Posted on 05/25/2015 8:22:13 AM PDT by rickmichaels
In every U.S. election, there are always threats by Americans that they’ll flee to Canada if the candidate they hate wins. Those threats rarely come to anything.
But thanks to a 2014 intergovernmental agreement committing Canada to provide the banking information of Americans living here to the IRS, there appears to be mad rush by some Americans to renounce their U.S. citizenship, and stay here - forever.
According to Global News, almost four times as many U.S. citizens as normal dumped their citizenship in March. The reason is an obscure regulation that forces Americans to fill out a Foreign Bank Account Report if they have an account abroad that totals over $10,000 in a year, according to the Wall Street Journal. While income earned abroad is mostly exempt from U.S. taxes, the penalty for not filling out the necessary paperwork can equal up to 50 per cent of the value of the account. In 2010, the U.S. passed FATCA, a law forcing Americans abroad to turn over banking information, and started going after people who weren’t reporting their money.
After that law came into effect, Patricia Moon had a choice: either renounce her citizenship and avoid the enforcement of IRS penalties, or risk fines in the hundreds of thousands of dollars, and face a lifetime of reporting and sending cash back to the U.S, she told the Wall Street Journal. Moon, who lives in Toronto, gave up her passport, rather than face the prospect of exposing her husband’s finances to the U.S. government and paying U.S. capital gains tax on their house in Canada. After she did it, she said, she “bawled her eyes out.”
Now, Americans who haven’t played by the rules could find their banking information handed over to the IRS anyway. The 2014 agreement means Canadian banks will turn over that financial information directly. The first reports are due May 1, which is why Americans who don’t want their financial data sent to the IRS are scrambling to become non-Americans in a hurry.
Despite a hefty fee - which jumped from U.S.$450 to U.S.$2350 last summer, according to Global News - the backlog to book a renunciation appointment at some U.S. consulates in Canada is now nearing a full year.
Global News cited a U.S. army veteran who has lived in Canada for 42 years, who flew from Ontario to a U.S. consulate in Calgary in March to complete his loss-of-nationality paperwork, because it was the earliest appointment he could get.
“I’ve lived Canadian for 42 years – give me a break,” said the man identified only as ‘Dale.’
“I’m not going back to the U.S., I have no ties to the U.S., I don’t own property down there. Why would I not formalize this and get my certificate?”
While Dale’s case seems cut and dried, others aren’t as lucky. Ruth Freeborn of Kingston, ON told Reason.com that the decision to give up her U.S. citizenship was “a gut wrenching experience that I do not think I will ever be over.”
Freeborn doesn’t make any of her own money, but she said banks were likely to err on the side of handing over too much information, putting her family’s finances at risk.
“They say they cannot afford to ferret out all Americans and anyone related to them every year and then on top of that ferret out who met the thresholds so to save money they are just going to report on everyone with any ‘U.S. indicia.’ They don't even have to be American, just share joint accounts with one,” she told Reason.com.
Freeborn’s choice is one that more and more people are making, according to a study by the University of Kent (at Brusssels) this past winter. The survey found that 31 per cent of U.S. citizens and former citizens have actively thought about renouncing U.S. citizenship and 3 per cent were in the process of doing so.
The reason, the survey found, isn’t income; it’s the increasing pressure to meet U.S. financial reporting requirements. At best, Americans abroad face thousands of dollars in accounting fees to prove they don’t owe the U.S. any money; at worst, they can be penalized tens of thousands of dollars for not reporting properly. It’s a lot of effort, and a lot of risk, for people who have already chosen to live elsewhere.
The report also found another subsector of Canadians who could get caught in the U.S. tax trap: those born along the border to parents of both nationalities. One survey respondent said:
“Canada is home to many border babies, born in the U.S. because that was the location of the closest hospital, and 'accidentals' like myself who left the U.S. as young children with no say in where they were born.” For those children, U.S. citizenship, while a birthright, has never been more than a matter of convenience, and is easily cast away when financial hardship is on the line.
In fact, a U.S. State Department representative told Global News that Canada now leads the list of countries where Americans are willfully handing in their passports. On May 1, it could get even worse.
Kind of amazing!
All because of the Government’s insatiable appetite for money.
If the left gets the White House next year you’ll see a bunch of Americans running north!
Citizenship, in any country, is all about privileges, immunities and obligations. Forfeiture of citizenship in the U.S. is a two-step process. First there is renouncement and then relinquishment by the U.S. Only relinquishment with the issuance of a certificate of loss of nationality relieves a renunciant of their obligations to the state.
Anyone who renounces still must file their tax returns, register for selective service, etc ... Only a certificate of loss of nationality issued by the U.S. will relieve a renunciant of their obligations.
The most harrassing thing to me is the suspicion there are so many laws and et cetera's already in place that NO ONE can simplify THEIR OWN THOUGHTS and THOUGHT PROCESSES
I believe that is by design and has been in the works since the beginning of the USA, but most active since around 1913
America must be destroyed and part of that destruction is the elimination of the American identity
Forcing the relinquishment of a passport severs forever that tie to a once righteousw nation.
I disregard, for the sake of my claim, the fact that people perhaps are not American in the first place ... but the passport is that tie
Too many people are ex-patriating, as well .... but I SUPPORT them.
Gosh! You mean some folks aren’t willing to pay their ‘fair share’?
Shocking!
I won’t turn tail and run away.
Not really. They can print that off any old time. This is about power and power over the people - a financial Berlin wall.
They’ll be shocked one day, when they learn they are part of the TPP....
“I won’t turn tail and run away.”
These people are being chased away. They should be free to live as they wish.
The only people who have a hint of freedom in this country are illegal aliens. They come and go as they please, and are accountable to nobody.
That America allows foreigners to have liberty in America and disallows liberty for America living in foreign countries is beyond bizarre.
It’s not “turning tail and running” for the folks in this story. They are being forced under threat of account confiscation to do this. There is a difference.
On the other hand, the Illegal Aliens swarming over the border from Mexico have it EASY! All they have to do is say one of two code words to stay: “Asylum” or “Obama”. No reporting requirements for THEM!
Excuses for cowards.
When Canada does the same they can run away from there too. LOL
As the US evolves into a globalist totalitarian state, I think that there will soon be a big market for fake IDs, fake passports, documents, identities.
The big issue will be overcoming biometrics, digital tracking.
--Thomas Jefferson
They're all border babies, huh...?
Nope.
So you are in effect saying that the US government owns its citizen-slaves?
I think I’m missing some parts of what’s going on here. American citizens who live in another country, even if they have no bank accounts in America, or tax liability to America, are still required to pay some fees based on filing of financial information? And banks in other countries are enforcing IRS regulations, and the IRS is able to take their money? Am I understanding this properly? I must be missing something.
“Mr. Obama, tear down this wall.”
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