We moved to Canada from the United States in 1968 and received what was then called Landed Immigrant Status. My wife was with me and I was a draft dodger.
It became obvious to us after only a couple of years that we wanted to stay in Canada so we looked into getting Canadian citizenship. At that time there was a mandatory five year waiting period before you could apply so we just continued to gather information. We were told that becoming a Canadian citizen would, by US law, mean we lost out US citizenship and we were told that at the citizenship ceremony we would be required to sign a renunciation of our US citizenship.
In 1973 we applied for Canadian citizenship and had our interview with a citizenship judge. The test then was simply a visit with this judge who asked questions and made a decision. It was a very friendly process. In November of 1973 we attended a citizenship ceremony where we became Canadians and swore an oath of allegiance to Queen Elizabeth II. We also found out that signing the renunciation of US citizenship was no longer required (hadn’t been since April of 1973 because of a court decision.) We still believed, however, that we were no longer US citizens.
We had been filing both Canadian and US income tax forms for the time we had been in Canada. Early in 1974 we filed our Canadian taxes as usual and our final US tax form. When we sent in the US form we enclosed a cover letter saying we no longer considered ourselves US citizens and would no longer be filing US tax forms. We never filed another US tax form and we never heard back from the IRS or the US State Department.
In February of 1977 I received paperwork for the Selective Service Amnesty granted by then President Carter. With the option of returning to the US available, my wife and I just stayed with our jobs and friends in Canada and never considered moving back to the US. Our life was now fully in Canada.
We lived quiet lives for the next three decades travelling on our Canadian passports (never applied for nor had US passports) until the requirement to show a passport at the US border came into effect in the middle of 2009. Most times crossing the border to visit family and friends was no problem but three times since this requirement came into effect we have had our Canadian passports handed back to us and were told we were US citizens because the passports showed US birthplaces. No big deal was made of this and we didn’t argue with the border guards and they let us in with only our Canadian passports. It was more or less a non-issue but it did set off a few alarm bells as we wondered how we could convince the border guards that we really weren’t US citizens anymore.
Through media stories we were very dimly aware that the US was cracking down on tax cheats holding overseas accounts. We never thought of our accounts as overseas as we are Canadian and our money was in Canadian banks – a retired teacher and a retired lab tech. Not the profile of persons hiding from the tax department.
In 2011 we were contacted by our financial advisor. She said that because she knew us she knew that we had been born in the US and wanted to warn us that our RRSP accounts which held mutual funds could be problematic unless we could prove we were no longer US citizens when and if this new FATCA legislation came into effect.
Now we started to panic. We knew we weren’t US citizens but how could we prove it? We had never received anything official saying we weren’t.
There is a lawyer locally who was also a draft dodger and we know him slightly so we contacted him and he told us about Certificates of Loss of Nationality. He also advised us not to approach the border unless we had one. It was his opinion that without a CLN a border guard had only to ask if we had filed US income tax forms last year and if we answered truthfully “no” then we had just admitted to income tax evasion and if we lied and said “yes” we had just made a false declaration and if discovered we were also in trouble. Nobody had been asked that question so it was a tiny risk but he advised against trying the border. He also mentioned that when entering Puerto Rico he had been told it was illegal for US citizens to enter the US using anything other than a US passport. Without the CLN he said it would take a court case to get recognized as no longer being a US citizen and we couldn’t afford that.
Then stories started appearing in the newspaper about it being almost too late to apply for amnesty for failure to file income taxes and that there was a program called OVDI which US citizens should join. Now we were in full panic mode. Were we really US citizens? Surely not. What was this CLN and how did you get one? Should we be joining this OVDI? We knew nothing about any of this stuff and we were scared. It appeared our savings, modest as they were, could be wiped out and we could be denied entrance to the US to visit our families.
We spent two months trying to get to the point where we had some grasp of what was going on. We found some websites: Renunciation Guide, Expat Forum and then the newly founded Isaac Brock Society. Without court cases everything we found was opinion and sometimes differing opinions.
We looked first at OVDI and the more we read the more it looked like a bad deal. I had amnesty papers from draft dodging and I didn’t have to admit any wrongdoing. OVDI was supposed to be an amnesty but we would have to sign a statement admitting guilt and assign ourselves a penalty of no less than five per cent on our accounts. Since we didn’t feel we had done anything wrong this had no appeal and we agreed to stay away from OVDI. Don’t know how that program has changed since last year but I would still be very cautious and read all the fine print before I had anything to do with it.
As far as taxes were concerned we thought that if we weren’t US citizens we shouldn’t have to have anything to do with them so we skipped the whole filing back taxes thing or becoming compliant and went directly to what it would take to get a CLN.
What people had to say about the Immigration and Naturalization Act of the US State Department was a bit more encouraging but also difficult. Changes kept being made to the Act and then parts of them were made retroactive or amended due to court cases.
We were pointed to the section outlining seven things you could do which State considered “expatriating acts” which could lose you your US citizenship and we had done two of them: Taking out citizenship in a foreign country and taking an oath of allegiance to a foreign head of State. That was great. We had believed that all along. However, a 1986 court case changed this slightly so that performing the expatriating act was not enough. Now you had to perform the expatriating act “…with the intent to relinquish US citizenship.” How do we show what our intent was 39 years ago? Do they have a mind reading machine? There was also a shift in the thinking of the US State Department over the years. In 1973 it seemed they wanted to punish draft dodgers and they did this by taking away their US citizenship. We learned that some people wrote letters to State saying they had become Canadian and got a CLN back within weeks. Wish we had known about that back when. Today it seems they want to punish people by refusing to take away their citizenship! Now it is no longer sufficient to inform them that you have performed an expatriating act. You have to make an embassy or consulate appointment and fill out forms DS-4079 and DS-4081and bring a lot of documentation with you to the appointment and try to convince them that you had intent to relinquish.
Fortunately for us the approach the State Department take is that actions speak louder than words. Since your expatriating act have you done anything that would indicate you really wanted to keep US citizenship: Traveled on a US passport? had a residence in the US? Paid taxes in the US? Have you voted in a US election? Registered your children as US citizens? A whole list of these things which, if done after your expatriating act, indicate you did not intend to relinquish. All this is on DS-4079.
Since we had done none of these things we made an appointment at the Consulate handed over all the forms and documentation and received our CLN’s twenty five weeks to the day after our appointments. It very nicely says we performed our expatriating acts in Nov of 1973. The consulate visit was friendly, professional and non-confrontational.
Because of a cute regulation from the IRS which says you expatriate not when you perform the expatriating act but when you inform the State Department (For us not 1973 but 2012) they may still think we are responsible for taxes for the past few years. We strongly disagree and think it is up to State and not the IRS to determine who is and who is not a US citizen and when they ceased to be one.
Now we wait to hear about the IRS but we are very confident that they won’t bother us for so little and from so far back. It might still come to a court case but we’ll probably let others who can afford it better fight that one.
@Johnnb, thank you so much for sharing your story with us. That you successfully received a backdated CLN is going to give many, many people who also became Canadian decades ago, a lot of hope.
Personally, I can’t imagine the IRS actually bothering to come after Canadians like you, given the US State dept’s position, and the position of our own gov’t, who have clearly stated they will not assist the IRS in collecting on Canadian citizens if they liability occurred when they were a citizen. That is definitely the case for you and your wife.
I would think there are many more that they would try to go after first, IF they actually go far. And now you have your CLN to show the US border guards, and the banks, if it comes down to that.
I also thought it noteworthy that your relinquishment appointment was friendly and non-confrontational. That’s as it should be, but we all know there are no guarantees when dealing with the US gov’t, or any government, for that matter.
Congratulations on escaping the clutches of the IRS bullies!
@johnnb
Thanks for your post, John. I envy you having the CLN in hand. Still not brave enough to make the appointment at the U.S.consulate. Like you, I should be able to qualify for a CLN.
I first came to Canada as an 18 year old University student. Met my future husband and landed here in 1964. I became a Canadian in October, 1972 so I did have to swear the renunciatory oath in addition to the Oath of Allegiance. I have never done anything since to indicate that I did not intend to relinquish my U.S. citizenship.
I guess I have always been a bit intimidated by authority (attended convent schools!). If my husband were still alive, I know he would walk me down to the U.S.consulate and insist on being admitted along with me. As I am afraid the U.S. will identify my three sons, I don’t believe it is a good idea for them to join me at the consulate. So here I still sit ‘on the fence’, trying to get the courage to make the appointment.
@Tiger Nobody can make decisions for someone else. I know we talked about the pros and cons of going to the consulate to get a CLN.
Your situation is, if anything, stronger than ours was. You performed three expatriating acts to our two: becoming a citizen of Canada, taking an oath to the Queen *and* signing a renunciation.
A friend of ours in a similar situation to yours was told at the consulate that his application was a “slam dunk.” His parents moved here when he was a teenager and when he turned 22 he took out citizenship and signed the renunciation. He had an appointment two days after we did and got his CLN the day after we did.
You stopped being a US citizen the day you did those three things. If all your children were born after that date they are all in the clear as well.
@johnnb
Thanks for the confidence builder. I know you are correct. I also know that the U.S.is more than capable of changing the rules to make it more difficult down the road to get the much coveted CLN. So acting sooner rather than later could be in my best interests.
Unfortunately, my three sons were all born prior to my becoming a Canadian citizen. I never registered them at a consulate and certainly they have never done anything to indicate they thought of themselves as dual citizens. However, the U.S. would defintely claim them as ‘accidental americans’. As things stand now, their passports identify them as Canadian only. My fear lies in the fact that once I go to the consulate, identify myself by my married name (same last name as my sons), the U.S. could track them down. My brain tells me they would not bother or they would not have the resources to do it, but my heart lives in fear that they might do it. My sons have told me to do what is best for me, not to worry about them etc.
Reading a story like yours, does give me courage to proceed, so thanks again for posting it here.
@Johnnb: Thanks so much for publicly sharing your story. I admire your bravery in being one of the first to go forward for a CLN.
I personally have decided to stay as far away from a US Consulate as possible. I have learned from past experience they can’t be trusted–i.e. telling me in 1973 my decision to become a Canadian citizen meant I was “permanently and irrevocably” relinquishing US citizenship. Forty years later, I’m not going to be forced to “prove” it to an American official.
The stories of the four of us are excellent examples of how everyone’s situation is unique and we all must do what gives us the most peace of mind. There is no “one size fits all” solution to this very complex issue.
@Blaze: After reading all the stories I could find I can only agree wholeheartedly that one size fits all can never be applied to our situations. Consular officials and border guards seem to have buckets of leeway in dealing with people. I ran into some really good ones but that is not true for everyone.
@johnnb, I’ve had my Canadian citizenship certificate thrown at my face (pre-passport days), and I’ve had my Canadian passport thrown on the ground. I just attributed it to power-mad, grumpy US border guards. It certainly didn’t make me question my Canadian-ness. Personally, I can’t go anywhere near a consulate, either. I actually would if I could, but I was a minor when I became a Canadian, and we assumed that what my mother had been told also held true for me. It never occurred to us that, at age 16, I would not be allowed to relinquish US citizenship, as she did. Which is why I have to fight to the bitter end. On the bright side, however, through this thing I have connected with some amazing people that I would never have met otherwise. So there have been some positives along the way, as well.
@Tiger, I also vote that you are safe, safe, safe. However, only you can decide what feels right for you, and what you’re comfortable with doing. But do always try to keep in mind that along with johnnb’s story, Calgary411 became Canadian in 1976 and a lawyer told her that she stopped being a US citizen at that time. I do believe you still have some time before you have to make a decision. I keep hoping that our gov’t will announce that they’ve worked out with the US gov’t that those of us who became Canadians decades ago are safe. Maybe a pipe dream, but it is my dream, nevertheless.
@OutragedC
I sure wish my brain and heart worked in tandem. Brain tells me one thing and then the damn heart goes aflutter telling me something else.
Like you and so many others, I keep hoping our Canadian government will stop the silence and come forward with the news that those of us who have been Canadian for decades are actually safe. No more worries about FATCA and no more worries about border crossings.
I hope that you will get some news that you did in fact relinquish your U.S.citizenship when you became a Canadian at age 16.
@Tiger, thanks! I’ve done a fair amount of research (of course), and while it seems like I can’t get around the law, I do hope that proving that I intended and thought I’d relinquished would help. I’ve never held a US passport, worked there, owned property there, travelled there on a Can passport, etc. I’ve done some research and there are certain cases where minors can be considered to have relinquished, it’s just difficult to see if I fit in. Deckard1138 pointed me to a statute from that time that may (may!) work – that if you did not establish permanent residence in the US by age 25, US citizenship would lapse. That was removed in the 1986 amendments. However, it does give me some hope, if it actually comes down to having to engage a lawyer and go through all the hoops.
If you travel on a Canadian passport and solely on a Canadian passport the preponderance is generally to the fact you are a Canadian citizen both under international law and in many ways under US law. Just by allowing you entry to the US on a Canadian passport the US in some sense is acknowledging you are a Canadian citizen and NOT a US citizen. For this reason most countries the US included try avoid allowing people who they believe are their own citizens to enter on foreign passports. Having said they cannot necessarily stop all Canadians with US birthplaces from entering the US and requiring them to provide a CLN.
That’s an interesting point.
Perhaps anyone with a US birthplace listed on their Canadian passport should ask the border guards if they would stamp their passports. If they would then it would provide proof that a) they had at least once been allowed in on a non-US passport and therefore b) at least one border official had acknowledged them as being Canadian only since it would technically violate US law to do otherwise.
Has anyone recently asked for a passport to be stamped? Do the border people even have stamps anymore?
I haven’t asked for my passport to be stamped. I am making a sudden unexpected trip to US on Friday. I may ask for that stamp depending on how friendly or unfriendly the border guard is (and how brave I’m feeling).
When I got my Nexus card in 2004, the US Immigration Officer insisted I was still a US citizen. We had a friendly debate about why I am not still a US citizen. That was years before I knew about this IRS issue.
She told me I should always enter as a US citizen because as a US citizen, I would have the right to return anytime for as long as I wanted. Consequently, I would not have to say where I was going, how long I was staying or the purpose of my trip. I think she was truly trying to be helpful, but I later learned that if I enter as a US citizen, the US could refuse me access to Canadian officials if I got into any problems in US.
Not wanting to have the debate again, I did not renew my Nexus card in 2009.
Then, in October, 2011, a border guard told me I should get a US passport. I merely nodded and went on my way. I did not follow that advice.
I had no problem entering on a Canadian passport in April of this year. The border guard looked at my passport, looked at the computer (Oh Oh, I thought), asked where I was going and waved me on.
I hope Friday goes as smoothly.
One thing to remember of course is as a Canadian citizen you have no actual right of entry into the US so you could be turned back. If you don’t mind me asking are you travelling in a private vehicle or by rail/air/bus. I don’t want to get anyone shook up but I have heard one possible way of enforcing a tax lien on Canadian with no assets in the US would be to impound their vehicle.
@Tim: As I understand it (and I may be wrong on this) before a lien can be enforced notification must be given that such a lien exists. If you have not received such notification then you are not subject to any penalty.
@Tim: I’m traveling by car. You’re right. I don’t want to get “all shook up.” I’m really not anticipating any problems. I think the worst they would do is refuse me entry–and I’m not anticipating that.
If they do, C’est la vie. The unfortunate part is they would be penalizing my 89 year old American mother, (who has lived in US her whole life and is now recovering from surgery) more than they would be penalizing me.
@Tim, I’m with Johnnb. A while ago I started researching a ‘what if’ post for my personal blog which I never finished, and I after the research I felt certain there could be no surprises at the border, that there is a definite process which must be followed, and which must include notification. First of all, they’d have to get access to your records to even begin to assess any kind of penalty or lien, which means, I believe, they’d have to go through CRA, who, again, I think, must let the person know. I will dust off my research, fact check it, and then if Johnnb and I are correct I’ll do a quick post on it.
I think Blaze will sail through the border on Friday, but I don’t know if it will be the same 12 or 24 months from now….
@All, apologies for the re-posting of things. I believe our format is final now, but in rearranging things, it made the older posts appear as new posts. This has been a learning process for me, but I hope we’ve got things setup now.
Born in Boston in 1951 to Canadian parents finishing med school, moved to Canada in 54. Naturalized Canadian Citizen in 78( relinquishing act). Bullied into gettin US passport by border guards after 911, now expired. Enter US frequently on my Canadian passport, no issues to date. Any hope of acqiring a CLN?
@Stickman: Because of US passport, you may have to renounce. You have not committed what US might consider a relinquishing act, i.e. by becoming a citizen of another country. That could mean you need to become compliant with IRS.
1951 was a great year to be born! That’s my birth year too.
Thanks for comments my friend. I thought obtaining naturalization in a “foreigh state” was number 1 in section
349 (a)(1) INA? I did so proactively after finding out that
under the 1947 Canadian Citizenship Act you had to register to
be recognized as a Canadian Citizen. Voluntary with relinquish-
in my heart….so to speak.
@Stickman: You *were* correct. Obtaining naturalization in a foreign state was number 1 in section 349(a)(1). In my opinion you did relinquish on that date. However, and this is a big however, the law was changed in 1986 so that it had two parts by adding the phrase “…with the intent to relinquish US citizenship.” Now you had to perform the expatriating act and show intent to relinquish.
When I ran into this I asked if they had a mind reading machine. Turns out they establish intent by your actions since performing the expatriating act. Form DS-4079 asks a series of questions for just this purpose: Since performing the expatriating act have you voted in the uS? Paid income taxes? Had a residence in the US? And included in this list is applied for a US passport. They think that if you got a US passport you did not intend to relinquish but rather wanted to maintain your US citizenship.
Because as you say you were frightened into it by a border guard you may have a case for pleading intent but I suspect it would take either one heck of a cover letter or, more likely, a court challenge to establish that it wasn’t of your own free will. Renouncing might be the much easier option.
@Stickman: I think the problem could be that you got the US passport after you registered Canadian citizenship.
In addition, when you “registered ” as a Canadian citizen, did you take an Oath?. I think that is what is required in order to show that you intended to relinquish US citizenship to US authorities, rather than registering the fact that you were a Canadian citizen at birth due to your parents’ Canadian citizenship.
Your other option is to simply do nothing. As a Canadian citizen, CRA will not collect any tax liability for IRS on a Canadian citizen. They will not collect any FBAR penalties for any Canadian citizen or resident.
i
FATCA is the monster looming over all of us. However, banks have no information at present about your place of birth. Current Canadian law prevents them from asking for that information or from releasing information to a foreign government without your consent. To date, we have seen no indication Canadian government will change the law to accommodate a foreign government.
If the banks violate those laws or if the government changes the law, it will be time for us to all consider a lawsuit together.
If, however, you really want a CLN for crossing the border, you may have to renounce rather than relinquish. .
Does anyone else have any advice for Stickman?
@johnnb
Posted on another site today – individual attending second appointment for CLN, expatriating act from early 1970s, told by clerk at Vancouver consulate that they will receive FORM 8854 to file with IRS when they receive their CLN. They willl need to ‘exit’ the U.S. tax system. Sure hope the clerk is incorrect. I could certainly understand that, if they were renouncing, but it should not be true if they relinquishing.
Perhaps the IRS can try it but if it comes down to the wire I think any official above clerk level will realize that DOS determines citizenship and not the IRS. With our income and savings level we would almost be poster children (poster seniors?) for people not to make a test case out of.
The consulates seem to be all over the map on their procedures and policies. I think it will get more settled as it moves up the food chain and I don’t see this as a winner for them and they will recognize that.
As i recall from postings on IBS, lawyer Michael Miller strongly felt that no U.S. tax filings would be required in a relinquishment case such as johnnb. Another lawyer, Phil Hodgen was less than sure, suggesting that a court case might be necessarily.
I met with a dual US/Canada immigration lawyer about a year ago and brought up the subject of the section of the IRC code that implies that the date of applying for the CLN was the important date. His response was that no, the date on the CLN, which would be the date of relinquishment (1970’S, etc), was the date to use So US tax filings were necessary.
I am so embarrassed by my country. The IRS acts as if the world is not globalized.
However, correct me if I am wrong, and i don’t see anyone mentioning this ,but even if your citizenship claim fails, the June 26th OVDI update provides you with relief OUTSIDE of OVDI.
Consider:
1. You’re an ex pat
2. You haven’t filed an US return since the 70’s
3. unpaid taxes less than $1500
I think you would qualify and only need to file 3 returns and pay the small amount of tax due.
I blogged on it here:
http://www.irsmedic.com/2012/06/27/2012-ovdp/
Best of luck.
Anthony
@Anthony: I have a CLN which says I ceased to be a US citizen in 1973. Perhaps someone with a poor claim might like to try and get straight with the IRS but I have no intention whatsoever of filing anything with them. I would see that as admitting they have a claim on me which I maintain they have not had since 1973.
Having said that, however, there are people who have, for example, taken out citizenship in the past and then been pushed to get a US passport to enter the US thereby putting their ability to relinquish into question. They might profit by this approach so it might be very valuable to some. Thanks.
Good News. I crossed the border today with no problem. The friendly border guard looked at my Canadian passport with US place of birth, looked at the computer, asked where I was going and why, said “Have a good time.” That was it.
Perhaps we need a new thread on border crossings. It seems to me far more people are crossing with no problem than are having problems. There is a lot of anxiety around this and hearing of other people’s experiences might help.
@Anthony: I’m glad to hear you’re ashamed. I am not going anywhere near US Consulate or IRS for any reason. I have been Canadian and Candian only since 1973. The US has no right t try to reclaim me as I am close to retirement.
FATCA, FBAR and all the other Fs of the United States of Arrogance are just one example of how US thinks their laws and only their laws matter in the world. They are attempting to trample on the laws and constitutions of other contries to solve their economic woes.
@Anthony, thanks for bringing this up,I actually don’t think I have this listed anywhere, probably because I was so very disappointed in our MInister of Finance’s approval of such a tepid measure. Personally, I am waiting, as I’ve stated often, for the Can govt to announce that the ‘talks’ they’re working on include a complete amnesty for any person who became a Canadian decades ago, with no requirement whatsoever to file anything to the IRS.
@Blaze, glad to hear it was a smooth crossing. And, I think you’re right, that’s a good idea to have a separate thread on crossings.
A border crossing thread sounds like a really good idea. Maybe I’ll try a trip next week just to see. I’m only an hour from the border.
Crossed 3 weeks ago from Quebec to Vermont. 90 min lineup as it was the midsummer weekend. 90 second interview. Where are you going?; to the beach. Bringing anything, food , more than $10,000? No. Ever been arrested? (laughing) No. (also laughing. Have a good holiday; Thank you.
I would like to be able to create new threads if no one minds. I found a very good article in the Canadian Tax Journal today that discusses some new angles to FBAR and FATCA issues that I found quite interesting. In fact after reading the article I am more convinced than ever that their is very little likelihood of Canada reaching an agreement with the US similiar to the G5 nations.
http://www.ctf.ca/ctfweb/CMDownload.aspx?ContentKey=7ae51268-fbf4-4abf-a07a-41c7be3af7f6&ContentItemKey=c3e8c6ab-f4f9-45b3-8d34-c8dde8c018a2
A real problem with FATCA that I was not aware of is some of the information the IRS wants to recieve from FFI by law and court ruling the CRA cannot even request of Canadian Financial Institutions on Canadian taxpayers.
@ Tim
Thanks for posting the article. I will read it more thoroughly when I have a chance. It is just the kind of detailed discussion on FBAR and FATCA in a Canadian context that I have long been looking doe
I especially was pleased to see a discussion of the “revenue rule”. I believe that this may be the legal basis upon which Jim Flaherty was able to issue his reassuring statement that that FBAR penalties would not be collected by CRA.
Not long before the Don Cayo story appeared in the Vancouver Sun, which provided the first solid evidence of Canada’s official position on FBAR penalties, I was told by a prominent cross border tax expert with, close ties to the Conservatives that, based on common law, any attempt by the IRS to obtain a judgement in Canada on FBAR would be “laughed out of Court”.
Let’s hope the laughter will continue when and if an agreement is reached between the U. S. and Canada.
Excuse my poor proof reading. I hope to post a non-technical FATCA item sometime soon.
Border crossing thread sounds like a great idea. I have heard there is more likely to be a problem crossing at one of Canada’s airports and that for the most part, land crossing have not presented any difficulties. Who knows how long that will last.
@Blaze
Great news that your trip was uneventful. Enjoy your time with your family.
@Tim, sorry for the delay. I’m camping and having trouble with my iphone hotspot, think I need to charge my phone, maybe. At any rate I’d be happy to set you up so you can create your own posts. You provide such excellent information on the fatca, banking, etc issues. email me at outragedcaathotmail.com and I’ll get you setup.
@Tim: I think we should name you our Chief Pirate. You have such amazing information for our treasure chest. I look forward to your threads.
re Hazy2
Is the last word in this comment supposed to be
UNnecessary ?
Hazy2 on August 17, 2012 at 9:02 am said:
As i recall from postings on IBS, lawyer Michael Miller strongly felt that no U.S. tax filings would be required in a relinquishment case such as johnnb. Another lawyer, Phil Hodgen was less than sure, suggesting that a court case might be necessarily.
I met with a dual US/Canada immigration lawyer about a year ago and brought up the subject of the section of the IRC code that implies that the date of applying for the CLN was the important date. His response was that no, the date on the CLN, which would be the date of relinquishment (1970?S, etc), was the date to use So US tax filings were necessary.
johnnb, I hadn’t read your post before, but I came across it because of a recent comment on it. I have a history somewhat similar to yours — left the US in the 1960s because of the Vietnam war and became a Canadian citizen in the late 1970s. I stopped filing U.S. tax returns after becoming a Canadian, but I didn’t find out about the need for a CLN until 2011. I have since obtained one, but I have not communicated with the IRS, nor do I plan to do so. I hope they will leave me alone, but I can never be sure about that.
It continues to astound and anger me that a person must apply for a document (CLN) to prove that s/he is NOT a U.S. citizen, when s/he is already a citizen of another country and is not even trying to exercise any rights of U.S. citizenship.
@ I arnold
For that comment, the word “unnecessary’ should have been used, not “necessary”
However, Phil Hodgen felt at that time that it may take a court case to completely resolve the issue
There have been absolutely no reports, here or at Brock, of anyone receiving a letter from the IRS after receiving a CLN backdated to many years ago.
@ I Arnold
Your anecdote about Carter’s Amnesty in 1977 reminds me of what happened when my wife and I transited through Los Angeles last month. We were en route to Vancouver from Cali and Panama City.
First a little back ground. I was (past tense) an accidental American. I was born to Canadian parents in the States, and my parents brought me to Canada as an infant in 1949, and I have lived here ever since. I renounced my US citizenship last year.
In an answer to one of the questions from the passport control officer (a woman), I said that I am a Canadian by birth and that I have lived in Canada since 1949.
Her response was:
“Well, that’s good to know you have been in Canada since 1949. We are still on the lookout for deserters.”
I replied:
“Madam, I was working in Toronto in 1977. One of my coworkers was a deserter. I distinctly remember him telling me that President Carter had given amnesty. Why is it that I know that and you apparently do not?”
Moral of the story: it helps to have facts at your disposal. It’s also never a bad idea to be polite with them.
@ I Arnold,
I remember that on Phil’s blog in Spring 2012. I think his opinion may have changed somewhat over time as I noticed that Phil was quoted Spring 2014 as saying,
“A backdated relinquishment can simplify or eliminate tax reporting requirements; if it was from long enough ago, says California-based international tax lawyer Phil Hodgen, you may be able to escape the paperwork entirely.”
http://globalnews.ca/news/1217871/how-to-get-rid-of-an-unwanted-u-s-citizenship/
“How to get rid of your US citizenship,” Patrick Cain, Global News
I received a CLN a year ago, backdated to 1973 when I became a Canadian and took the Oath that at that time included an Oath of Renunciation. When my Mom died recently, I received some money and unknown to me the IRS was seeking tax. So I said to them I am not a US Citizen and not a resident either but they are still after me based on the fact that they didn’t know until recently that I had a CLN. So stay tuned. Now I am in a fight I never thought I would have.
@AllanS That’s awful, but I am not surprised.
Does anyone have any advice for Allan?
@Alan S and Lynne Swanson
If you don’t mind letting us know, what is the IRS specifically seeking tax for in regard to the money from your Mom’s passing Alan?
I have some elderly relatives in the States and so have been in touch with their lawyer in regard to future protection from the IRS. There are different rules depending on if there is simply a will or a trust involved and the amount of inheritance.
Also beware of things like being a trustee in a US trust if you are no longer a US citizen. I have been told that this turns the trust into a foreign trust with unbelievable IRS tax implications.
I have been told by legal counsel to never deal with the IRS directly although then you are dealing through lawyers of course.
It is shameful that the US/IRS is trying to extort money from innocent Canadians to pay its national debt. It seems we all have to become our own legal and financial experts these days. Please do keep us posted. Good luck!