Steven Mopsick has written another post on what I would call “Tax Justice For Americans Abroad”. I have commented on a number of Mopsick posts on this blog. Leaving aside Mr. Mopsick’s position on FATCA, he has consistently been opposed to citizenship-based taxation and has been a strong voice for exposing the injustice of the the FBAR Fundraiser and other IRS insanities.
The article referenced in the above tweet includes:
What should we expect? So the question is, what are we going to get following this announcement? Is it too much to hope for something like a safe harbor revenue procedure for Americans abroad which lists broad enough qualifications to allow middle class, hardworking Americans overseas, who are struggling economically as hard as their counterparts here in the US, to simply forget about penalties and start filing? What about the 43,000 people who have already paid more than $6 billion in back taxes and a 20 to 27.5% hefty tribute to Uncle Sam under the various voluntary disclosure programs? Can they now apply for refund? Probably not if they have signed an IRS closing agreement which generally cannot be revoked or amended absent fraud or mistake.
Another issue for practitioners and the Service is how to approach cases still in the pipeline?
Are people still going to have to hire an international tax lawyer or Big Four CPA firm to run through the soon to be announced “program modifications” to see if they qualify for relief? Advocates for tax justice for Americans abroad can take credit for the fact that a high level government official has finally acknowledged that “one size” does not fit all. He said “We are well aware that there are many U.S. citizens who have resided abroad for many years, perhaps even the vast majority of their lives.” Overseas Americans have been saying for years that their local banks in Paris, Montreal, or London are no more Foreign Financial Institutions to them, than the Piggly Wiggly is to U.S. resident Americans.
If the IRS announcement doesn’t say to just start filing and forget about penalties (which it will not), are people still going to have to apply to yet another program which works like a funnel closed at the small end and wait for over a year to talk to an agent? Why should people who are minding their own business and just trying to make ends meet have to hire a lawyer or CPA at all, just to satisfy the crazy concept that says if you are an American, Uncle Sam doesn’t care where you live, you owe us an annual tax return and an annual report on all your foreign bank accounts when they add up to over $10,000?