If you can read this, either the style sheet didn't load or you have an older browser that doesn't support style sheets. Try clearing your browser cache and refreshing the page.

(Washington Post)   Wealthy Americans showing their love of country by renouncing their US citizenship before anti tax evasion law takes effect   (washingtonpost.com) divider line 370
    More: Obvious, tax laws, Marc Rich, political life, dual citizenship, Dan Balz, TPMDC  
•       •       •

27313 clicks; posted to Main » on 19 Jan 2012 at 3:23 PM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



370 Comments   (+0 »)
   
View Voting Results: Smartest and Funniest

Archived thread

First | « | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | » | Last | Show all
 
2012-01-19 08:12:22 PM

sethstorm: Unlike other countries, the US is willing and able to go the extra mile to handle tax evasion. This is mostly due to the fact that collecting taxes requires the ability to collect from these people.

If you want to thank anyone, you can thank every single tax evader for justifying such reach by the IRS.


Go even further my friend. Every single other country in the world doesn't even consider this income taxable. It's money earned overseas, while residing overseas, taxed overseas, and kept overseas.

Every. Single. Other. Country.

So in expat communities, when you're the only one required to pay taxes, and even if you aren't, are still facing hundreds of thousands of dollars in penalties for filing and reporting retroactively, and everybody around you says "Man, sucks to be American", renouncing U.S. citizenship isn't unpatriotic, it's farking common sense (although, they will find that renouncing citizenship will still not get the IRS penalties off their back)

sethstorm: The US can go anywhere it wants to go. There simply is no place to hide, no matter where in the world you are.


Yup. That was my point. It's like the mafia, once you're in, you're in for life.
 
2012-01-19 08:13:43 PM

Flab: corn-bread: but these banks all have a nexus in the U.S.

No they don't necessarily do. Under the current law, a farmer's credit union in North Bumfark, Manitoba would have to report to the IRS the accounts of all its customers who happen to hold a US citizenship, even if said credit union has no point of presence in the US.



Not saying that people on the internet lie or pull shiat out of their ass or anything, but you got a citation for that?
 
2012-01-19 08:18:16 PM

sethstorm: SpaceMoose: SNIP
There is very little sympathy for willful tax evasion. While taxes are a very sore spot for many, you're expecting the protection of a nation that you attack. The hand that feeds you is not the one you should be biting.

The US would make short work of the parts of the world that tried. You do not fark with the only nation that is able to project its power anywhere it goes.


You are right. There is very little sympathy for willful tax evasion. Tax cheats should be caught and dealt with accordingly. But this law treats law-abiding ex-pats as criminals and tries to bully other countries into complying. If something is fair (in a trade relation), then it should be possible for a law to work both ways. I can't imagine the US ever agreeing to the opposite action in return.
 
2012-01-19 08:20:27 PM
Considering you need to make a metric shiat ton of cash before overseas earned income can be taxed, I have no problem with this.
 
2012-01-19 08:26:51 PM
For the first time in US history people are fleeing the US. Another farking historic first for US Marxists.
 
2012-01-19 08:27:03 PM
We're hearing that, perhaps in response to the law, more U.S. citizens overseas are deciding to renounce their citizenship. That means the FFIs won't need to report anything and people can keep their foreign accounts and not worry and be happy.

It's not clear how many people have opted for this solution to avoid paying taxes. And it may be that many of these folks are dual citizens of places like Canada or England or Switzerland or other nice countries, so for some people the renunciations are no big deal.

i.imgur.com
 
2012-01-19 08:28:51 PM

Firethorn: $32k/year is 1/3rd the foreign income deduction. He owes no taxes, and should therefore face no penalties. What the IRS tends to do though, is if you don't file, they don't assume any deductions other than 'standard'. So that's $3k or so of taxes a year, plus penalties for improper withholding, etc....


Unfortunately, you can't use the foreign exclusion if you didn't file on time. To renounce, you have to be up to date for 5-6 years. So he's clear only for 2011, but he can't use that deduction for 2006-2010. Poor bastard.


Surpheon I'd be interested in the actual citation.

Okay, you got it! Smarty is referring to Foreign Account Tax Compliance Act (FACTA). Sarting in 2013 the IRS is require foreign financial institutions to to disclose all accounts held by current and former U.S. citizens and green-card holders.

Basically, if you have never filed an FBAR, then the banks will essentially be filing them for you as of 2013. The penalty for not filing an FBAR can be $10,000 per year, per account. So if you haven't filed an FBAR in 5 years, and you have two checking accounts, a joint account with your spouse, and an investment account, that's potentially $200,000 in fines.
 
2012-01-19 08:29:54 PM

ChuDogg: So in expat communities, when you're the only one required to pay taxes, and even if you aren't, are still facing hundreds of thousands of dollars in penalties for filing and reporting retroactively, and everybody around you says "Man, sucks to be American", renouncing U.S. citizenship isn't unpatriotic, it's farking common sense (although, they will find that renouncing citizenship will still not get the IRS penalties off their back)


Generally isn't common sense to give up your passport for the trouble of having to file once a year, since most expats don't owe a farking dime.
 
2012-01-19 08:31:06 PM
Good riddance. And take Congress, Obummer, the supposed "Supreme" Court, and the rest of your goddamn toadies with you.

/ all the douchebags running in the Repub primary would be a cherry on top.
 
2012-01-19 08:31:58 PM
SpaceMoose: It's an incredibly stupid law that's trying to catch whales using a shrimp net.

Totally agreed.

/Also, corn-bread, I'm now on my Blackberry, I'll try to find you a citation, but it may take a while... Please hold to retain your calling priority...
 
2012-01-19 08:33:08 PM

corn-bread: Not saying that people on the internet lie or pull shiat out of their ass or anything, but you got a citation for that?


As I told Surpheon, Google "Foreign Account Tax Compliance Act (FACTA)". The U.S> government is requiring foeign banks to disclose all accounts held by U.S. citizens. It comes into effec tin 2013 (but some countries have pushed it back to 2014 because it's not actually possible).

Banks are understandably furious because it violates the privacy laws of most countries, and the cost involve din collecting that kind of data is astronomical!
 
2012-01-19 08:40:00 PM
andreas.com

Taxes so unfair.
Half my millions taxed away.
Your food stamps untouched.
 
2012-01-19 08:40:30 PM

EatsCrayons: J B: And there are massive fines for failing to report each year, on time, on paper (no e-filing of the FBAR, apparently, even when Canada Post is on strike). And it's not as if they go out of their way make sure people are aware of the requirement.
Also, it pisses me off every year that I have to file my 1040 even though I never owe anything.

That's why the new banking regulations are pissing people off. Canadian banks will have to report bank accounts held by Americans to the U.S. The Canadian banking industry, BTW, has been fighting it because to collect that information (all their customers' citizenship and their parents' citizenship) is farking nuts!


Providing the information violates the Canada Privacy Act and several other laws. There is no way for banks to comply with both laws, so they (and their customers) are screwed either way.
 
2012-01-19 08:45:34 PM
If you take the time in this thread to wade through some of the most ill-informed and comically wrong-headed posts I've seen on Fark in some time, you'll find that there are a few people here who actually know what they're talking about and are quite informative.

Most of it is like trying to divine meaning from the puddle of drool left when you fell asleep at your desk, however. Sort of like the article itself.
 
2012-01-19 08:47:15 PM
I see others have provided the link.
 
2012-01-19 09:00:02 PM
Hell, it's not like having a US citizenship is worth what it once was. It used to make you a citizen of New Rome, above the rest, protected. Now, not so much.
 
2012-01-19 09:00:38 PM
fark them; and i don't care if the door hits hits them on ass as they exit
 
2012-01-19 09:04:15 PM

EatsCrayons: Surpheon I'd be interested in the actual citation.

Okay, you got it!


No, not I don't have it. All I have is your derptastic ramblings. What I was interested in was provided by:

Flab: I can't find the original article, but here's an update on the situation. You will not be penalized for non-disclosure unless the IRS finds that you willfully omitted to declare those asset


Good link, and it actually sounds about as I'd expect now. Only dealing with expats who left the US after having filed income taxes here, none of this 'left as a 5 year old' crap. And most will owe no taxes nor penalties.

""Taxpayers who owe no U.S. tax (e.g., due to the application of the foreign earned income exclusion or foreign tax credits) will owe no failure to file or failure to pay penalties," the IRS said. "In addition, no FBAR penalty applies in the case of a violation that the IRS determines was due to reasonable cause." "
 
2012-01-19 09:12:51 PM

AKTurkey: kayanlau: So what's so good about being an American again?

vs who?

Most of the world?
- don't have to worry about on a regular basis:
1. horrible diseases
2. famine
3. invasion
4. being killed for expressing speech
...

Oh I'm sorry, is this one of those bullshiat posts where we're only allowed to compare the US to Sweden?


Well, in the race to be Somalia, the US is gaining speed ...
 
2012-01-19 09:13:40 PM
You know, they really needed to work a U into FBAR to make that acronym really work
Foreign Universal Bank and Financial Accounts
 
2012-01-19 09:44:14 PM
320 posts and no one has mentioned the little fiasco by and between Marc Rich and the Klintons?

Tisk tisk, Fark.
 
2012-01-19 09:47:25 PM
EatsCrayons:
Let's see...
1) Consulates and Embassies? CHECK!
2) Military helicopters and passenger aircraft? CHECK!
3) Big goddamn air craft carriers? CHECK!
4) A sniper team to shoot the pirates? CHECK!

I got those with the other passport I carry. Can I opt out of the U.S. version and save on my taxes?


I'm trying to figure out what country this is. The UK does have an aircraft carrier, but not any aircraft to put on it. France has one but they're not allowed to shoot pirates, so scratch that. Any other European country with carriers (Italy & Spain) is too broke to do anything with them, so, I'm guessing you're other passport is Russian?
 
2012-01-19 09:51:57 PM

Egoy3k: I'll be doing the same.

I'm a dual citizen who was born in the USA and living in Canada since I was 5 years old. To be told that I could face fines and or jail time for not filing taxes in the USA is horseshiat. It's bad enough that I need an American passport to visit the USA instead of my Canadian passport which I have had all my life.


This. They're going after people who have never even worked in the US.

It's also bullcrap that they are just going after wealthy people. My friend, who moved to Canada when she was a little kid, and her brother, are being targetted and neither of them earn even close to six figures annually.

On top of that they are expected to file for income going back years longer than they or any Canadian employer is required to keep records.
 
2012-01-19 10:01:22 PM
Can't blame them. The US is the only country in the world that makes you pay taxes on money you earned WHILE OUTSIDE the country. Almost sounds like a joke if it weren't so ridiculous.
 
2012-01-19 10:02:51 PM
Yes, tax cheats must be found out, flogged, etc.

But for people like me, we really got screwed over by US tax law while living overseas:

--For five years, I lived in Singapore, working for a Norwegian company. I was paid in Singapore dollars deposited in a Singapore bank account.

--During those five years, I was in the US a total of 21 days (I just looked it up. The IRS requires documentation of non-resident status).

--My only US assets were an E Trade account worth about $100K, and a checking account with less than $5000 in it. I didn't own a house/car/boat/etc.

--As a non-resident, the first $80K of income is deductible from your gross; however, virtually any benefit you receive from your employer (housing subsidy, health insurance, car allowance, etc.) is valued and taxed at a higher rate. The upshot--my income was inflated to over $350K USD. My actual take home pay was in the $150K USD range.

The upshot--I paid around $100K in taxes to the US per year. That's on top of paying Singapore taxes.

I had no problem paying taxes on my assets in the US. I had no problem paying taxes to the Singapore government. That's all fair. But everything else I earned was outside the US. It had nothing to do with the US economy, government, interstate commerce, etc. I wasn't using highways, schools, police, fire protection, FDA regulations or anything of the sort. It was just the (exorbitant) price of carrying a little blue passport.

I'm told only one or two other countries do this to their citizens (I need to check for the exact countries). Whenever I tell non-US citizens about the law, they think I am mistaken or I misunderstand the law. No such luck. For five years in a row, I had KPMG doing my taxes (which cost around $4000 per year).

You cannot convince me that this was fair and/or just.

My point--if the money is earned in the US, then tax it there. Want to move your money overseas? Have an "exit tax" or some such policy tool. Just quit screwing me year after year.
 
2012-01-19 10:05:31 PM

Egoy3k: Citizenship is the only criteria that matters. If you are a US citizen, you are required to file taxes in the US.


The US is pretty much unique in that regard, AFAIK.
 
2012-01-19 10:07:49 PM

capt.hollister:
People all over the world pay their taxes in the country in which they reside, independently of their citizenship. The US is alone in expecting its citizens who live and pay taxes abroad to also pay taxes in the US.


I'm a citizen of both Canada and the UK. When I worked in the UK I filed my taxes there and when I returned to Canada I returned to filing my taxes here. Never heard from the UK about anything to do with taxation since.
Revenue Canada called me asking why they had no records on me for a few years. I explained to them that I was living in England as a British citizen and that was all. End of story.

If you are filing in Canada and you own property (can't remember about other assets - obviously I don't qualify anyway) over $100K somewhere abroad there is some sort of tax you owe but that's it.

As for my American friends living here, they've been blind-sided by this ruling. They had no idea that simply being citizens there that they had to file taxes there too, even if they haven't lived in the US since Elvis did his comeback tour.
 
2012-01-19 10:14:08 PM
Seems to me that Vladamir Putin actually had a practical, profitable and applicable solution to this problem...
 
2012-01-19 10:17:38 PM

plewis: Later dick eaters. Hope you like your money. Personally I'd rather live in the land of freedom, opportunity and barbeque, but hey, that's just me.

/unpatriotic biatches!


Me, too. Too bad it's the Philippines.
 
2012-01-19 10:23:30 PM
My ex-husband intended to renounce his citizenship so as not to pay taxes. Hopefully, there will be a coup in whatever Central/South American country he may be in now and he'll lose everything, as well as not receiving a visa to return, and he'll be found, eventually, amongst all the hoarded crap he no doubt has re-accumulated in his apartment (he's too cheap to buy a house). If I sound bitter, in my defense the man first tried to get me to exit our truck, in the middle of the night, at a clinic that was closed and in a sparsely populated area, then tried to abandon me in the hospital while I was in a coma after going through three emergency surgeries. I had already refused to leave the country and give up my citizenship and he didn't want to be stuck with my medical bills. He had refused to buy health insurance. The possibility of being made to do so was another reason he wanted to leave. When I served him with papers he was making plans to quickly leave the US. I had to freeze his assets to keep him here. I got next to nothing in the divorce because it was in Texas and his entire wealth was inherited. Plus I had the world's worst/laziest attorney.
 
2012-01-19 10:26:48 PM

wilde_at_heart: As for my American friends living here, they've been blind-sided by this ruling. They had no idea that simply being citizens there that they had to file taxes there too, even if they haven't lived in the US since Elvis did his comeback tour.


It's always been a rule but rarely enforced. They should have seen the writing on the wall a few years ago when they went after corporate tax shelters. Now they're just scraping the bottom of the barrel.

To be honest though, the U.S. always hated the concept of dual citizenship (it wasn't even legally allowed until supreme court rulings). I think this is there way of saying put up or shut up. You want to get a job overseas, then give up your citizenship. It sucks though that they won't let go all the people currently trapped.
 
2012-01-19 10:36:23 PM
The US tax system is so byzantine I'm surprised anyone can work out how much they owe. State taxes, federal taxes, taxes on people who've never even been to the US, taxes on income you've already paid tax on. No wonder people say "Fark it, I'll move to Monaco."
 
2012-01-19 10:41:15 PM

EatsCrayons: Subby doesn't understand how renunciation works.

1) You CAN'T renounce until you're all up to date and fully compliant with the IRS. They won't let you.

2) There is an "exit tax". Basically, you have to fork over capital gains tax as if you liquidated all your assets as if it was sold at market value.

If you're wealthy it's going to cost you far, far more to renounce than to fulfill compliance requirements.

The U.S. is the only country that taxes people who have never lived there, never worked there, have no assets there, and in some cases weren't even born there. Someone like my cousin who was born in the UK is facing ruin. My cousin makes $32,000 a year and just found out that he's a U.S. citizen (via parentage). Surprise, he faces tens of thousands in penalties.

The tax evasion laws were design to fight money laundering and for anti-terrorism funding. But hard-working innocent people (a majority) are getting painted with the same broad brush.


Yeah, this is the best summary of the situation. I will add the following -- you can't arrange your taxes to be advantages in two countries. For example, if can lower your tax rate in Canada with deductions and retirement planning but those same deductions and retirement plans don't lower your US taxes. For example, Canadian tax rates are higher generally, but I ended up owing more in the US.

So even if you file properly with the US, you have to pay the worst case taxes of the two countries.
 
2012-01-19 10:56:12 PM

Egoy3k: BarleyGnome: If you aren't living in the US, why would you be required to pay taxes in the US?

Citizenship is the only criteria that matters. If you are a US citizen, you are required to file taxes in the US.


Strangely the US is the only first world nation to make that distinction. No other free modern country operates the same way.
 
2012-01-19 11:02:35 PM
I work with a guy who was born with dual citizenship, never worked a day in the U.S but found out about this a year a go..he contacted the IRS and they pinged him thousands of dollars in fines not to mention money spent on a lawyer

my advice to a dual citizen in this situation .. do not report, do not cross the border ..the Canadian banks do not have to rat you out to the IRS yet..and I doubt that they will be allowed to, just stay low for now and try and wait it out
 
2012-01-19 11:15:10 PM

ows: of course the dual citizenship with isreal remains. rip off amerika then high tail it home and laugh your ass off. you can't touch this.



Like the "Russian Oligarchs".

Or at least the lucky ones that escaped Putin's wrath.


/Git while the gittin's good
 
2012-01-20 12:01:14 AM

The Stealth Hippopotamus: b-b-b-but they can't leave! They have to stay here so Obama can tax them to death!

/told you so


Very interesting. I think I'll declare myself dead for last year, so I don't have to pay taxes.
 
2012-01-20 12:04:30 AM
So? 1) They are already not paying taxes, but continuing to use services. 2) Their money is already invested overseas. Why do we want them around? Let them go find some Libertarian hell hole and live there.
 
2012-01-20 12:06:18 AM

Jingle Strangle: I learned from Rush Limbaugh that only the rich pay taxes, so this story can't be true.


I was delighted to hear it. All this time where I file Federal taxes and get a lower refund than I pay in, it turns out I'm in the bracket where I don't pay any taxes. It's good news to me! No more paying property taxes, no more paying sales tax when I shop, no more paying state income tax, or any of that. I PAY NO TAXES. Thanks, Rush!
 
2012-01-20 01:10:30 AM
<b><a href="http://www.fark.com/comments/6889868/74414937#c74414937" target="_blank">HellRaisingHoosier</a>:</b> <i>We have a little saying in used here in America: "Don't let the door hit ya where the good Lord split ya."

If you think our small tax rate is too much of a burden on you, then I personally don't want to count you as a fellow American citizen.</i>

lesseee. a shockingly ignorant post by somebody who wraps themselves in the American flag. Rick Perry, is that you?
 
2012-01-20 01:14:53 AM
The fun is in the nibbles, not necessarily reeling them in.

/you guys entertained me today
 
2012-01-20 01:19:55 AM

wmoonfox: The target of this law is wealthy Americans who have moved their money offshore to avoid paying taxes on it. This isn't money made sewing shoes in a Turkish sweat shop; this is money made through investment profit generated right here in America. This is a well-known tactic of the super-wealthy, and you aren't fooling anyone with your appeal to emotion over dual-citizens working full-time jobs overseas.


And the target of the PATRIOT act is them damned dirty terrists. That doesn't mean that there aren't unintended (or were they?) consequences for the law-abiding little guy with such retarded laws. You "eat the rich" types are just as farking clueless as any freeper.
 
2012-01-20 01:42:42 AM
With NDAA passed, I don't think it would be too difficult to legally proscribe people like this.
 
2012-01-20 02:06:31 AM
Seems like eatscrayons is one of the few knowledgeable people in this thread.

To summarize:

1. If the US has a tax treaty with your country (which is almost always the case), you get a credit for taxes already paid there. So if your tax burden would be $50k to the US, but you already paid $55k in taxes in the other country, then you owe nothing. Related to this, with a few countries, there is also reciprocity for Social Security. So if you pay it to the local country (like the Netherlands is one), then it counts as you paying to the US, making you eligible for SS later on.

2. You can't renounce your citizenship to avoid back taxes. See Item E directly from the State Dept (pops)

3. The Philippines also taxes its citizens' worldwide income.

4. The first $90k-ish of your earned income abroad is tax-free in the US. Anything above that is taxed but again you get credited for taxes already paid (see #1)

So in short, the system isn't that unfair and it mostly just sets a tax floor equal to what you'd pay in taxes if you lived in the US anyway, because of #1.
 
2012-01-20 02:31:28 AM

KarmicDisaster: So? 1) They are already not paying taxes, but continuing to use services. 2) Their money is already invested overseas. Why do we want them around? Let them go find some Libertarian hell hole and live there.


Except that the people being hit by this are 1)living and paying taxes to a different country and are not using any US services 2)most people being hit by this are not rich investors but regular folk who happen to have dual citizenship.

They aren't "around"; they are living and working (and paying taxes) in a different country whose government services they are actually using. Generally they are not living in hell holes, but in very nice countries.
 
2012-01-20 03:06:41 AM
Good for them. Fark the IRS.
 
2012-01-20 03:09:55 AM

BumpInTheNight: Well, bye.

/screw those unpatriotic leeches
//I'm not even American


How does that make them unpatriotic? You seem to be confusing love of country with love of government.
 
2012-01-20 03:14:00 AM

MycroftHolmes: Aarontology: Then seize all their assets held in America.

Under what possible grounds, besides 'I want it, I want it, I want it'?


What else do you need? Envy, to a liberal, is a virtue.
 
2012-01-20 03:47:36 AM

shortymac: que.guero: bhcompy Add Favorite User
Magorn: vpb: Sounds good to me. If they aren't willing to pull their weight then let them GTFO.

And like "the man with no country" NEVER be allowed back in this country again. Okay that's too harsh: They can come, on tourist visas only, for a period not to exceed one month every calendar year. The rich guy will have a boat, which he'll then take to the various marinas where there are no customs or border patrol.

Egoy3k: I'll be doing the same.

I'm a dual citizen who was born in the USA and living in Canada since I was 5 years old. To be told that I could face fines and or jail time for not filing taxes in the USA is horseshiat. It's bad enough that I need an American passport to visit the USA instead of my Canadian passport which I have had all my life.

That is a farked up situation. My understanding was that you could claim exception for taxes already paid(so you basically pay if you owe more than you already paid to your host country). Is that incorrect?

The US doesn't allow you credit for taxes paid in your home or any other country - you have to pay the US on all of your income - converted to US dollars. Canada will credit you for taxes paid to the US but you still have to pay first and then wait for the refund.

In some cases, you can avoid paying by not making much money, but you still have to file every year or face debilitating fines and penalties.

This is one of the reasons why you don't find a lot of US citizens getting international job offers - the tax situation is onerous.

UGH tell me about it! I'm an American living in Toronto and it's a pain in the ass and farking confusing! Thankfully, I make under 90k USD so I never had to pay US tax on top of Canadian tax, but this new law is making me scared.

I recently got engaged to a Canadian and we plan on staying in Canada. Apparently, I would have to pay tax on our house, any retirement account in my name, any bank account, etc. I won't be able to open any new ...


I suggest you contact Mark Serbinski, offices in Toronto and Chicago, specializes in exactly what you need. 1-888-878-2937, http://www.serbinski.com
 
2012-01-20 03:55:46 AM
This whole thing should be interesting. By my recollection, I've missed probably 2 years of filing the FBAR because I hadn't known about it (though I did know to file my 1040). And the only reason I had enough money those two years is because it was a disbursement of my student loan so I could pay for my degree.

That's a funny thing there. In the UK, an American student opens a UK bank account to get their student loan disbursements, but they will then have over $10k in the bank. How many students abroad have ever filed an FBAR on that money?
 
Displayed 50 of 370 comments

First | « | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | » | Last | Show all

View Voting Results: Smartest and Funniest


This thread is archived, and closed to new comments.

Continue Farking
Submit a Link »






Report