Category Archives: Retirement planning for Americans abroad

Q. Who are the #Americansabroad “forced” to renounce US citizenship A. Those who are tax compliant

The above tweet references the following comment on the RenounceUSCitizenship blog that is worth a “stand alone” post:

I renounce June 8. I have not lived in the US at all since 1992. I did know about the ludicrous requirement to keep filing taxes annually and did so. Last year when I moved to France (from Australia), my “non-US person” husband and I opened a joint bank account. I did consider leaving my name off (to stop having to file fbars), but why should the one fact that I happen to be a US citizen dictate simple, everyday, choices like that? So we opened a joint acount. About a week later, the bank called us in–we didn’t know why. Our account representative (yes, a REAL person – in France people are still treated as humans – not as consumers with numbers and no faces) explained that because I had indicated on my application that I had been born in the US, I had to sign a form required by the US. This was the first I had ever heard of FBAR. Being called in and having to sign the form made me feel as if I had been raped by Uncle Sam! Only me–my husband was not a “US person” so no problem with him. That’s when I started really looking into it. And really thinking. Since 1992, when I started filing, things have just gotten so ridiculousy complex, and I can no longer suffer the intrusion on my time, health and freedom. Yes, I am forced to renounce because I happen to live overseas. For me, I had always seen the hypocrisy of the US–I remember in the 70s when I was in high school in the US reading things in the newspaper that the US did, and recognizing that what ‘we’ were doing was so often the exact things that ‘we’ criticized the Soviets for. doing, I could go on. I find that it is the US citizens who are worldly, can think deeply and widely to see various sides of issues (not just “You’re either with us or you’re against us!”) and are HONEST (i.e, file US taxes once they find out it is a responsibility to do so) who are the ones to renounce. Sadly for the US, we are exactly the type of people needed to make a country great in this globalizing world.

The #FATCA Retirement and other assorted #CookvTait short stories …

Have you either considered stopping working because of U.S. policies toward Americans abroad? Have you stopped working? Have you given up attempting to plan for your retirement?

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FATCARetirement

Updated and continued on January 8, 2015 …

Meanwhile back on the Homeland Front …

As the above tweet confirms:

Yes, it’s true! Americans abroad are damaged by FATCA, FBAR and CBT. Who could have known? Of course the “FATCA Retirement” is only one form of damage. What follows is the message forwarded  from ACA and rerouted to me:

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“… living life as an American is all about living in fear, ALL THE FUCKING TIME!! Fear of the government…”

Americans who self-identify as expats as opposed to citizens of other countries seem to believe that the solution to their problems related to the USA lies in Washington DC. But DC is the source of the problem, and its functional purpose is to serve Homelanders not expats.

A lot of the 8.5 trillion so-called Americans abroad do not self-identify as Americans but as citizens of their country of residence. Hence, they are not lobbying Congress or the POTUS, because these branches of government represent not the expat but the Homelander.

This post ushers in one of the most interesting discussions among non-U.S. residents who are deemed to be U.S. citizens. Truly fascinating. This discussion should be sent to Washington, DC (let’ pretend that they care).

U.S. residents do NOT experience the United States (and the world) the way non-U.S. residents experience it. We have just passed the 4th of July.

The above tweet references a comment from the Facebook discussion that should be required reading for all. Many of those trying to navigate the new FATCA and FBAR world often wonder whether they are “really American”. Does this really apply to them? I have often jokingly (or maybe not) suggested that:

 

“If you are terrified of the U.S. Government then you are truly American”.

Consider the following comment from the Facebook discussion.

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The American in Canada – Investor education from @TfRitchie interviewed by @rcarrick

In 2012 I did a post about Terry Ritchie’s book “The American in Canada“. It is referenced in the following tweet.

Mr. Ritchie is has done a series of interviews with the Globe and Mail’s Rob Carrick as follows:


A 2012 presentation by Mr. Ritchie:

Statement from @AARO (unlike @DEMSabroad) supports Bopp #FATCA lawsuit

https://www.facebook.com/groups/AmericanExpatriates/permalink/492020850963992/

Official statement from AARO on the FATCA Lawsuit filed last Tuesday.

The filing of the lawsuit challenging the constitutionality of FATCA is one more development in the history of a law that AARO has always felt was crafted hastily without thinking of its repercussions on the estimated 8.7 million Americans living and working around the globe, the vast majority of whom are law-abiding citizens who strive, even when it is difficult overseas, to comply with their country’s tax laws.

As a non-partisan organization representing the interests of all overseas Americans, AARO supports all efforts to eliminate or alleviate the damaging effects of FATCA, including this constitutional challenge that would have the law repealed. Likewise, since the very early days of FATCA, we have supported the “safe harbor” concept that would eliminate from FATCA reporting the accounts held by overseas taxpayers in the country where they are fiscally domiciled. In that connection, we are grateful for the efforts of the Co-chairs of the Congressional Americans Abroad Caucus to convince Treasury Secretary Lew and IRS Chairman Koskinen of its merits.

Both approaches appear to us to pose problems – in the case of the constitutional challenge, probable litigation that could take months if not years to resolve, and in the case of the “same country exception”, probable difficulties in satisfying banks and the IRS of a taxpayer’s legitimate status abroad. However, we support any effort to alleviate the negative effects of FATCA on Americans abroad. AARO’s sole concern is the financial, professional, domestic and personal well-being of people abroad who are being treated like “tax cheats” because of financial accounts they must maintain in their countries of residence.

Note that the statement from Democrats Abroad condemning the Bopp/Republicans Overseas FATCA lawsuit is here.

#Americansabroad will be subject to “economic quarantine” in a #FATCA world

The above tweet references a comment at the Isaac Brock Society.

@Nervousinvestor

See Deckard’s comment here:

http://isaacbrocksociety.ca/2015/01/27/are-strata-corporations-the-next-target-of-canadian-banks-fatca-zeal/comment-page-1/#comment-5391660

and Badger’s comment here:

http://isaacbrocksociety.ca/2015/01/27/are-strata-corporations-the-next-target-of-canadian-banks-fatca-zeal/comment-page-1/#comment-5394406

It is quite obvious that “U.S.ness” is a form of contamination that has the potential to first infect and then effect every aspect of human society. In Deckard’s comment he notes the restrictions placed on the Jews during the Third Reich. The restrictions were completely unjustifiable. Notice how they proceeded one “law” at at time. (what could be more legitimate than that – Remember the “Battle Cry of the Condor” – FATCA is “U.S. law”.)

Restrictions on U.S. persons are completely justifiable.

In the case of FATCA, U.S. persons really ARE a threat to the societies where they live. The reason, as has been articulated time and time again is that:

U.S. citizens are being used by the U.S. as tools (via citizenship-based taxation) to extract capital from other countries and transfer that capital to the U.S. There are people who do not understand this. There are people who pretend to not understand this. But, at the end of the day U.S. citizens really are IN ACTUAL FACT a threat to any country where they may reside.

Eventually countries will be forced to protect themselves from what I would call the:

“U.S.ness Forced Extraction of Capital” and the compliance costs associated with having U.S. citizens as residents.

Who could have imagined even 5 years ago that the discussion on this thread was even taking place?Whether a real threat or not, this newly discovered “Condo Terror”, will make condo boards and developers want to avoid U.S. persons. Same for jobs, marriages, businesses, etc.

But, here is the most likely next step.

Special tax laws imposed on U.S. persons. These laws will be for the purpose of neutralizing the extraction of capital by U.S. tax laws. Simple example:

“No person who is taxable as a U.S. person can have a tax free capital gain on a principal residence.”

(the effect would be to produce a Canadian tax which can be used as a credit against a U.S. tax)

So, although U.S. citizens would still be allowed to own property, they will be subject to special tax rules. These rules are designed to protect the local tax base from the theft of capital by the U.S. Perfectly reasonable. Unfair to the U.S. person? Of course, but they can and should renounce.

On a positive side, I predict a whole new universe of financial products.

These will be designed to:

A. Provide products that give U.S. persons the opportunity to plan for retirement; and

B. Segregate U.S. persons from “free people” so that the “free people” cannot be harmed by the “U.S. contamination”

These new investment vehicles will be a welcome development.

Perhaps we will see Condominiums that are specifically for those who carry the disability of U.S. citizenship.

U.S. citizenship is now a disability and this opens up a whole new world of possible financial products for this group of disabled people.

We are witnessing the beginning. What’s important to note here is that by using FATCA and CBT to attack the tax base of other countries, the U.S. has created a situation where retaliation against U.S. persons is rational, necessary and completely justifiable.

If you don’t want to live in the USA you should renounce NOW. You won’t be able to have any kind of life as a U.S. citizen abroad!

The defensive measures taken to protect countries from “U.S. person contamination” will be incremental and significant. But, they will quickly add up to a world where “U.S. persons are subject to “economic quarantine”. I could also see them being barred from certain professions. For example, the legal profession. Do you really want a lawyer who is subject to FBAR on client trust accounts? Real Estate: Do you really want a broker who must report his trust accounts (with your money) to the IRS?

The implications are huge.

No doubt, some will view this prediction as extreme.

Consider this comment to be a “message in a bottle”. Read it again in 10 years.

And finally, (to echo some of the posters here):

If you want to stop this, then you support the people who are fighting on your behalf.

I am thinking of the stopfatca.ca legal challenge.

John Gibson in New York interviews Keith Redmond in Paris and the train wreck known as ‪#‎FATCA‬ ruining American lives