Looking for Mr. FBAR
This is one more in a series of posts discussing the FBAR rules. The FBAR rules were born in 1970, laid virtually dormant until the 2000s and then were then unleashed in their full “ferocity” on U.S. persons. A good review of the history of Mr. FBAR is here. A discussion of how the discovery of Mr. FBAR can lead to larger problems is here. Finally, a discussion of of why people must exercise caution in “fixing problems with FBAR” is here. Mr. FBAR has not visited Canada, but he has visited Canadian citizens
Mr. Pomerantz returns …
Readers of this blog (particularly those in Canada) may recall that I have previously written about the adventures of Mr. Jeffrey P. Pomerantz (currently of Vancouver, Canada) with Mr. FBAR. At that point (March 2017) it was clear that the U.S. Department of Justice planned to sue Mr. Pomerantz to collect the FBAR penalties to which it felt entitled. It is worth noting that FBAR penalties are assessed under the Bank Secrecy Act (Title 31 of U.S. laws) which is different from the Internal Revenue Code (Title 26 of U.S. laws.) In order to collect FBAR penalties the U.S. Government must sue, and sue it did. The purpose of this post is to tell the story of what happened when the U.S. Government sued Mr. Pomerantz in U.S. District Court in Seattle. But, before we begin our story, this post is more about “Civil Procedure” than it is about “Mr. FBAR” … Bottom line: Although the U.S. Government suffered a temporary (probably) defeat, the defeat was because the Government failed to follow the rules of “Civil Procedure”. In other words, whether Mr. Pomerantz actually violated the FBAR statute was NOT the issue in this case. The issue was whether the Government followed the rules that they were required to follow in order to win their case. The Government did NOT follow the rules. Therefore, the Government lost. With that disclosure, we are no ready to begin yet another example of an adventure with Mr. FBAR. Once upon a time in District Court in Seattle …
It appears that the hearing took place in early June of 2017. In any event, the court’s judgement was dated June 8, 2017. Interesting fact: Mr. Jeffrey P. Pomerantz appeared “pro se” – he represented himself at the hearing. He may have had “legal advice” prior to the hearing. On the other hand, he may have had the assistance of the judge who recognized that he did NOT appear with a lawyer.
The judgement references the fact that Mr. Pomerantz sought to transfer the venue from Washington State to Washington, DC. Apparently his “lawyer of choice” was in Washington, DC. The court (for various procedural reasons) denied his request for this “change in venue”. In other words, the hearing took place in Seattle. Continue reading →
Update June 19, 2017:
The Department of Justice sued Mr. Pomerantz in Seattle. The purpose of the lawsuit was to get a judgment against Mr. Pomerantz. Interestingly, the Government lost the lawsuit for reasons unrelated to the substance of the issue. The Government failed to plead the facts that it needed to succeed in the lawsuit.
A full discussion of the ongoing adventures or Mr. Jeffrey Pomerantz and Mr. FBAR is here. The FBAR Chronicles continue … First, A Public Service Announcement – Mr. FBAR Get’s A New Filing Due Date
This is one more of my posts about Mr. FBAR. Mr. FBAR is a mean, nasty vicious thug who has no place in any civilized society. Thomas Jefferson once said:
Were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.
My thoughts are that:
Were it left to me to decide whether we should have FBAR without outlaws, or outlaws without FBAR, I should not hesitate a moment to prefer the latter.
Unfortunately, Mr. FBAR has become the new symbol of American citizenship. Furthermore, Mr. FBAR disproportionately affects the local bank accounts of Americans abroad – becoming (in effect) a form of “domestic terrorism” against U.S. citizens living outside the United States. Mr. FBAR As Applied To The Canada U.S. Dual Citizen … Continue reading →
This is Part 5 of a 15 part series on the Exit Tax. The 15 parts are: Part 1 – April 1, 2015 – “Facts are stubborn things” – The results of the “Exit Tax” Part 2 – April 2, 2015 – “How could this possibly happen? Understanding “Exit Taxes” in a system of residence based taxation vs. Exit Taxes in a system of “citizenship (place of birth) taxation” Part 3 – April 3, 2015 – “The “Exit Tax” affects “covered expatriates” – what is a “covered expatriate”?” Part 4 – April 4, 2015 – “You are a “covered expatriate” – How is the “Exit Tax” actually calculated” Part 5 – April 5, 2015 – “The “Exit Tax” in action – Five actual scenarios with 5 actual completed U.S. tax returns.” Part 6 – April 6, 2015 – “Surely, expatriation is NOT worse than death! The two million asset test should be raised to the Estate Tax limitation – approximately five million dollars – It’s Time” Part 7 – April 7, 2015 – “The two kinds of U.S. citizenship: Citizenship for immigration and citizenship for tax” Part 8 – April 8, 2015 – “I relinquished U.S. citizenship many years ago. Could I still have U.S. tax citizenship?” Part 9 – April 9, 2015 – “Leaving the U.S. tax system – renounce or relinquish U.S. citizenship, What’s the difference?”
_________________________________________________________________________________________ Part 5 – The “Exit Tax” in action – 5 actual scenarios and 5 actual tax returns
In order to see the graphic and brutal confiscatory effects of the U.S. Exit Tax in action I asked a licensed U.S. CPA who specializes in International Tax to consider the following scenario:
Relinquishment date: A person who renounced U.S. citizenship on November 1, 2014. Profile: He was a “middle class” person who was completely tax compliant in his country of residence. He was a saver and investor. He had worked hard for this money.
The CPA was asked to calculate the Exit Tax based on the following scenario. Note that the persons assets do exceed the $2,000,000 dollar U.S. threshold. Notice also that this example is representative of a “middle class” person. Continue reading →
— John Richardson – lawyer for "U.S. persons" abroad (@ExpatriationLaw) March 30, 2015
This is a good opportunity to engage the people of Quebec on the issues caused by FATCA and U.S. citizenship taxation. In Standtead Quebec approximately 25% of the town residents, including the Mayor Phillippe Dutil (featured in the interview), were born in Vermont, U.S.A.