# Help Needed - Foreign Account Tax Compliance Act



## snub

I am looking for help and advise on how to deal with my problem with the FATCA legislation. Here is my story. My father was born and raised
in Canada and was a pilot in the Canadian Navy. In 1954 he was sent to the American Naval Air Base in Portsmouth, Virginia. Since he was
going to be there awhile, my mother went down there to be with him as she was pregnant with me. I was born in July of 1954 and three weeks
later we all returned to Canada. Upon returning, my parents were issued a Certificate of Registration of Birth Abroad on my behalf.Basically 
this is to retain my Canadian citizenship. Except for the first three weeks of my life I have never lived in the USA, I have never worked 
in the USA. 

A few months ago I went to my bank to open a new mutual fund account and they had to update my personal information. They asked where I
was born and thats when the red flags appeared. I filled out the forms they gave me and they got back to me saying I am considered a US
person. I spoke to my lawyer who admitted that he new little about FATCA and suggested I talk to my accountant, which I did, but he too
new little about it. I talked to another accountant who was supposed to know about it, but he was no help. I found a lawyer who has 
knowledge of it, but he could not help me.

I went to my bank seeking assistance. They phone some higher up person who informs me that I must fill out the IRS W9 form that is 
asking for my USA Social Security Number ( which I obviously don't have ). They then say that I must apply for a USA Social Security
Number. Then I can renounce my US Citizenship or apply to keep it. They say that if I don't do this they will withhold 30% of my
assets. They are also telling me that if I don't fill out the W9 they will freeze all of my accounts. I won't be able to withdraw
any money.

I have opened an account at a local credit union, based on Vancouver Island, and am transferring funds into it in case my accounts
are frozen. But my bank says that if I don't comply with them, they will rat me out to the CRA. So this might be futile. 

The last lawyer I talked to said that I might be able to file tax returns in the USA for the last 5 years and that I would only pay 
to one Country. I have to sign the W9 before June 10 or my accounts will be frozen. I have absolutely no clue as to what I should so
am hoping someone here can give me some advice.


----------



## Numbersman61

This is not unusual since it has been a major news item for some time. Since you were born in the US, you are a US citizen and subject to its laws which require that you have a social security number, annually file a 1040 return and in some cases a FBAR return. Do a google search for Canadian accountants who specialize in US tax - a number are listed for Victoria. Don't delay.


----------



## james4beach

You might want to talk with fatcat who is on these forums. I think he has a similar situation to yours.

As said above. You need to talk to an accountant who knows US/Canada taxes. This is complicated stuff and even the professionals are still learning how this works. I'm a "US Person" as well (not a citizen though) and... I don't want to scare you... it's been a painful and expensive year.

The four big things you should watch out for are requirements to file: 1040, 8938 (FATCA), FBAR, and 3520 (TFSAs). Personally I have to file three of those four, but everyone's situation is different, so you must talk to a US tax professional.

Here's the back story. The US is becoming more aggressive on taxing foreigners, because they have horrible deficits and are very desperate for more tax revenue post-crisis, as the government is in really bad shape. The low hanging fruit are US citizens since, well, they're obviously subject to US laws. The FBAR & FATCA rules suddenly appeared and impact all "US persons" in any country worldwide.

The rules were introduced a few years ago but the authorities are well aware that it's novel and a surprise to EVERYONE in the world. In the first couple years, the authorities have been very lenient... it's not like they're fining all violators $10,000. However this is starting to change, as the US authorities are now getting more serious about enforcement of these.

Basically this whole thing is a huge tax grab. But don't take it lightly -- they're serious about the penalties.

In the coming years, the US will become more aggressive about these rules because they really want to collect those penalties. You are probably still in a period where there is some leniency (I think they are permitting late FBAR filings for instance) but they will keep tightening the net.

Find the right professionals, and keep a paper trail of what you're doing. Your records should be able to show that you are acting in good faith, not trying to hide anything, and that you WANT to be compliant with US rules. I'm sorry you have to go through this.


----------



## james4beach

Time is of the essence because FBAR is due June 30. It can be filed electronically so it's actually not too difficult to fill & file it.

However you really need to get that conversation going with an accountant that knows US tax issues. I would NOT rush to file the FBAR until you have talked with an expert. FBAR is *distinct* from FATCA


----------



## Userkare

By all means, talk to someone who specializes in US/Canada tax law. 

Are you positive that you're a US citizen? You might want to explore the possibility that you have relinquished your US citizenship at some point in your life. There are certain acts that can cause this to happen. It might even be that your particular situation, born to foreign military personnel on US soil, does not give automatic US citizenship. I don't know, but it's worth exploring.

I can't give you any specific advice b/c I'm not at all sure what the exact requirements are. Relinquishing US citizenship is different than actually renouncing it. In my case, I was born in the US, but renounced my citizenship in my early 20's before I started making any significant money to tax. I have a CLN document (Certificate of Loss of Nationality ) to prove this, and must present it to the bank if they find out about my birthplace.

Good luck avoiding the clutches of Uncle Sam ( land of the free? ). 

You might want to check out this website..

http://isaacbrocksociety.ca/2011/12/14/about-the-isaac-brock-society/

and post your questions to their forum; maybe someone there might have some useful info for you.


----------



## fatcat

http://www.hutcheson.ca/


----------



## Numbersman61

http://www.forbes.com/sites/robertw...n-paid-irs-is-now-renouncing-u-s-citizenship/


----------



## RCB

snub, this is what we call your "Oh My God" moment, and it is painful. As suggested, go to the Isaac Brock Society website, where those of us affected by US overreach have been working together, providing each other with information on the various situations, and getting through it. It has the best information online.

There is a lawsuit here in Canada against the Canadian government for implementing Canadian law to allow for our financial information to go to the IRS. There is a summary trial in Vancouver Aug. 4-5, and it's hoped there will be an injunction stopping any info flow from CRA to IRS under the FATCA IGA.

You have my sympathy. I was born under very similar circumstances to your birth, and I had even checked on my US status 25 years ago. At that time the US Dept. of State told me I was not a US citizen. I discovered a few years ago that they lied, and the US government considered me a tax cheat, for not filing income tax and bank account reporting forms from Canada. Yes, it is absurd. I paid the $450 to renounce, before the fee went up to $2,350.

Don't go to anymore accountants or tax lawyers until you go to the IBS site. There are some real scammers out there in the "compliance" world. Get info at IBS first, you might be lucky enough to relinquish (free, no tax reporting or exit tax requirements).


----------



## RCB

I just wanted to add, I don't believe a Canadian bank can LEGALLY freeze your accounts in Canada for failing to file US SSN or US tax related forms with them. I don't think I've heard of it happening in the several years I've dealt with this. They cannot take 30% of your assets, either. The 30% is a witholding on *US sourced* payments that go through the bank, ie. if you have US based investments, or receive employment income out of the US.


----------



## Numbersman61

The original poster is a US citizen. He now knows he has filing obligations which, if not met promptly, have serious consequences. Suggesting he delay contacting an accountant who specializes in US tax matters is absurd. Like it or not, this is the new reality - our federal government has capitulated to the IRS. For the record, even corporations are now subject to this new reporting. I am the Treasurer of a small condo corporation and our bank requires us to file a comprehensive report to comply with new documentation requirements of CRA. We have to report whether or not we are controlled by US persons. If our condo corp is controlled by US persons, that info will be shared by CRA with the IRS.


----------



## Eclectic12

james4beach said:


> ... Here's the back story. The US is becoming more aggressive on taxing foreigners, because they have horrible deficits and are very desperate for more tax revenue post-crisis, as the government is in really bad shape. The low hanging fruit are US citizens since, well, they're obviously subject to US laws. The FBAR & FATCA rules suddenly appeared and impact all "US persons" in any country worldwide.


Most would think of "foreigners" as non-US citizens which could be misleading. As I understand it - the US is mainly going after US citizens who haven't been respecting the US taxation by citizenship instead of residency. (Though some like post # 8 seem to be citizens or not depending on the US gov't convenience.)

From what I recall, there are also implications for Canadian spouses but at the end of the day - one has to be considered a US citizen or a Canadian with US connections (ex. green card, working in the US etc.).




Numbersman61 said:


> ... Like it or not, this is the new reality - our federal government has capitulated to the IRS.


Technically ... I believe it's the Canadian corps such as the banks due to how much business is done in the US. Otherwise, if the corps were turfing US citizen accounts similar to what's happened in Europe - I doubt there would have been a Canadian gov't agreement.

I'm under the impression that when the lobbying by say the Canadian banks failed to achieve a better result, they started lobbying the Canadian gov't to do something to help them out. The "something" ended up being the agreement that was signed.


Cheers


----------



## WhiteKat

Snub, PLEASE do not act hastily! You really need to carefully consider ALL YOUR OPTIONS before making any decisions that you may regret later. Be particularly careful talking to accountants and lawyers - most of whom will advise you to enter the US tax system which may NOT be in your best interests. I am in a similar situation as yourself - born in USA to Canadian parents but left as a baby, and had no clue I was considered a US taxpayer until a couple years ago. I have made the decision NOT to comply. However, unlike yourself I did not find out from my bank that I was considered to be a 'US person', so have been able to stay under the radar so far.

Keep in mind, that EVEN IN A WORST CASE SITUATION, if your bank rats on you, and you get a nasty penalty notice from the IRS, Canada cannot and will not collect taxes or penalties on behalf of the IRS. The government has stated this several times (people at isaacbrock can you supply you with the links if you need proof). 

As another poster has commented, the banks cannot freeze your accounts (I believe the CDN gov't wrote this into the IGA signed with the USA), and they cannot withhold 30% of your CDN assets (only 30% of any US sourced income/transfers to your bank). 

Everyone's situation is different, and there is A LOT of misinformation flying around. Come on over to isaacbrocksociety dot ca, explain your story, and people there will help you to determine what your options are, so that you can assess for yourself what makes the most sense for you to do in your own unique situation, depending on your own risk tolerances. Whatever you do, do NOT run out in a panic, and hire an accountant, or even a lawyer for that matter. There are lawyers at isaacbrock who will give you FREE advice. 

So, S L O W D O W N! You need to take the time to digest everything (and there is a lot to digest) before you do anything.


----------



## RCB

Numbersman61 said:


> The original poster is a US citizen. He now knows he has filing obligations which, if not met promptly, have serious consequences. Suggesting he delay contacting an accountant who specializes in US tax matters is absurd. Like it or not, this is the new reality - our federal government has capitulated to the IRS. For the record, even corporations are now subject to this new reporting. I am the Treasurer of a small condo corporation and our bank requires us to file a comprehensive report to comply with new documentation requirements of CRA. We have to report whether or not we are controlled by US persons. If our condo corp is controlled by US persons, that info will be shared by CRA with the IRS.


You sound like you are an accountant. Regardless, you are irresponsible in suggesting you have determined that this person is a US citizen, with tax reporting respnsibility to a foreign government. Are you a US citizenship lawyer? Are you a Canadian that has been caught up in this, yes ABSURD, situation for a number of years, having to do your own research because your Canadian government has failed to protect you and your family from a foreign power?

Many caught up in this mess were directed by ACCOUNTANTS into OVDI, OVDP, etc., where they faced life-altering, asset-confiscating tax and penalties, in addition to absurd accounting fees. These people were not first directed to citizenship information, to determine if they could relinquish FOR FREE, absolving them of any US claim to a responsibility to file income tax and reporting returns, and subject to the exit tax. That direction wouldn't have allowed for the poor Canadian's contribution to the CASH COW this mess has become for cross-border accountants.

Some of those accountants have dollar signs instead of pupils.


----------



## RCB

Eclectic12, US tax and citizenship law, combined, say that even a Canadian born in Canada, must file US tax returns, FBARs, etc. with the IRS, if one parent is American. This is dependent on how much time the US parent spent in the US, and other factors. This is very far reaching.

The popular perception is that individuals KNOW or HAVE KNOWN the US considers them citizens. This is NOT the case for those who grew up in a country other than the US, especially if they were not born there.


----------



## RCB

snub, I just wanted to add, you do NOT need to apply for a SSN. If you do, and you have grounds to relinquish citizenship for free, it can be seen in some consulates as an indication you want and ACCEPT US citizenship, opening a whole other can of worms.

I filed an exit tax form after renouncing that contained no SSN (never had one), and no ITIN. I have heard nothing from the IRS or US Treasury Dept.


----------



## Numbersman61

Yes, I am proud to say I'm a retired accountant and am not a citizenship lawyer. I'm a believer in complying with the law even if I disagree. I am a Canadian citizen, no ties to US other than I own a condo in the southern states. I am careful to comply with all IRS rules. I have a number of friends and relatives who have been ensnared by the US taxation of its citizens and have assisted in putting them in contact with appropriate tax specialists. In most cases, the costs have been minimal; in more complex cases the costs can be significant.
There have been many, many news reports in the past 5 years about this issue so it should not be a surprise to anyone about the rules.


----------



## RCB

Numbersman61, yes, there has been media coverage, however the vast majority of it is not catching the eye of those truly affected. The media, and most Canadian politicians keep using the phrase "Americans in Canada". This leaves everyone to think of those born and raised in the US, that chose to move to Canada. Most reporters and politicians fail to acknowledge this affects CANADIANS that the US has more recently CHOSEN to include as citizens/taxpayers. In my case, as late as 1992, the US Dept. of State informed me I was NOT a US citizen. 

The US keeps changing their laws. As a Canadian citizen, it is not my job to keep up on the laws of a foreign country, when I have only the tie of birthplace to that country. If I had been born in Thailand or Russia, to Canadian parents, should I have to follow THEIR laws in Canada? I think not.


----------



## snub

Thanks to all for your comments, links and advice. It is much appreciated. I plan on moving very slowly with this as I'm afraid of doing something I will regret later. I'm going to transfer money to my Credit Union account. Apparently, small Credit Unions are exempt from FATCA due to the financial burden it would impose on them. Also, I'm wondering if someone could take a look at the W9 form that the bank wants me to sign.

On the bottom right of the form it states " Use form W9 only if you are a U.S. person to provide your correct TIN." And so on. Makes no sense to sign this form when I don't have a TIN.

Here is the link to the W9:http://www.irs.gov/pub/irs-pdf/fw9.pdf


----------



## Eclectic12

RCB said:


> Eclectic12, US tax and citizenship law, combined, say that even a Canadian born in Canada, must file US tax returns, FBARs, etc. with the IRS, if one parent is American. This is dependent on how much time the US parent spent in the US, and other factors. This is very far reaching.


Agreed ... though I thought this situation was covered when I said:


> considered a US citizen





RCB said:


> The popular perception is that individuals KNOW or HAVE KNOWN the US considers them citizens. This is NOT the case for those who grew up in a country other than the US, especially if they were not born there.


Certainly with the changes made ... there's a large grey area and lots of room for confusion.

I would question making it a blanket statement as you appear to be doing as I can recall US citizen parents with Canadian born kids talking about their kids having US citizenship going on thirty years ago.

For each individual ... YMMV as to the possibilities and any misdirections.


Cheers


----------



## Numbersman61

I have relatives and friends who have US citizenship due to an American parent or being born in the US. They consider having dual citizenship an advantage and no one I know would consider renouncing their US citizenship. The extra cost in IRS filings etc. and taxation is minor to them compared to the opportunity to work and live in either country.


----------



## Franz Josef

Snub. W9 is for US taxpayers. If you sign anything ,it should be a W8-Ben. This is the form used by most financial institutions for you to certify that you are not a US person. They cannot freeze your accounts and they cannot withhold 30%.
The bank had no business asking where you were born. The best thing would be to transfer all of your accounts to the credit union . Failing that, you should insist that you gave up your so-called citizenshio, that you don't have a CLN and have no intention of getting one.

At one time, you would have lost your citizenship and there was no requirement to inform the US or to obtain a CLN. A reasonable explanation plus self certification is supposed to be enough to satisfy the bank. Go to IBS for a full discussion of what this is all about.


----------



## snub

Franz Josef, I filled out the W8Ben, signed it and submitted it to my bank. They came back and said that they consider me a US person and that I have to fill out and sign the W9, which , after reading the instructions that come with it, consider this absolute bullshit. The bank is forcing me to do things there way so they can cover there *** with the CRA. I am actually dealing with one of the bank tellers as my "personal account manager" is on holidays. And she is getting her information from someone at another branch who is supposed to be schooled with the FATCA regulations. But since 2 lawyers and 2 accountants couldn't help me I have to rely on the information the bank is giving me. Thankfully I found this forum and realise there is a light at the end of the tunnel.


----------



## BC_Doc

Numbersman61 said:


> Yes, I am proud to say I'm a retired accountant and am not a citizenship lawyer. I'm a believer in complying with the law even if I disagree. I am a Canadian citizen, no ties to US other than I own a condo in the southern states. I am careful to comply with all IRS rules.  I have a number of friends and relatives who have been ensnared by the US taxation of its citizens and have assisted in putting them in contact with appropriate tax specialists. In most cases, the costs have been minimal; in more complex cases the costs can be significant.
> There have been many, many news reports in the past 5 years about this issue so it should not be a surprise to anyone about the rules.


I am a Canadian living in Canada. I comply with Canadian laws. U.S. laws are foreign to me. When I travel to the U.S., I of course comply with US laws. But here in Canada, US law should not apply given such basic principles of sovereignty amd jurisdiction. I think you are giving bad advice to the original poster. As others have said, the original poster needs to first sort out the citizenship issue (they may not be a U.S. citizen). The accounting issue becomes a non-issue if they are not a U.S. citizen.

Original poster: as others have said, please visit the Isaac Brock Website. It is a fantastic resource.


----------



## james4beach

RCB said:


> The US keeps changing their laws.


This is a very important point. The US is constantly changing their laws on taxation, and releasing clarifying "notes" and guidance. They've brought in so much new legislation, and so many crazy new rules, that the Treasury Dept and IRS has no idea how to handle it. Their agents don't even know how to process some of these filings.

Here's an example of how fast it changes. I spent a lot of money having my accountant prepare all my US tax filings and disclosures. Then the IRS released a clarification document on the same morning we were going to courier all the documents to the US government.

This particular change to the rules was harmless in my case... but that's not always the case.


----------



## WhiteKat

Snub, I have a message for you from the director of the Alliance for Canadian Sovereignty (ADCS), Stephen Kish, who suggested that you contact him as he knows someone in the Vancouver Island area who is willing to speak to you and offer advice and options. To get in touch with Mr. Kish, you can go to the contact page on the website for ADCS at adcs-adsc dot ca.


----------



## Franz Josef

snub said:


> Franz Josef, I filled out the W8Ben, signed it and submitted it to my bank. They came back and said that they consider me a US person and that I have to fill out and sign the W9, which , after reading the instructions that come with it, consider this absolute bullshit. The bank is forcing me to do things there way so they can cover there *** with the CRA. I am actually dealing with one of the bank tellers as my "personal account manager" is on holidays. And she is getting her information from someone at another branch who is supposed to be schooled with the FATCA regulations. But since 2 lawyers and 2 accountants couldn't help me I have to rely on the information the bank is giving me. Thankfully I found this forum and realise there is a light at the end of the tunnel.


Snub Of course you are right and the bank is wrong. Who do they think they are telling you whether or not you are a US person? Tell them you relinquished years ago. You could, if you feel so inclined threaten them with a human rights complaint or a complaint to the BC privacy commissioner. Whatever you do, don't sign a W9. Finally, let's say you close your account and they give the info to the CRA. Let's further assume that a year or 2 from now you get a computer generated letter from IRS- 'Dear Snub- we think you just maybe could possibly owe us some money" You could safely snub them.


----------



## RCB

Numbersman61 said:


> I have relatives and friends who have US citizenship due to an American parent or being born in the US. They consider having dual citizenship an advantage and no one I know would consider renouncing their US citizenship. The extra cost in IRS filings etc. and taxation is minor to them compared to the opportunity to work and live in either country.


That's wonderful for your friends and relatives. They have made a choice. I made a choice 30 years ago that I wanted nothing to do with the US, except for the odd visit as a tourist. I acted on that choice by seeking clarification from Dept. of State. I did everything I was supposed to do, and they still put me in a position to be screwed over.

Many of us are now finding ourselves in the position of having to pay 2,350 USD to shed a clinging citizenship and taxation and reporting burden. We are not all like your friends and relatives. When I renounced early in 2013, an appointment with State at the Toronto consulate could be had in just two weeks, for a 450 USD fee. The fee was jacked to help stop the bloodflow, but it didn't work. Toronto is now booking TEN MONTHS out, Ottawa embassy isn't even booking, telling people to email and resubmit their forms in September.


----------



## snub

WhiteKat, thanks so much for doing that. I sent him a message via the website with my contact information. Thanks again!


----------



## snub

I see that people over at the Isaac Brock site have been watching this thread and had some questions. I wanted to share this letter I received from HSBC after my apparently stupid reply to the question of where I was born. It might give some insight to others wondering if they might be considered a U.S. person by the banks.


Well I screwed the photo posting up so I'll try again.


----------



## snub

Trying again:


----------



## snub

2 more:


----------



## Cal

I have a friend who had to legally renounce his US citizenship, was born there, moved to Canada when he was 3 months. Recently the US says he owes them $, despite the fact he never earned a penny there. Had to get an immigration lawyer. He is a Canadian citizen now as well.

He could have negotiated some sort of settlement, but out of principle, renounced citizenship.


----------



## Userkare

snub said:


> I wanted to share this letter I received from HSBC after my apparently stupid reply to the question of where I was born. It might give some insight to others wondering if they might be considered a U.S. person by the banks.


When/how/why did they ask you about your birthplace? Were you opening a new account, or did they do this 'out of the blue'? 

I have accounts at HSBC that were opened pre-FATCA, but have never been asked to provide any additional information since.


----------



## snub

I have been banking at HSBC for 30 years. I was attempting to take some cash and put it into a new mutual fund. They told me they had to update my personal information. They say that in order to be FATCA compliant they will be reviewing their existing customer base to confirm their FATCA status.


----------



## Nononymous

snub said:


> I am looking for help and advise on how to deal with my problem with the FATCA legislation. Here is my story. My father was born and raised in Canada and was a pilot in the Canadian Navy. In 1954 he was sent to the American Naval Air Base in Portsmouth, Virginia. Since he was
> going to be there awhile, my mother went down there to be with him as she was pregnant with me. I was born in July of 1954 and three weeks
> later we all returned to Canada. Upon returning, my parents were issued a Certificate of Registration of Birth Abroad on my behalf.Basically
> this is to retain my Canadian citizenship. Except for the first three weeks of my life I have never lived in the USA, I have never worked
> in the USA.


Late to reply here, just found this forum. To the OP - you may not be a US citizen (if so, lucky you). As I understand it, children born to serving military or diplomatic personnel posted to the US did NOT acquire US citizenship at birth. You need to follow up on this, and if your bank is still being horrid, find out what sort of documentation they required. 

I have a feeling that "my dad was in the military" is going to be a frequently used excuse for anyone with a US birthplace who's getting unpleasant questions from their bank.


----------



## Nononymous

Also, since I've found some different viewpoints here, a question that came up on another forum:

Does anyone have a sense of what the Canadian *legal* consequences of lying about US personhood to a Canadian bank would be? As in just answering untruthfully when CIBC or whomever asks if you have US citizenship. (Not going quite so far as providing forged birth certificates etc.) 

I'm not worried about the moral consequences, nobody's going to risk damnation for protecting themself from FATCA reporting.


----------



## Userkare

Nononymous said:


> Does anyone have a sense of what the Canadian *legal* consequences of lying about US personhood to a Canadian bank would be?


IANAL, so I won't venture to guess what consequences there might be. I have decided, though, that I will not fill in any form from a financial institution that simply asks my US birthplace without also asking if I have relinquished/renounced that citizenship. Hopefully, they will provide a number to call if there are any questions. I fear that once you've been thrown into the meat-grinder that is the IRS, it would be difficult to extricate yourself - even if your name was given in error.


----------



## snub

@Nononymous. That is something I am looking into, but so far my research only shows that Diplomats were exempt. But, according to the Canadian government, I am a Canadian citizen due to my parents applying for the Certificate of Registration of Birth Abroad when we returned home. It is the FATCA police at HSBC that are implying that I am a U.S. person. They could just tell the CRA that I am not considerd a U.S. person, and this would be over. At this point in time, since I recently retired and have lots of spare time, I'm quite happy to fight this to the bitter end. Apparently the CRA will not collect money on behalf of the IRS so I'd like the to know how the IRS will attempt to collect money from me.


----------



## james4beach

What if you just don't reply to the bank? Who has all the time and energy to answer all these damned forms?

Taking it slow... and silently... is probably the right immediate step. Don't rush into things. Do NOT hastily make any "declarations", do NOT fill out and sign anything. *The more information you supply, the more information they have.*

Can you just end your relationship with HSBC?


----------



## Nononymous

snub said:


> @Nononymous. That is something I am looking into, but so far my research only shows that Diplomats were exempt. But, according to the Canadian government, I am a Canadian citizen due to my parents applying for the Certificate of Registration of Birth Abroad when we returned home. It is the FATCA police at HSBC that are implying that I am a U.S. person. They could just tell the CRA that I am not considerd a U.S. person, and this would be over. At this point in time, since I recently retired and have lots of spare time, I'm quite happy to fight this to the bitter end. Apparently the CRA will not collect money on behalf of the IRS so I'd like the to know how the IRS will attempt to collect money from me.


Couple of things here:

Your Canadian citizenship isn't really relevant as far as HSBC is concerned. They're only interested in identifying US persons. (Canadian citizenship does make it virtually impossible for the US to collect anything from you in Canada, so it's still good to have.)

So why did HSBC get in touch with you? What exactly did they have as "US indicia" that would make them start the FATCA ball rolling? I don't think they're doing this for all their customers in Canada.

My approach would be to stall, delay and cooperate as little as possible. Do not sign anything or admit to anything. Politely write back to the bank and say "To the best of my knowledge I am not a US citizen, why would you think otherwise?" (Legally, you may or may not be a US citizen. It might depend on the exact nature of your father's military status. In practical terms, if you left as a child and never applied for a US passport, you don't really exist as far as the US government is concerned.) 

It's pretty easy to stay off the radar, at least for now. Your only disadvantage is that US birthplace. If you haven't had issues travelling to the US with a US birthplace on a Canadian passport, you might soon - the law states that US citizens must enter the US with a US passport, and the folks at the border are beginning to actually follow the law. So if indeed you are not a citizen, you might need some way of documenting that fact. 

A bit about my story. Like you, I was born in the US to Canadian parents (graduate students) and moved back as a small child. Unlike you, I was aware of my citizenship, went to school and worked in the US for a few years (during which time I filed taxes like everyone else) then returned to Canada in the mid-90s and had no further connection to the place. I used US passports for a number of years because there were slight advantages in terms of visa requirements when living in Germany. 

When the tax thing hit the headlines a few years ago I had a brief panic then said "bugger that" and decided to remain off the radar. I hadn't renewed my US passport because there was a section where you had to certify that you were tax-compliant, and give your SSN. I had a bit of grief at the border with my Canadian passport, so did eventually get another US passport, but the certification of tax-compliance was no longer in the application (only the SSN) and I did the renewal from a temporary address in Europe so my whereabouts would not be straightforward, should that data ever be passed from the State Department to the IRS (apparently they don't cooperate much).

Banks never bothered me about FATCA - until recently they didn't keep place of birth or citizenship data with account records - and all was fine until last year, when the investment advisor we use (with RBCDS) contacted me with questions about US citizenship. They wanted an SSN and either a W9 or W8 signed, depending on my status. (I expect they knew of my citizenship via my parents, who had probably discussed the issue in the context of estate planning.) I did not cooperate. All I have with them are RRSPs, which are exempt from FATCA under the terms of the IGA. I said I wasn't supplying that information for non-reportable accounts, since there was no guarantee that it would not be passed on anyway to either CRA or ultimately to the US - they weren't very clear on what would happen to the data. There was some back-and-forth, some threatening to suspend the account, then they backed down and agreed not to collect any citizenship information for RRSPs. Afterwards the advisor asked me to confirm that I was not a US citizen, by e-mail, which I did. An utter bald-faced lie on my part, which I'm sure he's completely aware of - just covering his posterior. It's been quiet ever since.

I did consider renouncing my US citizenship, even had an appointment at the consulate three years ago. I decided not to because I was basically too lazy and stubborn to deal with the five years of returns and reporting that is required to "log out" of the US tax system. I've since learned that many people ignore this, just renounce the citizenship without bothering with taxes, and the IRS is far too busy and disorganized to ever contact them - probably because no money would ever be owing in 99 percent of the cases. With that in mind I'm tempted to go through with it and renounce, but of course the fee was raised from $450 to $2350 (USD) last year. That annoyed me enough that I'm sticking with "civil disobedience" for now - renewing the passport to prevent border grief on those rare occasions when I travel south, not renouncing the citizenship, and remaining completely non-compliant on all tax and reporting (FinCEN/FBAR) requirements. As long as I live in Canada and keep my assets in Canada, there is nothing the US can do to collect a penny from me (for now, at any rate).


----------



## bgc_fan

I hadn't really been following this thread that much, but I find the advice that has been given out a little odd, i.e. "Just lay low, never reveal that you were born in the states and hopefully nothing will happen". 

I would think the simplest course of action is to confirm US citizenship, which actually should be pretty easy as when the OP was born, there must have been a birth certificate, or registry issued from the US, which pretty much establishes US citizenship. 

In which case, go through the process of renouncing your citizenship, with aid from professionals and not some anonymous people on a message board. 
Once you have your proof of non-US citizenship, you can use that whenever the subject comes up. At the moment, it doesn't sound like the OP has any proof that he isn't a dual-citizen, but the fact that he was born in the US makes it highly likely that he is one.

Sure, it entails paperwork and remitting taxes, but generally speaking there should be little or no taxes to pay. The obvious pain is the fee to renounce the citizenship.

As for all this talk about sovereignty and what not. The fact is the US taxes its citizens, regardless of where they live. If you are a US citizen, you have to live with that privilege.


----------



## Nononymous

Well I think there are a few points in favour of the off-the-radar approach:

1. Renunciation is not a simple or inexpensive process. It can involve travel to US consulates, sometimes multiple trips, plus the $2350 fee, plus depending on one's abilities either a fair chunk of time and/or money to prepare the five years' of tax returns and FinCEN reports to fully and correctly escape US tax reporting obligations. So there is certainly a barrier. It's not quite as simple as just deciding you want to be rid of it.

2. There are plenty of folks whose connection to the US is very tenuous - born there but only lived there as a child, or born to a US citizen parent in Canada, or naturalized as a Canadian decades ago with the understanding that they were relinquishing US citizenship by so doing - who simply object to the idea that they have a lifelong obligation to file US tax paperwork, and don't wish to cooperate. Despite what the law says. Some of these folks are pretty cranky - see the Isaac Brock Society site, and the FATCA lawsuit.

3. At least for now, under the tax treaty the Canadian government is very clear that it will not permit the US to collect any tax debts, fees, fines or penalties against Canadian citizens living in Canada (US assets are fair game, of course). So even if one is "outed" by FATCA, odds are that nothing will happen. (Despite all the hype, rumour has it that the IRS has suffered budget cuts and doesn't really have the resources to go after "normal" US citizens overseas who likely owe little or nothing anyway.)


----------



## james4beach

For any of you in these grey areas or who may face future issues of this (Nononymous too), I would recommend that you avoid any kind of US investment. No direct US stock or ETF ownership. This was the advice of Wegelin bank, too.


----------



## Nononymous

james4beach said:


> For any of you in these grey areas or who may face future issues of this (Nononymous too), I would recommend that you avoid any kind of US investment. No direct US stock or ETF ownership. This was the advice of Wegelin bank, too.


God no. Nothing direct. No real estate. Nothing.


----------



## bgc_fan

Personally, I'd think the peace of mind that you've renounced citizenship would be worth it. After all, what's not to say that in the future, they use more heavy handed tactics as flagging your name with immigration for not filing your taxes and preventing entry or exit in or out of the US?

Some of the arguments that are presented here are ignoring the fact that the point of FATCA is to catch US citizens who are not paying their taxes. Sure, it's nice to think that they are targetting the "rich", but if you're a US citizen, then you should be following the rules, or you renounce your citizenship. Too be honest, based on the comments here, it sounds like it is doing its job.

Sure it seems unfair, in that people are unaware that they fell into the FATCA trap, but it has been news for at least the past year, so it isn't that big a surprise.


----------



## Nononymous

It always looks a little different when you are the one with the unwanted US citizenship. The time and hassle to get rid of it seems fairly outrageous. 

I at least exercised the privilege to live down there for a few years many decades ago, so I shouldn't really be complaining. Others who've had zero connection to the country are justifiably outraged when they've been confronted by this mess, with all its implications.

The irksome thing about FATCA is that it's a very blunt weapon. While it was primarily designed to find money stashed offshore by US residents - all well and good - it's managed to sideswipe US expats abroad (who are now having trouble with banking services in places like Switzerland) and "accidental" US citizens who've lived all their lives in Canada or elsewhere; even immigrants to the US are catching it for having their names on family accounts in their home countries.


----------



## bgc_fan

That's true that it doesn't involve me, so I have a different outlook, whether bad or good on the issue.

It is a blunt weapon, but it was probably constructed that way to ensure ease of compliance. The minute you start add specific conditions, you've added loopholes and you end up loosing the people you're trying to catch as they try to adjust their finances/situations to match.

Sure, some people are unaware, but there are others like yourself who have taken advantage of the dual-citizenship.


----------



## Nononymous

It's not always a case of just file the papers, never pay any tax. Here's an example of where US taxation of citizens abroad can be cruel to the point of ridiculous, recently discussed on an expat forum:

Individual is born in the UK but has US citizenship through parents. Lived all their life in the UK. Graduate student at a UK university receiving a scholarship to cover living expenses (not tuition) from UK public funds. Under UK law the scholarship is tax-free. Under US law it is not, and to be fully compliant this person should be sending approximately 15 percent of their modest income - paid for by UK taxpayers - to the IRS. 

Fortunately this person does not have a US birthplace so their bank will cannot easily identify them under FATCA rules and they will continue staying off the radar.


----------



## Guban

^ Many would view the above example as unfair and ridiculous, and it indeed may be so, but I will point out that the person in the above example has all of the rights and privileges that being a US citizen holds. He or she can, amongst other things enter the US at will and get a job there. He or she can also make use of the US embassy and call on Uncle Sam's assistance at any time, as well as vote in federal elections.

Some may say that a similar person living in the UK, except with a dual UK/Canadian citizenship, is in a ridiculous situation. He/she has the right to enter Canada and ask for help from Canada without ever having any real attachment to Canada. He or she has no "skin in the game", unlike a US citizen who maintains ties to the US by filing a tax return, no matter where in the world that he/she lives.


----------



## bgc_fan

^ I would agree to this. 
In the example, sure the individual doesn't seem to have ties to the US, but why did he consciously keep the citizenship? He must be aware that he was a dual citizen, but either decided that renouncing the US citizenship was too bothersome, or thought that it may be an advantage later in life. In either case he made a choice to keep US citizenship, and should accept the duties related to it, which is reporting to the IRS.


----------



## snub

bgc_fan said:


> Sure it seems unfair, in that people are unaware that they fell into the FATCA trap, but it has been news for at least the past year, so it isn't that big a surprise.


Well, it was a surprise to me. I don't watch the news on TV and the only newspaper I read is the local weekly. I prefer to remain uninformed of world events.


----------



## Nononymous

snub said:


> Well, it was a surprise to me. I don't watch the news on TV and the only newspaper I read is the local weekly. I prefer to remain uninformed of world events.


A perfectly reasonable defence. I'm curious though, what triggered the enquiry from HSBC? Do you have a US address, did they for some reason know of your place of birth?

I still maintain that you have a credible claim to not being a US citizen. The rule on exceptions to automatic citizenship by birth is pretty vague - it excludes foreign "representatives of the sovereign". That could be taken to include serving military as well as diplomats. (What little I could find actually discusses the reverse problem - due to chaotic record-keeping diplomats are obtaining passports for their children born in the US, to which they were not entitled.)

I read up-thread that you signed a W8ben for the bank, which certifies your non-US status. If you did that in good faith, believing yourself not to be a US citizen due to your father's status, then hopefully it ends there. I would ask HSBC a couple of questions though: Do they believe you? What will they do with that information? Does it mean that your account and personal data is never passed to CRA, or is it passed to CRA along with the W8? If the latter, does CRA pass anything on to the US? I could never get a straight answer from RBCDS so I refused to sign anything. (I personally find it a bit outrageous that Canadian banks are requiring Canadian customers to use US government forms to certify that they are not US persons, but that's a minor issue.)

Assuming that you never took steps to actively use your _possible_ US citizenship - never applied for a social security number, never applied for a passport - then the US government really doesn't know much about you. A birth certificate somewhere would be the only record of your existence. If you can avoid FATCA reporting - move accounts to a credit union, make a plausible claim to non-citizenship - then no further information about you would ever be sent south, and you could safely remain off the radar. (And if you don't have US assets, it doesn't really matter what the IRS gets up to, they can't touch a penny north of the border, under current rules at any rate.) 

The only issue you're likely to face going forward is travel to the US, because a US birthplace on a Canadian passport is an obvious flag for US citizenship, which technically requires a US passport unless you can prove you're not a US citizen - those who've renounced often carry a copy of their loss of nationality certificate (CLN) with their Canadian passport.


----------



## snub

I have been banking at HSBC for 30 years. I was attempting to take some cash and put it into a new mutual fund. They told me they had to update my personal information. They asked me where I was born. I told them U.S. of A. They say that in order to be FATCA compliant they will be reviewing their existing customer base to confirm their FATCA status.


----------



## Nononymous

bgc_fan said:


> ^ I would agree to this.
> In the example, sure the individual doesn't seem to have ties to the US, but why did he consciously keep the citizenship? He must be aware that he was a dual citizen, but either decided that renouncing the US citizenship was too bothersome, or thought that it may be an advantage later in life. In either case he made a choice to keep US citizenship, and should accept the duties related to it, which is reporting to the IRS.


Actually it's quite possible that people are unaware of US citizenship (though increasingly difficult as this story gets out). If you are born in Canada and one of your parents moved to Canada from the US as a teenager, congratulations, you've just inherited US citizenship. Depending on what your parents believed or told you, that piece of news may come as a complete surprise. (In this case it's easy to hide, without the US birthplace.) A bit harder to claim ignorance if you were actually born in the US, but the OP on this thread wasn't clear on it, obviously. Finally there are Americans who naturalized as Canadians decades ago with the belief that in so doing they'd relinquished US citizenship, only to discover that the US changed the rules on them years later (they can usually prove it but have to go through a formal relinquishment process to do so).

So it's by no means clear that duals are aware of their US citizenship - and consciously keeping it for future considerations. It's also not a simple thing to get rid of - for lots of us the $2350 fee, multiple trips to a distant consulate, and five years' US tax preparation (should one choose to exit the system properly) are a huge barrier. Fortunately, even with FATCA it's still not overly difficult to stay off the radar, and the IRS is suprisingly toothless if you are discovered.


----------



## Nononymous

snub said:


> I have been banking at HSBC for 30 years. I was attempting to take some cash and put it into a new mutual fund. They told me they had to update my personal information. They asked me where I was born. I told them U.S. of A. They say that in order to be FATCA compliant they will be reviewing their existing customer base to confirm their FATCA status.


Good to know - thanks. For the place of birth, did they ask for any sort of documentation? In other words, could you have given a purely verbal answer? (My implication being that one simply lies and names a city in Canada.)


----------



## Nononymous

snub said:


> I have been banking at HSBC for 30 years. I was attempting to take some cash and put it into a new mutual fund. They told me they had to update my personal information. They asked me where I was born. I told them U.S. of A. They say that in order to be FATCA compliant they will be reviewing their existing customer base to confirm their FATCA status.


If that mutual fund was not an RRSP, guess what, you're going to learn about something called PFIC. Technically, if they aren't RRSPs, the US considers regular old mutual funds to be "foreign trusts" with all kinds of hideous reporting requirements. Duals who actually want to be properly tax compliant are encouraged to avoid such things - even TFSAs and RESPs. It's a mess. Another good reason to insist that you're not a US citizen.


----------



## snub

They did not ask for my birth certificate until after I told them I was born in the U.S. I am quite certain that if I had lied and said I was born in Canada, that would have been the end of it.


----------



## bgc_fan

Nononymous said:


> Actually it's quite possible that people are unaware of US citizenship (though increasingly difficult as this story gets out). If you are born in Canada and one of your parents moved to Canada from the US as a teenager, congratulations, you've just inherited US citizenship. Depending on what your parents believed or told you, that piece of news may come as a complete surprise. (In this case it's easy to hide, without the US birthplace.) A bit harder to claim ignorance if you were actually born in the US, but the OP on this thread wasn't clear on it, obviously. Finally there are Americans who naturalized as Canadians decades ago with the belief that in so doing they'd relinquished US citizenship, only to discover that the US changed the rules on them years later (they can usually prove it but have to go through a formal relinquishment process to do so).
> 
> So it's by no means clear that duals are aware of their US citizenship - and consciously keeping it for future considerations. It's also not a simple thing to get rid of - for lots of us the $2350 fee, multiple trips to a distant consulate, and five years' US tax preparation (should one choose to exit the system properly) are a huge barrier. Fortunately, even with FATCA it's still not overly difficult to stay off the radar, and the IRS is suprisingly toothless if you are discovered.


Forgetting the obvious "ignorance is not an excuse" thing, generally most people are aware of passing on citizenship due to one of 2 circumstances: one of the parents has that citizenship, or you were born in that country. While some countries have different rules, i.e. I believe in Germany, you only get automatic citizenship when one of your parents is a German citizen, and not if you were born in Germany, the US goes with both circumstances. 

The first may not be so obvious if the parent had been living away from the US for a while, and didn't know of their obligations to file taxes. Still, they should be aware that citizenship doesn't just disappear unless you actually do something, and getting Canadian citizenship doesn't count since we allow dual citizenship. 
The second situation is the more obvious one with the big concern in the states with illegals crossing the border to give birth so that their children are automatically US citizens. 

The OP had stated he fell in the latter situation as his birthplace was in the states, albeit on a military base, but there does not seem to be any sort of exemption for military members.


----------



## Nononymous

Guban said:


> Some may say that a similar person living in the UK, except with a dual UK/Canadian citizenship, is in a ridiculous situation. He/she has the right to enter Canada and ask for help from Canada without ever having any real attachment to Canada. He or she has no "skin in the game", unlike a US citizen who maintains ties to the US by filing a tax return, no matter where in the world that he/she lives.


Dual citizenship will always entail some individuals having rights and privileges that others don't, though mostly hypothetical if they are never exercised. I'm not sure how many people would move from the UK to Canada to collect welfare benefits, if that was the implication.


----------



## Nononymous

snub said:


> They did not ask for my birth certificate until after I told them I was born in the U.S. I am quite certain that if I had lied and said I was born in Canada, that would have been the end of it.


How frustrating. What did they say when you signed the W8? You are effectively claiming that you are not a US citizen, despite having a US birth certificate.


----------



## snub

You don't have to be a U.S. citizen to be affected by FATCA, Here are a few ways you can be nabbed:

U.S. residence
U.S. place of birth
U.S. address
U.S. post office box
U.S. telephone number
Repeating payment instructions to pay amounts to a U.S. address or an account maintained in the U.S.
Current Power of Attorney or signatory authority granted to a person with a U.S. address
In Care of or Hold mail address which is the sole address for the account holder
If you spend a significant number of days in the U.S. each year
If you have a U.S. parent


----------



## Nononymous

I just went back up-thread. Sorry for any confusion earlier. You signed the W8, the bank rejected it and told you to sign a W9. Presumably you have not done so? Where do things currently stand?

One issue here is that HSBC has been nailed on a number of tax fraud case lately so they are probably the most gun-shy of the major banks when it comes to the US. Also, I suspect they are more concerned about investments - particularly non-RRSP - than regular banking. 

If you don't cooperate with them, they can close your account and report you to CRA as "recalcitrant account holder"; if you close your account, they will also report this to CRA. 

You can easily move your daily banking to a FATCA-proof credit union, but investments are problematic. (I looked into this during my argument with RBCDS.) Credit unions pass that business on to larger dealers who follow the FATCA rules. Since the IGA went into effect on 1 July last year, they will ask citizenship questions as part of the account-opening procedure. One is of course free to lie, if they don't demand some form of documentary proof.

The good news, without a TIN or SSN the US doesn't have much to go by, and even less power to do anything, so in the event that your name, address and account numbers wound their way from HSBC to the CRA to the IRS, it's not clear that you'd face any meaningful consequences in terms of non-US assets. 

In light of the above, you have four basic options:

1. Sign the W9 then become fully compliant with US taxes. You'd likely never owe them any money, and doing all the paperwork might become a satisfying retirement hobby. You could renounce your citizenship once you were caught up for five years, should you so choose.

2. Sign the W9 and ignore any mail you receive from the US government. Potentially stressful but by no means clear they can touch your money.

3. Find some sort of way to prove to HSBC that you are not a US citizen, due to your father's military service, then live out your life in peace. I have no idea how difficult this would be.

4. Refuse to sign the W9, move your banking and investment to something FATCA-proof, and ignore any mail from the US government in the event that HSBC and CRA rat you out. Again, potentially stressful but by no means clear that the IRS could ever touch your money.


----------



## Nononymous

snub said:


> You don't have to be a U.S. citizen to be affected by FATCA, Here are a few ways you can be nabbed:
> 
> U.S. residence
> U.S. place of birth
> U.S. address
> U.S. post office box
> U.S. telephone number
> Repeating payment instructions to pay amounts to a U.S. address or an account maintained in the U.S.
> Current Power of Attorney or signatory authority granted to a person with a U.S. address
> In Care of or Hold mail address which is the sole address for the account holder
> If you spend a significant number of days in the U.S. each year
> If you have a U.S. parent


Those are the "US indicia" that put you in the cross-hairs for further inquiries by your financial institution. Doesn't necessarily mean that you would be deemed a US person. Note also that you don't have to be a US citizen to be deemed a US person. Also vulnerable: snowbirds who stay south too long, or people who worked in the US then failed to cancel their green card after returning home.


----------



## bgc_fan

I think a lot of the speculation and comments on this thread could be cleared up looking at the CRA website:

http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/fq-eng.html


----------



## Nononymous

bgc_fan said:


> I think a lot of the speculation and comments on this thread could be cleared up looking at the CRA website:
> 
> http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/fq-eng.html


I don't think I said anything that's directly contradicted by the guidelines. My question isn't what do the rules say, but rather what can I do to get around them if I think they're BS, and what are the potential consequences if I try?

Even the CRA site doesn't make things entirely clear:



> 7. Will my financial institution ask me if I was born in the U.S.?
> 
> A financial institution does not have to ask its account holders about their place of birth.
> 
> If a financial institution, applying the due diligence rules of the agreement to its accounts, finds records that have an unambiguous indication of a U.S. place of birth, the financial institution must treat the account as a reportable account or follow up with the account holder to obtain documentation that shows he or she is not a U.S. resident or a U.S. citizen.


This suggests that HSBC was doing more than it needed to. Alas, the only unambiguous indication of US place of birth in this case was the OP's unfortunate honesty. 

There is still the possibility that the OP could document non-citizenship by virtue of the father's military status, though probably a long shot. According to the guidelines that's something one would negotiate with the bank.



> 4. What if account holders are unsure whether they are U.S. citizens?
> 
> An account holder may be unsure whether he or she is a U.S. citizen and may ask a financial institution for clarification about the rules for U.S. citizenship. These rules are complex, and financial institutions are not expected to provide information on all aspects of U.S. citizenship. If an account holder asks for such a clarification, a financial institution may refer the account holder to relevant U.S. government websites or resources, such as the IRS website or U.S. Citizenship and Immigration Services. It is the responsibility of the account holder to determine whether he or she is a U.S. citizen.


----------



## Guban

Nononymous said:


> Dual citizenship will always entail some individuals having rights and privileges that others don't, though mostly hypothetical if they are never exercised. I'm not sure how many people would move from the UK to Canada to collect welfare benefits, if that was the implication.


One could also say that dual citizens have rights, privileges and _responsibilities_ that others don't.
Welfare is a possible benefit, as is help from the Canadian military. Recall Lebanon? The example given is for UK/Canadian. What about Lebanese/Canadian, Iranian/Canadian, Egyptian/Canadian, Afghan/Canadian, Sudanese/Canadian, ...


----------



## Nononymous

We're not really talking about the ease and benefits of maintaining a Canadian citizenship-of-convenience here. Different issue, on which I don't necessarily disagree.

If a citizenship comes with responsibilities, that's fine, but don't make it onerous to renounce the citizenship. If I'm that dual Canadian/UK I can shed my Canadian or UK passport very quickly, for free. If I'd lived all my life in the UK, I'd have no Canadian tax obligations due to non-residency; ditto the other direction. It's perfectly simple. Different story for US citizenship.


----------



## Guban

^ I was merely responding to your post #48, and indicating that your example wasn't really that ridiculous at all. Perhaps citizenship should have responsibilities too, and a country, such as the US, is within its rights to ask that all citizens file a tax return.

I am not exactly sure how one renounces their Canadian (or any other) citizenship, but I agree with you that renouncing an American citizenship is unnecessarily expensive and complicated. However, I don't generally have a problem that they must be up to date with their tax filings first.


----------



## Userkare

Guban said:


> I am not exactly sure how one renounces their Canadian (or any other) citizenship, but I agree with you that renouncing an American citizenship is unnecessarily expensive and complicated. However, I don't generally have a problem that they must be up to date with their tax filings first.


I would agree that if a person knows that they are a citizen of the USA, and avails themselves of whatever benefits derive from that citizenship, then they should also understand and comply with the obligations of that citizenship, especially taxation.

What I have trouble with is when a person, not even aware of their American citizenship, is told that the 'nest-egg' they have built for their retirement is subject to taxation, even though they never lived or worked there for their entire life. Even more disturbing is that the US is powerful enough to bully banks in almost every nation around the world to act as their informants to ferret out these heinous 'tax delinquents'.

If I were in that situation, I think I would go with the 'fly under the radar' plan; stay out of the states, and avoid anything that might expose me to the IRS. As it turns out, I was a visionary in the 1970s and renounced my US citizenship as I was about to become a Canadian citizen. I had gone to the US consulate in Toronto to simply ask about what the ramifications to my US status would be if I were to take Canadian citizenship. This was before the Internet, so I was completely ignorant of the rules. As it turned out, so were the consulate staff. They gave me confusing and conflicting information, but told me that the only way I could be certain to lose US citizenship was to renounce it; but only a totally insane person would ever do that. To which I replied "sign me up!".

For the longest time when I crossed the border, I played the 'ignorant card'..
*Border agent:* _I see you were born in the US; why don't you have an American passport?_ 
*Me:* _I was told by the US consulate that when I took Canadian citizenship in the 1970s that I would lose my US citizenship._
*Border agent:* _That's not correct. No one can take away your citizenship._
*Me:* _Oh wow, I had better look into that. Thank you very much!_
*Border agent:* _You're very welcome. Have a nice trip._

I have not been back to the states since all this FATCA bulls**t hit the fan. I'm going to get an enhanced D.L. that doesn't show my birthplace. If I should be asked, I will not lie to a US border agent, and will produce my CLN. If denied entry, I'm fine with that; I'll spend my vacation money in Canada.


----------



## fatcat

having just filed my 2014 fbar i must weigh in with a different point of view
this thread should be sub titled "the claude rains manuever" wherein claude was famously shocked to find out there was gambling going on in ricks casino just as someone handed him his winnings

the op can hold his breath all day long and say "i'm not a us citizen" and yet when he finally exhales, guess what ? ... he will still be a united states citizen

and like it or not the usa requires its citizens to file a tax return on worldwide income every year and a report to the treasury department that outlines in detail what "foreign" accounts they own

never mind the idea that somehow in his 50+ years on the planet (30 years at hsbc plus 20 makes 50 ???) 
he almost certainly has known that this is his responsibility even if he pretends otherwise (as do all of these _shocked_ canadians who haven't bothered to file all these years)

the issac brock society's challenge may succeed or it may fail, regardless, either a new law will come in to place or the old treaty will stand ... it will stand because despite their bitching and moaning, canada's big banks want to do big business in the usa and they want to see banking integrated across the whole continent and these are the guys that eat lunch and play golf with the regulators and the mp's and the representatives of the irs etc etc

this is going to happen whether we like it or not (i certainly do not like it one damn bit)

the op and others have the opportunity to enter an amnesty program and complete a relatively simple requirement of 6 years of fbars
i have done my own and my aunts for many years and i can tell you that 6 years of fbars can be assembled by an individual in a few hours the tax returns will cost about a $1000 for 3 years

to choose to go underground and spend the rest of your life fighting the cra, the irs and us treasury department strikes me as utter and complete misguided foolishness (though i admit, for sheer entertainment value i cannot wait to hear back from the op, in his undisclosed location, how things are going because really who doesn't like to take on the the cra AND the irs at the same time ?)

there are all kinds of people in the usa who having been contesting the "illegal" and "unconstitutional" income tax act for decades most of them can be found in a federal prison somewhere in arizona ... some people swear that the earth is flat

for better or worse the usa has decided it will make citizenship cost something

even though i hate the compliance regime i kind of admire their guts in contrast to canada's gutlessness as it protects and welcomes back people with passports who haven't lived in the country for years when the shite hits the fan back home (as we saw in lebanon a few years back when all kinds of people who haven't paid taxes for years demanded to be extricated by the our government)

the law is badly written and it is being badly implemented, the treasury and the irs are having trouble understanding their _own_ rules

a simple 1 or 2 million dollar exemption would solve the problem and still target the big fish which is the intention of the law in the first place, this may happen someday but in the meantime i am gonna keep filing and stay in compliance

next year i will be down to 5 accounts (from 23 at the start of all this) and compliance will be simple and straightforward and take about an hour since i now keep good records 

maybe in a few years if the tax laws continue to get more complex (can't own mutual funds, can't have a tfsa, can't even own etf's all because the pfic reporting is too complex) i will renounce but not yet

i would say to the op the exact opposite of what others are saying in this thread which would be to enter the amnesty and get compliant and then renounce

you won't be fighting the good fight but in the long run you will sleep better and that, as they say, is priceless ... it certainly is at my age anyway


----------



## Nononymous

I think there are actually a rather a lot of US citizens in Canada and elsewhere who quite reasonably believe they don't have US citizenship. Increasingly fewer with this story in the news, but still plenty. Many different (false) assumptions are possible:

- that when they naturalized as Canadians, they lost US citizenship
- that if they did not take action to somehow "claim" US citizenship by a certain age, the right to it was lost
- that being born to parents on military or government assignment excluded them

US citizenship law has changed over the decades, which doesn't help. I don't think it's unreasonable at all for the OP or many others to have a US birthplace and honestly believe that they are not US citizens. If you live your life in Canada, as a Canadian, it's not something you'd necessarily give a great deal of thought to - until recently, it had no impact on your day-to-day existence. And it would never have been an issue until the introduction of the passport requirement at the border, and then FATCA. Canadian-born children of US-born parents are probably more likely to make false assumptions; though at least in their case the Canadian birthplace makes FATCA very easy to ignore.

Of those who were at least aware of US citizenship, only a subset would have known about the tax filing requirement, and FBAR, and all that nonsense. For the longest time I had a vague idea that an income under some relatively high limit meant I didn't need to file because I wouldn't owe anything anyway, or something like that. Didn't give it a great deal of thought. Again, until recently this had no impact on one's daily life as a Canadian, so what was the incentive to dig any deeper?

But enough excuses. The cat is increasingly out of the bag. So what to do now?

Compliance is one approach. Renunciation definitely offers you the ultimately security here, but it comes at a price.

If you have no US assets and minimal contact with the US, non-compliance is still a viable option, in my view. You're not taking on the IRS and the CRA at the same time, or even one at a time. All you need to do is, when asked, tell your financial institution that you are not a US person. They should not ask for place of birth as it does not determine US personhood. They definitely should not ask you to sign a W8 because they're too scared or lazy to come up with their own document. With my investment firm I refused to budge on that issue - I told them that as a Canadian living in Canada without US assets, I would not sign a US government form, on principle. They backed down. 

For the OP, I think there's a chance he could persuade HSBC that he's not a US citizen - they're obviously not too clear on the personhood rules themselves if they're only asking for place of birth. That's who he needs to convince - the bank, not the US government, not the Canadian government. The bank is the gatekeeper, they collect and pass on personal information. Maybe it'll work, maybe it won't. It's difficult to find much information on his specific case because the law seems pretty vague and most of the precedent would be around people wanting to claim US citizenship, not the reverse (until fairly recently it was considered a desirable thing to have; now, not so much). 

Finally, if one is indeed FATCA'd and data is sent on to the US, it's by no means clear that much of anything would happen. Under the current tax treaty, Canadian assets (held by Canadians living in Canada) cannot be touched, period. Bless his heart, the late Jim Flaherty made public statements to this effect. Meanwhile IRS resources are being reduced so their incentive and ability to go after ordinary non-wealthy citizens abroad cannot be high (apparently 94% of US citizens filing from outside the US owe precisely zero, due to the foreign earned income exclusion and foreign tax credit). Ironically, even as the US rolls out FATCA and cranks up the hype, they're closing all the overseas IRS offices.

I personally am completely non-compliant and sleep very well. I would ignore this issue entirely except that I enjoy spending a small amount of time helping reduce the panic among those who've just discovered the situation. A few years ago when the story first appeared in the news people hit the panic button, received some terrible advice from lawyers and accountants, and entered very punitive "amnesty" programs (OVDI etc.) designed for genuine tax criminals, at great cost to themselves. With each passing year the come-clean deal for ordinary taxpayers seems to get better - the US actually doesn't have much power over its citizens abroad - so what's the rush to comply?

In an ideal world the US would drop citizenship-based taxation; with the exception of Eritrea, every other country practices residence-based taxation. That obviously won't happen. So they could up the FATCA limit to the millions, as you say, which would still catch the big-time crooks, but amount to de facto tolerance of non-compliance among the ordinary folk. (FATCA isn't a huge deal in Canada yet, but it's causing problems for US citizens living in Europe, some of whom are having difficulty obtaining banking services because financial institutions would rather not have them as customers than risk somehow running afoul of the US government. Swiss banks brought this down on themselves, but there's a lot of collateral damage hurting the people who don't happen to be wealthy tax evaders.) Alternatively, the US could make renunciation much easier: charge $100 and sign a statement to the effect that you don't owe any US taxes and leave it at that. None of this will happen, so you can either drag yourself into compliance - sometimes easy, sometimes not, depending on the complexity of your investments and your connections to the US - or make a reasonable calculation of risk and decide it's still worth ignoring.


----------



## fatcat

i don't believe for a minute that these people (i.e. as one group, those born in the usa who then left as infants) 

a) don't know they are american citizens, indeed many of them are overjoyed to know that they have a ticket to the usa 

b) i don't believe that, if they have assets to protect and grow that in all their decades on the planet they haven't once heard the basic piece of knowledge that every american is taxed on their worldwide income (unlike every other sane country in the world except eritrea) and "oh, i was born in the usa i wonder if should be filing ? hmmm, well i guess i'll just pretend i don't know" ... i flatly don't believe it ... they know damn well but just don't want to bother (and who can blame them, it's a bad law and a pain in the ***, but it is the law)

as to the issue of compliance or not, to take the non-compliance route means doing a financial two-step for the *rest of your life* that will affect every financial product you buy, every bank you use and even your travel since flying anywhere even near the usa means your going to be on somebody's list ... forget ever going to the usa

and the mere fact that canada won't allow irs / treasury asset seizures now doesn't mean they won't in the future

so, the question is not whether or not you can effectively go underground and dodge the plain fact of your birthplace for the rest of your life, you can certainly try, the question is, what happens if you get caught, what happens if your non-compliance gets sussed out ? ... you are then facing serious life changing penalties, not to mention the legal bills you will pay to defend yourself to try and prevent asset seizures which may or may not be successful

everyone talks tough until they find themselves in the small windowless room with the taxman who starts talking about fines and jail time and then 99% of them roll over like puppies and beg for forgiveness and open their wallet

i think non-compliance is really, really bad advice

take a look around, everywhere i look i see information and data converging and being collated and collected, i couldn't get a drivers license without using my damn middle name because thats on my birth certificate and that now is the standard, i can't even get a library card that doesn't have my middle name on it by law

having said that, the op is of course free to choose his own path, i just hope we get to hear about his progress through the storm drains and back alleys of the investing / money-growing world, it might prove to be very entertaining

stuff like "got another letter from the irs and used it to roll a doobie, man this feels good !" ... "i won't be updating for a while since it takes me 4 hours to get to a viable internet connection and check my po box, but stay tuned"


----------



## Nononymous

Obviously it's not easy to find hard data on this. I've read lots of "shocked and appalled" stories from people who honestly didn't realize they were considered US citizens. Even Boris Johnson, who you'd think might have known better.

Yes, we can't predict what the future will hold. The Canadian government could sell us all down the river. But for now, based on what little information we have, there's no public evidence of ordinary dual citizens living in Canada running into any sort of trouble. It's a different story for anyone with assets, a residence, business ties with the US, of course. If one gets into that situation unawares, I have less sympathy.

I imagine you'd have to be into some fairly deep **** before travel becomes an issue - currently there's no evidence that tax status is ever checked at the border, and ordinary failure-to-file doesn't get you an arrest warrant. Interestingly, about five years ago the US passport application asked you to sign a little statement saying that your tax filings were up to date (on pain of a $500 fine for perjury - probably cheaper than having an accountant do your US taxes). Two years ago that had changed to a requirement that you truthfully provide your social security number, if you have one (all zeroes if you don't). What I'd read into that is a hint that the passport and immigration folks don't want anything to do with playing tax collector. 

Anyway, minor point, it's all about personal risk tolerance. For me, my risk is very low and the "deals" keep getting better. I'm going to wait for more **** to hit the fan before I consider renunciation - for now, too costly in time and money.


----------



## Eclectic12

fatcat said:


> i don't believe for a minute that these people (i.e. as one group, those born in the usa who then left as infants)
> 
> a) don't know they are american citizens ...


One can question the numbers ... but at least one has posted here that the US told them they weren't a citizen when it was checked (I can't remember with which branch of the US gov't). With all the talk of FATCA, they checked again where this time they were told they *were* a US citizen.




fatcat said:


> b) i don't believe that, if they have assets to protect and grow that in all their decades on the planet they haven't once heard the basic piece of knowledge that every american is taxed on their worldwide income ...


Most are triggered by what they hear around them ... if there is no one talking about it - there may not be a trigger to investigate.




fatcat said:


> ... i think non-compliance is really, really bad advice.


Agreed.




Nononymous said:


> Obviously it's not easy to find hard data on this. I've read lots of "shocked and appalled" stories from people who honestly didn't realize they were considered US citizens...


There is obviously a disconnect for whatever reason as a fair number of the articles I've read talking about FATCA highlight that the US estimates there's one million US citizens in Canada where only something like 250K or so report themselves to be US citizens.

Then too ... how many read "US citizen", say to themselves "this does not apply to me" and stop reading before they get to the "this applies to green card holders" part?




Nononymous said:


> I imagine you'd have to be into some fairly deep **** before travel becomes an issue - currently there's no evidence that tax status is ever checked at the border, and ordinary failure-to-file doesn't get you an arrest warrant. ... But for now, based on what little information we have, there's no public evidence of ordinary dual citizens living in Canada running into any sort of trouble ...


No evidence currently being reported ... what they are doing and have the technology to start doing is a different question.


Cheers


----------



## fatcat

Eclectic12 said:


> No evidence currently being reported ... what they are doing and have the technology to start doing is a different question.


this is the issue ... staying "under the radar" when you are homeless or live from paycheck to paycheck is one thing but doing so with significant assets and pensions and travel etc is another

we are now seeing data linking at an unprecedented and rapid pace ... it is getting hard and harder to really disappear unless you really make it your full-time business

the op has made a crucial misstep by outing himself

to me the risk / reward proposition is poor and overweighted to full disclosure

especially since there is an amnesty in place

you can effectively come in under the amnesty, file your taxes and fbar's and then renounce for about 5K (i am allowing for tax prep, renunciation fees and travel hotel)

that 5K is going to be a bargain versus getting caught in 5 or 10 years time and really hung out to dry


----------



## RCB

I am the one that posted that the US State department told me I was not a US citizen in 92.

fatcat, your disbelief that many of us should have KNOWN we were US citizens, and KNOWN that we had tax and reporting obligations to the US, per the US, smacks of ignorance of the situation.

In 92, I had no one to rely on regarding US citizenship information except the State department, which DETERMINES citizenship, based on US law at the time. There was no internet, and as a poor student, with no desire to HAVE US citizenship, I certainly was not about to seek out and pay a citizenship lawyer, when the horse's mouth said I was NOT.a US citizen.


----------



## Nononymous

fatcat said:


> that 5K is going to be a bargain versus getting caught in 5 or 10 years time and really hung out to dry


That $5k is pretty significant for some people. Whether you have it or not, paying $5k to get rid of something you don't want, didn't know you had and derived no benefit from is outrageous.

I take the possibly naive view that there's a certain safety in numbers. Even the worst federal government would have a difficult time standing by watching 2 to 3 percent of the population (the vast majority either born to Canadians or born in Canada) being fleeced by the US government.


----------



## Userkare

RCB said:


> I am the one that posted that the US State department told me I was not a US citizen in 92.
> 
> In 92, I had no one to rely on regarding US citizenship information except the State department, which DETERMINES citizenship, based on US law at the time. There was no internet, and as a poor student, with no desire to HAVE US citizenship, I certainly was not about to seek out and pay a citizenship lawyer, when the horse's mouth said I was NOT.a US citizen.


Isn't this something that they would give you in writing? Could the OP go to the nearest US consulate and ask if by nature of his US birth to Canadian military personnel, does he have automatic American citizenship? There's nothing to lose by asking. If they say no, then get it in writing as something to take to the bank. If the answer is yes, then the relinquish / renounce option is still on the table.


----------



## fatcat

RCB said:


> I am the one that posted that the US State department told me I was not a US citizen in 92.
> 
> fatcat, your disbelief that many of us should have KNOWN we were US citizens, and KNOWN that we had tax and reporting obligations to the US, per the US, smacks of ignorance of the situation.
> 
> In 92, I had no one to rely on regarding US citizenship information except the State department, which DETERMINES citizenship, based on US law at the time. There was no internet, and as a poor student, with no desire to HAVE US citizenship, I certainly was not about to seek out and pay a citizenship lawyer, when the horse's mouth said I was NOT.a US citizen.


so lets see here, you were born in the united states of america, correct ? ... and you wonder "golly, am i a us citizen or not ?" ... really, seriously, do people actually buy this ? ... 

it couldn't be more plain, more simple, more straightforward, except for some arcane and oddball circumstance involving diplomatic personnel and so on, if you born in the usa, unless you formally renounce your us citizenship, you are a us citizen, period ... this is so simple



> That $5k is pretty significant for some people. Whether you have it or not, paying $5k to get rid of something you don't want, didn't know you had and derived no benefit from is outrageous.


 complete nonsense, if the 5K means that much to someone then they don't have enough assets to even worry about hiding, they don't need to non-disclose because they don't have enough assets to protect ... 5K, that's the price ... get out yer hanky and just find the money and go through the process



> Isn't this something that they would give you in writing? Could the OP go to the nearest US consulate and ask if by nature of his US birth to Canadian military personnel, does he have automatic American citizenship? There's nothing to lose by asking. If they say no, then get it in writing as something to take to the bank. If the answer is yes, then the relinquish / renounce option is still on the table.


 you don't need to ask anyone a damn thing ... you are born in the united states you are us citizen period .... it has been that way for decades ... i promise you that every single pregnant mexican girl in any border town on the southern border can recite the law chapter and verse, they are experts in citizenship law but the op can't figure his way through this ? ... honestly, i don't know whether to laugh or cry ..

tell me you hate the worldwide taxation law, i get it, i do too .... tell me you hate filling out fbar's, i hate them too ... tell me are pissed off about the complexities of dual citizenship and filing out two tax returns every year, i really get that because i do it

but please don't weep and moan and get all confused by the answer to the question: "gee, i was born in chicago, illinois, i wonder if i am a us citizen ?" ... please don't run that one by me because unless you have yer head right up yer bum then you damn well know the answer unless of course you want to pretend that you don't

you guys need to just say "#### this law, and #### the usa, i am a non-cooperator cuz i don't like the whole goddamn thing" ... that i can understand, that i can respect

you don't need to dress it up with all this phony hard thinking about whether or not you are us citizen just because you were born in dubuque iowa and gee my momma she's a canuck and my poppa's a canuck so does that cancel out my citizenship ??

no it doesn't and it never has, you are born on us soil then you are a us citizen, like i say, ask the mexican girls, they will all set you straight


----------



## RCB

They didn't give it to me in writing, nor did they provide me with a CLN.

Considering the US doesn't provide anything without a fee, good luck. The IRS doesn't answer tax questions, they direct you to seek professional advice. I would imagine the State dept. would do the same, or tell you to cough up the new $2,350 fee to renounce. Hell, it's taking close to a year just to get an appoinment at a consulate to renounce or relinquish now. The US government is incompetence beyond belief...then and now.


----------



## RCB

fatcat, you are calling me a liar, are you not? I am not a liar.

Growing up in Canada, I heard repeatedly through the 70s and 80s from my US law enforcenent officer uncle by marriage that the US government did not allow dual citizenship. In my early 20s, my US resident cousin (born in Canada, opposite situation to mine) had to renounce his Canadian-by-birth citizenship for the US to be a USpolice officer, as they would not allow dual citizenship.

Shortly afterwards, I was checking the back of my Canadian Registration of Birth Abroad certificate for the information that stated what I had to do to maintain Canadian citizenship. A friend of a friend, in coversation, had revealed he was born in the US, and had dual citizenship. We discussed that I had thought that the US did not allow dual citizenship. I phoned the Toronto consulate, spent half an hour on the phone with various levels, until finally speaking with the vice consul. I was grilled rudely, and finally told by the vice consul that I WAS NOT A US CITIZEN for various reasons, including that I had voted in Canada. When I asked if I had to do anything else, I was told no.

Perhaps your disbelief would be best spent on the incompetence of the US government.


----------



## fatcat

RCB said:


> fatcat, you are calling me a liar, are you not? I am not a liar.
> 
> Growing up in Canada, I heard repeatedly through the 70s and 80s from my US law enforcenent officer uncle by marriage that the US government did not allow dual citizenship. In my early 20s, my US resident cousin (born in Canada, opposite situation to mine) had to renounce his Canadian-by-birth citizenship for the US to be a USpolice officer, as they would not allow dual citizenship.
> 
> Shortly afterwards, I was checking the back of my Canadian Registration of Birth Abroad certificate for the information that stated what I had to do to maintain Canadian citizenship. A friend of a friend, in coversation, had revealed he was born in the US, and had dual citizenship. We discussed that I had thought that the US did not allow dual citizenship. I phoned the Toronto consulate, spent half an hour on the phone with various levels, until finally speaking with the vice consul. I was grilled rudely, and finally told by the vice consul that I WAS NOT A US CITIZEN for various reasons, including that I had voted in Canada. When I asked if I had to do anything else, I was told no.
> 
> Perhaps your disbelief would be best spent on the incompetence of the US government.


let me come at this from another direction without appearing to call you a liar, i certainly am not calling you a liar, i am saying that you are deliberating deluding yourself because you don't like this law, i get it, i also dislike this law

you were born in the united states of america, correct ? .. on us soil somewhere in the contiguous 48 states do i have that right ?

if i have that correct, what is the rationale that would make you NOT a citizen of the united states of america ?
what is the reason you would not be a citizen ?

wikipedia says this about us citizenship, specifically birthright citizenship,



> Birthright citizenship may be conferred by jus soli or jus sanguinis. Under United States law, *U.S. citizenship is automatically granted* any person born within and subject to the jurisdiction of the U.S. This includes the territories of Puerto Rico, the Marianas (Guam and the Northern Mariana Islands) and the U.S. Virgin Islands, and also applies to children born elsewhere in the world to U.S. citizens (with certain exceptions).[1][2]


https://en.wikipedia.org/wiki/Birthright_citizenship_in_the_United_States

further the state department of the usa says this:


> The U.S. Supreme Court has spoken (Afroyim v. Rusk, 387 U.S. 253 (1967) and Vance v. Terrazas, 444 U.S. 252 (1980)): a person cannot lose U.S. nationality unless he or she voluntarily relinquishes that status.


http://travel.state.gov/content/tra...siderations/us-citizenship-laws-policies.html

both web pages are very clear to me at least

so what in your life situation has caused you to think you are not a us citizen because it is abundantly clear to me that the state department says you MUST renounce your citizenship in order to no longer fall under the obligation to file a tax return on your worldwide income

why are you NOT a us citizen ?


----------



## Nononymous

1. Advice on the subject of US citizenship has been shitty and inconsistent over the years. Growing up, I had been told by my parents that I had to choose my citizenship at 18, I could not maintain both. Turns out that was no longer true. I needed my first passport for a trip to the UK in the 1970s. We took out an American passport because the consulate told me that I'd lose my US citizenship if I had a Canadian passport. For years I never voted because I thought that would also cost me US citizenship. All of which was probably not true at the time. (I wanted the citizenship because I thought I might go to school in the US. I did, spent a few years there, decided it wasn't for me, and have since lived only in Canada and Germany.)

2. The law on loss of US citizenship due to acquisition of a second citizenship through naturalization has not been constant. There's a significant cohort who came to Canada in the 1970s (Vietnam and all that) with the understanding they'd lost their US citizenship when they became Canadian. I believe a law was changed retroactively and unbeknownst to them, the US citizenship was restored. Some of these people are none too happy (at least one of the two principals in the FATCA lawsuit fits this profile). Luckily they can apply for a relinquishment through the consulate, at no cost, and it's back-dated so there are no tax issues.

3. In my case I've known all along that I'm a US citizen. I fall squarely, and proudly, into the "#### this law, and #### the usa, i am a non-cooperator cuz i don't like the whole goddamn thing" camp. I don't necessarily publish that declaration alongside my name, address and social security number, but I don't hide my views.


----------



## RCB

Again, in 1992, DESPITE the 1967 Afroyim v. Rusk decision (which I knew nothing of pre-internet), the State department TOLD ME I was NOT. a US citizen under US LAW. If you go to THE authority on US citizenship, you expect to get the correct answer.

Looking back, with the information on US law widely available on the internet, it is much easier to assess a situation. In 1992 it was not.

You are looking at this as though I should have been a legal specialist in a foreign country's laws. I was a Canadian, with Canadian parents, resident in Canada from the time I was an infant. A law enforcement officer, and an American told me as a child that his country did not allow dual citizenship.

If you can't get that, I don't know what to tell you. There are many cases such as mine, and many were told if the voted in another country, they lost US citizenship, well AFTER 1967. The US constantly changes laws and how it implements them. I suspect that the vice consul told me what I was told because around 92 the "anchor baby" issue was seen as a problem. Or the vice consul was plain ignorant of the law and incompetent, and should have been fired.

I am not a US citizen because I spent the $450 and airfare to a US consulate to tell them to shove their re-imposed citizenship.


----------



## Nononymous

I remember renewing my passport at the US consulate in the late 1980s and being grilled about the fact that I'd had a summer research job with the federal government, and that this might be grounds for losing the US citizenship since it was essentially working for a foreign state. It's like they were looking for an excuse to take it away. In retrospect I wish I'd said "oops, sorry, guess I did swear an oath of allegiance to the Queen".

On edit: Very distant memory, but in the 80s the passport renewal had to be in person at a consulate, and you had to go through a list of of potential expatriating acts and swear that you'd not done any of them. They did not want you to keep that citizenship. Ten years later you did the renewal by mail, no questions asked.


----------



## fatcat

RCB said:


> Again, in 1992, DESPITE the 1967 Afroyim v. Rusk decision (which I knew nothing of pre-internet), the State department TOLD ME I was NOT. a US citizen under US LAW. If you go to THE authority on US citizenship, you expect to get the correct answer.
> 
> Looking back, with the information on US law widely available on the internet, it is much easier to assess a situation. In 1992 it was not.
> 
> You are looking at this as though I should have been a legal specialist in a foreign country's laws. I was a Canadian, with Canadian parents, resident in Canada from the time I was an infant. A law enforcement officer, and an American told me as a child that his country did not allow dual citizenship.
> 
> If you can't get that, I don't know what to tell you. There are many cases such as mine, and many were told if the voted in another country, they lost US citizenship, well AFTER 1967. The US constantly changes laws and how it implements them. I suspect that the vice consul told me what I was told because around 92 the "anchor baby" issue was seen as a problem. Or the vice consul was plain ignorant of the law and incompetent, and should have been fired.


you still haven't told me where you were born ?

as to the issue of what you have been "told", at various times i have called the cra, the irs and the treasury department and i have never once thought that whatever some clerk was telling me was the final word on the law, i take their direction and add in my own common sense and what i read and go from there

i have had both my lawyers and accountants give me bad advice ... bad advice abounds in this world, and guess what ? ... in the end the responsibility falls on the asker not the advice giver

you give every impression of someone who was born in the usa and is looking to convince himself that he isn't a us citizen when you almost certainly are

why not just say "i hate the law and i am not going to obey it" and drop all the pretense of having been given bad advice ? ... you can weep all day long and knash your teeth and it won't do diddly .. you may have gotten bad advice, but in the end you are responsible



> 3. In my case I've known all along that I'm a US citizen. I fall squarely, and proudly, into the "#### this law, and #### the usa, i am a non-cooperator cuz i don't like the whole goddamn thing" camp. I don't necessarily publish that declaration alongside my name, address and social security number, but I don't hide my views.


 i appreciate your honesty and directness ... i really have no beef with issac brock or anyone that wants to fight the law, i see their point

i too hate the damn law and do think about renunciation but i spent many years in the usa where i became a naturalized citizen, turning my back on the usa is hard for me at present but i must say, i cannot have a tfsa, i cannot own mutual funds, i can't even own an etf, the increasing complexity and conflicts between 2 complex tax regimes may leave me no choice just for my own sanity

for the purposes of this thread i am merely saying that in my opinion, unless one wants to take on this fight as the cause of their life and really dedicate themselves to it, you are far better off entering the amnesty and then renouncing than just going underground

just be clear who you are and what you want to do before you act and don't pretend that you aren't what you are


----------



## Nononymous

From post #84: "I am not a US citizen because I spent the $450 and airfare to a US consulate to tell them to shove their re-imposed citizenship."

I would infer that RCB believed himself/herself to not be a US citizen on the basis of what the consulate said in 1972, later discovered that this was not true, then renounced said unwanted US citizenship.


----------



## RCB

fatcat, just which part of the US government determines if one is a US citizen, SUPPOSEDLY based on US law? The STATE DEPT. Which US department currently determines if one is NOT a US citizen? Which givernment department NOW extorts people for $2,350 to get a piece of paper that says one is NO LONGER a US citizen? The very same STATE DEPT. that told me I wasn't a citizen in 92, and charged me $450 in 2013 to get rid of that damned "US citizen" label.

Yes, I believe much earlier in this thread I stated I was born in the US to Canadian parents temporarily in the US.

You obviously look at the US as something good...you naturalized there. I, on the other hand, have NEVER wanted anything to do with the US. I don't even want to live next door to it.


----------



## Franz Josef

Fatcat: You are quite simply wrong but you won't admit it. RCB is absolutely correct but you keep telling him he's not

At the time, (70s and 80s) the official state department position was that an American such as RCB who was American and also a citizen of another country such as Canada would lose his American citizenship if he _took advantage of the other country's citizenship_. For example by using a Canadian passport or voting in Canada. The fact that they later changed the rules doesn't negate the fact that RCB was told by a vice-consul that he was no longer a US citizen. The vice-consul was following the rules of the day. RCB had every reason to believe that he was no longer American.


----------



## Eclectic12

fatcat said:


> ... further the state department of the usa says this:
> http://travel.state.gov/content/tra...siderations/us-citizenship-laws-policies.html
> 
> both web pages are very clear to me at least ...


Is it all that clear and simple?


The State Department also says:



> The Department of State is responsible for determining the nationality status of a person located outside the United States ...
> 
> Section 349 of the INA (8 U.S.C. 1481), as amended, states that * U.S. nationals are subject to loss of nationality if they perform certain specified acts * voluntarily and with the intention to relinquish U.S. nationality. Briefly stated, these acts include:
> - obtaining naturalization in a foreign state upon one's own application after the age of 18 (Sec. 349 (a) (1) INA); ...
> 
> 
> Loss of Nationality and Taxation
> 
> P.L. 104-191 contains changes in the taxation of U.S. nationals who renounce or otherwise lose U.S. nationality. In general, any person who lost U.S. nationality within 10 years immediately preceding the close of the taxable year, whose principle purpose in losing nationality was to avoid taxation, will be subject to continued taxation.


http://travel.state.gov/content/tra...olicies/citizenship-and-dual-nationality.html



So one have have US citizenship granted at birth but all it takes to put the US citizenship into question is applying for citizenship in another country but hey - U.S. law does not require a person to choose one nationality over the other. 


It doesn't seem simple to me to figure out who applied for foreign citizenship because they've made their homes in Canada for the last eighteen years without regard US taxation and who applied because of taxation.


Cheers


----------



## Nononymous

Just wait until all these duals who are confirming their US citizenship discover that they'll owe capital gains on the sale of their primary residence (if over $250k single, $500k married) which isn't going to be too hard to hit if you've owned a house in Toronto or Vancouver for a few decades. That won't be fun.


----------



## fatcat

RCB said:


> fatcat, just which part of the US government determines if one is a US citizen, SUPPOSEDLY based on US law? The STATE DEPT. Which US department currently determines if one is NOT a US citizen? Which government department NOW extorts people for $2,350 to get a piece of paper that says one is NO LONGER a US citizen? The very same STATE DEPT. that told me I wasn't a citizen in 92, and charged me $450 in 2013 to get rid of that damned "US citizen" label.
> 
> Yes, I believe much earlier in this thread I stated I was born in the US to Canadian parents temporarily in the US.
> 
> You obviously look at the US as something good...you naturalized there. I, on the other hand, have NEVER wanted anything to do with the US. I don't even want to live next door to it.


rcb, it is possible you were given bad advice and conflicting advice, i accept that but in the end it falls on you, you can call or walk in to government office and talk to clerks and you will get inconsistent advice and even wrong advice but it fell on you to look at the law and be proactive, go to a consulate and formally do the process of renunciation, you didn't and so must do it now, it's a pain in the *** and you are pissed off, i get that but there it is, this is what you have to do

in my opinion, coming forward is a smarter position because a) it's the law and b) there is an amnesty in place and this is the advice i would give to the op especially since he has surfaced and is no longer under the radar

all these arguments you are advancing about the confusion and contradictions of the us government don't mean diddly, every fool is going to step forward and make up a story about being bad advice and say "let me out, i don't have to do or pay anything" ... this is not how the united states government works, they like to play hardball, 

to all in the thread, i agree with you that law is both unfair and a royal pain in the ***, so much so that i and many others are thinking of renouncing

i also think that whatever your experiences with the government and regardless of what they have told you, the burden of citizenship falls on you and the only way to discharge it is by actively renouncing it and until and unless you do that you are a us citizen with all the rights and responsibilities

i don't have enough interest in the isaac brock challenge to bother wading through it, can someone boil it down to a single sentence ?

isn't it about canadian sovereignty and privacy and even if succeeds as a challenge all of the usa laws will still stand .. correct ? ... 

in that case canada and the big banks will have find another way to report us citizens, if they don't they face 30% penalties and a serious disruption of doing banking with the usa


----------



## Nononymous

Dude, RCB said he/she had renounced in 2013... presumably when he/she figured out that he/she still had US citizenship.


----------



## Nononymous

The OP has probably fled in terror by this point. 

Yes, the OP potentially has a bit of a situation on his/her hands. I did lay out the options earlier:

As a first step, the OP should try to convince HSBC that they are not a US person, due to father's military status.

If that works, great, problem solved, at least as far as HSBC is concerned.

If that does not work and the OP is determined by the bank to be a US person, he or she can:

1. become US tax compliant, and stay tax compliant
2. become tax compliant and renounce
3. renounce and show the CLN to the bank but not bother becoming tax compliant (two separate processes and apparently folks are renouncing without the exit tax paperwork because they feel it's low risk for their situation)
4. ignore the fact that he or she has been FATCA'd and ignore any mail received from the US government

Another alternative occurs to me. If the OP never took action to actively "use" that US citizenship - apply for a US passport, vote in a US election, live in the US, etc. - then depending on his or her life circumstances, he or she may have potentially committed an "expatriating act" as far as the US is concerned - serving in the Canadian military or joining the federal civil service would certainly count. The OP could then travel to the US consulate, claim to have committed this expatriating act with the intention of losing US citizenship, and in theory he or she would be allowed to relinquish, which costs nothing, and should be back-dated to the date of the act so there would be no further exit tax silliness. Then he or she could take the CLN to the bank and it's all good.


----------



## Nononymous

I believe that the core principle of the FATCA lawsuit centers around unequal treatment of Canadian citizens. As in this scenario:

You and I are both Canadian citizens from birth. You were born in Canada, I happened to be born in the US. We are not treated equally in terms of banking services: I can be denied an account (there is already one small bank in Alberta that refuses US persons) and, more importantly, I have my personal data collected and sent to a foreign power by the Canadian government, while you do not.

The lawyer who took this case has a pretty good track record (just won a Supreme Court case, can't remember the details) so it's not completely nuts. 

I agree, however, that if the law gets struck down, we might end up with something worse. By negotiating the IGA, Canada got FATCA exemptions for RRSPs and other tax-protected accounts, and protected its financial institutions from having to deal with the US directly. That's not the worst deal they could have made, given the gun pointed at their heads.


----------



## Eclectic12

fatcat said:


> rcb, it is possible you were given bad advice and conflicting advice, i accept that but in the end it falls on you, you can call or walk in to government office and talk to clerks and you will get inconsistent advice and even wrong advice but it fell on you to look at the law and be proactive, go to a consulate and formally do the process of renunciation, you didn't and so must do it now, it's a pain in the *** and you are pissed off, i get that but there it is, this is what you have to do
> 
> in my opinion, coming forward is a smarter position because a) it's the law and b) there is an amnesty in place and this is the advice i would give to the op especially since he has surfaced and is no longer under the radar


Trouble is ... from what I've read in this thread and others - he *has* renounced his US citizenship, when it was the under $500 fee to do so.
This is probably better directed at those in the thread who are now aware they have US citizenship but are not planning on complying or renouncing.

[There is no mention of fees where a US citizen obtains naturalization in a foreign state upon one's own application after the age of 18. I wonder is "arranging" for this to come to light and responding that he/she intended to relinquish U.S. nationality when performing the act could be a cheaper way. I doubt it but it is an interesting question.]




fatcat said:


> ... all these arguments you are advancing about the confusion and contradictions of the us government don't mean diddly ...


If someone who has followed up as soon as they were aware that things might not be as they believed has confusion/problems ... why is it hard to believe that there could be others who don't realise they still have US citizenship?

Is it likely that 750K or so all are unaware? 
IMO ... probably not.

Is it likely that all 750K have had interactions that warned them?
IMO ... probably not.




fatcat said:


> ... to all in the thread, i agree with you that law is both unfair and a royal pain in the ***, so much so that i and many others are thinking of renouncing ...


I think people are questioning what appears to be a blanket claim that "everyone should know" despite one person following up & being told they weren't a US citizen to later followup again and be told something different.




fatcat said:


> ... i also think that whatever your experiences with the government and regardless of what they have told you, the burden of citizenship falls on you and the only way to discharge it is by actively renouncing it and until and unless you do that you are a us citizen with all the rights and responsibilities ...


So using the analogy of a Canadian tax return ... should the NOA be challenged or followed up on when it says everything is fine?
I didn't, where two years later I received an updated NOA demanding penalties/interest for RRSP over-contributions.

When I worked though the details ... the original NOA turned out to be correct and the mistake by CRA was what caused the updated second NOA.


Expecting everyone to figure out when they are being given bad info from the source that *should* provide the correct sounds like a bit of a stretch, IMO.




fatcat said:


> ... isn't it about canadian sovereignty and privacy and even if succeeds as a challenge all of the usa laws will still stand .. correct ? ...
> in that case canada and the big banks will have find another way to report us citizens, if they don't they face 30% penalties and a serious disruption of doing banking with the usa


I haven't waded through either ... but there is also the option taken by some European banks which is to drop US citizens. After all, assuming the 1 million number for US citizens is accurate and excluding those who are 19 or younger, this would be about 3.5% of the population whose business the banks would be giving up on.

I doubt they will do it but one never knows.


Cheers


----------



## fatcat

Nononymous said:


> Dude, RCB said he/she had renounced in 2013... presumably when he/she figured out that he/she still had US citizenship.


missed that, why the fuss then ? ... he clear and out of the loop ? i don't get indignation if rcb has renounced ? ... smart of him to save the 1900 bucks


----------



## Nononymous

fatcat said:


> missed that, why the fuss then ? ... he clear and out of the loop ? i don't get indignation if rcb has renounced ? ... smart of him to save the 1900 bucks


The indignation concerned your constant harping on about how he/she should have magically known all along instead of trusting the answer received directly from the US consulate when he/she enquired in 1992. 

The larger point concerns your insistence that everybody the US considers to be a citizen should somehow know this, and if they claim not to, they're either idiots or just pretending they don't know.


----------



## fatcat

Nononymous said:


> The OP has probably fled in terror by this point.
> 
> Yes, the OP potentially has a bit of a situation on his/her hands. I did lay out the options earlier:
> 
> As a first step, the OP should try to convince HSBC that they are not a US person, due to father's military status.
> 
> If that works, great, problem solved, at least as far as HSBC is concerned.
> 
> If that does not work and the OP is determined by the bank to be a US person, he or she can:
> 
> 1. become US tax compliant, and stay tax compliant
> 2. become tax compliant and renounce
> 3. renounce and show the CLN to the bank but not bother becoming tax compliant (two separate processes and apparently folks are renouncing without the exit tax paperwork because they feel it's low risk for their situation)
> 4. ignore the fact that he or she has been FATCA'd and ignore any mail received from the US government
> 
> Another alternative occurs to me. If the OP never took action to actively "use" that US citizenship - apply for a US passport, vote in a US election, live in the US, etc. - then depending on his or her life circumstances, he or she may have potentially committed an "expatriating act" as far as the US is concerned - serving in the Canadian military or joining the federal civil service would certainly count. The OP could then travel to the US consulate, claim to have committed this expatriating act with the intention of losing US citizenship, and in theory he or she would be allowed to relinquish, which costs nothing, and should be back-dated to the date of the act so there would be no further exit tax silliness. Then he or she could take the CLN to the bank and it's all good.


i favor #1 first and then #2 when he has completed #1 ... if he has fled in terror he has a big problem on his hands because that means he doesn't have the stuff to actually see non-compliance through because if he goes underground he will be in whole new world with fines and jail time hanging over his head for the rest of his life ... if he's feeling terrified, that is a sign he should enter the amnesty


----------



## fatcat

Nononymous said:


> The indignation concerned your constant harping on about how he/she should have magically known all along instead of trusting the answer received directly from the US consulate when he/she enquired in 1992.
> 
> The larger point concerns your insistence that everybody the US considers to be a citizen should somehow know this, and if they claim not to, they're either idiots or just pretending they don't know.


ok, let me back up, i am sure there are some people who actually don't know their citizenship status but that number for people over the age of say 40 who have assets is probably less than 2 or 3%

as to rcb, why the heck is he even in the thread, he is free and clear, none of this even touches him ?


----------



## Nononymous

fatcat said:


> i favor #1 first and then #2 when he has completed #1 ... if he has fled in terror he has a big problem on his hands because that means he doesn't have the stuff to actually see non-compliance through because if he goes underground he will be in whole new world with fines and jail time hanging over his head for the rest of his life ... if he's feeling terrified, that is a sign he should enter the amnesty


By terrified I meant the OP fleeing in terror from this message board, not from life.

In terms of the options, #1 is staying compliant for the rest of your life, while #2 is becoming compliant then renouncing (the recommended order). It's not first one, then the other - they are two distinct options.

As for fines and jail time, I think we need to keep a lid on the paranoia here. When you owe the US zero, guess what the penalty for not having filed is? A percentage of zero, which turns out to also be zero. That covers 94 percent of US citizens filing from outside the US. (Yes there are stiff penalties for not filing FBAR reports, but at present those would not be collectible in Canada, and there's actually no record of their having been assessed against anyone in Canada.)


----------



## Nononymous

fatcat said:


> ok, let me back up, i am sure there are some people who actually don't know their citizenship status but that number for people over the age of say 40 who have assets is probably less than 2 or 3%


Let's be clear, you're inventing that number.

Should it ever come down to this, there's a big difference between people knowing something, and someone else (i.e. the IRS) proving that they knew something. Which is why the "I wasn't aware of my filing requirements" excuse has, by all accounts, been universally accepted for anyone entering the current amnesty program.


----------



## Userkare

fatcat said:


> as to rcb, why the heck is he even in the thread, he is free and clear, none of this even touches him ?


Oh, that's not nice! I wasn't aware of the forum rule that nobody can contribute to a thread on CMF unless currently directly affected by the topic. I've been free and clear since '73 when it cost $0 to renunciate. That hasn't stopped me from reading everything I can on the topic... but I guess I should just go away too?

Before I go, I would like to thank the OP for reminding me to scan my CLN and Oath of Renunciation into my computer before the paper turns too yellow and brittle to handle. It looks like I may be cranking out copies of these docs before too long. I just hope that whomever I deal with at a bank understands that a CLN trumps a US birthplace, and doesn't send my info down the pipe.


----------



## Guban

Nononymous said:


> As for fines and jail time, I think we need to keep a lid on the paranoia here. When you owe the US zero, guess what the penalty for not having filed is? A percentage of zero, which turns out to also be zero. That covers 94 percent of US citizens filing from outside the US.


It may not cover 94% of people who read the CMF. TFSA's income and realized capital gains are taxable in the US, but not in Canada, so they may not have foreign tax credits to use. Investment income is not earned income, so it can't be excluded from a US tax return. Also, there is the matter of PFICs. Holding non-US based mutual funds and ETFs are problematic, and will likely result in a US tax bill.


----------



## Nononymous

Guban said:


> It may not cover 94% of people who read the CMF. TFSA's income and realized capital gains are taxable in the US, but not in Canada, so they may not have foreign tax credits to use. Investment income is not earned income, so it can't be excluded from a US tax return. Also, there is the matter of PFICs. Holding non-US based mutual funds and ETFs are problematic, and will likely result in a US tax bill.


Investment income and capital gains can be excluded with the foreign tax credit if Canadian taxes were paid. Still plenty of ways it can bite you in the *** though, due to differences in the tax systems - real estate being one of them (see Boris Johnson).

Really I'm just suggesting that instantly assuming you're going to face abduction by the black helicopters for not having filed US tax returns is a bit over the top.


----------



## Guban

Nononymous said:


> Investment income and capital gains can be excluded with the foreign tax credit if Canadian taxes were paid. Still plenty of ways it can bite you in the *** though, due to differences in the tax systems - real estate being one of them (see Boris Johnson).
> 
> Really I'm just suggesting that instantly assuming you're going to face abduction by the black helicopters for not having filed US tax returns is a bit over the top.


I agree with you about the helicopters!

My point is that with TFSA accounts, I suspect that many US people in Canada would face taxes owing to the IRS. They wouldn't likely be paying a lot of investment taxes to the CRA to be able to claim foreign tax credits on their 1040.


----------



## fatcat

Nononymous said:


> As for fines and jail time, I think we need to keep a lid on the paranoia here. When you owe the US zero, guess what the penalty for not having filed is? A percentage of zero, which turns out to also be zero. That covers 94 percent of US citizens filing from outside the US. (Yes there are stiff penalties for not filing FBAR reports, but at present those would not be collectible in Canada, and there's actually no record of their having been assessed against anyone in Canada.)


let me semi-quote donald rumsfeld, there are the known unknowns and the unknown unknowns .... the mere fact that a tax debt can not be collected now says zero about whether a law might be brought in to make it collectable in the future, that is not a risk i am ready to run

i see no scenario wherein, if the op decided not to file and to go underground (whatever that might mean) that he wouldn't be looking over his financial shoulder for a long time and every time he needed to do banking and investing .... will it be possible for him to try ? sure, and maybe he'll enjoy being an outlaw, personally i am too old to fight the good fight ... and frankly, i halfway admire the usa for making its people pay for the privilege of a passport, i'd like to see canada do something similar

there is a big problem of the conflicting tax regimes however which is now becoming a serious problem



> Oh, that's not nice! I wasn't aware of the forum rule that nobody can contribute to a thread on CMF unless currently directly affected by the topic. I've been free and clear since '73 when it cost $0 to renunciate. That hasn't stopped me from reading everything I can on the topic... but I guess I should just go away too?


oh goodness, feel free to blather on like the rest of us, you have every right 

except it means something different when people who have no skin in the game and aren't in the fatca whirlpool like james and Nononymous and i are to be willy nilly giving people advice about not filing when they aren't the person risking heavy penalties and even jail time ... easy for them to say

in the end the op is a big boy and can make his decisions for himself, this thread has given him plenty to read

i am having trouble understanding why rcb is so worked up if none of this even touches him and he is home free, thats all


----------



## Nononymous

fatcat said:


> and frankly, i halfway admire the usa for making its people pay for the privilege of a passport, i'd like to see canada do something similar


Do you admire the US for making people both pay to keep and pay to get rid of a passport they don't want, don't need, and did nothing to acquire? I don't find that particularly admirable.


----------



## snub

Nononymous said:


> The OP has probably fled in terror by this point.


Nope, I'm still here. Still looking for a solution to my problem. Thought I would hang back and try to soak up all the information I can before my head explodes. I'm a high school drop so I'm not the brightest star in the sky when it comes to legalese. I was a labourer for 45 years making below average wages but started saving and investing at a young age. I have no intention of giving the U.S.of A a single penny of that hard earned money. I'm guessing the U.S. Navy payed for my mothers stay in the hospital. If they like, I will reimburse them for that. 

p.s. HSBC has not frozen my account. Yet.


----------



## Nononymous

snub said:


> Nope, I'm still here. Still looking for a solution to my problem. Thought I would hang back and try to soak up all the information I can before my head explodes. I'm a high school drop so I'm not the brightest star in the sky when it comes to legalese. I was a labourer for 45 years making below average wages but started saving and investing at a young age. I have no intention of giving the U.S.of A a single penny of that hard earned money. I'm guessing the U.S. Navy payed for my mothers stay in the hospital. If they like, I will reimburse them for that.
> 
> p.s. HSBC has not frozen my account. Yet.


Here's what I'd do. Do not under any circumstances sign a W9. Tell HSBC that while you were born in the US, your father was a naval attache (with diplomatic status) so you never had US citizenship. If you can dig up a picture of him in an officer's uniform, even better. Then suggest that if they aren't happy with that explanation you'll take your business elsewhere.


----------



## Franz Josef

AttaBoy Snub. Keep calm and carry on. You won't have to give them a nickel ( no pennies anymore) and you can out manoeuvre HSBC. Threaten them with holy hell if they try to freeze your account. They have no right to do so. The very worst thing they could do is report an account that you close. But RRSPs and TFSAs are not reportable.


----------



## bgc_fan

Nononymous said:


> Here's what I'd do. Do not under any circumstances sign a W9. Tell HSBC that while you were born in the US, your father was a naval attache (with diplomatic status) so you never had US citizenship. If you can dig up a picture of him in an officer's uniform, even better. Then suggest that if they aren't happy with that explanation you'll take your business elsewhere.


While I don't have any personal interest in this thread. My main issue is the fact that people are advising to be non-compliant with the law. Regardless of personal views of people on this board, I don't believe I've ever seen this happen.

That does not include the fact that you are advising to essentially falsify documents.

And if one is to lie, one should make it somewhat believable. Somehow, I doubt we have military attaches posted to the US. Lying will just bring more scrutiny on your situation.


----------



## Nononymous

How I see it is, a bad law that facilitates a potential extraterritorial grab of assets from someone who's lived and worked all their life in Canada, probably deserves an extraordinary response. I was luckier - I knew the question was coming, so when my investment firm asked, I simply lied and told them I wasn't a US citizen. 

Canada has defence attaches in many different countries. Perhaps the military relationship with the US is so tightly integrated that they don't have diplomatic representatives there. But given how confused HSBC is about its own rules, that doesn't seem like the worst story to tell them. 

The alternative of course is spending some money and renouncing (though in the OPs case I might not bother going through the whole compliance and exit tax regime). 

The OP has some things working in his favour - he's never had any bureaucratic contact with the US since leaving at three weeks of age. All he needs to do is fool the bank, the FATCA gatekeeper, and he stays off the radar.


----------



## fatcat

Nononymous said:


> How I see it is, a bad law that facilitates a potential extraterritorial grab of assets from someone who's lived and worked all their life in Canada, probably deserves an extraordinary response. I was luckier - I knew the question was coming, so when my investment firm asked, I simply lied and told them I wasn't a US citizen.
> 
> Canada has defence attaches in many different countries. Perhaps the military relationship with the US is so tightly integrated that they don't have diplomatic representatives there. But given how confused HSBC is about its own rules, that doesn't seem like the worst story to tell them.
> 
> The alternative of course is spending some money and renouncing (though in the OPs case I might not bother going through the whole compliance and exit tax regime).
> 
> The OP has some things working in his favour - he's never had any bureaucratic contact with the US since leaving at three weeks of age. All he needs to do is fool the bank, the FATCA gatekeeper, and he stays off the radar.


except, unless i missed something, they have frozen part of his money and he needs to find a way to get it back by lying through his teeth 

second, how does he know that his name won't somehow find its way to the irs ? and then via them to the cra ?

there are a whole lot of axes being ground in this thread by people who clearly have an agenda to non-cooperate with the law and apparently want to recruit others to do so

they are particularly brave when risking other peoples money and other peoples freedom

i would say that the smartest thing the op could do would be to comply with the law, enter the amnesty, spend the 5K and get it done ... to me 5K is a small price to pay to sleep well at night

anyway, i will now quit the thread and let the non-cooperators run the show and have the last word

good luck to us all as we wind our way deep into the belly of the fatca beast


----------



## Nononymous

fatcat said:


> except, unless i missed something, they have frozen part of his money and he needs to find a way to get it back by lying through his teeth


Yes, you missed something. Someone the OP spoke to at HSBC threatened this but it hasn't happened yet and frankly it sounds like they didn't have a clue what they were talking about. 

I was threatened with a suspension - no trades - but that's a company compliance policy decision, I assume. As far as I know there's no provision for freezing assets under the IGA. What a financial institution can do is report you anyway if you refuse to provide information, whether you keep or close the account.



> second, how does he know that his name won't somehow find its way to the irs ? and then via them to the cra ?


He doesn't. But it's a risk he can decide to take given the fact that the IRS currently has no ability to touch his assets in Canada, and knows nothing else about him.

Also, what do you mean via the IRS to CRA? That's not how FATCA works; under the IGA, information deemed reportable flows from the bank to CRA to the US. Not the other way. Why does CRA care what a Canadian citizen's tax status is vis-a-vis the US? That's not part of FATCA or the IGA, to the best of my knowledge. (If the OP had assets in the US that he hadn't declared to CRA, that's another matter, but not what we're talking about here.)

Part of my and others' concern is that we have no guarantees that our data won't shared even for accounts that are not reportable. Banks might decide it's easier and safer to dump everybody's customer data on the CRA. That's why I refused to sign any US forms when all I have is RRSPs; apparently I won that minor skirmish. And that's why it's best not to hand over the data in the first place; sadly the OP was unprepared and answered honestly when asked where he was born.



> there are a whole lot of axes being ground in this thread by people who clearly have an agenda to non-cooperate with the law and apparently want to recruit others to do so
> 
> they are particularly brave when risking other peoples money and other peoples freedom


Absolutely. Because the more that people refuse to cooperate, the more difficult it will be to compel cooperation.

I'm at least putting my money where my mouth is. I lied to my bank to avoid FATCA.


----------



## RCB

I am a law-abiding Canadian. Unless I leave my country, I am only required to abide by the law of my country, which is Canada. I do not concern myself with abiding by the laws of foreign countries while at home in Canada.

If China decides to implement a law taxing all people throughout the world that have more than one child, should I submit? If not, why should I submit to the US, which is also a foreign country?

I did what I did ($450 renunciation, exit tax form WITHOUT a SSN or ITIN) only to ensure that my private financial information (and that of my Canadian-born, Canadian citizen spouse) would not be sent to a foreign power for attempted confiscation. I have filed no other income tax or information returns. I think, based on the nasty letter that accompanied my exit tax form, they get the picture that I'm not willing to play their game any further than that.

Should they attempt to impose some sort of monetary judgement upon me, I will contact all federal and provincial politicians, demanding they bill the US for all public services (education, medical, etc.) that I have received throughout my 50 years in Canada.


----------



## Nononymous

RCB said:


> I did what I did ($450 renunciation, exit tax form WITHOUT a SSN or ITIN) only to ensure that my private financial information (and that of my Canadian-born, Canadian citizen spouse) would not be sent to a foreign power for attempted confiscation. I have filed no other income tax or information returns. I think, based on the nasty letter that accompanied my exit tax form, they get the picture that I'm not willing to play their game any further than that.


Just curious, how long ago did you send in the "abbreviated" exit tax paperwork? I've heard of a few people now who sent either nothing or just the exit tax form (presumably with a big zero scrawled across it in red crayon) and have not heard a single thing back.

What I do know is that you can renounce and eventually receive your CLN - the magic get-out-of-FATCA card - without having done anything on the tax front. Completely separate process. You cease being a US citizen when the CLN is issued, but you remain a "tax citizen" until you've completed the exit process to their satisfaction. Being a "tax citizen" may or may not be a problem, depending on one's situation, and whether the US has the ability or interest to follow up - it's by no means clear that they do in all cases. I liken it to an extortion racket - why go after you if there's not enough money in it to justify the effort?


----------



## RCB

Nononymous, I sent it last year, but a bit after the deadline. I cared not one bit about it being late and their...ooooo....penalty threat for it being late. LOL

(I suspect you may have picked up the red crayon idea from me elsewhere on the internet. Maybe two elsewheres. . )


----------



## Nononymous

I'd bet the farm you'll never hear from them.

When I stop being annoyed about the $1900 fee hike I might do the same. But not before I see additional signs of impending grief. Right now it's pretty easy.

Failing that, anyone with medium-grade Photoshop skills can do up a pretty convincing BC birth certificate.

I am quite curious, for my own reasons, as to what the legal consequences of lying to one's bank might be. Of course they'd fire you as a customer if they caught you, but I'm sure they wouldn't want to publicize the fact that you'd tried; if your actions caused the US government to impose horrid penalties for FATCA non-compliance I'm sure they'd sue you for every penny you had, but that's a very unlikely outcome.


----------



## Nononymous

An American friend of mine lived and worked here for a few years. His version of US tax compliance was to print off a 1040, write a big zero at the bottom, staple it to a copy of his Canadian tax return, and mail it off in a big fat envelope. Never heard a whisper of protest.

Which suggests that the IRS isn't really willing or able to follow up in any great detail, despite all the threats and hype in the media.


----------



## RCB

I keep hoping to hear from them.

I got the CLN so I didn't have to lie to my bank. When I took it to the bank, the bank had zero interest in recording the info. Showed me their FATCA tab on my profile, showing me as Canadian. Introduced me to the branch manager. LOL. That introduction may have been because it was 2013, and I had been grilling everyone in the bank about FATCA for at least a year at that point. I continue to educate the tellers any time I'm in there. The introduction certainly wasn't based on my family's deposits with them. LOL


----------



## james4beach

I think avoiding/ignoring the questions is an OK strategy, but I don't think you should lie or misrepresent yourself.

You definitely should not forge any paperwork.

Remember, with Harper's new citizenship & immigration laws, dual-citizens (e.g. Canada & US citizens) can be stripped of their Canadian citizenship and deported back to their home country. Canadian passports can be cancelled at the Minister's discretion. *Anyone who is a dual citizen* -- even those born in Canada -- can have their citizenship revoked by the Minister, and deported.

Don't play dangerous games with citizenship/forgery, don't violate any Canadian laws.


----------



## Nononymous

Right, just saw that. I doubt it'll last past the first constitutional challenge, but still, the bastards. This election can't come soon enough.


----------



## RCB

james4beach said:


> I think avoiding/ignoring the questions is an OK strategy, but I don't think you should lie or misrepresent yourself.
> 
> You definitely should not forge any paperwork.
> 
> Remember, with Harper's new citizenship & immigration laws, dual-citizens (e.g. Canada & US citizens) can be stripped of their Canadian citizenship and deported back to their home country. Canadian passports can be cancelled at the Minister's discretion. *Anyone who is a dual citizen* -- even those born in Canada -- can have their citizenship revoked by the Minister, and deported.
> 
> Don't play dangerous games with citizenship/forgery, don't violate any Canadian laws.


That and FATCA are the reasons why I will not be voting Conservative this election, after decades of Conservative and Reform voting.


----------



## Nononymous

RCB said:


> That and FATCA are the reasons why I will not be voting Conservative this election, after decades of Conservative and Reform voting.


Factor in Liberal support for C51, and suddenly the NDP is basically the only choice if you give even half a rat's *** about sovereignty and civil liberties.


----------



## snub

fatcat said:


> maybe in a few years if the tax laws continue to get more complex (can't own mutual funds, can't have a tfsa, can't even own etf's all because the pfic reporting is too complex) i will renounce but not yet


Did you have to cash out your RRSP'S or did you not have any? I thought RRSP'S were exempt from reporting. I don't understand why you would want me to be in the same situation as you.


----------



## RCB

snub, just like there are different procedures for checking out of US citizenship vs. checking out on the IRS, there are different reporting requirements for "foreign" banks vs. individuals the US claims to be citizens. While Canadian FFIs aren't required to report RRSPs, RDSPs, etc., the individual is supposed to report those to the IRS.

It's quite the clusterbleep.


----------



## james4beach

Nononymous said:


> Factor in Liberal support for C51, and suddenly the NDP is basically the only choice if you give even half a rat's *** about sovereignty and civil liberties.


That's the shocking result I came to as well.

I'm particularly upset with the government about making us lower-tier citizens by watering down our intrinsic rights. It's a huge slap in the face to all dual citizens. The Canadian Bar Association thinks so too.


----------



## snub

Saw this in the news today , thought I would share it. Maybe the IRS will leave us alone while they hunt down the real criminals:

*Wal-Mart has $76B in overseas tax havens, report says*

Full story: http://www.msn.com/en-ca/money/comp...ax-havens-report-says/ar-AAbGjfG?ocid=U142DHP


----------



## james4beach

How about General Electric (GE), according to Vermont's Senator



> From 2008 to 2013, while GE made over $33.9 billion in United States profits, it received a total tax refund of more than $2.9 billion from the Internal Revenue Service.
> G.E.’s effective U.S. corporate income tax rate over this six year period was *-9 percent*.


----------



## snub

Found something interesting while looking for Credit Unions that don't have to deal with FATCA. Island Savings online membership application asks: Are You a Politically Exposed Foreign Person? Giving them your Social Insurance Number is optional, and they will accept an address in the U.S. of A.

https://www.islandsavings.ca/Personal/JoinUs/PersonalMembership/


.


----------



## Userkare

Oaken Financial asks if an applicant is a politically exposed person as well as if subject to US taxes ( US person ). They don't ask about birthplace.

I don't think a politically exposed person has anything to do with FATCA. I think it's a Canadian anti money laundering law that they ask this.

The section on Politically Exposed reads...

_Do you or any of your family member(s) hold or have ever held or is a close associate to one of the following positions?
A head of state or head of government; member of the executive council of government or member of a legislature; deputy minister or
equivalent rank; ambassador or attaché or counsellor of an ambassador; military officer with a rank of general or above; president of a
state-owned company or a state-owned bank; head of a government agency; judge; leader or president of a political party represented
in a legislature._


I don't know how any financial institution that pays interest would get away with not requiring your SIN as mandatory to open an account.


----------



## Eclectic12

snub said:


> Saw this in the news today , thought I would share it. Maybe the IRS will leave us alone while they hunt down the real criminals: ...


 ... with their armies of lawyers/lobbyists and political contributions ... call me crazy but I doubt it. :biggrin:


Cheers


----------



## Nononymous

Userkare said:


> Oaken Financial asks if an applicant is a politically exposed person as well as if subject to US taxes ( US person ). They don't ask about birthplace.


Below a certain balance threshold, I think that this will be the norm for US personhood. Financial institutions will ask the question to cover their asses, but not demand proof unless they are suspicious. One is of course free to answer that question however one's conscience dictates - truthfully or not. At higher balances, they may look at you more carefully.


----------



## Nononymous

Of minor interest:

I just received some forms from the people who handle my RRSPs (investment division of one of the major banks). Their updated personal information has yes/no indicators for Canadian citizenship (with SIN) and US citizenship (with SSN). Of note: they only ask to identify US citizens, not US persons for tax purposes; no questions about place of birth. Just an internal record for the bank, then, to flag potential FATCA candidates.

Thanks to a less-than-truthful answer to the broker a few months ago, my pre-filled forms only said yes to Canadian citizenship, not US citizenship. I must have failed to notice that when I signed them...


----------



## Guban

^ unbelievable!  How can the banks even credibly try to be FATCA compliant when they don't ask if you are a US person for tax purposes? The US citizenship question seems to be only a token attempt. No questions about green card status, days present in the US? Perhaps they don't want to get into what actually defines a US person. Messy...


----------



## Nononymous

Guban said:


> ^ unbelievable! How can the banks even credibly try to be FATCA compliant when they don't ask if you are a US person for tax purposes? The US citizenship question seems to be only a token attempt. No questions about green card status, days present in the US? Perhaps they don't want to get into what actually defines a US person. Messy...


Two possible reasons: they figure that this is sufficient to cover their asses; there might be a lower standard for RRSPs, which aren't reportable anyway - if I had significant (whatever that number might be) non-RRSP investments it could be a very different story.


----------



## Nononymous

james4beach said:


> Remember, with Harper's new citizenship & immigration laws, dual-citizens (e.g. Canada & US citizens) can be stripped of their Canadian citizenship and deported back to their home country. Canadian passports can be cancelled at the Minister's discretion. *Anyone who is a dual citizen* -- even those born in Canada -- can have their citizenship revoked by the Minister, and deported.


Update on this - it's not for any violation of the law, at the minister's whim, it's only for terrorism and treason and stuff like that. Of course the scope could be widened, but likely not before this law fails under a charter challenge and/or a new government revokes it.


----------



## bgc_fan

Nononymous said:


> Update on this - it's not for any violation of the law, at the minister's whim, it's only for terrorism and treason and stuff like that. Of course the scope could be widened, but likely not before this law fails under a charter challenge and/or a new government revokes it.


Well, given certain circumstances, you can make anything look like treason. All they have to do is make up some trumped up charges (i.e. spying for China) and they could try revoking citizenship and deporting MPP Michael Chan to China. The fact that Justice Minister MacKay originally made suggestions that CSIS was investigating Chan would make me worried that someone like MacKay would have the power to unilaterally revoke his passport, and then send him off to Immigration Minister to revoke citizenship.

http://www.theglobeandmail.com/news...ntario-minister-michael-chan/article25033086/


----------



## james4beach

Guban said:


> ^ unbelievable! How can the banks even credibly try to be FATCA compliant when they don't ask if you are a US person for tax purposes? The US citizenship question seems to be only a token attempt. No questions about green card status, days present in the US? Perhaps they don't want to get into what actually defines a US person. Messy...


_Nobody_ (except the IRS) wants to get into a full discussion about what defines a US Person. It has been observed that virtually anyone in the world can become a US person, it's a very broad category.


----------



## james4beach

Nononymous said:


> Update on this - it's not for any violation of the law, at the minister's whim, it's only for terrorism and treason and stuff like that.


It's not _just_ for "stuff like" terrorism. Articles covering the new legislation also mentioned child abuse / sex crimes. And they will expand it, at the Minister's discretion of course. Grrrrr



bgc_fan said:


> Well, given certain circumstances, you can make anything look like treason. All they have to do is make up some trumped up charges (i.e. spying for China) and they could try revoking citizenship and deporting MPP Michael Chan to China. The fact that Justice Minister MacKay originally made suggestions that CSIS was investigating Chan would make me worried that someone like MacKay would have the power to unilaterally revoke his passport, and then send him off to Immigration Minister to revoke citizenship.


And this is why it is so dangerous. These laws can be used to silence or punish political or ideological enemies, like activists, opponents, lawyers, judges. This has happened in other countries. "Terrorist" is the catch-all term.

Even if the law isn't actually used to deport enemies of the government, it establishes a chill. It makes those in opposition (including activists) scared, and tries to keep them silent under fear of getting on the government's wrong side. It's really dangerous for freedom and liberty.


----------



## Nononymous

Note for snub, the OP on this thread. I was in a discussion with someone on another forum. The basis for current US citizenship law is the Fourteenth Amendment. In particular:



> All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.


The phrase "subject to the jurisdiction thereof" has been taken to exclude diplomats; no reason why you can't attempt to use the same argument to excuse yourself from US citizenship on the basis of your father's status. Remember, you only need to convince the bank, not a citizenship judge.

In the meantime, sign nothing. Especially not a W9.


----------



## Eclectic12

james4beach said:


> ... And this is why it is so dangerous.
> These laws can be used to silence or punish political or ideological enemies, like activists, opponents, lawyers, judges.
> 
> This has happened in other countries.


It is doubly concerning giving the track record *in Canada*.



> ... the October 6, 1972, break-in at the Agence de Presse Libre du Québec office, had been the work of an RCMP investigation dubbed Operation Bricole, not right-wing militants as previously believed.[4] The small leftist Quebec group had reported more than a thousand significant files missing or damaged following the break-in.[5] One RCMP, one SQ and one SPVM officer pleaded guilty on June 16, 1977, but were given unconditional discharges.
> 
> A similar break-in occurred at the same time, at the office of the Mouvement pour la Défense des Prisonniers Politiques Québécois.
> 
> In 1974, RCMP Security Service Corporal Robert Samson was arrested at a hospital after a failed bombing - the bomb exploded while in his hands, causing him to lose some fingers and tearing his eardrums - at the house of Sam Steinberg, founder of Steinberg Foods in Montreal. While this bombing was not sanctioned by the RCMP, at trial he announced that he had done "much worse" on behalf of the RCMP, and admitted he had been involved in the APLQ break-in.[4][6]


https://en.wikipedia.org/wiki/List_of_controversies_involving_the_Royal_Canadian_Mounted_Police


Add in from the same link:


> On September 26, 2002, during a stopover in New York City en route from a family vacation in Tunisia to Montreal, Maher Arar was detained by the United States Immigration and Naturalization Service, acting upon information supplied by the RCMP. Arar was sent to Syria where he was imprisoned for more than 10 months, tortured and forced to sign a false confession that he had trained in Al Qaeda camps in Afghanistan. A public campaign ended in his release and won a public inquiry into his case, which found that he had no ties to terrorism.



So where in the "good ole days" when there was supposed to protections there were abuses ... why would we think that streamlining the process will be able to avoid abuses?


Cheers


----------



## snub

Update on my situation. The last time I was at the bank, they asked if I could get a passport, which I guess would prove my Canadian Citizenshipness. Not sure why that would help since the U.S. wants to lay claim to me as well. I was able to prove that I was a Canuck through my B.C. Enhanced Drivers Licence. So a few days later they phone and tell me that they are O.K. with me signing the W8-Ben, they are no longer asking me to sign the W9, but now............they are requiring me to produce a Certificate of Loss of Nationality from the U.S. Are you freaking kidding me? My bank is requesting I give up my U.S. Citizenship? What right do they think they have to do that? In case you missed it, my bank is HSBC. Which will soon be my former bank. They can kiss my Royal Canadian ***.


----------



## Nononymous

Uh-oh. So in your situation I would keep stalling (while at the same time looking for another bank) and stick to your story: you never had US citizenship because of your father's status (as a "military attache") so you can't relinquish or renounce, and therefore you'll never have a CLN. 



> My bank is requesting I give up my U.S. Citizenship? What right do they think they have to do that?


No, actually, the bank is not requesting that you give up US citizenship. They are requesting that you either acknowledge US citizenship (by signing a W9 and subjecting yourself to FATCA reporting - which they are required to do under the current law) or prove that you no longer have US citizenship (by showing them your CLN). Those are the two options they should present to anyone with a US birthplace, thanks to FATCA.

What I'm suggesting you do is attempt a third option: yes I was born in the US but no I was never a citizen, and therefore there's no document to prove it.

Alternatively, close all your accounts, move to another bank, and for the love of god don't tell the truth when you open a new account. Just be aware that financial institutions may be stricter about asking questions for anything reportable under FATCA, particularly non-RRSP investments with high balances (not sure the limit, check the terms of the IGA).


----------



## Nononymous

Note that I recently signed some personal information forms for my RRSPs where I only checked the box for Canadian citizen and did not check the box for US citizen. This is a lie. Thus far the sky has not fallen. If it does, I will let you know. (See my post #135.)


----------



## snub

Some good news:

*Sen. Rand Paul to sue IRS, U.S. Treasury*


Rand Paul is poised to become the first major presidential candidate in memory to sue the government he seeks to lead as president.



The Kentucky senator will take legal action against the U.S. Treasury and the Internal Revenue Service for what he says is the denial of his constitutional right to vote on more than 100 tax-information treaties that the Obama administration unilaterally negotiated with foreign governments, The Washington Times has learned.

In what the suit says is a violation of Article II, Section 2 of the Constitution, President Obama has not consulted the U.S. Senate about the treaties nor given the Senate an opportunity to approve or disapprove of the treaties. The administration calls them “intergovernmental agreements.” They require foreign banks to gather and share private financial information about millions of Americans living and working outside the U.S. — information they would not have to disclose to the U.S. government if they lived and worked in the U.S.





Read more: http://www.washingtontimes.com/news/2015/jun/24/sen-rand-paul-sue-irs-us-treasury/#ixzz3e6FqPIH2 
Follow us: @washtimes on Twitter


----------



## snub

Nononymous said:


> Just be aware that financial institutions may be stricter about asking questions for anything reportable under FATCA, particularly non-RRSP investments with high balances (*not sure the limit*, check the terms of the IGA).


Does anyone know what the limit is? Or can you direct me to a site where I can read the IGA. I can't seem to find it.


----------



## RCB

FATCA Cdn/US IGA

https://www.fin.gc.ca/treaties-conventions/pdf/FATCA-eng.pdf

I believe the limit for banks is $50,000, USD I would assume. Bet Canadian banks will report on $50,000 CAD, though. I actually think they'll just report all non-reg accounts to CRA of "US persons".


----------



## snub

Thanks RCB. I can't believe I read the whole thing and my head didn't explode. I found this write up (at the Isaac Brock Society) from Roy Berg, via the Canadian Tax Foundation Annual Conference from 2014. I was actually able to comprehend everything he said, and found some new information that may help me out of this situation. 


http://isaacbrocksociety.ca/wp-content/uploads/2015/04/Berg.-FATCA-Cure-for-US-Place-of-Birth.pdf


----------



## Nononymous

Snub, how goes the struggle?


----------



## snub

Nononymous said:


> Snub, how goes the struggle?


Ehhh, could be worse. Thanks to some people who joined this forum just so they could reply to my post, I have a lawyer "working my case". Hopefully we can convince my bank to back down from their "requests". What is most annoying about all this is the Government has passed the buck down to the banks to make life changing decisions. And the fact that banks are asking for place of birth when the CRA says they don't have to.
On another hopefull note, I found this excerpt from Roy Berg, apparently it is from the IGA. Perhaps someone smarter than me can attest to this.

*3. Unambiguous Place of U.S. birth *
"Annex I of the IGA sets forth the due diligence procedures that reporting Canadian financial institutions must undertake in order to identify U.S. reportable accounts. Specifically, if an account holder has an unambiguous place of U.S. birth, the account is a reportable account.54 The Guidance Notes 55 take a bifurcated approach to what constitutes an unambiguous place of U.S. birth depending on the due diligence required under the circumstances. 
For preexisting individual accounts that are subject to a digital records search, an individual has an unambiguous place of U.S. birth only if the country of birth is shown. If the country of birth is not shown then the place of birth is not unambiguous.56 For example, if the digital records search shows a place of birth to be New York, New York, then the place of birth is not unambiguous (because it does not indicate “USA”) and the account will not be a reportable account. Conversely, if the digital records search shows a place of birth to be New York, New York, USA, then the place of birth is unambiguous and will be a reportable account unless Cured. 57 
For existing high-dollar accounts or where a paper search is required, a U.S. place of birth is unambiguous only if the United States would be the only place of birth “without formal review.”58 For example, if “Georgia” is identified as a person’s place of birth, without reference to the United States, the place of birth is ambiguous and not reportable. The Guidance Notes do not yet explain either: 1) what is contemplated by the phrase “without formal review” or 2) whether including a city within Georgia (Atlanta, for example) would cause the place of birth to become unambiguous." 


The reason this interests me is that my Certificate of Live Birth was issued by the Commonwealth of Virginia. No mention of U.S. or U.S.A. or United States of America. It has the Signature of the Attendant, which lists the attendants address as the U.S. Naval Hospital, Portsmouth, Virginia. It seems to me that U.S. doesn't necessarily mean United States. 
Same with my "Hospital Birth Certificate". States that " This Certifies that Snub was born in U.S. Naval Hospital, Portsmouth, Virginia". Unfortunately it was signed by the" CDR, Medical Corps, United States Navy." But that just means he was in the United States Navy. Maybe there is another country that calls themselves United States? United States of Eriteria?

Yeah, I know, I'm clutching at straws. I ain't giving up until the men in black suits show up at the door,


----------



## RCB

Oh, look, another US Navy brat. Nice to meet you. LOL

Have you been over to IBS tonight, snub? The lawsuit and request for injunction was filed today in the US.

http://isaacbrocksociety.ca/2015/07/14/finally-the-bopp-suit-has-arrived/


----------



## snub

Yes, I spend a lot of time at IBS, but find it difficult to navigate. I also like to post here because everyone at IBS is aware of FATCA, but not so many here. This thread has had 8000 views, I'm hoping someone in my situation will be spared the OMG moment.

As far as the lawsuit is concerned, that is good news. But I'm wondering what the time frame might be before it actually goes to court. And then they have to win. Could be forever, considering who the defendants are. I think the best bet for me, right now, is to convince the bank I am not reportable. Perhaps an act of treason against the U.S.A. might do it. I actually don't know what treason is, but it sounds interesting.:biggrin:


----------



## Nononymous

Well, keep up the good fight. The bank is the gatekeeper, so if you convince them that you're not a US person, your problems stop.


----------



## Numbersman61

http://www.collinsbarrow.com/en/cbn/publications/are-you-a-u.s.-citizen-still-sitting-on-the-fence
This Obama proposal may have been discussed before but it appears to potentially be good news for some.


----------



## RCB

That Obama proposal died March 24, 2015, when Obama's budget was defeated 98-1 by the Senate.


----------



## RCB

For those looking to document a relinquishment (eg. joined a foreign military, took out a second citizenship) as opposed to renouncing, you are now on the hook for the USD 2,350. Just like those who renounced (eg. born with dual citizensip, which doesn't allow relinquishment).

http://isaacbrocksociety.ca/2015/09...itizenship-renunciation-fee-to-relinquishers/


----------



## snub

In my quest for something that might help convince the bank to free me of my USA connections, I came across this service from Citizenship and Immigration Canada. Under the Access to Information act, you can request copies of every document they have with your name on it. It only costs $5.00 and takes less than a month. They e-mailed me PDF copies. If you need a certified copy of the original, they will get that for you, but it costs extra. Some of the documents they had:
Application For Registration of Birth Abroad
A letter confirming the application
The Certificate of Registration of Birth Abroad
My application for " Declaration of Retention ( of Canadian Citizenship ) Under Sections 4 and 5
And a few more that I'm not sure what they.

Maybe someone out there in "Oh My God Land" might be missing some. It can't hurt.

http://www.cic.gc.ca/english/department/atip/requests-atip.asp

Something else I found on the application for registration of birth abroad instructions to applicant. I highlighted the part I found interesting.

"*REGISTRATION OF BIRTH ABROAD-INSTRUCTIONS TO APPLICANT (1954)
*
If there is in the country in which the child was born, a Canadian Embassy, or Legation, or a Canadian Consulate or Vise Consulate, or a Canadian High Commissioners Office, or Trade Commissioners Office, send two signed copies of the application to that office.
If there is no such office in the country in which the child was born, mail one signed copy to the Canadian Citizenship Registration Branch, Department of Citizenship and Immigration, Ottawa.
The application will be investigated and if it is accepted, you will receive a Certificate of Registration of Birth issued by the Dept. of Citizenship and Immigration. If it is not accepted, you will be so informed.
Under the provisions of Section 4 of the Canadian Citizenship Act, a person who is born outside of Canada after the 1st day of January, 1947, shall cease to be a Canadian Citizen upon the expiration of one year after he attains the age of 21 years unless after attaining that age and before the expiration of the said year, he asserts his Canadian Citizenship by a declaration of retention thereof, registered in accordance with the regulations.* In addition if he is a National or a Citizen of a country other than Canada, he is required to divest himself of that other Nationality or Citizenship by making a declaration of alienage , or as otherwise provided."
*


----------



## snub

Someone at Isaac Brock shared this link. The law was changed in 1977, but prior to that you could not be a dual citizen. I applied for my Retention of Canadian Citizenship in 1975 so I must have renounced my U.S. citizenship. Something to take to the bank.

"In 1977, the current Citizenship Act came into force, making extensive changes to the law. The effect was to make citizenship more widely available (for example, by reducing the period of residency required from five to three years), and to remove the special treatment for British nationals and the remaining discrimination between men and women.(1)* The Act also provided that Canadians could hold dual citizenship, reversing the previous situation in which citizenship was lost upon the acquisition of the citizenship of another country." *

http://publications.gc.ca/collections/Collection-R/LoPBdP/BP/bp445-e.htm


----------



## Nononymous

Do let us know how it goes with the bank. They are the gatekeepers of your personal information.

I'm not sure if your reading of citizenship law would persuade the US that you're not still a citizen, but that's not who you're trying to persuade - you only need to convince the bank. (Per your second post, that doesn't really apply to Canadians born in the US - they aren't "acquiring" citizenship in another country, they have it from the moment of birth.)


----------



## fatcat

Nononymous said:


> Do let us know how it goes with the bank. They are the gatekeepers of your personal information.
> 
> I'm not sure if your reading of citizenship law would persuade the US that you're not still a citizen, but that's not who you're trying to persuade - you only need to convince the bank. (*Per your second post, that doesn't really apply to Canadians born in the US - they aren't "acquiring" citizenship in another country, they have it from the moment of birth.)*


that is snub's situation, he was born in the usa ... i am the opposite, born in canada and naturalized in the usa


----------



## Nononymous

More FATCA fun to report. Just had a phone call with my angry and worried mother. One of the major banks, with whom my parents have parked a fairly considerable sum, started asking all kinds of questions about their time in the US back in the 1960s (the period during which I was, alas, born south of the border). My mother, being a chatty octogenarian, basically said "Oh look I still have my green card!" so now they need to figure out how to retract that statement and convince the bank that they lost permanent resident status when they returned to Canada, or they could be put on a FATCA list as "US persons" and then god knows what paperwork to sort this mess out. My mom is super pissed-off and threatens to close the accounts and move their money elsewhere if the bank doesn't mind its own business. (Go mom! But also, for the love of god keep your mouth shut and don't say another word!)

Meanwhile, there's been absolutely zero fallout from my telling an utter untruth and not checking the box for US citizenship on a whole bunch of forms sent to our investment broker.


----------



## fatcat

Nononymous said:


> More FATCA fun to report. Just had a phone call with my angry and worried mother. One of the major banks, with whom my parents have parked a fairly considerable sum, started asking all kinds of questions about their time in the US back in the 1960s (the period during which I was, alas, born south of the border). My mother, being a chatty octogenarian, basically said "Oh look I still have my green card!" so now they need to figure out how to retract that statement and convince the bank that they lost permanent resident status when they returned to Canada, or they could be put on a FATCA list as "US persons" and then god knows what paperwork to sort this mess out. My mom is super pissed-off and threatens to close the accounts and move their money elsewhere if the bank doesn't mind its own business. (Go mom! But also, for the love of god keep your mouth shut and don't say another word!)
> 
> Meanwhile, there's been absolutely zero fallout from my telling an utter untruth and not checking the box for US citizenship on a whole bunch of forms sent to our investment broker.


relinquishing your green card requires an affirmative step, if she kept it and did not formally relinquish it she is a us person for taxation and must file all tax returns

i just paid $3700 to an accountant to file us taxes and fbars for my aunts estate, she had a green card and never relinquished it


----------



## Nononymous

No, we did a bit of research, returning to Canada permanently was enough to lose it, formal relinquishment not necessary, plus apparently they went in person to an IRS office and got their taxes squared away before they departed, some 50 years ago. And frankly, even if they were still technically considered US persons, they have no US assets so why on earth would they voluntarily make themselves known to the IRS by filing returns?


----------



## fatcat

Nononymous said:


> No, we did a bit of research, returning to Canada permanently was enough to lose it, formal relinquishment not necessary, plus apparently they went in person to an IRS office and got their taxes squared away before they departed, some 50 years ago. And frankly, even if they were still technically considered US persons, they have no US assets so why on earth would they voluntarily make themselves known to the IRS by filing returns?


i had an expensive attorney and a slightly less expensive certified public accountant sit with me in a small room and tell me the exact opposite ...



> Many clients who come to see me are under the mistaken belief that simply because their green cards have “expired” they are no longer US tax subjects. This is incorrect. The tax law is very precise on this topic. Under the US tax rules, once resident status is acquired, it is deemed to continue unless it is rescinded or administratively or judicially determined to have been abandoned.


returning to canada permanently is not enough ... it requires an affirmation


----------



## Nononymous

So, to repeat the question, if you are a Canadian living in Canada with no US assets who happened not to have formally given up a green card at some point in your past, why on earth would you voluntarily make yourself known to the IRS?

In my parents' case, without going into detail, it appears that they did some sort formal exit from the US tax regime prior to departure, so we assume there is no reason for concern. They will tell the bank to back off or lose their business, and speak of this no further. 

I do find it pretty funny though that the immigration side of the US government (INS) considers your green card invalid if you stay out more than a year, while apparently the tax side of the US government (IRS) assumes it's good for all eternity unless you formally hand it back.


----------



## RCB

To the best of my knowledge, the US does not provide documentation to the person giving up the green card, that they properly gave it up. So just what would you show the Canadian bank that you did?

Just curious because my parents were also in the US in the 60s, and I know my mother had a green card. I've seen nothing in her papers after her death showing she gave it up. I did find her Canadian passport from that period, however.

The IRS is SOL, because she's dead.


----------



## bgc_fan

I don't know if people watched The Office, but I can't help but think of Michael Scott when he got in debt and wanted to declare bankruptcy. After being advised by an accountant that he was so far in debt that he should declare bankruptcy, he walks out of his office and shouts "I declare bankruptcy" and then walks back into his office thinking that it is all solved. Of course the accountant explains that he actually has to fill in paperwork with the government.

Quite frankly it is the same thing that I see on this thread. People trying to convince themselves that they shouldn't be considered US taxpayers even though they never presented anything to the US government to state their case. Is the US government supposed to automatically know that you made your declaration of citizenship choice if you don't tell them?


----------



## Eclectic12

Nononymous said:


> So, to repeat the question, if you are a Canadian living in Canada with no US assets who happened not to have formally given up a green card at some point in your past, why on earth would you voluntarily make yourself known to the IRS?


I'd guess to stop looking over one's shoulder as more and more info gets shared electronically across the border.

Of course, allegedly from the US tax perspective - not having given up the green card means one's Canadian assets are also US assets as both countries tax world-wide income with a few exceptions.




Nononymous said:


> I do find it pretty funny though that the immigration side of the US government (INS) considers your green card invalid if you stay out more than a year, while apparently the tax side of the US government (IRS) assumes it's good for all eternity unless you formally hand it back.


Funny and annoying ...


Cheers


----------



## kcowan

A person that I know really well had a green card in the 80s. Also had a SSN. Shh. No one else knows....


----------



## Nononymous

Nowadays if you formally relinquish the green card you sign a form (I-407 I believe). My wife did this at the airport after interrogations about the stamp in her passport caused her to nearly miss a connecting flight once. No idea if she was given a copy. No idea what would have been done back in the 1960s.

The parental green card has now been permanently lost. There was an accident. With matches, apparently. And someone has learned not to talk too much around bankers.


----------



## Nononymous

bgc_fan said:


> Quite frankly it is the same thing that I see on this thread. People trying to convince themselves that they shouldn't be considered US taxpayers even though they never presented anything to the US government to state their case. Is the US government supposed to automatically know that you made your declaration of citizenship choice if you don't tell them?


Actually it's not the US government you need to convince. It's Canadian financial institutions. They are the FATCA gatekeepers. If they don't pass on any information, you aren't identified as a US person living in a foreign country.

And the best way to convince your financial institution is to deny utterly ever having lived, worked, studied or been born in the USA. Certainly don't offer any information voluntarily. I doubt that the banks have much mandate or capability to do detailed background checks, so I expect they are mostly happy to just take your word for it when you tell them you have no past or present connection to the US.


----------



## Nononymous

Eclectic12 said:


> Of course, allegedly from the US tax perspective - not having given up the green card means one's Canadian assets are also US assets as both countries tax world-wide income with a few exceptions.


Taxation of world-wide income is one thing, collection of monies owed quite another. Currently under the terms of the tax treaty, Canada will not assist the US in collecting tax debts owed to the US by Canadian citizens living in Canada (the only exception being if the debts were incurred before those individuals became Canadian citizens, which obviously doesn't apply to "accidentals" such as those born in the US to Canadian parents). Furthermore, when this first hit the news a few years ago, the late Jim Flaherty stated that FBAR penalties are "administrative fines" rather than taxes owed, are completely outside the tax treaty, and impossible for the US government to collect in Canada.

As usual, all bets are off if you have US assets, and who knows what the future will hold.


----------



## bgc_fan

Nononymous said:


> Actually it's not the US government you need to convince. It's Canadian financial institutions. They are the FATCA gatekeepers. If they don't pass on any information, you aren't identified as a US person living in a foreign country.
> 
> And the best way to convince your financial institution is to deny utterly ever having lived, worked, studied or been born in the USA. Certainly don't offer any information voluntarily. I doubt that the banks have much mandate or capability to do detailed background checks, so I expect they are mostly happy to just take your word for it when you tell them you have no past or present connection to the US.


That's not the way I interpret it. The fact is in many of these situations that are brought up, the person is a US taxpayer, but is refusing to acknowledge it or doing anything to deal with that status. Evidently there are some old cases like were brought up regarding green cards and lack of documentation. But there other cases, mainly the OP where he believes he isn't a US taxpayer despite being born in the US, but doesn't do anything about it. So obviously he has no documentation explaining otherwise. 

Obviously if you have the documentation it is pretty easy to prove it to the banks, because they prove that you aren't a US taxpayer. But for most of those who don't have the documentation it is because they haven't gone through the process to make it official through the US government.

People like making the argument about sovereignty, but it has nothing to do about that. The big banks want to play in the US so they play by US rules. I am sure that the idea of being shut out of the US market is enough for the banks to make sure that they have done due deligence.


----------



## Nononymous

The OP, who started this thread, honestly believed he wasn't a US citizen, despite birth in the US, because of his father's military status. Now he's not sure, but I suspect that he doesn't necessarily care whether the US does or doesn't consider him a taxpayer, he's trying to figure out how to convince his bank that he's not a US citizen, so they don't rat him out with FATCA.

I on the other hand know full well that I'm a US citizen, but I want nothing to do with the US so my approach is to figure out how best to fool the banks into believing that I'm not a US person. So far it's been pretty easy - don't check that box that says "US citizen" when you apply for an account, and nobody asks any questions. How far will the banks' due diligence go? The tough problem is birthplace, once financial institutions begin asking to see passports as ID, but for someone with an "unexpired" green card there should be no issue at all with a Canadian bank as long as they keep quiet about it.


----------



## RCB

bgc_fan said:


> That's not the way I interpret it. The fact is in many of these situations that are brought up, the person is a US taxpayer, but is refusing to acknowledge it or doing anything to deal with that status. Evidently there are some old cases like were brought up regarding green cards and lack of documentation. But there other cases, mainly the OP where he believes he isn't a US taxpayer despite being born in the US, but doesn't do anything about it. So obviously he has no documentation explaining otherwise.
> 
> Obviously if you have the documentation it is pretty easy to prove it to the banks, because they prove that you aren't a US taxpayer. But for most of those who don't have the documentation it is because they haven't gone through the process to make it official through the US government.
> 
> People like making the argument about sovereignty, but it has nothing to do about that. The big banks want to play in the US so they play by US rules. I am sure that the idea of being shut out of the US market is enough for the banks to make sure that they have done due deligence.


The US has been playing the "you are a citizen, you aren't a citizen, now you are, now you're not" game for decades. I have been a victim of that game. We've only briefly had the internet to actually have accurate information regarding these foreign (US) laws, previously relying on the State Dept. through consulates, which have (and continue) to knowingly and ignorantly provide WRONG information. They provide "information" only as it suits their purposes AT THAT TIME. 

They have CONSISTENTLY failed to play by their own rules, so why should anyone else? As proof of this, they are about to impose the $2,350 US fee for renouncing US citizenship on relinquishers as of November. Doing so is a violation of their own freaking laws.


----------



## fatcat

Nononymous said:


> The OP, who started this thread, honestly believed he wasn't a US citizen, despite birth in the US, because of his father's military status. Now he's not sure, but I suspect that he doesn't necessarily care whether the US does or doesn't consider him a taxpayer, he's trying to figure out how to convince his bank that he's not a US citizen, so they don't rat him out with FATCA.
> 
> I on the other hand know full well that I'm a US citizen, but I want nothing to do with the US so my approach is to figure out how best to fool the banks into believing that I'm not a US person. So far it's been pretty easy - don't check that box that says "US citizen" when you apply for an account, and nobody asks any questions. How far will the banks' due diligence go? The tough problem is birthplace, once financial institutions begin asking to see passports as ID, but for someone with an "unexpired" green card there should be no issue at all with a Canadian bank as long as they keep quiet about it.


there are people who honestly believe they didn't just rob the bank they just walked out of with a bag of money in one hand and a gun in the other

you can "believe" whatever you want but the us government doesn't much care, they want proof and tax returns and more paper

snub was born in virginia and has invented a spectacular fantasy to try and convince himself that virginia isn't part of the united states or that his military father was actually the ambassador of canada ... all kinds of canadian mothers give birth in the usa for all kinds of reasons and guess what, their babies are all usa citizens ... read the current news, there is a huge kerfuffle about this with trump and others advocating getting rid of birthright citizenship

as to your mother, she should have proof or be able to obtain proof that she has filed the i-407 or its functional equivalent, a record exists somewhere ... she shows it and problem solved

if she can't find proof then she can merely lie and continue to lie regarding her financial affairs until she dies and hope that works for her ... then you or the lawyer that handles her estate will also lie about her green card status though that exposes both of you to potential risk

on the other there is an amnesty, she can file 3 years worth of returns and an fbar and be done with it ... that actually strikes me as an easier course than spending one's life lying about your finances


----------



## Nononymous

In my mother's case they actually went through some process to exit the US tax system 50 years ago, a personal visit to an IRS office before leaving the country for good (though of course they have no piece of paper to prove this). So there is no concern in her specific case. The lesson, rather, was to keep one's mouth shut around Canadian banks if you ever spent time in the US.


----------



## fatcat

Nononymous said:


> In my mother's case they actually went through some process to exit the US tax system 50 years ago, a personal visit to an IRS office before leaving the country for good (though of course they have no piece of paper to prove this). So there is no concern in her specific case. The lesson, rather, was to keep one's mouth shut around Canadian banks if you ever spent time in the US.


except you said


> so now they need to figure out how to retract that statement and convince the bank that they lost permanent resident status when they returned to Canada, or they could be put on a FATCA list as "US persons" and then god knows what paperwork to sort this mess out.


 implying she is caught in the same mess as snub where his money is trapped in his bank and his name is on a list headed to the usa, if that isn't the case with your mother what exactly did you mean by the above statement ?


----------



## Nononymous

As far as I know the bank was only doing some preliminary fishing, no idea why it started, probably a required FATCA review for higher-balance accounts. Unfortunately my mother quite literally said to someone "oh look I still have my green card" - meaning the physical piece of paper. This set off alarm bells. 

I believe that they are composing a letter that says - as briefly as possible - that they do not still have permanent resident status in the US, they never acquired US citizenship, they are not US persons etc. That presumably will be the end of it. Only one of the green cards was found though neither has any recollection of formally giving them up, or whether that was covered in their pre-departure visit to the IRS office.

I think this is a non-issue. They have no US tax obligation, due to that IRS visit 50 years ago. They don't need to lie or hide from the black helicopters. My point is more that someone said the wrong thing so now they need to backtrack and fix it before it causes further (paperwork) problems due to accidental and erroneous FATCA-fingering. I do love it that my mother is absolutely furious at the bank for prying into their past, and threatening to move not a small sum of money to another institution.


----------



## Nononymous

fatcat said:


> implying she is caught in the same mess as snub where his money is trapped in his bank and his name is on a list headed to the usa, if that isn't the case with your mother what exactly did you mean by the above statement ?


Snub's money is not trapped, and we do not know that his name is on a list - he's still arguing with his bank and has not acknowledged US citizenship.


----------



## fatcat

Nononymous said:


> As far as I know the bank was only doing some preliminary fishing, no idea why it started, probably a required FATCA review for higher-balance accounts. Unfortunately my mother quite literally said to someone "oh look I still have my green card" - meaning the physical piece of paper. This set off alarm bells.
> 
> I believe that they are composing a letter that says - as briefly as possible - that they do not still have permanent resident status in the US, they never acquired US citizenship, they are not US persons etc. That presumably will be the end of it. Only one of the green cards was found though neither has any recollection of formally giving them up, or whether that was covered in their pre-departure visit to the IRS office.
> 
> I think this is a non-issue. They have no US tax obligation, due to that IRS visit 50 years ago. They don't need to lie or hide from the black helicopters. My point is more that someone said the wrong thing so now they need to backtrack and fix it before it gets causes further problems. What I do love is that my mother is absolutely furious at the bank for prying into their past, and threatening to move not a small sum of money to another institution.


certainly none of us like this and it is intrusive ... isn't the issac brock decision supposed to come down in about a week ?


----------



## Nononymous

Supposedly there will be a preliminary decision soon, this month at any rate, which will lead to appeals and an injunction that would delay/prevent shipping the first batch of data to the IRS.


----------



## bgc_fan

RCB said:


> The US has been playing the "you are a citizen, you aren't a citizen, now you are, now you're not" game for decades. I have been a victim of that game. We've only briefly had the internet to actually have accurate information regarding these foreign (US) laws, previously relying on the State Dept. through consulates, which have (and continue) to knowingly and ignorantly provide WRONG information. They provide "information" only as it suits their purposes AT THAT TIME.
> 
> They have CONSISTENTLY failed to play by their own rules, so why should anyone else? As proof of this, they are about to impose the $2,350 US fee for renouncing US citizenship on relinquishers as of November. Doing so is a violation of their own freaking laws.


That's why I said most cases and qualified that certain circumstances when dealing old policies the paperwork may not be there. You've already stated your situation enough times.

I was referring mainly to those who are either born in the US or to US citizens fairly recently (say past 30 years or so), but haven't done anything active to relinquish their citizenship and complain that they are being picked on.


----------



## snub

Nononymous said:


> Supposedly there will be a preliminary decision soon, this month at any rate, which will lead to appeals and an injunction that would delay/prevent shipping the first batch of data to the IRS.


The decision came out today. We lost.

The decision (all 46 PDF pages):http://cas-ncr-nter03.cas-satj.gc.ca/rss/T-1736-14 decision sept-16-2015.pdf


----------



## RCB

Fortunately, this is only a portion of the case, regarding the Income Tax Act and the legality of the IGA. The Charter challenge is likely where the teeth lie.

Unfortunately, the banking information of many Canadians ("US persons" or otherwise) will start to flow to the US government beginning Sept. 23, per CRA.

Do you know if yours will be sent? Canadian financial institutions are NOT required to inform you.


----------



## Nononymous

RCB said:


> Unfortunately, the banking information of many Canadians ("US persons" or otherwise) will start to flow to the US government beginning Sept. 23, per CRA.
> 
> Do you know if yours will be sent? Canadian financial institutions are NOT required to inform you.


That is one of the better features of this mess - the bank isn't required to tell you if your name's on the list. How nice.


----------



## snub

Nononymous said:


> The bank is the gatekeeper, so if you convince them that you're not a US person, your problems stop.


Lets hope that is the case. Speaking of banks, I found the IRS site that has a list of every bank in the world that is FATCA compliant. Even most of the Credit Unions are now compliant. Only one I could find on the West Coast that isn't is Van City. There are a few small ones in the interior (Osoyoos, Grand Forks) that are not.

*FATCA Foreign Financial Institution (FFI) List* 
Search and Download Tool 

The FFI List is updated the first day of each month. It includes all foreign financial institutions and branches that are in approved status at the time the list is compiled. 

Financial Institutions in approved status as of August 25, 2015 


http://apps.irs.gov/app/fatcaFfiList/flu.jsf


----------



## Nononymous

VanCity has taken a principled stand against FATCA and, wisely in my view, sells this as a benefit of membership:

https://www.vancity.com/PrivacyAndSecurity/YourPrivacy/FATCA/

That's fine for regular banking, but if you want investment options more sophisticated than a term deposit, that appears to be run by a separate VanCity organization that is FATCA-compliant, unfortuately.


----------



## snub

Some good info from BDO Canada regarding Credit Unions:

*



In this Tax Alert, we’ll look at the exceptions to the FATCA provisions that could apply to Canadian credit unions to provide relief from full due diligence and reporting obligations.

Click to expand...

*http://www.bdo.ca/en/Library/Services/Tax/pages/Tax-Alert-FATCA-and-Canadian-Credit-Unions.aspx


----------



## Eclectic12

Nononymous said:


> VanCity has taken a principled stand against FATCA and, wisely in my view, sells this as a benefit of membership: ...


As I understand it, credit unions have an exemption so I'm not sure how much of this is principled versus advertising an advantage to build one's business.




Nononymous said:


> ... if you want investment options more sophisticated than a term deposit, that appears to be run by a separate VanCity organization that is FATCA-compliant, unfortuately.


 ... which likely means principals have nothing to do with it.


Cheers


----------



## Nononymous

Eclectic12 said:


> As I understand it, credit unions have an exemption so I'm not sure how much of this is principled versus advertising an advantage to build one's business.


Credit unions don't have an automatic exemption, they need to apply for the "local client base institution" status to spare themselves FATCA reporting. From the searches I've done, some do, some don't. Principles or no, VanCity is at least smart enough to advertize the fact that it's FATCA-free.


----------



## Eclectic12

Interesting ... hopefully the article that wrote it up as all are exempt has been amended. :biggrin:


Cheers


----------



## gardner

Nononymous said:


> VanCity is at least smart enough to advertize the fact that it's FATCA-free.


How long will that last? The IRS will see a company *advertising* itself as a tax haven and undo the exemption to get at all the Point Roberts tax evaders owing dozens, or even scores of dollars of tax.


----------



## fatcat

this is really a high wire act, anyone with significant sums of money to invest is going to have to think 1-2-3-4-5 times before investing in anything or even moving money ........ and this will go on for the rest of their life

is it really worth it when there is a simple and _relatively_ painless way out ?

i just do not get it


----------



## Nononymous

gardner said:


> How long will that last? The IRS will see a company *advertising* itself as a tax haven and undo the exemption to get at all the Point Roberts tax evaders owing dozens, or even scores of dollars of tax.


Not sure how a chequing account at a BC credit union qualifies as a tax haven, exactly...


----------



## kcowan

Nononymous said:


> Not sure how a chequing account at a BC credit union qualifies as a tax haven, exactly...


Well for a US person, it delays any reporting obligation for the moment.


----------



## Nononymous

kcowan said:


> Well for a US person, it delays any reporting obligation for the moment.


Certainly. But that's not really the common definition of tax haven.


----------



## fatcat

kcowan said:


> Well for a US person, it delays any reporting obligation for the moment.


no. it doesn't delay anything, the obligation is to reports all accounts if you have a combined total of more then 10K USD in offshore accounts ... it might delay the information reaching the irs but it doesn't delay any reporting requirment


----------



## RCB

fatcat said:


> this is really a high wire act, anyone with significant sums of money to invest is going to have to think 1-2-3-4-5 times before investing in anything or even moving money ........ and this will go on for the rest of their life
> 
> is it really worth it when there is a simple and _relatively_ painless way out ?
> 
> i just do not get it


I don't get it either, having renounced a second time before the US got it through their thick heads. Or maybe I do get it.

Current renunciation fee (and relinquishment fee as of Nov. 2015) is $2,350 US. Converted to Canadian dollars today is a minimum of $3,137. Add in travel expenses, possibly airfare, to get to a US consulate, possibly a hotel if flights don't line up.

If the relinquisher or renunciant happens to have spent X years in the US before becoming Canadian and having kids here, the kids may need to escape as well. Say he/she has two kids in college/university, still dependent, ages 18 and 20. Getting those kids free will now cause the family to pay $9,411 Cdn at a minimum in renunciation fees to the US State Dept. alone. No travel costs included, no BS tax or form prep included.

I can't imagine ANYONE would be happy paying that.


----------



## fatcat

RCB said:


> I don't get it either, having renounced a second time before the US got it through their thick heads. Or maybe I do get it.
> 
> Current renunciation fee (and relinquishment fee as of Nov. 2015) is $2,350 US. Converted to Canadian dollars today is a minimum of $3,137. Add in travel expenses, possibly airfare, to get to a US consulate, possibly a hotel if flights don't line up.
> 
> If the relinquisher or renunciant happens to have spent X years in the US before becoming Canadian and having kids here, the kids may need to escape as well. Say he/she has two kids in college/university, still dependent, ages 18 and 20. Getting those kids free will now cause the family to pay $9,411 Cdn at a minimum in renunciation fees to the US State Dept. alone. No travel costs included, no BS tax or form prep included.
> 
> I can't imagine ANYONE would be happy paying that.


you clearly haven't looked at the penalties for not filing fbar's ... or even making a *non-willful* mistake


----------



## RCB

Actually, I have.

What's the penalty to the State Dept. informing me I was no longer a US citizen 25 years ago, and failing to issue me a CLN at that time? Oh, wait, under their own laws they lied. Hmm. Too bad the US has laws that say if they lie, no penalty.

One can only make a mistake if they send in information. I couldn't give a rat's *** what some foreign country thinks. Maybe they should have done their jobs and followed their laws in the first place. Me? I'm Canadian. I follow Canadian law. The US can call me a Twinkie, doesn't make me one.


----------



## Nononymous

fatcat said:


> you clearly haven't looked at the penalties for not filing fbar's ... or even making a *non-willful* mistake


Bear in the mind the utter inability of the US to collect penalties against Canadian citizens if they have no US assets or income.


----------



## fatcat

Nononymous said:


> Bear in the mind the utter inability of the US to collect penalties against Canadian citizens if they have no US assets or income.


going forward we will see tighter and tighter integration of the two countries via tax and entry/exit security laws and so on ... what is now an inability may change one day

you are fighting an entity that has unlimited resources, unlimited funds and quite literally gets to make up it's own rules, personally, it's not a battle i would choose

RCB, you need to let go of the anger here, none of this touches you and yet you are wound up tighter than a dog on a chain, why so much heat in a fight that doesn't even involve you ?


----------



## Nononymous

fatcat said:


> going forward we will see tighter and tighter integration of the two countries via tax and entry/exit security laws and so on ... what is now an inability may change one day
> 
> you are fighting an entity that has unlimited resources, unlimited funds and quite literally gets to make up it's own rules, personally, it's not a battle i would choose


We won't really know unless I get caught, of course, but all indications are that the IRS most definitely does not have unlimited resources. They have closed their overseas offices, reduced staff, and rumour has it that auditors need to hit quotas and demonstrate ROI. All of which suggests that going after dual-citizen "accidentals" of modest means in Canada or elsewhere won't be very high on their priorities.


----------



## RCB

fatcat said:


> RCB, you need to let go of the anger here, none of this touches you and yet you are wound up tighter than a dog on a chain, why so much heat in a fight that doesn't even involve you ?


To quote the kids... "Seriously?!"

I, my spouse and my children, will now get to spend the rest of our lives looking over our shoulders for the next new law that scumbag country tries to enforce retroactively, with the aid of the Canadian government.

Not to mention the BS money I've already spent to renounce when I shouldn't have had to.


----------



## diharv

To call kids born in Canada to US citizen parents US citizens , is a laughable stretch at best and they should not have to live in fear of anything. They have Canadian birthplaces in their passports so no US indicia there. So unless someone opens their mouth about it while trying to decipher US citizenship to the nth degree with a microscope , nothing should come from it . I think that they will have their plates full enough flushing out the actual US born people before they decide to pursue the rest of he fruit on the geneological family trees. My $.02.


----------



## snub

Speaking of the IRS, this was posted over at Brock. 
http://isaacbrocksociety.ca/



> PLANNED IMPROVEMENTS HAVE NOT BEEN MADE TO MANAGE AND TRACK CORRESPONDENCE
> WITH INTERNATIONAL TAXPAYERS



"Even though the IRS sent approximately 855,000 notices and letters to U.S. taxpayers living in other countries during Calendar Year 2014, it cannot determine taxpayer response rates. The lack of data on response rates for international taxpayers is problematic because this information is needed to determine the effectiveness of international correspondence on increasing taxpayer compliance and to make program improvements.

IRS data systems are not designed to accommodate the different styles of international addresses, which can cause notices to be undeliverable. Other factors complicate the delivery of international mail, making its delivery less certain than domestic correspondence.

In addition, the IRS generally does not know if international taxpayers receive the tax correspondence sent to them. Without specific controls to monitor and metrics to measure international tax correspondence, the IRS cannot determine the impact of its international tax correspondence on taxpayer compliance."

The whole thing here:https://www.treasury.gov/tigta/auditreports/2015reports/201530072fr.html


----------



## fatcat




----------



## Nononymous

Wait a second, the IRS is not omniscient and omnipotent? WTF?

--

On edit: That business with mother admitting to having discovered an ancient green card has been resolved. They sent the bank a very short letter stating that they had lost US permanent resident status when they moved to Canada half a century ago. The bank accepted this explanation and considers the matter closed. They won't be FATCA'd.


----------



## snub

Might as well keep this thread going. With over 16000 views, I'm hoping someone as been spared from the Fatca boondoggle. Perhaps our new government will help us out.

*Liberal Party Position on U.S. Foreign Account Tax Compliance Act (FATCA)

*
August 26, 2015




> We also have concerns that the agreement reached with the U.S. may not stand up to a Constitutional challenge given that it forces the banks to treat clients differently based on their national origin, something forbidden by Section 15 of the Charter of Rights and Freedoms


.

https://darrellsamson.liberal.ca/li...u-s-foreign-account-tax-compliance-act-fatca/


----------



## fatcat

snub said:


> Might as well keep this thread going. With over 16000 views, I'm hoping someone as been spared from the Fatca boondoggle. Perhaps our new government will help us out.
> 
> *Liberal Party Position on U.S. Foreign Account Tax Compliance Act (FATCA)
> 
> *
> August 26, 2015
> 
> 
> .
> 
> https://darrellsamson.liberal.ca/li...u-s-foreign-account-tax-compliance-act-fatca/


there's two ways politicians talk, the first is when they have no power and can say any silly thing they want especially if it might make the party in power look bad

the second is what they say when they actually have power and have to actually deal with large multinational banks and massive foreign tax bureaucracies

what's in it for the liberals to start kicking the toes of the us government and the irs ? .... not much


----------



## james4beach

fatcat, I feel that you're a bit cynical on this matter.

I'm very excited about the potential Liberal action on FATCA.

We _do_ have other economic/tax deals with the US. We have an entire tax treaty, for instance.


----------



## kcowan

They should announce a targeted quid-pro-quo legislation forcing any Canadian (resident in the US) to report all worldwide income to the CRA and pay some kind of new tax. (Call it the Bieber/Carrey/Sutherland bill?  ) Make it retroactive to birth! Give them the right to vote as well.


----------



## RCB

fatcat said:


> there's two ways politicians talk, the first is when they have no power and can say any silly thing they want especially if it might make the party in power look bad
> 
> the second is what they say when they actually have power and have to actually deal with large multinational banks and massive foreign tax bureaucracies
> 
> what's in it for the liberals to start kicking the toes of the us government and the irs ? .... not much


Agreed.

I have zero faith in the new Liberal government's desire in doing anything about this situation, never mind actually changing it. Trudeau was quite happy to talk about "repairing" the relationship with the US. That speaks volumes right there.


----------



## fatcat

james4beach said:


> fatcat, I feel that you're a bit cynical on this matter.
> 
> I'm very excited about the potential Liberal action on FATCA.
> 
> We _do_ have other economic/tax deals with the US. We have an entire tax treaty, for instance.


a bit cynical ? ... i wrote the book on cynicism on this matter

you have said yourself, we have extensive tax treaties with the usa, we have always had a pretty good working relationship on this matters THIS is precisely what will allow fatca to stand

i'd be happy if they (the usa/irs) would just allow tfsa's to be tax exempt then i could join the fun

i agree with kcowan, we should tax canadians on worldwide income and i suspect the day will come when we will

though as fatca and fbar's are proving the, nighmarish tax prep and record keeping is a real burden especially with regards to investments that i can't make because of dual taxation, this is likely to put the kibosh on canada/worldwide tax

though i promise you there are government pinheads thinking about it, they would love the tax revenue


----------



## Eclectic12

kcowan said:


> They should announce a targeted quid-pro-quo legislation forcing any Canadian (resident in the US) to report all worldwide income to the CRA and pay some kind of new tax. (Call it the Bieber/Carrey/Sutherland bill?  )


If you want similar legislation - should this not be that the US banks have to report to CRA?

After all, as I understand it - FATCA is about third party sources flagging those who aren't filing the required returns (putting aside the loose definition of who should file a US return). AFAICT ... the only new tax is for financial institutions that don't play ball and new penalties for those who fill out the forms wrong.

Someone who has been filing their US tax returns correctly has extra paperwork to do but won't owe any additional US income tax. Or did I miss something?


Cheers


----------



## Eclectic12

fatcat said:


> ... i agree with kcowan, we should tax canadians on worldwide income and i suspect the day will come when we will


As I understand it ... we already do tax Canadians on world wide income.

Like the US and FATCA, if there is an issue - it is the self-reporting where those who have made themselves aware are filing on worldwide income and those who ignore it or don't know, are skipping it.


Since you don't like the FATCA limits/paperwork ... I'd be interested to hear what thresholds/forms for Canada's version you'd like to see.


Cheers


----------



## Guban

Eclectic12 said:


> As I understand it ... we already do tax Canadians on world wide income.
> 
> Cheers


We only tax residents of Canada (citizens or not) on world wide income, the US plays by different rules, as you well know.


----------



## Nononymous

I'm not optimistic the Liberals will do much on this. Not because they like the agreement, but because the alternative might be worse - the US holding a gun to the head of any Canadian bank doing business with the US. Furthermore they can blame the previous government for signing the IGA, and claim that they're too busy with other priorities to open this can of worms.

I'm more interested in how strict Canadian banks are going to be in identifying suspected US persons. I expect that some of them are not going to try very hard. It will be relatively easy to lie to them if you don't want them to know about your US citizenship.

On a related note, I made another trip to the US last week on a Canadian passport with US birthplace, and no questions were asked. So it's probably not essential yet to put yourself on the radar by applying for a US passport if you're dual and occasionally travel south.


----------



## bgc_fan

Nononymous said:


> On a related note, I made another trip to the US last week on a Canadian passport with US birthplace, and no questions were asked. So it's probably not essential yet to put yourself on the radar by applying for a US passport if you're dual and occasionally travel south.


IIRC there is an option to obtain a Canadian passport that doesn't specify your country of birth. I remember a number of years ago there were complaints that Canadian citizens born in certain Middle East countries would get scrutenized more just because their country of birth was on the passport. I thought that an option to not have it was brought up at that point.


----------



## Eclectic12

Guban said:


> We only tax residents of Canada (citizens or not) on world wide income, the US plays by different rules, as you well know.


Ahhh ... I missed the part about switching from a residency based taxation to citizenship based.


Cheers


----------



## Nononymous

bgc_fan said:


> IIRC there is an option to obtain a Canadian passport that doesn't specify your country of birth. I remember a number of years ago there were complaints that Canadian citizens born in certain Middle East countries would get scrutenized more just because their country of birth was on the passport. I thought that an option to not have it was brought up at that point.


There is this option. The suggestion I'd seen elsewhere was that doing to would be unusual and likely to stand out, so wouldn't really spare you from questions.

As for the future of FATCA, I did just see something about the Liberals planning to do away with C24, the provision to strip Canadian citizenship from duals who'd committed nasty acts, because it would create "two classes of citizenship". If that were to proceed it might provide a useful precedent for the lawsuit.


----------



## RCB

bgc_fan said:


> IIRC there is an option to obtain a Canadian passport that doesn't specify your country of birth. I remember a number of years ago there were complaints that Canadian citizens born in certain Middle East countries would get scrutenized more just because their country of birth was on the passport. I thought that an option to not have it was brought up at that point.


Some countries will not admit people with a passport lacking a birthplace. The US is one of those countries.


----------



## bgc_fan

RCB said:


> Some countries will not admit people with a passport lacking a birthplace. The US is one of those countries.


I wasn't sure if the US was one of those. I do recall that the UK was another.


----------



## fatcat

there are maybe a couple of million canadians over seas who hold canadian citizenship and all the rights and privileges but pay no tax to canada

if in trouble anywhere in the world they can call on canada for state department assistance, they can come and establish residency in a heartbeat which makes them eligible for medical care, they are getting real benefit from citizenship

far from looking at the usa and seeing fatca as a bad idea, i think other countries, canada (including the liberal government when it sees how much tax revenues it needs to raise) being one of them are going to think, yes, why not collect a little more tax from expats who are doing well

look to see greater and greater inter-country sharing of data, there already is a treaty in place and i think more to come

the simple thing to do for all countries is implement a 1-million dollar exemption or some such thing to make it more workable, more practical because right now it's a mess though in time it will all come together

i asked for a gic application from peoples trust and guess what, they have a line in it: are a united states citizen or do you hold united states residency ?


----------



## Nononymous

fatcat said:


> there are maybe a couple of million canadians over seas who hold canadian citizenship and all the rights and privileges but pay no tax to canada
> 
> if in trouble anywhere in the world they can call on canada for state department assistance, they can come and establish residency in a heartbeat which makes them eligible for medical care, they are getting real benefit from citizenship


1. I think we sometimes greatly overestimate what the Canadian government is willing or able to do for citizens abroad, and how much public money is actually spent on non-resident expats who pay no tax. With the exception of the Lebanon evacuation, probably not very much. Rescuing tourists is rescuing taxpayers, remember.

2. You can only use the medical system if you return as a resident - not as a visitor - in which case you're paying taxes again. Note also that some provinces impose a waiting period before returning residents can use the public system. Some years ago we moved from Europe back to BC then on to Ontario, and had to pay for 5 months' private insurance before we qualified for OHIP. No free lunch there.



> i asked for a gic application from peoples trust and guess what, they have a line in it: are a united states citizen or do you hold united states residency ?


You'll probably find that on almost any application form nowadays. The more important question is, will they do anything if you just check "no" on the application? Will they run any kind of check to verify that you've answered truthfully? I expect that unless you're dealing in the millions, they just take your word for it and consider the matter closed.


----------



## fatcat

Nononymous said:


> You'll probably find that on almost any application form nowadays. The more important question is, will they do anything if you just check "no" on the application? Will they run any kind of check to verify that you've answered truthfully? I expect that unless you're dealing in the millions, they just take your word for it and consider the matter closed.


they probably won't do much if you check "no" especially if the amounts are small

you, on the other hand, if you fail to report the account in question on both your fbar disclosure and your income tax return, are committing a whack of serious felonies punishable by massive fines and jail time

you can fight the good fight and even if the chance of getting caught is small, i assure that if you do get caught the us government has a long memory and they will come after you in any way they can in perpetuity

even with limited irs resources your name will start to procreate and find itself on list after list after list

not a likelihood that i want to take on 

also, i am glad that they are now asking these questions as it will make my job of complying a lot easier

in time this will all begin to work and fall into place and those who who have gone underground are going to have to stay underground


----------



## Nononymous

fatcat said:


> you, on the other hand, if you fail to report the account in question on both your fbar disclosure and your income tax return, are committing a whack of serious felonies punishable by massive fines and jail time


Lucky thing I'm not filing FBAR forms or US tax returns then! Wouldn't want to risk spending the rest of my life in jail.


----------



## james4beach

Like fatcat, I encourage everyone to file their FBAR & FATCA (8938) if required. It can be tough to figure out if it's required.

Even if my cdn accounts are not explicitly flagged as US Person, I still think it's wise to file the FBAR to be in compliance with US law. And I do file them.


----------



## Nononymous

Thought I should reactivate this old thread to see if there was an update from "snub" on his quest to disentangle himself from potential FATCA reporting by HSBC. You still there, and if so, what's up?

In the meantime, some interesting developments on the US tax front:

- Who knows how this might pan out, but there's at least a possibility that FATCA could be repealed or hobbled under the new US government; it was in the Republican platform (to keep the rest of this sane, no political commentary please).

- The Canadian IGA lawsuit will go to trial this year (follow up at the Isaac Brock Society site).

- The very anti-FATCA organizer of a US expats Facebook group reported on a phone conversation with a 25-year veteran of the IRS enforcement division, who essentially told him that the IRS makes zero attempt to enforce its laws against "ordinary" overseas residents, and therefore any dual citizens living outside the US ("accidentals" like myself and many others) with no US assets or financial ties should under no circumstances enter the US tax system. In response a number of outraged "compliance professionals" abused him and threatened to "turn him in" to the point where he had to shut down the comments section; worst of the lot was a Canadian accountant by the name of Kevyn Nightingale, in Toronto, who is a real piece of work.

In other words, fun times ahead, and anyone in Canada staying under the radar should definitely remain so for the being. 

Also it's been two years now since I lied to my investment firm and denied US citizenship, and guess what - I still haven't been thrown in jail!


----------

