Here at Brock, we worry – well some of us do – quite a bit about the omnipotence of the IRS and the United States government when it comes to financial institutions and taxes, but should we?
In addition to the many, many corporations and uber wealthy that seem to routinely use tax law loopholes (often written into the tax code by lobbyists they employ) to pay as little tribute to the empire as possible, it seems that undocumented workers in the United States are able to do the exact same thing. And what’s more, the IRS and members of Congress know about it and haven’t done anything to stop it.
Four billion dollars have flown out of the USA’s coffers every year for past several years in the form of a child tax credit that enterprising illegals are claiming for kids who don’t live with them and sometimes aren’t even living in the United States at all.
According to the Inspector General, interviewed in the following news vid, once the IRS issues a refund check to a “taxpayer” that money is nearly impossible to recover.
Which brings me to my point. The IRS, that Americans outside the actual physical boundaries of continental America are being told by various tax compliance agencies and entities to fear more than the Grim Reaper, is seemingly powerless to stop actual fraud – for which they have actual proof – practically down the street from it. What power then do they really have over USP’s who live across international borders and are often citizens of other countries?
In a recent discussion thread on another post, Petros – again – reminded us that those who have no ties to the USA, or need to venture there, should take time and consider the long-term ramifications before back filing any type of compliance forms (before or after) when renouncing US citizenship. He pointed out that for many – duals especially – the IRS doesn’t know they exist. Why feed the USG’s info beast? What can the really do? I mean really do. Not theoretically. What is the actual damage? And what are the real odds? And if the IRS doesn’t care about 4 billion dollars being stolen from it by people they can put their hands on, what do they really care about law abiding duals who don’t owe taxes in the first place?
Yes, FATCA is … probably … coming in some form or other and hiding will do a person no good in the longer run (although truthfully, no one is truly invisible anymore thanks to technology), but allowing fear of an agency that isn’t even able to control fraud and evasion within its own borders be the driving factor behind decisions is something that might be cause for pause.
I encourage you to watch the video. It’s not new news in terms of the hysteria in the US about undocumented workers and fraud, but it puts the dilemma, at least for me, of USP’s who’ve emigrated in another context.
The point of FATCA and the offshore jihad on expats is not about money. It’s about information, and information is power.