Monthly Archives: March 2015

Residents of Stanstead Quebec Wake up to Their OMG Moment

This past Monday a radio interview (in English) on CBC Radio Quebec aired; seemingly an an introduction to FATCA for this little town right on the border with Vermont. One can clearly hear the fear and confusion in some of the residents interviewed, including the mayor.

While some of the information is not quite accurate, the situation they face is something we understand all too well. The CBC is interested in comments, which gives us a chance to reach out to fellow Canadians in Quebec who are afflicted with this problem.
Phone: 1 888 691 3476
You can see some of the comments on their Facebook page:

John Richardson was interviewed as well and has offered some thoughts for them to consider:

We have had virtually no contact with anyone in Quebec other than a few via Info Sessions in Montreal/at McGill last year.Please consider commenting at Facebook, tweeting and doing whatever you can to reach out to get this message across. And please don’t forget to mention the ADCS-ADSC lawsuit! Thanks!

What FATCA Did to a U.S. Military Veteran

Here is the story of what FATCA did to US Military Veteran Daniel Kuttel (aka Swiss Pinoy). veteran_proud
Daniel wrote this to Jubilee Network which has been promoting the myth that FATCA is intended to end corruption and that we are all the cause of global poverty.

Dear Mr. Hanauer,
I risked my life serving in the US military to defend America. While on active duty, I served in an active deployment unit which was ready to be deployed anywhere in the world within 72 hours to defend America. Have you ever risked your life for America, for the American people or even for an American living abroad?
After serving in the US military, my car broke down in the Nevada desert while I was moving to California, so I sold it for a night in a hotel room since I didn’t have any money to repair it. I then put my belongings into boxes and took the greyhound bus, from which my bicycle was stolen. Later, I got a general discharge from the Army reserves because I didn’t have the money to buy a car to report for duty! It wasn’t until many years later that I was able to afford a salvaged Geo Metro with a motor hood that was fastened down with a loose bolt! Once while driving along the freeway, the bolt came lose and the hood banged upon the front windshield, blocking my view. I was lucky to be able to pull over without getting into an accident.
Then, I lost my job, car and home during the dot-com crisis. I might have been able to stay in America if the check to finance the visa for my wife to join me hadn’t bounced since my bank account had been cancelled. My retirement savings was also cashed and taxed without my approval. Being unable to find work in the glutted job market, I put some clothes into a backpack and went job-hunting in Europe. Eventually, I found work, repaid my debts in the US and saved to be able to get a mortgage. For many years, my wife and I did not have any children because I feared losing my job again and since we struggled financially.
Living in Switzerland, I continued to fight for America, debating for years the most controversial and heated conflict. Often, I was the only American voice speaking out diplomatically against anti-American hostility. I provided a lone American voice which challenged negative stereotypes about Americans. I donated thousands of hours of my time for America and was never given a single penny in return. I didn’t even get any thanks or recognition. My time spent for America was for free and for my own personal satisfaction with no gain of any kind.
In 2012, my mortgage was soon to expire, so I scanned the market for refinancing options and learned that most banks were rejecting clients with US citizenship due to FATCA. FATCA caused Americans to be seen as being a risk. So, I contacted HUD and the VA, but they replied that they do not help Americans overseas. I then contacted various US politicians, but they either didn’t respond or they stated that anything that they did for US expats would be used against them by the opposing party. Other people accused me of being a tax cheat or having a poor banking record.
Can you imagine how it feels to be discriminated against for being American because of the US government, after having spent decades fighting for America? Can you even attempt to begin to picture how angry I am?
Since I didn’t want to risk losing my home a second time, since nobody cared about me or was willing to help, I gathered the strength to renounce US citizenship. After doing so, my bank reported in the press that it had closed the bank accounts of all of its US clients that it was able to contact. By renouncing US citizenship, I had thus saved my mortgage. I didn’t lose it a second time. I also wasn’t thrown out of any banks again.
After renouncing, I spent many free hours of my time helping and supporting Americans living abroad. Yet, instead of challenging non-American hostility against Americans, I challenged American hostility against Americans. Again, I’m was never paid to do this, I gained nothing from it and never received any kind of recognition or thanks from the US government. Yet, I’m still fighting for America as a non-US citizen since I feel for the people who are suffering and since I know that this situation is not right.
If you were to put yourself into my shoes, could you even begin to imagine how this feels? There are no words to describe this. I am angry, very angry. Yet, I continue to do what I have always done, and that is to fight for what is right, against all the odds.
You know, there is one thing that my sister would really want, and that would be for me to live near her in Colorado. Yet, I cannot do so since I am no longer a US citizen, due to FATCA. My family is divided. My daughter is a US citizen but not my son.
I know that you want FATCA more than anything in the world, but is the pain and suffering caused from such really worth it? If your foundation protects the poor from predatory financial behavior, then where have you been? I’ve been seeking your help for many years now and now that I’ve finally found you, will you really be true to the efforts of the Jubilee Network? I’m hoping to hear from you again.
Best regards,
Daniel Kuettel

It's Real -Amendment to Budget Resolution Sets Stage for Repeal of FATCA

[Congressional Record Volume 161, Number 50 (Wednesday, March 25, 2015)]
[Pages S1901-S1956]
From the Congressional Record Online |through the Government Printing Office []
SA 621. Mr. WICKER submitted an amendment intended to be proposed by
him to the concurrent resolution S. Con. Res. 11, setting forth the
congressional budget for the United States Government for fiscal year
2016 and setting forth the appropriate budgetary levels for fiscal
years 2017 through 2025; which was ordered to lie on the table; as
At the appropriate place, insert the following:
The Chairman of the Committee on the Budget of the Senate
may revise the allocations of a committee or committees,
aggregates, and other appropriate levels in this resolution
for one or more bills, joint resolutions, amendments,
amendments between the Houses, motions, or conference reports
relating to fairness of United States taxpayers, which may
include the repeal of the provisions commonly known as the
Foreign Account Tax Compliance Act, by the amounts provided
in such legislation for that purpose, provided that such
legislation would not increase the deficit over either the
period of the total of fiscal years 2016 through 2020 or the
period of the total of fiscal years 2016 through 2025.
Hat Tip to Tim

FATCA Letter to Leaders and MPs

In this election year, ADCS has sent letters requesting Party policy on FATCA:
Letter to Leader of NDP
Letter to Leader of Liberals
Letter to Leader of Green Party
Letter to Leader of Conservatives
Copies of that letter to several Opposition Critics, Cabinet Ministers or some MPs.
As you can see, these letters are very similar. We ask direct questions relating to FATCA. As an example, here is the content of the letter to Thomas Mulcair:

Thank you to you, the NDP and some of your MPs for standing up for Canadian citizens and residents, whether born in the United States, in Canada or in any other country, against the American Foreign Account Tax Compliance Act (FATCA) Intergovernmental Agreement (IGA) enabling legislation.
You may be aware we have commenced litigation against the Government of Canada resulting from the Conservative government surrendering Canadian citizens, residents, laws, constitution and sovereignty to the United States for FATCA.
We are disappointed at your near silence since the FATCA enabling act was passed. We are, therefore, contacting you now to request your party’s policy in writing on what you would do if the NDP is elected to form the next government.
Specifically, we ask:
1. Will your party commit to repealing the FATCA IGA in its entirety?
2. If not, why not?
3. What action will your party take to protect Canadian citizens and residents from the demands of a foreign government under FATCA?
4. What action will your party take to uphold Canadian laws, the constitution, the Charter of Rights and Freedoms and Canadian sovereignty as they relate to FATCA?
5. What action will your party take to agree with our lawsuit that the FATCA enabling Act violates the Charter of Rights and Freedoms and Canada’s constitution? Will you direct the Ministry of Justice to quickly reach an acceptable settlement with us?
6. What action will your party take to ensure a foreign law does not prevail over Canadian privacy, human rights, banking and other laws?
7. What is your time frame for any commitment you may make?
Approximately one million Canadians, their families and business associates are affected by FATCA and many will want to know which party represents their needs and rights. Many will make their voting decision based on this.
We hope the NDP will fight for their rights as Canadians.

I will advise you of the responses we receive or if we do not receive responses.
Other Canadians may wish to write to their MPs and/or candidates in their ridings. You can share responses you receive here.

Relinquished Decades Ago: Still a U.S. Tax Citizen or Not?

Lawyer Virginia La Torre Jeker in Dubai has a fascinating Two Part (and a coming Part Three featuring John Richardson) article Living in the Past: Citizenship Relinquishments: Am I Still A U.S. Tax Citizen?
She addresses the issue many of us are experiencing. We were told decades ago we were “permanently and irrevocably” relinquishing U.S. citizenship when we became citizens of other countries.
Part 1 addresses One Country, Two Citizenships.
She makes it clear reading this is not for the faint of heart. She says:

It may come as a surprise to learn that the United States of America, while one country, has two forms of citizenship. One form reaps many benefits; while the other form bears only fiscal burdens. One country – Two citizenships? Yes – it is true.

She also makes writes about the frightful trip back to the future many of us are experiencing as to whether we are or are not “tax citizens” of a foreign government.
While Part I deals with ways people can relinquish U.S. Citizenship for Immigration and Nationality purposes, Part 2 focuses on U.S. TAX citizens.
It’s complex but thorough. Stay tuned. I will post Part 3 when it is available.
Unfortunately, she does not cover the issue of those whoibecame citizens of other countries as minors or the issue of Accidental Americans.
UPDATE March 24, 2015 Virgina La Torre Jeker responded to a comment I made on this article. She pointed out she wrote an article last month about minors and about mental incapacity issues. Unfortunately, it confirms the nightmare the title of her article Help! I Want to Expatriate but they won`t let me.
In her response to my comment to her, on the subject of minors, she responded:

Another very difficult topic. While I am not an immigration lawyer, I understand that parents can apply for their minor children to become naturalized US citizens. From what I understand – No consent or understanding is required of the child in order for them to be naturalized as citizens. The parent can do all of this for the minor child. Again, this is my understanding & if it is incorrect, I would appreciate the relevant information. On the other hand, a parent cannot renounce US citizenship for his or her minor child. Only the child can do it and of course, not until he has reached a certain age and level of maturity so that the Dept of State is satisfied he has the mental capacity to know what he is doing when renouncing. I found this disparate treatment of the child’s rights and the parents’ rights with respect to the child’s US citizenship to be rather uneven and quite interesting.

Updated March 30, 2014 Part 3
was posted today.
It contains a lot of legal and technical information, including input from John Richardson. Ms. La Torre Jeker seems to concur with the position that those who relinquished U.S. citizenship prior to 2008 or 2004 are not U.S. “tax citizens.”
However, as John notes, many of the compliance fanatics are trying to turn their advice into a self-fulfilling prophecy.
My non-legal advice is don’t fall into the self-fulfilling prophecy trap!

Reminder: "Have You Received a #FATCA Letter?" Hamilton ON March 26


HAMILTON Thursday, March 26, 2015
6:30 – 8:30 pm – $20.00
McMaster Innovation Park Room 1A, 175 Longwood Road S.,
Hamilton, ON L8P 0A1 MAP

Why am I getting letters from my bank all of a sudden?
What individuals are U.S. taxpayers? Who is a U.S. citizen?
I have never heard of these requirements! What determines the income that must be reported to the IRS? What “Information Returns” are required to be reported to the IRS?
I am only a snowbird! Why does this affect me?
What are the ways I can become compliant?
What costs are involved in renouncing U.S. citizenship?

WHO: John Richardson, B.A., L.L.B., J.D., is a Toronto lawyer and a member of the Ontario Bar.
Hope to see you, your families and friends! Spread the word!
Information presented is NOT intended or offered as legal or accounting advice specific to your situation.
Next Information Session:
LONDON Thursday, April 23, 2015
6:00 – 8:00 pm – $20.00
London ON N6C 3P6 MAP
(location is the **Landon (not a typo) Branch of the London Public Library)

Update from CCLA on FATCA Lawsuit

I have again been in contact with Abby Deshman at Canadian Civil Liberties Association. Abby has advised they are currently researching whether they will be involved in our FATCA lawsuit.
Here is the content of an e-mail I just received from Abby. I am posting it here with her consent.

Dear Lynne,
Thank you very much for getting in touch with us regarding the ongoing litigation over FATCA and the implications of the recent legislation and inter-governmental agreement.
You have asked for more information about CCLA’s process for deciding whether or not to intervene in a particular case, as well as an update on whether we intend to intervene in the Hillis v. Canada case. The CCLA prioritizes its research and intervention decisions to match litigation deadlines. In every case that is brought to our attention, we conduct background legal and policy research to help assess whether we want to intervene, and if so what position the organization will take. All intervention decisions are approved by our General Counsel, and in some cases our Board of Directors as well. We generally focus cases that raise public interest and systemic issues, and frequently direct our resources towards the cases that have will set binding legal precedent (for example, appellate cases).
While CCLA is not able to get involved in every case that is brought to our attention, this is an issue we have spoken out on before, and that we are actively looking at for a possible intervention when the time comes. We are currently in the legal and policy research phase, and hope to complete that work in the near future. We will definitely let you know as soon as we can when we decide whether we are intervening in the case.
I hope this information helps, please feel free to get in touch with Laura Berger if you would like to discuss this matter further.
Best regards,

Goodbye Uncle Sam. FATCA Causing Renunciations

Goodbye Uncle Sam in the Houston Law Review is about how FATCA is causing Americans to renounce citizenship in record numbers.
I have not yet read it in detail, but it appears to be a very comprehensive document.
I especially like this statement on page 3:

in order to slow down the rate of Americans renouncing their citizenship as well as to make life better for U.S. persons living abroad, FATCA needs to be repealed or, at a minimum, drastically amended.

Plus, the author also references our lawsuit on page 29, reporting that:

A group of Canadian citizens has sued the Canadian government challenging its FATCA agreement with the United States. The plaintiffs are angered that the deal requires Canadian financial institutions to give the IRS private information regarding the bank accounts of Americans and their family members living in Canada regardless of wether those family members are American or Canadian nationals…

Thanks to Badger for this great find and for pointing out that articles written by Victoria Ferauge and Lynne Swanson are referenced in the article.

A Young #Americanabroad Has a Fantastic Reply to the Young Turks

I am sure a lot of Sandboxers will remember how horrifying it was to listen to this video referred to in this post. I remember thinking it couldn’t possibly be real and assumed at first, that it was a spoof. It was really that bad.

The above tweet links to a video made by a young man studying in Germany who apparently has heard the Turks and this is his response. He obviously has a much better grip on the facts. Interesting to see a young person’s reaction to this dilemma. Worth a listen.

John Richardson, Co-Chair and Legal Counsel of ADCS-ADSC, introduces Professor Daniel Shaviro by saying "It is encouraging to see that "citizenship taxation" is being considered in law school classes."

I am happy this morning to cross-post today’s ADCS-ADSC blog entry…

“Repealing “Citizenship Taxation”: The difficult we do today, the impossible takes a little longer”.

which starts out with:

The Alliance For The Defence of Canadian Sovereignty is prosecuting a lawsuit against the Government of Canada. The lawsuit is for the purpose of “striking down Canada’s FATCA IGA”. The Canada FATCA IGA lawsuit is providing citizenship leadership and FATCA education for the world.
The primary purpose of FATCA is to enforce U.S. “citizenship taxation”. In reality, U.S. “citizenship taxation” is taxation based on the immutable characteristic of “place of birth”.
Although “citizenship taxation” may have always been U.S. law it has NOT always been U.S. practice. In fact, the U.S. made no attempt to enforce “citizenship taxation” until sometime after the 2008 financial crisis. The reasons for the enforcement are not entirely clear, but the enforcement of “citizenship taxation” has been a “life altering” event for Americans abroad. For Americans abroad, “citizenship taxation” is NOT a theoretical concept.  It is a reality that impacts on virtually every aspect of their lives. It directly affects their career opportunities, their retirement planning and (for those Americans with an “alien spouse”) their marriages. This has led to cries of anguish and pleas for change. It has led to a huge surge in the “relinquishments” of U.S. citizenship. On March 2, 2015 I participated in a session for U.S. citizens in London. A comment about the about the session and the recent enforcement of U.S. citizenship taxation included…

I would add that it was evident that some people at the meeting have suffered significant mental anguish, either now or in the past. These are good people, who had tried as US citizens to do the right thing, but who have been stymied by rules and complexities of the IRS code which, to paraphrase John, “no rational person would ever have suspected or guessed would remotely be true”.

I find the damage to mind and body to be one of the most heart-rending things about this whole mess. Someone wrote to me recently, “So I’m not alone in my panic!! Yeah, there’s been plenty of sleepless nights. Just can’t get it out of my head.” Many reading have had that experience.

I am waiting for the day that someone in government finally notices and apologies, perhaps admitting, “We tortured some folks.”

In the short term, the implementation of FATCA will exacerbate the “pain”. On the other hand, the “pain” may be the necessary impetus for change. In order for there to be “change”, there must be some discussion and analysis of the issue. In order for there to be analysis, there must be awareness of the problems of “citizenship taxation”. That’s the reality of what has been unleashed by FBAR, FATCA, PFIC, CFC and the whole “Alphabet Soup” list of provisions which have changed the lives of Americans abroad.
The good news is that awareness of “citizenship taxation” is growing. The awareness is “growing” largely because of the efforts of Americans abroad (including those who identify as Americans abroad and  “accidentals” who simply do NOT regard themselves as Americans). The following groups (working independently) have been responsible for this awareness:

John Richardson also introduces a new voice in commentary by Professor Daniel Shaviro:

9. It is encouraging to see that “citizenship taxation” is being considered in law school classes. Two recent examples include:

A. The tax policy and law workshops at the Peter A. Allard School of Law – University of  British Columbia. On Friday February 27, 2015, Professor Ruth Mason discussed her recent paper on “citizenship taxation”.

B. The Tax Policy and Public Finance Colloquium and Seminar run by Professors Daniel Shaviro and Alan Viard of NYU law school. On Tuesday March 3, 2015 Professor Ruth Mason was in attendance to discuss “citizenship taxation”.

Professor Daniel Shaviro commentary on the Ruth Mason presentation – March 4, 2015

Professor Shaviro’s perceptions of “citizenship taxation” (based largely on the Mason presentation) appear as a separate blog post here.

His post identifies (and categorizes) many of the “theoretical concerns” of “citizenship taxation”. He begins by saying:

Yesterday at the colloquium, Ruth Mason discussed her paper, Citizenship Taxation.  I enjoyed reading it enough to conclude that I may want to write about this topic as well.  (I generally agree with the paper, but it’s a rich topic and perhaps a fruitful area for me to deploy some of my interests and approaches.)

His post contains 10 interesting points. I would like to identify what I consider to be the most interesting and important two…

The John Richardson, ADCS-ADSC Co-Chair and Legal Counsel, ADCS-ADCS entry ends by saying:

U.S. “citizenship taxation” is a problem for:

1. The individuals affected by it.

2. The countries where U.S. citizens reside which are required to accept the capital outflows inflicted by “citizenship taxation”.

In 2009 few would have imagined that the problems of “citizenship taxation” would be given the attention that they are today.

As they say in the Marines:

“The difficult we do today. The impossible takes a bit longer.”

Keep up the great work! Keep the faith!

John Richardson