# Uncle Sam shuts down oldest Swiss bank



## james4beach (Nov 15, 2012)

The US government has fined / shut down Switzerland's oldest private bank
http://www.telegraph.co.uk/finance/...pleading-guilty-to-aiding-US-tax-evasion.html

What may be interesting to you is this 2009 article that Wegelin published, which I found very interesting as a non-American investor. This caused a big stir in the investment world.

http://www.greatponzi.com/shared/Wegelin.pdf

They describe the USA as a dangerous place for non-Americans to invest, particularly due to the increasing aggressiveness of the IRS. I think Wegelin makes a very strong point. Reading this did actually change my investment behaviour... I have avoided American investments quite a bit ever since. There are some real examples that are relevant in Canada. One is for RRSPs and TFSAs... for anyone mixed up with US tax obligations (e.g. dual citizens) these can be a royal pain with the IRS. Another one that worries me a lot is the "U.S. person" definition. My understanding is that if you spend more than 31 days in America or 183 days over three years, you may actually have U.S. tax filing obligations even if you're a visitor or tourist.
http://hutcheson.ca/~hutcheso/cross...olidaying-in-the-u-s-tax-filing-consequences/

Anyway, the basic point (and what Wegelin was saying) is that because the US is starved for income, you can expect the IRS to become more aggressive and sudden new rules may appear. This can include rules that impact Canadians who invest in the USA. Beware.


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## kcowan (Jul 1, 2010)

US property holdings are covered by their estate taxes. Married couplse should own property as Tenants in Common rather than Joint Tenancy to get the maximum benefit of the Tax Treaty. Much of this is spelled out here:
PWC Paper on US Residence Ownership by Canadians (PDF)
It has not been updated for the Fiscal Cliff laws but it will be. Any direct holding in US equities also counts towards the total calculation.


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## james4beach (Nov 15, 2012)

kcowan said:


> Married couplse should own property as Tenants in Common rather than Joint Tenancy to get the maximum benefit of the Tax Treaty. Much of this is spelled out here:


I'm talking about looking forward though. Not just estate taxes, and not just relating to US residents or citizens. I'm talking about potential impacts on anyone who invests in the USA, even somebody who just owns a couple American stocks or ETFs in their brokerage.

I think US tax laws are likely to keep changing to become more unfriendly to foreign investors. This is fundamentally because the USA is in a very tough financial situation and the fiscal cliff just demonstrated how things can change very quickly due to precisely this.


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## kcowan (Jul 1, 2010)

It is already happening. I have friends who worked on the states on assignment. They had kids that were born in the states. They moved back to Canada, completed their schooling and started work. Now they are offside with the IRA for not filing returns. It is mighty ugly.

But for the average snowbird who blithely buys a place in Florida or Arizona, they have no clue how exposed they are. This is why we chose to buy in Mexico 5 years ago. Uncle Sam has no mercy on resident aliens.


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## Eclectic12 (Oct 20, 2010)

kcowan said:


> It is already happening.
> 
> I have friends who worked on the states on assignment. They had kids that were born in the states. They moved back to Canada, completed their schooling and started work. Now they are offside with the IRA for not filing returns. It is mighty ugly...


Thanks for the head's up ... though I'm puzzled why the Irish care .... :rolleyes2:

I suspect it was meant to be the IRS but that A key is so close ... :biggrin:


Cheers


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## YYC (Nov 12, 2012)

kcowan said:


> It is already happening. I have friends who worked on the states on assignment. They had kids that were born in the states. They moved back to Canada, completed their schooling and started work. Now they are offside with the IRA for not filing returns. It is mighty ugly.


My sister-in-law is going through something similar to this right now. Night. Mare.


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