Her thoughtful post includes:
FATCA Security Risks with Sensitive Data
The Foreign Account Tax Compliance Act, commonly called “FATCA” has caused Americans abroad to be fearful of security risks when their personal financial information is reported by non-US financial institutions or foreign government agencies to the IRS. FATCA reporting will include the name, address and taxpayer identification number of each US account holder at the financial institution; the account number; account balance and value; the account’s gross receipts and gross withdrawals or payments; and other account related information requested by the Internal Revenue Service (IRS). The Treasury Inspector General for Tax Administration has expressed concerns with the security of data transmission as mandated by FATCA. In September of 2014 the IRS issued a fraud alert to all international financial institutions that are complying with FATCA. Scam artists posing as the IRS have fraudulently solicited financial institutions seeking account holder identities as well as financial account information. Financial institutions directly registered to comply with FATCA, and those in jurisdictions that are treated as having an IGA in effect to implement the FATCA provisions through their home governments, have already been approached by parties impersonating themselves as the IRS. The IRS now has reports of incidents from various countries and continents.
The most significant piece of information that a U.S. citizen discloses to a “Foreign Financial Institution” under the FATCA IGAs is his/her TIN (“Taxpayer Identification Number”) AKA his “Social Security Number”.
I received the following email today from the U.S. State Department: firstname.lastname@example.org. It is clear that the U.S. will no longer be offering “Social Security Services” from the U.S. Consulates or Embassy in Canada. I presume this also means that the Social Security numbers cannot be obtained from U.S. Consulates in Canada. Assuming this to be true, this is one more big headache for Americans in Canada who are attempting to become U.S. tax compliant.
What follows it the bulletin from the State Department:
United States Embassy Ottawa, Canada
Notice Regarding Social Security Services
September 29, 2017
The Social Security Administration (SSA) has consolidated its overseas operations and will no longer be offering social security assistance through the United States Embassy or Consulates in Canada. Effective October 1, 2017, individuals residing in Canada who require social security services or have questions about SSA benefits must contact their nearest SSA field office in the United States.
Please be advised that as of October 1, the United States Embassy and Consulates across Canada can no longer accept telephone calls, emails, or walk-in consultations regarding Social Security issues.
For questions regarding your application or your benefits, residents in Canada can find their designated field office on the SSA website: https://www.ssa.gov/foreign/canada.htm. SSA may require you to appear in person to submit your SSA application.
For general information on SSA services for people living outside the United States, please visit https://www.ssa.gov/foreign/.
If you are already receiving SSA benefits payments, there will be no change in the method of distribution of those payments.
For further information for American citizens in Canada:
• See the Department of State travel website for the Worldwide Caution, Travel Warnings, Travel Alerts, and Canada Country Specific Information.
• Enroll in the Smart Traveler Enrollment Program (STEP) to receive security messages and make it easier to locate you in an emergency.
• The U.S. Embassy in Ottawa is located at 490 Sussex Drive, Ottawa, Ontario, K1N 1G8, and is open from 8:00 a.m. to 12:00 p.m. Eastern Time on Monday, Tuesday, Thursday and Friday. You can reach us at 1-613-688-5335 during business hours. If you are a U.S. citizen in need of urgent assistance outside of business hours, the emergency after-hours number for the U.S. Embassy is 1-613-238-5335.
• Call 1-888-407-4747 toll-free in the United States and Canada or 1-202-501-4444 from other countries from 8:00 a.m. to 8:00 p.m. Eastern Time, Monday through Friday (except U.S. federal holidays).
Click here if you need help with the process of renouncing U.S. citizenship.
Why do some Canadians wish to have a U.S. Social Security number?
Many Canadians are in the process of coming into U.S. tax compliance. One might ask:
Why would a Canadian citizen residing in Canada wish to come into U.S tax compliance?
There are two reasons why Canadian citizen/residents file U.S. tax returns:
1. They have learned that they are U.S. citizens or learned about U.S. “citizenship taxation” (perhaps encouraged by a FATCA letter or their local CPA) and they wish to file U.S. taxes; and/or
2. They have learned that they are U.S. citizens and wish to come into U.S tax compliance to “renounce U.S. citizenship” and avoid “covered expatriate” status (particularly important if they wish to take advantage of the “dual citizenship” exemption to the S. 877A Exit Tax).
Regardless of the motivation, one must do considerable work for the privilege of filing U.S. taxes.