Tag Archives: US Person

Black Fly Time

I am attaching to this post the full text (minus my name and address) of an email I sent earlier today to Prime Minister Harper, Finance Minister Flaherty, Opposition Leader Mulcair, Justin Trudeau (Liberal leader), Elizabeth May (Green Party leader), Paul Dewar (NDP Foreign Affairs Critic and my MP), Peggy Nash (NDP Finance Critic) and Murray Rankin (NDP National Revenue Critic).  For greater effect (I hope), I sent these emails separately rather than as a bulk list or ccs.  I focused a bit on NDP members, because I want to flag the Toronto Centre dimension to current sitting members (and maybe also hand a few grenades to the other parties for the by-election, if McQuaig wins the nomination and the other recipients’ staffers pay attention).
IGA email re Cruz etc
The full text is too lengthy to post here, and perhaps arguably too lengthy as an email (more than four pages).  However, the first page summarizes the six points I wanted to make; the following pages are elaboration and a few web links supporting the points.
The gist of the email is to express opposition to a Canada-US IGA, for reasons that are already painfully familiar to regular visitors to this website – with the recent addition of the Ted Cruz story, which necessarily takes a full page on its own, to communicate exactly why I consider the treatment of his renunciation of his accidental Canadian citizenship so grotesquely disparate to a not-so-hypothetical parallel renunciation of accidental US citizenship.  I think this stark and compelling example needs to be driven home to our elected parliamentarians and cabinet ministers.  (I maybe should have used the female gender in my example, but that didn’t occur to me until after I sent the emails and then stumbled over one of WhiteKat’s blogs, sorry WhiteKat no offense intended …)
The current timing of an email such as this is, I believe, critical, given the possibilities of an IGA announcement when Parliament resumes in October (and, one hopes, not before then!).
One email probably won’t make a difference. But multiple emails may make a difference.  I encourage all Canadians visiting this website, whatever your national or ethnic origin (to borrow the words of our precious Section 15 of the Charter), to send similar emails NOW to your own Member of Parliament and to other members as you think appropriate.
No doubt my email could have been shorter and perhaps better-written.  Please do NOT cut and paste my wording; use your own, perhaps with my wording as a starting point for improvement.  Cut-and-paste jobs don’t have the impact of obviously-individual emails.
I appreciate so very much all that Lynne, Victoria, Don and others have done in attempting to get these stories before Canadian media.  But I am discouraged at how seldom we seem to get much media traction in Canada.  I think our best bet, for now, is to blitz Parliament with the message.
And please, those of you who are NDP members, even if you don’t live in Toronto Centre, hammer home your concerns to Mulcair and the NDP critics, mentioning your NDP membership in your emails.  I didn’t do that in the copy I’m posting here, nor in the copies I sent to Harper, Flaherty, Trudeau and May, since I don’t want to dilute the message by flagging that I’m not one of their “base” members.  I’m rubbing the NDP’s nose in it, though.
Toronto Centre residents, whether NDP or not, should pay close attention to what happens to the NDP nomination meeting on September 15.  Vote accordingly in the by-election.  See my post on this elsewhere on Sandbox, linked in my email.
Remember, all that is necessary for evil to triumph, is for good people to say and do nothing when it rears its ugly head.
And (re the thread title): one black fly can’t kill a moose, but a swarm of black flies can bleed a moose to death, if the moose can’t free itself from the swarm.  Let’s bleed the moose!  NOW!

Saddened Is A Canadian Citizen!

flagFinally! After 36 years in Canada and a very long wait for her citizenship application, Saddened became a Canadian citizen today.
Here is what Saddened sent to me in an e-mail a few minutes ago.  (I’m posting this with her consent)




Congratulations Saddened. Now you need to change your name to Happy.   freedom next exit
Next step on the Road to Freedom is a CLN.


Where do we go from here? Is it time for an organization?

Since their origins, both the Isaac Brock Society and Maple Sandbox have been invaluable sources of information and a productive forum for intelligent discussion. These discussions have matured to a point where we have a much greater understanding of the overreach of the United States government into the lives of those who choose to permanently live outside of the United States or are ‘Accidental Americans’. This summer, we have seen contributors to Brock and Sandbox quoted in various publications and even have articles published in The Hill.
However, in Canada, the issues discussed here, primarily Citizen Based Taxation and FATCA, are virtually invisible to our elected representatives, the media and the general public (with the exception of the Green Party of Canada).
Living in an advanced Western democracy, with a modern and model Constitution, Canadian citizens and permanent residents can and should expect our government to protect us in many ways. We expect police and fire services, safety regulations, affordable and accessible health care,protection of our land, our borders, our resources, and our economy. And when some of those protections fail or are inadequate, we expect public debate and action by our government.
Can anyone honestly say that the Canadian government has protected U.S. persons in Canada from CBT?
We do know that Canada has limited influence over U.S. tax policies. However, except for RRSPs, why haven’t TFSAs, RESPs and RDSPs been included in any of our treaties or other agreements with the U.S.? Instead, they are treated as taxable foreign trusts, with compliance difficulties and penalties.
Why are our mutual funds and ETSs classified as Passive Foreign Investment Corporations, thereby making them subject to discriminatory taxation, complicated forms and penalties for honest mistakes?
As far as FATCA is concerned, the jury is still out. We simply don’t know the shape of a Canada-U.S. FATCA IGA and how it will compromise our Charter rights and freedoms and our privacy rights.
In spite of all the wonderful discussions we have been having, I feel we are hampered by the lack of a legally registered organization with a spokesperson the media can turn to. Instead, on those rare occasions when FATCA or other issues affecting U.S.  persons in Canada is mentioned, reporters usually turn to professionals with a vested interest in promoting compliance and fear.
This proposed organization would be one of Canadians defending Canadian interests, values and laws from the intrusion of U.S. extra-territorial taxation.
The organization could begin with just a few core members to get things started and look after the not very difficult or costly task of provincial registration. Then it would recruit members. Both the Maple Sandbox and Isaac Brock Society can be used to promote membership. There would be a small membership fee to defray expenses.
It is my opinion that the organization would be more effective if the core group was located in Ottawa or Toronto. There appears to be a more concentrated population of duals and former Americans in those cities. The location would also be closer to political and media centres, and thus possibly have more legitimacy in the eyes of the media and the powers that be.
The organization itself might not launch any lawsuits over FATCA, but would assist anyone or any other group, such as the Canadian Civil Liberties Association, with both financial and research assistance.
So, the question is, where do we go from here? Is just discussing the problems of CBT and FATCA enough or do we need boots on the ground, so to speak?  Please share your ideas.

"I Hope Someone, Somewhere, Sometime Will Say This Is Wrong"

Exposed: IRS Colludes With Banks To Unfairly Target U.S. Citizens Abroad is an excellent article about the real impact of FATCA. It comes from Occupy.Com.
It is one of the comprehensive and accurate articles on FATCA I have read.I wish the mainstream media would do as thorough and as accurate a job in covering the issues.
A woman in France speaks for many of us when she says:Wrong

“I hope someone, somewhere, sometime will say this is wrong.”

“In a panic,” she renounced her U.S. citizenship because of the upset it was causing her ill non-US husband.  She is now “more and more depressed.”
Victoria Ferauge (aka Victoria) says:

“There are too many unintended consequences. It’s negatively impacting people who are not tax evaders. What I find astonishing is how it never occurred to the IRS how this could have an impact on regular people.”
Marvin Van Horn (aka Just Me) shares his horror story of IRS trying to seize $172,000.

“I said, ‘You want to apply the penalty based on my house?’ So then my penalty went from $90,000 to $172,000. I said, ‘This is ridiculous. For a tax failure that’s less than $20,000 over six years and a failure to file a form, you want to charge me a penalty of $172,000?'”

With help from TAS, he managed to whittle that down to $27,000, which he now says he probably should not have paid.
A Georgetown University law professor gets it:

“In my view, a working system to address offshore accounts addresses offshore accounts,” said Itai Grinberg, professor of law at Georgetown University. “For a U.S. expat living in Berlin, having an account in a Berlin bank is not an offshore account. It’s an on shore account.”


“That’s my view, that’s not what FATCA says,” he added.

Victoria describes the situation well:

“We feel a little like David against Goliath here.”
I’m certainly no Bible expert, but I seem to recall from Sunday School that David whacked the giant bully Goliath in the head with a stone and killed him.
If we are Davids working together, we can do the same to FATCA (I hope!)


What Would Einstein Think Of FATCA?

EinsteinAlbert Einstein said “The hardest thing in the world to understand is the income tax.”
He also said “This (preparing my tax return) is too difficult for a mathematician. It takes a philosopher.”
It takes much more than a mathematician or philosopher to deal with FATCA!Einstein simple
Einstein also said “If you can’t explain it simply, you don’t understand it well enough.”
What do you think Einstein would say about FATCA?

FATCA: A Project Audit

Victoria has an excellent post on her blog today:  FATCA: A Project Audit.
Victoria looks at FATCA through the lens of her professional experience computer auditmanaging large information systems for multi-nationals.
She gives great insight into what might be said about FATCA in an audit.  Here are key points she thinks would be found.

Failure to identify the stakeholders.
Failure to do proper assessment of the impact and risks.
Lack of success criteria.
An out of control core model.

After her superb analysis, Victoria concludes:

Stepping back and looking at it very coldly, FATCA may represent one of the riskiest projects the U.S. has ever tried to push on the international stage.

Or, as Victoria describes in simpler terms:

FATCA is rapidly becoming a bowl of spaghetti the kids are trying to eat on a white couch.

I have no idea why Congress, IRS and US Treasury ever thought it was a good idea to have a white couch.
Let’s be kids with spaghetti. Let’s spaghetti FATCA until it looks like this!Spaghetti Baby

FATCA Delayed. But,Could USP in Canada Be FATCA'S "First Victims?"

As WhiteKat posted under What’s New, there has been a FATCA delay of six months.  Hopefully, this will be the beginning of the end of FATCA.
However, Kevn Nightingale, the expatriate tax lead for MNP,  is predicting Americans in Canada could be the “first victims.”
He first spoke about what a “nightmare” FATCA is to administer and what a challenge developing a a FATCA data base is.
After he says all of that, he raises some alarm bells with this statement;

And since Canada’s easy for the IRS to reach, “it wouldn’t surprise me if Americans who live in Canada are the first victims. Some of those people are going to be made examples of. It will take until 2016 or 2017 for real penalties to show up, but it will happen.

I made the comments below in the What’s New thread, but because of the very serious consequences of such a statement, I’ve decide to give this it’s own thread.
I don’t know if this is simply speculative fear mongering or if he has inside information.
However, he did not mention CRA will not collect penalties for IRS on Canadian citizens of residents. I don’t know if this was not mentioned because Mr. Nightingale does not know (which makes me question his professional knowledge) or if it is because he does not want to (which makes me question his professional integrity).
In any case, it is clear we need to continue to be vigilant.
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My Financial Career- A FATCA Chronicle

Many Canadians are familiar with the 1962 animation of Stephen Leacock’s early 20th century humorous tale of a young man’s attempt to open his first bank account. It’s worth a view, even if you’ve seen it many times before. Here’s the link:
Now, instead of a young man rattled by a bank, think of a U.S. person having to deal with a financial institution under a Canada-U.S. FATCA IGA.
Although an IGA has yet to be announced, some FIs are already collecting information.
Similar to the Border Crossings thread, perhaps we can relate our own experiences, either in person or through online account opening. Any other information on account opening, from any source, would also be useful. It would be helpful to distinguish between banking, investment and other types of accounts.
If you have already posted your ‘story’ elsewhere, please post it again here.
And, input from our friends in other countries is most welcome.

It's Official: No American Reciprocity

Breaking News
Just in time for US Independence Day, there is a a major AM-138-0111blow for IGAs and perhaps for FATCA itself.
James Jatras at repealfatca.com is reporting It’s Official: There Will Be No American Reciprocity

In a letter to U.S. Treasury Secretary Jack Lew, Congressman Bill Posey (R-Florida 8th), a key member of the House Financial Services Committee, has turned thumbs down on Treasury’s public claims that the U.S. will impose on American domestic financial institutions the “equivalent” of FATCA’s ruinous reporting requirements on foreign financial institutions (FFIs). It’s now clear that is not going to happen.

We’ve known for ages Americans would never agree to real reciprocity. Congressman Posey now seems to confirm that.  Given the anger in Europe over NSA, this is just going to add fuel to the fire.  It could also give Canada every reason to walk away from whatever is happening with those IGA negotiations.
Congressman Posey says:

“Given the evidence above, it is difficult to conceive of any circumstance that would justify imposing such an expensive and counterproductive domestic mandate.

James Jatras says:

It needs to be understood that this is a denial that will stick…Thus, by sounding the death knell for reciprocal authority, Congressman Posey is sinking the IGAs, and in turn FATCA itself.

Here’s what Posey himself wrote:

“Further delay in FATCA enforcement and a moratorium on negotiating and signing additional IGAs is in order,” pending “substantial modification or, more likely, outright repeal.”


Congressman Posey further suggests Treasury does not have the authority to negotiate IGA and suggests

A cooperative scheme to penalizing tax evasion without harming the innocent.

We’re not free yet, but I hope this will be a great step on the road to freedom.
Happy Independence Day everyone!

FATCA Under Fire In Canada

Globe and Mail is reporting Canada’s Information Sharing Deal With US Is Under Fire
The article covers many points we already know. It also misses some really important points.
The lead on the article says:

A debate over fighting tax evasion versus protecting personal privacy looms large for Canada as it prepares to announce a deal with the United States to share banking information.

As we know, this is NOT about tax evasion.  Canadian citizens and residents pay tax on their income from bank accounts and other assets in Canada.  Many of us have not had a connection to US in decades. Others have never had a connection to US other than being born there when parents were working in US or because their mother was sent to an American hospital to give birth.
The author reports on what Canadian banks want:

Canadian banks have urged Ottawa to take on the reporting duties through the Canada Revenue Agency, which could ensure that privacy laws are respected when information is sent south of the border.

He is not getting the point that does not resolve the problem. Why should Canadians with some obscure tie to US have to report all details about their finances to CRA when other Canadians do not.
More importantly, our information should never be submitted to a foreign government–and especially not to a foreign government which has significant problems with identity theft and protection of personal information.
He does get one point right:

There has been little debate on the issue so far, partly because no details on the talks between Canada and the U.S. have been released. However, Ottawa is promising to make the deal public once it is signed.

Queen’s law professor Art Cockfield sums it up well:

“No foreign government should be able to come into our country and demand personal information about our own citizens and residents.”

However, that statement is followed by:

The negotiations are aimed at smoothing over this problem by ensuring exchanges are mutual and at the government-to-government level.ad

No, that does not resolve or smooth over the problem. We should have the same rights as all other Canadians to manage our finances in confidence and privacy with our banks without involvement of either the Canadian or any foreign government.