Partial translation: Continue reading
Do you want to Share Your US Tax Story?
Well, Democrats Abroad wants to hear from you. They are publishing a selection of stories each day and say they will use some in submission to the government.
My big question is, what has Democrats Abroad done so far? My sense is not much (neither, of course, have Republicans Abroad). If representatives of either would like to dispute that, they are free to come here and tell us differently. Don’t be surprised if we don’t agree with you.
Someone who has been a Canadian citizen for decades who got caught up in IRS snare with no one telling her she relinquished US citizenship and could get a CLN and be free of IRS.
A Belgian who had bank accounts closed. An Israeli terrorized by IRS over legal sale of stocks. A US citizen in Switzerland overwhelmed with costs and time to be compliant. A Thai businessman who finds IRS anti-business.
Then, there’s the Canadian citizen born in Canada with “US citizenship as it was passed to me, like a genetic disease, from my American father.” Legal fees to the “sharks” (aka tax lawyers) and penalties extorted through OVDI cost him six months salary. He considers himself “lucky” with a understanding wife, a mortgage to pay, and a young family to support. It seems none of those “sharks” told him CRA will not collect for IRS on Canadian citizens. He’s waiting to renounce US citizenship.
I personally am not going to tell Democrats Abroad my story as I don’t consider myself American (and I don’t trust them!) Have they told one Canadian citizen she relinquished three decades ago or told the other one born in Canada that CRA will protect him? I doubt it.
I am posting this, though, in case others want to share their experiences to try to make a difference.
As you know, Maple Sandbox is a gathering place for us to come together to share, learn, explore and grow together.
I hope What’s New will be a building block for sharing those stories from the media or your own experiences.
What’s New will allow you to post articles under one central thread, rather than spreading them out through many different threads. It also will give you the opportunity to share any other information you have with others.
Of course, some news and information will have still have threads of their own.
Please share your news, scoops and ideas.
We’ve known all along reciprocity is not really reciprocity. Not only that, but FATCA IGAs Are A Bad Deal For Partner Countries.
Why? Because the U.S. Treasury Department’s ability to enforce FATCA directly, on each and every FFI on the planet is highly questionable.
Getting IGAs signed isn’t proceeding like U.S. Treasury thought it would. Plus, faux reciprocity in Model 1 is in trouble.
Even according to an IRS manager, ““clearly existing U.S. rules don’t require U.S. financial institutions to provide the exact same information that a foreign institution has to under FATCA.”
Mr. Jatras does an excellent assessment of that:
Some have been critical of Mr. Setzer for having the bad manners to speak something like the truth out where it could be reported to those not familiar with the imbalance codified in the IGAs. But putting aside questions of indiscretion and the vague characterization of a timeframe for “full reciprocity” – something that clearly isn’t going to happen anytime soon, and probably not ever – it’s nice to have confirmed officially what most people familiar with the details prefer to obscure.
In his article, Mr. Jatras also points out many ways US has to unilaterally change or escape from an IGA after it is signed.
Moreover, an IGA provides no protection at all for one additional, simple reason: they are written on sand.
American Bankers Association have also now joined the fray
“There is no indication or evidence suggesting that the Treasury conducted the required due diligence for entering into such an automatic exchange relationship” with Mexico.
Mr. Jatras further says:
As a bad deal for all concerned, the IGAs should also be seen as a “weak link” for undermining FATCA and working for its repeal before its worst features go into effect.
Foreign governments need to stop helping to save FATCA from its own fatal flaws by signing IGAs that cannot provide promised protection for cherished institutions. Instead, they should tell Treasury in clear and principled terms that they will not allow their domestic firms to comply with FATCA, and that they’re prepared to respond with WTO and other remedies if IRS tries to apply sanctions.
Finally, firms faced with wasting untold millions of dollars to comply with FATCA need to stop pressing their governments to sign IGAs and instead help get rid of it by supporting the repeal campaign in the United States.
We need to keep up the pressure on our own governments and financial institutions.