Category Archives: FATCA

Vulnerable Americans Abroad: Legal Weight of IRS Pubs, Info, FAQs = ZILCH!

An article by Virginia La Torre
Jeker JD, at the
angloinfo blog

VLJeker

This is an excellent post. It clarifies how one can determine what the IRS really can (and can’t) do and in particular, points out how the OVDP program is NOT rooted in law. This is important for those who do not/never did belong in OVDP in the first place. OVDP is for criminals. Simply failing to file with no tax due when one is unaware of the requirements does not equate to being a criminal. And don’t forget, once OVDP is entered, there is no “reasonable cause” option available. Instead, one commits to a penalty, pretending to be guilty when likely one is not.

What’s a taxpayer to do? As if the US tax rules are not confusing enough, it’s a sad situation when taxpayers cannot rely on information supplied by the Internal Revenue Service (IRS) in the most commonly accessed and user-friendly formats – such as IRS Publications, “Frequently Asked Questions” (FAQs), news releases, videos and the like. On May 18, 2017 IRS issued a memorandum to all of its examiners reminding them that FAQs and other items posted on the IRS website www.IRS.gov that have not been published in the Internal Revenue Bulletin (IRB) are not legal authority.

The five types of guidance published in the IRB are:

Treasury Regulations
IRS Revenue Rulings
IRS Revenue Procedures
IRS Notices, and
IRS Announcements

Be Careful What You Rely On! Case in Point: OVDP

A good example of how serious the problem of “unofficial” IRS guidance can be is evidenced by the IRS “Offshore Voluntary Disclosure Program” (OVDP), which was accused of IRS “bait and switch” tactics. Taxpayers with offshore assets and those living abroad are likely very familiar with the OVDP. Even with the critical importance of the OVDP and its monumental impact on thousands of taxpayers, the OVDP is governed only by a long series of FAQs (and much agency secrecy). Taxpayers must be reminded these FAQs are not binding authority, even though the FAQs themselves do not indicate any warning to taxpayers or their advisors of this fact.

More here

13 Reasons Why I Committed #Citizide: (Inspired by the television series, 13 Reasons Why)

cross-posted from citizenship solutions

citizide graphic_reversed

Introduction – Guest post by a perfectly ordinary person who renounced U.S. citizenship for perfectly ordinary reasons

In a recent submission to Senator Hatch I argued that what the United States thinks of as “citizenship-based taxation”, is actually a system where the United States imposes U.S. taxation on the residents and citizens of other countries. That submission
included:

On July 4, 2017, Americans living inside the USA celebrated the “4th of July” holiday – a day that Americans celebrate their independence and freedom.

On that same day, I had meetings with SEVEN American dual citizens, living outside the United States. This “Group of Seven” were in various stages of RENOUNCING their U.S. citizenship. Each of them was also a citizen and tax paying resident of another country. They varied widely in wealth, age, occupation, religion, and political orientation. Some of them have difficulty in affording the $2350 USD “renunciation fee” imposed by the U.S. Government. Some of the SEVEN identify as being American and some did NOT identify as being American.
But each of them had one thing in common. They were renouncing their U.S. citizenship in order to gain the freedom that Americans have been taught to believe is their “birth right”.

On August 2, 2017 posts at the Isaac Brock Society and numerous other sources, reported that that there were 1759 expatriates reported in the second quarter report in the Federal Register. The number of people renouncing U.S. citizenship continues to grow.

Now on to the guest post by Jane Doe, which is a very articulate description of the reasons why people living outside the United States feel forced to renounce U.S. citizenship.

John Richardson

Continue reading

Call for Information Regarding Lack of U.S. Reciprocity #FATCA

I’ve received a request from our fellow expats-in-peril Association des Américains Accidentels to search for documents to help them in their litigation.

As of this week, we have hired a lawyer to get a legal opinion re: FATCA.

One of the angle we are pursuing is non reciprocity. Under the French Constitution (article 55) a treaty which is not reciprocal becomes null and void, as simple as that. We are presently looking for all documents written par the IRS/Treasury to US Senators or any other documents emanating from the US Treasury which point to the fact that the US has no intention of making FATCA reciprocal.

We are now in full gear and our aim is to make FATCA null in void in France and perhaps at the European level too. (it is another avenue we are exploring too)

In advance many many thanks,

Eric and Fabien

I have already sent them the letter from Mark Mazur (then Assistant Secretary of Treasury for Tax Policy) to Senator Rand Paul dated Oct 10, 2012.

Please help their legal challenge: Let’s Unite to Defeat FATCA

 

U.S. “culture of penalty” and inflation: First, inflation used to first increase the size of #FBAR penalty base and then increase the size of actual penalties

cross-posted from citizenshipsolutions blog
written by John Richardson

Introduction: Penalty as a part of American Culture

https://twitter.com/ExpatriationLaw/status/879094844622327808

The above tweet links to a wide range of examples of America’s culture of penalty.

The purpose of this post is to explore how inflation results in the facilitation of enhanced penalty collection in America today.

What is inflation?

In its simplest terms:

“Inflation is defined as a sustained increase in the general
level of prices for goods and services in a county, and is measured as
an annual percentage change. Under conditions of inflation, the prices
of things rise over time. Put differently, as inflation rises, every
dollar you own buys a smaller percentage of a good or service. When
prices rise, and alternatively when the value of money falls you have
inflation.”

Source: Adam Hayes, CFA

(Note his use of the words “goods and services“. Are
FBAR penalties and the S. 877A Exit Tax consumer goods or
government services
?)

Inflation can either be helpful or can be hurtful. Some benefit from
inflation and others are hurt by inflation. At a minimum, inflation will
always erode the value of cash.

Effect of inflation on owners/lenders of cash: When it
comes to cash inflation will hurt the owners/lenders of cash. This is
because inflation will erode the value of cash.

Effect of inflation on borrowers of cash: Inflation
will help he borrowers of cash. This is because inflation erodes the
value of the cash that must be repaid.
Continue reading