Few American laws have been as controversial as FATCA. FATCA stands for Foreign Account Tax Compliance Act, a law passed in 2010 to clamp down on the use of foreign bank accounts by U.S. taxpayers to hide money that is otherwise subject to taxation in the United States. FATCA is the U.S. government’s newest enforcement tool in the fight against international tax evasion.
Those that denounce the law criticize its complexity, its expansive reach, and the high cost of compliance. Those that like it (and there are some) argue that it will blow the lid off of “the old way of exchanging tax information between countries on request,” which they view as too lenient on tax cheats. FATCA, they predict, will revolutionize the exchange of information, by making it “automatic,” thereby removing any safe harbors for those who have, shall we say, less-than-pure motives.
What is it about this pestilent law that engenders such strong emotions? Very simply, it turns foreign banks and financial institutions into enforcement arms of the Internal Revenue Service (IRS). Foreign financial institutions are put in the untenable position of having to choose between disclosing account information on clients who are “U.S. persons,” on the one hand or paying a whopping 30% of all payments they receive from America to the IRS, on the other. Although they seemingly have two “options,” most foreign financial institutions would argue that they have only one real option if they want to be around long enough to report next year’s quarterly earnings, and that is to succumb to Uncle Sam’s heavy-handed demands and turn over U.S. accountholder information.
Regardless of what side of the fence you are on, recent statistics support the notion that the threat is having the effect that it was intended to have. More than 77,000 financial institutions have signed up. And approximately 80 countries have entered into agreements with the U.S. to permit their banks to surrender information to the IRS.
Against this backdrop, there is an enormous amount of confusion (not to mention little guidance) when it comes to interpreting key aspects of FATCA. For example, determining which funds, trusts and other non-bank entities should be classified as “financial institutions” under the law is as much a mystery as trying to find where the body of former teamster boss, Jimmy Hoffa, is buried. And it doesn’t end there.
There is also confusion over a provision that is as fundamental to FATCA as the right to due process is to U.S. citizens under the U.S. Constitution: who is a “U.S. person.” Incredibly, financial institutions have had to guess whether certain accountholders satisfy the definition of U.S. person. In other words, are they the type of persons intended by FATCA for information exchange?
The definition is expansive and includes not only citizens but current and former green-card holders and non-Americans with personal and economic ties to the United States. Some Canadian snowbirds who prefer to trade the cold and desolate tundras for the sundrenched beaches in Miami could be caught in the net, says Allison Christians, a tax professor at McGill University.
As these complexities have surfaced, the U.S. government has had to extend several deadlines. For example, there is a two-year moratorium on enforcement for banks so long as they have made efforts to comply.
FATCA has sent shockwaves through the U.S. expat community, a sizeable population estimated to be a whopping seven million! Thousands are being treated like “second-class citizens” by their once friendly foreign banks. Indeed, many such banks have drawn a line in the sand, saying that they no longer want their business because it is too much hassle. Many others have been forced to spend a good chunk of change trying to straighten out their paperwork with the IRS, even when they owe no tax. In fact, few if any even owe tax thanks in part to the foreign tax credit.
This frustration has caused some expats to take inspiration from the famous line in “Network”: “I’m mad as hell and I’m not going to take this anymore!” Almost 3,000 expats renounced their citizenship or green cards in 2013, not an insubstantial amount in light of how overwhelmingly burdensome the process actually is. Indeed, it makes renewing a license at the Division of Motor Vehicles a “walk in the park.” More than 1,000 did so in the first quarter of 2014 alone. Prior to FATCA, that number paled in comparison: it was just a few hundred a year.
Others have remained citizens but are rising up and fighting back, mounting a powerful uprising that is gaining momentum every day. For example, a Dutch-American citizen sued a Dutch lender that, pre-emptively, closed his account and 149 others. He won the case.
While no two groups have had the wrath of FATCA rain down on them with more fury than foreign financial institutions and U.S. expats, the fact remains that they are not the only two groups to be effected by it. Believe it or not, FATCA even places a burden on the IRS. How so? By creating more work for an agency that is already understaffed. Very simply, the agency is being given more to do with fewer people to do it, leaving it “on the verge of collapse,” according to a former senior official.
The biggest travesty is that for as much pain as FATCA is causing, experts predict that the likelihood of success is slim to remote. These grim predictions suggest that FATCA will fall short of accomplishing its goal. Why you ask? It doesn’t take a rocket scientist to realize that those tax dodgers who are hell bent on using offshore accounts to hide their assets from Uncle Sam are the least likely to open foreign bank accounts in their own names. While FATCA may pierce some of the shell companies they hide behind, Senate investigators and other experts admit that loopholes remain.
Part and parcel of that is the question of whether FATCA is self-sustaining economically. In other words, will it pay for itself? Unfortunately, this question is not susceptible to a “yes” or “no” answer. Instead, the answer is “maybe.” According to Congress, FATCA must net at least $ 800 million a year in order to pay for itself. Ironically, the law was passed without any formal cost-benefit analysis. Notwithstanding, experts believe that the overall costs of complying – a burden carried by non-American banks – will far exceed the additional tax that the IRS would ever collect.
Mark Matthews, a former deputy commissioner of the IRS who is now with Caplin & Drysdale, argues that the effort that has gone into rooting out offshore tax evaders is disproportionate to domestic tax evasion, in the sense that the amount of taxes evaded by the latter far exceeds the former: the sums they (offshore tax evaders) rob from the domestic coffer “look[s] like a pinprick” compared with other types of tax dodging, such as the underreporting of income by small U.S. businesses.
As more countries are pushed to the brink to share tax information, the focus will shift to America’s willingness (or unwillingness) to reciprocate. Who can forget the expression made famous by a dull nursery rhyme: “What’s good for the goose is good for the gander!” For example, consider Latin Americans. Although this group is a large user of banks in Florida, the U.S. has not gone out of its way to share data with Latin American countries.
And when it does, the type of information that it makes available for exchange pales in comparison to the type of information that it demands from foreign banks in exchange. For example, the U.S. only has limited information to exchange on the owners of shell companies. And while it might have a valid excuse – i.e., it does not collect their names itself – it nonetheless makes the U.S. out to be a hypocrite.
Some FATCA partner countries have been even more scathing in their criticism of the U.S., stating that the U.S. is worse than the tax havens it deplores.
Do you agree or disagree? Comment below or join my new Community for discussion on all FATCA related discussions:
FATCA Tracker
Original Post By: Michael DeBlis
As a former public defender, Michael has defended the poor, the forgotten, and the damned against a gov. that has seemingly unlimited resources to investigate and prosecute crimes. He has spent the last six years cutting his teeth on some of the most serious felony cases, obtaining favorable results for his clients. He knows what it’s like to go toe to toe with the government. In an adversarial environment that is akin to trench warfare, Michael has developed a reputation as a fearless litigator.
Michael graduated from the Thomas M. Cooley Law School. He then earned his LLM in International Tax. Michael’s unique background in tax law puts him into an elite category of criminal defense attorneys who specialize in criminal tax defense. His extensive trial experience and solid grounding in all major areas of taxation make him uniquely qualified to handle any white-collar case.
20 comments on “Is FATCA Doing More Harm Than Good?”
To a certain degree, tax evasion worldwide has become a sport. The sport is becoming a blood sport.
While the US has the right to enforce its tax laws, it owes its citizens and the world the obligation to do this as straightforward and simply as possible.
FATCA and the way it has been implemented with repetitive forms (FBAR, 8938, 5471), lack of guidance, unclarity, tens of thousands of corporate officers of multinational companies having to file, and overreach is a fiasco.
In addition, getting the documentation and information to comply is difficult and there are no good faith exceptions or extensions.
Trip up and you’ve got nasty penalties and maybe a felony charge.
My experience is that many expats and overseas US citizens have not been in compliance with the tax laws for many years. Now they are going to be caught with FATCA, instead they are giving up their citizenship. Not a big loss.
Despite my negative views, I think the success is overwhelming. The vast majority of the non-compliers and tax preparers have gotten the message. It is causing fear and compliance. It not just the taxpayers, the tax preparers who used to turn a blind eye will not any longer. Just look at the OVDP program.
I don’t understand why the US still wants for FATCA to be legal. It forces entities around the world to discriminate against locals according to their place of birth, while such national origin discrimination continues to be a US federal crime. I had to renounce US citizenship in response to such discrimination, since I needed to refinance my mortgage. So, if the US really wants to continue to insist that it needs to violate its laws in order to discriminate against its expat population, then shouldn’t at least treat is expats much better than how it is doing so today, such as adopting residency-based taxation like how such is already being practiced by the rest of the world?
Seriously, FATCA is closing off opportunities for Americans to live and work abroad. I just tried to open a new local retirement savings account, quite similar to one I already had open. I’ve financed the one I’ve had open since the beginning with money taxed in the US, and reported my balances accurately.
Local retirement savings accounts have a local (non US) tax disadvantage in that one must withdraw them all at once, thereby taking a huge tax hit.
So many people split them into multiple accounts. I was advised to do this, too. But when I tried to open a new account, there’s this uniform questionnaire one must fill out, in which every account holder must confess whether they are American or not. I checked that I was, and was told flat out that the company does no business with US citizens.
Day-to-day hassles and discrimination like this is but one one of the many drawbacks of the mallet-headed thinking behind FATCA. Our Congressional lawmakers have become an embarrassment.
FATCA should be repealed, though even that would only partially reverse the damage already done. Once a country misbehaves as the US have in trying to turn foreign banks into its policemen, then trust is shattered — foreign banks will think, “OK, so they wised up and fixed this nonsense, but how long will it be before they come up with some new insanity?”
But repeal the thing anyway, and draft a formal letter of apology to foreign institutions, normalize tax policy with that of other countries of the world, and stop being such arrpant special-case problem children.
What is that causes strong emotions? How about having my foreign spouse have his bank investigage our family like we are criminals for having one U.S. person in the family and on the accounts? How about having it implied to us after finding there was an American born person on the account that perhaps we wouldn’t find our mortgage terms very favorable when it was time to renew. We are in our fifties, lower income, we cannot afford to not have our mortgage renewed. How about being the only U.S. person in the household who has family back in the U.S. but, now you are are burden to your foreign spouse and kids because THEY cannot bank, save and get accounts normally as any other citizen of their country can? How about being a burden to your spouse and kid because you are American. Most foreign spouses somehow don’t think their account numbers, balances and transactions are any business of the U.S.A. where they have never lived or worked or been a citizen. ACA has pointed out that many low income women abroad are being put in some very, very onerous and difficult situations because of FATCA. I was one. I had to relinquish my citizenship so my family here could bank and save and hold a mortgage normally. I could not up and move back with foreign spouse and kid in tow. It was the most painful gut wrenching decision of my life. And what do I get back when I tried to write house ways and means? Nothing. What happened when Nina Olsen pointed out some would not be able to keep their citizenship to congress? Nothing. For all the hardships and problems this is causing forcing people to have to choose between their country of birth and their family abroad is the absolute worst and yes it brings up a lot of emotions. Emotions I am not so sure will ever go away. It shouldn’t be so difficult to understand. We are just considered collateral damages. It’s hard for me to think no one inside the U.S. can’t see what is wrong with this picture and even harder to realize they simply do not care.
Ruth,
As the Founder and CEO of http://www.taxconnections.com, I want you to know that we do sincerely care. When I hear stories like yours of families being torn apart, it makes us work even harder to get the message out.
We Care,
Kat Jennings, CEO of TaxConnections
Being the only nation in the world, along with the dictatorship of Eritrea, which double-taxes foreign income earned by non-residents, one would expect for America to treat its expats royally and to make every effort to ensure that they were not discriminated against due to their national origin, as well as making expat filing simple and free.
Instead, the contrary is the case. America and Eritrea are the both the most hostile nations towards their expat community. They accuse their expats of being nasty things, encourage national origin discrimination against them and make it difficult for them to renounce.
This is not the America that I grew up in. It is no longer the land of the free. Rather, it has become a nation which is filled with greed and corruption that treats people as being its property.
At the very least, the US government owes its expats a huge apology.
Kat Jennings, please re-read Ruth’s two-part final sentence: “It’s hard for me to think no one inside the U.S. can’t see what is wrong with this picture and even harder to realize they simply do not care.”
And now here’s your half a reply: “I want you to know that we do sincerely care. When I hear stories like yours of families being torn apart, it makes us work even harder to get the message out. We care.”
Ummm… Twice you care… but you have dodged the “what’s wrong with this picture” half. Do you know what’s wrong, and would it be made right by the unstated “message” you offer as a panacea?
Specifically, what is your message, and how does it remedy the wrong behind Ruth’s story?
The only way you will have any credibility as being caring is if this nebulous “message” you claim you promote is in fact to U.S. lawmakers to scrap citizenship-based taxation, (the entire cause of Ruth’s problems), and adopt the international norm of residence-based.
If advocacy to eliminate Ruth’s CBT problem is not the TaxConnections message (and I don’t see that as “the message” anywhere on your website), then your claim to be caring to her amounts to just so much more empty, uncaring homelander hypocrisy.
Shovel,
We are starting the process of collecting everyone’s views on FATCA in the http://www.taxconnections.com FATCA Tracker Community. Just go to TaxConnections; Scroll down to the bottom of the home page and Click on “All Communities” then join the FATCA Tracker Community led by Michael DeBlis. Tell everyone you know to join this Community and communicate their experiences in the FATCA Tracker Community we just started.
We want to aggregate all these stories and demonstrate how they are affecting expatriates lives abroad. You have my promise we will be bringing the FATCA Tracker Community to the attention of Congress. We want to educate Congress how the world feels about the laws they made. Our goal is to acquire a thousand different examples of how these laws are negatively affecting expatriates. Please encourage everyone to tell their stories in FATCA Tracker Community.
Kat Jennings, Founder and CEO
http://www.taxconnections.com
Thank you for clarifying. I withdraw my final “if…then” paragraph with apologies.
I have posted your request for stories to the Isaac Brock Society website, along with your explanation of intent.
I (again) point out there is already a strongly-worded document drafted by a group of highly aggrieved expatriates. It’s called “The Declaration of Independence”. And though Congress clearly is unaware of its lessons, if Congress were to be alerted, it could provide valuable context for your compilation of stories.
(There is one caveat; though some have held its authors to be patriotic freedom fighters, Congress might condemn them as tax-evading terrorists… it’s a bit risky trying to predict how Congress would react. In light of what Congress is doing today to U.S. expats, I suggest the Declaration is worth a read, anyway.)
The US government is the single biggest threat to Americans living abroad.
“What is it about this pestilent law that engenders such strong emotions?”
Answer: “it … makes the U.S. out to be a hypocrite.”
However, the hypocrisy isn’t only about some lack of reciprocal information sharing.
With Citizenship-based taxation (enforced by FATCA), the U.S. hypocrite has enacted and implemented the very evil its founders judged so abhorrent they took up arms to defeat. Ask those tax-evading gentlemen about “pestilent law that engenders such strong emotions”.
The answer is that CBT and FATCA together make the U.S. out to be a hypocrite… against its own founding principles.
I am a retired señor citizen. I have worked hard all of my life to save for retirement and live off of a meagre pension. Since the enactment of FATCA and the enforcement of CBT my days and nights are filled with overwhelming emotions vacillating between rage and terror. These feelings NEVER leave me. The US will put me on the street, make me a bag lady, if what I am suffering through this doesn’t kill me first.
I fail to understand how the US has been allowed by other nations to actually pull this off. There is no argument in the universe that can justify this. If they had banned together and all just said no to the bullying and extortion what could the US have done? Why are all nations behaving like obedient dogs to their master?
On the up side, now I truly understand what rage, betrayal and hatred feel like. The fact that the US is trying to destroy me and my government will not protect me renders me stateless. This is a terrifying position to be in. Four months ago all I worried about was mastering crochet patterns, now I am fighting for my life. This is just simply cruel.
“Why are all nations behaving like obedient dogs to their master?”
With the dollar (for now) being the world’s reserve currency, the U.S. is temporarily able to run an extortionist protection racket (30% withholding threat) against other countries; that’s one of the things “shining beacon on the hill” thugs do.
John:
I couldn’t agree with you more about how burdensome compliance is. As basic as it might seem to someone on the outside looking in, a task as simple as obtaining account statements can turn into a Herculean feat.
You’ve also identified a growing trend — i.e., that the number of U.S. citizens renouncing their citizenship has risen dramatically. Those doing so have made a bold statement, inasmuch as the obstacles for doing so are quite burdensome, from the extensive paperwork to the onerous “exit fee.”
Regardless of what side of the fence people are on, one thing is true: FATCA has certainly gotten people’s attention.
What’s so interesting about these comments is how they all relate to public policy: i.e., the United States’ justification for worldwide taxation of its citizens and residents. As many are aware, that justification has its roots in a United States Supreme Court case that goes back to 1924: Cook v. Tait.
The Court relied on the putative benefits of U.S. citizenship (i.e., governmentally furnished benefits). for justification of worldwide taxation. In this respect, three models of U.S. citizenship are relevant: minimalist model, psychological model, and Tiebout/purchase model. None justify the worldwide taxation of U.S. citizens and residents on a benefits basis.
The minimalist conception of U.S. citizenship emphasizes that few legal rights flow from U.S. citizenship. The psychological model highlights the intangible emotional and symbolic value of a U.S. citizen’s membership in a “proud and historic political community.” The Tiebout/purchase model of U.S. citizenship views citizenship as a public service that a citizen purchases through tax payments.
Here are my views:
The benefits rationale for U.S. worldwide taxation is not persuasive, either in theory or in practice. The most significant civil and social benefits extended by the U.S. government are tied to U.S. residence, not to U.S. citizenship.
The Tiebout/purchase characterization of citizenship as a public service purchased through tax payments is the strongest benefits argument. However, even that approach is not consistent with the current system, which in practice charges different tax prices for the identical benefits of U.S. citizenship, depending upon the level and kinds of taxes asserted by the nation in which a U.S. citizen resides and earns his income.
Ruth:
I join Kat in saying that “I do care.” Your story is very powerful. We need to be persistent in getting the stories of folks like yourself — who have been ensnared in the coils of a law that places insurmountable burdens on those whose U.S. citizenship was the result of nothing more than birth place — to those who can influence change: Congress.
Shovel:
Thanks for sharing that. I will read it.
I am weary of comments like:
quote
People with dual citizenship make that choice, and they owe taxes to the US in some circumstances. Tough.
unquote
This comment relates to all “Accidental Americans”. The Lord Mayor of London, Boris Johnson, is one of them and he has put this into the world news where it needs a better airing. His story will get much better notice than those I speak of the same I speak of.
Yes, FATCA is absolutely doing more harm than good. Too often, it will also affect the most vulnerable.
I do realize that US law requires my Canadian-born-to-two-US citizen-parents son be *extended* US citizenship, but it does not solve my family’s US citizenship-based taxation law problem for my Canadian son (even if this is said to not be intended for him or others like him). Most as he cannot renounce (even if they had the US$2,350 fee for what is a right – to expatriate) because he does not understand the concept of citizenship. The Department of State regulations state that a parent, a guardian or a trustee cannot act on such a person’s behalf, even with a court order.
As far as I’m concerned my Canadian-born son who happens to have a developmental disability as his mental incapacity has no more ‘requisite mental capacity’ to do everything required of him to comply with some US law (extra-territorial in Canada) than he does to be able to renounce a US-defined US citizenship never asked for — he has never lived in the US and has never had any benefit from the US, only from Canada, the country of his birth. Canada is also where his family lives.
Those who are “Accidental Americans” don’t have / didn’t have the choices that I had and I made by becoming a Canadian citizen in 1975 (and being told at that time that I would be losing my US citizenship by doing so) and in renouncing my US citizenship finally with a Certificate of Loss of Nationality in 2012. I maintain that with the US citizenship-based taxation law, all “Accidental Americans” should absolutely have a choice — a claim. Until *claimed* as an adult with ‘requisite mental capacity’, it should be THE SAME AS NOTHING! To entrap “Accidental Americans” into having to pay US tax and entrap even more deeply those without the mental capacity, unable to renounce their US-defined US citizenship and all the ongoing consequences of that fact, is not something any country should feel proud of. If there is such a thing as citizenship-based taxation (when the rest of the world, save Eritrea) practices residence-based taxation, then the US law should not be such that it would entrap one such person into a US-defined US citizenship. The US needs to get in step with the rest of the world who practice residence-based taxation.
I very much agree, on behalf of ALL “Accidental Americans” and my son AND ANY OTHERS WITHOUT REQUISITE MENTAL CAPACITY (like a brain injury from accident or stroke, developmental disability or conditions like age-related dementia) especially, that these statements need to be made:
– The laws of the United States end at its borders.
– For “Accidental Americans”, US citizenship should be a CHOICE when they are adult and WITH requisite mental capacity.
– They should be able to say I have never had any voluntary connection to the U.S. including: not living in the U.S., not born in the U.S., and if born in the U.S., not choosing where I was born (and I left the US with my parents to return to their country as an infant or minor child).
– They should be able to say I will not allow the U.S. to forcibly impose US citizenship, (and the financial terrorism it implies) on me without my consent — OR in the case of a ‘mental incapacity’ the consent of my parent(s), guardian(s) or trustee(s).
– They should be able to say Because I have no voluntary connection to the U.S. I will pay not one penny to extricate myself from U.S. claims of ownership.”
My son and others like him have NOT had benefit of US-defined US citizenship per all US claims that he and others like him have such benefit. In fact, such an automatic US-defined ‘US citizenship’ causes further discrimination in my son’s own country, Canada, as he does not have the same opportunity and benefits of a Canadian Registered Disability Savings Plan (RDSP) to save for some of his future needs as any other Canadian who has a disability. Further, in my family’s situation, U.S. taxes ($3,661 USD) have been assessed and paid (from my Canadian-only earned and taxed retirement savings) to the IRS because I, parent and trustee, hold an RDSP on behalf of my CANADIAN adult son. The Disability Tax Credit and the RDSP are not part of the Canada/US Tax Treaty. (Nor are the Canadian Registered Education Saving Plan to help pay for our children’s educations nor the Canadian Tax Free Savings Account part of the Canada/US Tax Treaty.)
Something is very wrong with such consequences. This absurdity may not be intended for those such as my son, but how does it not affect my son and such others like him? I say my son is ONLY CANADIAN and deserves the same rights as any other Canadian. He is NOT a ‘US citizen who happens to reside in Canada’ as he is referred to by the Canadian Conservative government who legislated implementation of the IGA signed with the US to make Canadian banks and the Canada Revenue Agency arms of the IRS! He is, with the FATCA IGA, now deemed a second-class Canadian to any other Canadians – no matter their national origin or the national origin or their parents. I say he is a Canadian just as I who chose this country and naturalized as a Canadian and have now officially renounced any US citizenship or allegiance.
From the U.S. Department of State Foreign Affairs Manual Volume 7: Consular Affairs:
“It is a generally recognized rule, often REGARDED AS A RULE OF INTERNATIONAL LAW, that when a person who is a dual national is residing in either of the countries of nationality, the person owes paramount allegiance to that country, and that country has the right to assert its claim without interference from the other country.”
The hypocrisy is staggering.
Your experience is emotionally riveting. Words can’t begin to describe what you and your family are going through. Stories like yours help draw attention to how the U.S. system of worldwide taxation casts too wide a net, unjustly targeting “Accidental Americans”who enjoy absolutely no benefits of U.S. citizenship.
Recall that the case that gave constitutional justification for the U.S. government’s worldwide taxation of nonresident U.S. citizens was Cook v. Tait. In sustaining the federal income taxation of a nonresident citizen’s Mexican-source income, the Court emphasized “that government by its very nature benefits the citizens and his property wherever found.
If the basic tenets of citizenship are civil rights, political rights, and social rights, then it is hard to imagine how a person born outside of the U.S. to a mother or father who happen to be U.S. citizens can automatically be classified as a U.S. citizen.
While the U.S. might consider its system of worldwide taxation to be the most efficient to administer, it casts too wide a net.
Thanks for sharing this heartfelt story.
http://taxconnections.com/taxblog/help-i-want-to-expatriate-but-they-wont-let-me-part-ii/#.VItIB8kYFDQ
Virginia La Torre Jeker advises that ‘if the individual is under a permanent mental incapacity such that renunciation will never be possible, then proper planning of US tax matters becomes even more critical. A well-meaning parent or guardian may often look to trust structures to ensure the continued care of the child or mentally challenged individual. However, setting up a “foreign” (non-US) trust for such an individual may well be the worst action to take from a US tax planning perspective! The stakes are high. Get proper advice.’
I feel the only real answer to what (I consider) an absurd injustice of the consequences of an automatic US-defined US citizenship never asked for has to be litigation.
If such vulnerable persons can be entrapped by this not claimed / not asked for designation of *US* in a country outside the US in which they were born and live, unable to renounce because they cannot understand ‘citizenship’, must have no influence from anyone else and their parent(s), guardian or trustee cannot act on their behalf into the consequences of US citizenship-based taxation, some Senators and Congressmen are asleep at the switch. Others in the US may, I hope, perhaps put themselves into the shoes of such families and determine if they would like to be treated as a US slave with the expensive consequences of US tax law and accounting professional help each year in order to be able to comply — having never lived in, had or asked any benefit from the USA. If they still feel that this is warranted, there is little hope — and proof to me that citizenship-based taxation law combined with FATCA to highlight such persons in other countries is only for the exceptional in the USA (and the other country, Eritrea)– punitive and one of the USA’s cash cows. Why, oh why, will the US not change to residence-based taxation so situations like this entrapment cannot ever happen? No one has yet given me a good reason for the exceptionality of the US keeping citizenship-based taxation.
Can anyone here?
Comments are closed.