment entered by the district court is

AFFIRMED.

*****

I am not at all suggesting that minnows would have any need to be overly fearful. Given our government’s recent “throwing us under the bus”, I have little faith they will do anything to fight this if it becomes larger in scope.

If a bank acted outside of the tidy IGA arrangement and was involved in the exchange of private taxpayer information to the IRS (a PIPEDA violation-even if against US Persons), wouldn’t the bank open itself up to being sued?

I think it is totally possible Harden, Van deMark etc, may not be of much help given the overall shift regarding extraterritorial tax…..

********

Principal Deputy Assistant Attorney General Caroline D. Ciraolo Delivers Keynote Address at the American Bar Association’s 27th Annual Philadelphia Tax Conference
Philadelphia, PA United States ~ Wednesday, November 2, 2016
Remarks as prepared for delivery

Excerpts concerning “offshore” efforts:

In addition, since 2008, the department, working with our colleagues in IRS Criminal Investigation (IRS-CI), charged more than 160 U.S. accountholders with tax evasion and willful failure to report foreign accounts and more than 50 individuals who assisted in this criminal conduct. We also reached resolutions with nine foreign financial institutions outside of the Swiss Bank Program and continue to pursue investigations of entities located within and outside Switzerland.

Our criminal offshore enforcement efforts have encouraged participation in the IRS offshore voluntary disclosure programs, through which more than 55,000 taxpayers have come into compliance and paid nearly $10 billion in tax, interest and penalties since 2009. In addition, filing of Reports of Foreign Bank and Financial Accounts (FBARs) has increased from 332,000 reports for calendar year 2007, to over a million reports for 2015.

Our civil trial attorneys also furthered our offshore tax enforcement efforts, seeking the issuance of John Doe summonses to identify U.S. taxpayers whose identities are unknown and who are engaged in violations of the internal revenue laws and initiating summons enforcement proceedings to assist the IRS in conducting its examinations and determining the accurate tax due. The information we seek is often located in the United States; however, as we recently demonstrated in a district court in Miami, we will pursue enforcement of a Bank of Nova Scotia summons when a domestic entity has dominion or control over records located outside the United States, even where the domestic entity asserts that production may be a violation of foreign law, if our interest in combatting tax evasion substantially outweighs the interest in foreign jurisdictions in allowing banks to preserve the privacy of their customers.

Our civil trial attorneys also are actively engaged in suits involving penalties assessed for failing to file FBARs. These suits include affirmative litigation to collect unpaid penalties, and defensive litigation raising a variety of issues. We have approximately three dozen cases involving FBAR issues pending, the vast majority of which include a willfulness penalty for at least one of the years at issue. These suits have raised issues related to the computation of the penalty, burden of proof, service of process abroad, definition of a foreign account, corresponding assessments on spouses, venue, jurisdiction, and challenges under the Administrative Procedures Act.

UPDATE
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Solving U.S. Citizenship Problems-with special guest Andrew Grossman Montréal Monday December 5, 2016

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A very special meeting for “U.S. Born People” or those who are otherwise “U.S. Persons” !(Naturalized U.S. citizens or Green Card holders)

Joining John Richardson will be Andrew Grossman

Discussing the “hot topic” of U.S. citizenship (including its liabilities in a FATCA and FBAR world)

In addition to focusing on the problems faced by those who agree they are U.S. citizens (to be a citizen or not to be a citizen …), this seminar will include consideration of …

     

  • Why the US cannot automatically restore your citizenship without your consent

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  • The advantages of not making use of benefits of U.S. citizenship

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  • Why the U.S. cannot force those born abroad to accept U.S. citizenship

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  • Dominant Nationality & FATCA

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  • About the revenue rule: How is it affected by the Canada U.S. Tax Treaty? Is the Revenue Rule on the way out?

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  • Can the IRS place a lien on my assets even though I live in Canada?

The idea for this meeting grew out of Andy’s participation on a post at the Isaac Brock Society (Andy05).

“If anyone wants to follow up on issues I have raised, I will be in Montréal Dec. 1-3 & 5-6 and in Stanstead QC Dec. 3-5 and would be glad to meet for coffee and exchange views. I do not seek and scarcely ever accept clients but like to exchange views as an academic lawyer with a view to nationality law, cross-border tax and conflict of laws. French or English ok.”
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Dual Citizens of Sweden, France, Netherlands, Denmark & Canada take note! Your Country WILL NOT Collect for the U.S.

Posted on by Posted in Tax Treaties 102 Comments

cross-posted from citizenshiptaxation.ca

Last week in my email was a link to an article by Michael J DeBlis (unable to determine whether it was the father or the son). It runs in my memory that prior to the launch of the Tax Connections website, the younger Michael had started a blog that was specifically about expatriate issues and many of us joined and took part. He seemed particularly sympathetic and supportive of our plight and one who I would never have labelled a “condor.” And this post is in no way meant to be demeaning.

Imagine my surprise to read this:

Consider the following example. Pierre is a dual citizen of the U.S. and Canada who presently resides in Montreal. He has fastidiously filed U.S. and Canadian tax returns for the last ten years. Following an audit of his 2012 U.S. tax return, the IRS determined that there was a $ 20,000 deficiency and mailed him a notice of deficiency. Pierre timely filed a protest but Appeals found in favor of the IRS. Having failed to file a petition with the tax court, that deficiency soon became a $ 20,000 assessment.

The IRS now seeks to collect on its claim by imposing a tax lien on real estate owned by Pierre in Canada. Essentially, what the U.S. government is attempting to do is cajole collection officials from the Canadian Revenue Agency (Agence du revenue du Canada) to do its dirty work for it: namely, to collect Pierre’s unpaid U.S. taxes by enforcing an IRS tax lien on property located within Canada.

As incredible as this might sound, reliance upon a foreign taxing authority for assistance in collecting a tax judgment against a citizen of the requesting country is entirely permissible under the terms of the U.S.-Canadian Treaty. Of course, such a request must be accompanied by documents firmly establishing that the taxes have been finally determined.[ix]

Therefore, the Canadian Revenue Agency would have no choice but to enforce the lien and to collect the unpaid taxes. But what if Pierre filed a motion in a Canadian court to have the tax lien imposed by the Canadian Revenue Agency, at the behest of the IRS, set aside? Not surprisingly, the court would refuse Pierre’s request on the grounds that the imposition of the tax lien was proper under the terms of the treaty.

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Reminder: Solving US Citizenship Problems Toronto Sat Nov 5, 2016

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WHEN: Saturday – November 5, 2016 4:00 – 6:00 pm
WHERE: 100 St. Joseph St., Toronto ON M5S 2C4 MAP
ADMISSION:PLEASE REGISTER IN ADVANCE by email to nobledreamer16 at gmail dot com and kindly include your phone number, or phone 416-519-8172 ;
COST is $20 payable in cash at the door
WHO: John Richardson, B.A., LL.B., J.D. (Of the bars of Ontario, New York and Massachusetts), Toronto citizenship lawyer and Co-chair of the Alliance for the Defence of Canadian Sovereignty and the Alliance for the Defeat of Citizenship Taxation. citizenshipsolutions.ca

International Investment recognizes the Isaac Brock Society as global info resource on US Expat issues

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isaacbrock article 2
Screen snip of Helen Burggraf’s article in International Investment (click for full article)

The Isaac Brock Society is a direct response to the Obama administration’s criminalization of innocent expat behaviour. Helen Burggraf has written a great article in International Investment, telling our story.