What follows appeared at the Isaac Brock Society:
United States IRS international revenue officers admit they they have a few problems in “International Collection cases” and really could use Canada’s help.
The IRS difficulties include:
“—The taxpayer could pay, but the IRS was unable to collect the liability because the taxpayer resides in a foreign country.
—The IRS was unable to locate the taxpayer or their assets [Canada’s FATCA agreement should be very helpful.]
—The IRS was unable to contact a taxpayer, and although the taxpayer’s address was known, there was no means to enforce collection.”
The IRS expects to get around these problems in part with a CUSTOMS HOLD:
“International revenue officers can request that a Customs Hold be input into the Treasury Enforcement Communication System (TECS) for delinquent taxpayers.
Once the taxpayer is on the TECS, the U.S. Department of Homeland Security (DHS) notifies the IRS whenever the taxpayer travels into the United States [Last week a Canadian notified me that this threat was made to him by an IRS official — He and I wondered why Homeland Security would be involved. Now we know.]
During our interviews with a judgmental sample of 15 international revenue officers and all five group managers, many identified the Customs Hold as one of the most effective enforcement tools available to them in dealing with delinquent international taxpayers. International revenue officers use information obtained through a Customs Hold to attempt to contact the taxpayers while they are in the United States and/or locate the taxpayers’ assets.”
The Canadian government also wants to help the United States collect money from “delinquent” Canadian citizens resident in Canada by helping the U.S. enforce the FATCA law. It agreed to do this only because it is afraid of economic retaliation by the United States.
U.S. Persons Abroad - Members of a Unique Tax, Form and Penalty Club 