— John Richardson – lawyer for "U.S. persons" abroad (@ExpatriationLaw) October 19, 2014
FATCA Hunt Begins
“FATCA Hunt” – the hunt for U.S. persons (whatever that is) began on July 1, 2014 which is “Canada Day”. Although both the definition of “U.S. person” (and whether one meets the definition) is not always clear, the search has begun. The level of FATCA awareness has begun. Some organizations are actively warning people that “U.S. Personness” matters. (The purpose of the warning is presumably to encourage people to “come clean“ and deal with their U.S. tax situations.) In some cases, there is no particular warning – just a letter indicating that they are suspected to be a “U.S. person”. Often one must prove to the institution sending the letter that one is not a U.S. person.
A Canadian wealth management company for doctors asks: "Are you a U.S. person?" http://t.co/ipc4Xn3Gs5 If so, consult a lawyer!
— John Richardson – lawyer for "U.S. persons" abroad (@ExpatriationLaw) October 22, 2014
The above tweet references a notice from a Canadian Wealth management firm for doctors after warning that they are required to (and will) report all U.S. persons to the IRS (via the CRA) state: Continue reading →
The Supreme Court of Canada has declared its independence from the Harper Government. This is a necessary, but not a sufficient condition for a successful legal challenge to a FATCA IGA. The recent Globe article includes:
Last week, the Supreme Court offered a declaration of its independence, reminding the Prime Minister that its power is constitutionally entrenched, not subject to his whims or arrogance. In pushing a highly controversial choice on the court, the PM tried to retroactively rewrite the rules via one of his much-criticized omnibus bills. The court’s stinging rebuke was applauded by pundits and editorialists across the land.
It all started back in 1961, when Phyllis Michaux, an American woman married to a Frenchman and living in France since 1946, found a friend in a similar situation. They began talking about the future of their children, their American and French citizenship and wondered whether there were other women “out there” in a similar position.
They had a question and an idea. The question was, “How many people are affected by the citizenship law 301(b)?” At the time under section 301(b) of the Immigration and Nationality Act of 1960, children born overseas of one American parent would lose their American citizenship unless they lived five consecutive years in the United States between the ages of fourteen and twenty-eight. Essentially, the children would have to move to the United States sometime before their twenty-third birthday to retain their American citizenship. The idea was to find out how many families were affected. This they did. And they did a lot more along the way.
On February 12, 2014 I made submissions to the New Zealand Finance and Expenditure Committee concerning a possible New Zealand FATCA IGA with the United States. My original submission may be found here.
At the end of that submission, the committee requested additional information about the 877A Exit Tax imposed on “covered expatriates”. The purpose was to assess the relevance of this information to a possible IGA between New Zealand and the United States. I have written a second detailed submission which is of relevance to ALL countries contemplating a FATCA IGA. This submission will also be of interest to those who wish to understand the workings of the Exit Tax on the most basic level.
Here is the pdf version of the submission. As always, comments are appreciated.
This article appeared in the Toronto Observer which is a paper published through the journalism program at Centennial College in Toronto. It’s great to see awareness of FATCA and citizenship-based taxation expanding. The article includes:
Former American Peter Dunn wants Americans living in Canada to ask themselves an important question.
“Am I really an American citizen?”
Dunn, 50, has recently co-founded the Isaac Brock Society, a group raising awareness about the Foreign Account Tax Compliance Act (FATCA). Dunn settled permanently in Canada in 1994.
FATCA, designed to hinder tax evasion, forces American-Canadian residents to file taxes with the Internal Revenue Service (IRS). Dunn believes FATCA takes advantage of Americans abroad.