IRS to be audited!


reposted from Virginia La Torre Jeker ‘s site



Americans Abroad, IRS to be Audited
July 17, 2016

Maybe it’s time for the shoe to be on the other foot.

A new tax watchdog group, the Tax Revolution Institute (TRI) believes that the problems with the US tax system “demand nothing short of revolutionary change.” TRI has commenced a major effort to independently audit the Internal Revenue Service (IRS), with the help of all interested taxpayers.

TRI is a nonpartisan Washington, D.C.-based group, with its nonprofit status currently pending. TRI plans to conduct an “audit” of the IRS, in part, by collecting personal experiences from taxpayers detailing their encounters with the IRS. TRI is “committed to promoting transparency, accountability and integrity at all levels of the US tax system, while researching and developing simple and innovative tax reform solutions to advance freedom and prosperity for all Americans.” As part of its efforts, TRI will also examine the IRS’ employees, work culture, finances, policies and enforcement as well as taxpayer advice given by the IRS. “[T]hrough FOIA requests, briefings, testimonies, advocacy, research studies, white papers, and educational programs, TRI will expose corruption, fraud, and incompetence within the US tax system.” TRI plans to “provide educational tools and resources for tax accountability to policy makers, grassroots organizations, and the American public”.

You can make your voice be heard. Visit TRI’s website. Americans abroad who are experiencing hosts of problems caused by FATCA and citizenship-based taxation can use TRI as a platform for getting their views known and hopefully, acted on!

Audit IRS
Many Americans believe the IRS should be subject to an independent audit. We agree.

We are conducting the first ever independent audit of the IRS, and we need your help.

The Audit will examine all areas of :

The IRS’ treatment of individual taxpayers
The IRS’ treatment of small businesses
The IRS’ expectations of its employees
The IRS’ work culture
The IRS’ handling of its finances
Advice given to taxpayers by the IRS
IRS policy and enforcement
… and more

Click here to read Audit IRS Key Issues List

Every year, the IRS touches the lives of 246.23 million Americans who file tax returns, and has a much greater effect on the lives of the million or so Americans who are subjected to audits.

At any time, the IRS can demand up to six years of accurate financial information. Failure to provide this information can result in large fines and penalties, even in the absence of due legal process.

Unfortunately, the IRS does not meet the standards of transparency that it enforces on others. Lacking public oversight or accountability, the agency has frequently denied requests for information, ignored subpoenas and destroyed records. It has also been found to provide misleading and inaccurate information in response to legal requests.

Anything you share with us will be kept in the strictest confidence. We never publish personally identifying information. We also offer assistance to individuals who have been victimized by un-professionalism or corruption within the IRS. Just check the “I need help” box when completing the form.

Thank you for help.

To learn more about the people conducting this audit visit:

Tax Revolution

Don’t Expect Those who worship at the shrines of Lady Liberty and The Flag to support Fellow Americans who are Expatriates


An expat using the monikker Pilgrim7 made one of the best comments I have ever seen in nearly 5 years. Read this.

reposted from The Isaac Brock Society

The treatment of expatriates by the Government of the United States often defies explanation. It is burdensome, often frightening and usually threatening. It is also marked by confusion and lack of comprehension. In short, the attitude of some Americans toward the plight of expatriates is mystification, outright antipathy, or shoulder-shrugging “so what”–or all three. I am going to suggest that these things may be best understood by seeing it as analogous, at least, to behaviour which may be described as “religious.”

The U.S. effectively has what may be termed a “state religion.” Conor Cruise O’Brien calls it the “American Civil Religion” (following Rousseau). Its core is “Patriotism.” It has a deity (originally represented by “Lady Liberty”, but in more recent years by The Flag), tenets, rules and forms of worship. Its proponents behave very much like religious persons generally.

When I was a child of five, I began each school day with a little “religious” ritual. We would sing “America”, recite the Lord’s Prayer (King James’ version) and, of course, pledge allegiance to the Flag. Indeed, during my childhood years, the words of the pledge were altered to include the now controversial “under God”. This was a simple form of worship for a more simple time. Other simple forms included Memorial Day ceremonies at local town and village squares, local Independence Day celebrations and even boy and girl scout meetings. In time, however worship would encompass thousands of people in sports stadiums, enormous flags that would require troops of people to carry, celebrity singers of “America the Beautiful” and “To Anachreon in Heaven..”, oh sorry, “The Star Spangled Banner” (same tune), and military fly-overs.

This isn’t worship? Well, it’s a pretty good imitation. 50 or 60 thousand people with their hands over their hearts looks a lot like religious ritual–or would to an uninformed observer who didn’t know exactly what they was going on.

And of course there are the “saints”. “Land of the Pilgrims’ pride” celebrates the first real Americans, the first American “saints” (and indeed, the Pilgrims termed themselves “saints” in the traditional religious sense). Never considering, of course, that some descendants of these very “saints” would be driven out of their homes because they remained loyal to the Crown between 1775 and 1783.

But for sure there is “Saint Washington” (so sublime a saint that his monument has no graven image), “Saint Jefferson”, “The Sainted Father Abraham”, and so forth. All properly worshipped, each with his sacred shrine in Washington.

And there are the hymns. “America,” “America the Beautiful,” “Columbia Gem of the Ocean” …a particular 1991 recording of American patriotic hymns has a total of eighteen (but three would likely have to be discounted, because they are Confederate hymns). Even this collection does not include things like “I’m a Yankee Doodle Dandy” and “Over There..” I’ve been a Canadian for fifty years and, besides the national anthem, I can only think of two patriotic songs, “The Maple Leaf Forever,” and “Mon Pais…” (a third might be Stompin Tom Connors’ “The Hockey Song.”)

You need these hymns for the same reason you need the rituals, to keep people “in” the faith. The greater the emotional involvement, the more encompassing the faith.

And, of course, there are tenets of this religion. “The U.S. is the very cradle of freedom. “ ”The U.S. observes and upholds the rule of law.” “The U.S. is the exemplar of democracy.” And so forth. But above all, Patriotism holds that the United States is the greatest country that has ever existed. Ever. Sing it: “This is My Country, grandest on earth.”


And, having drunk this kool-aid from childhood, the average American cannot imagine why any person would not want to be an American. As proof of that particular pudding, there are the thousands upon thousands of “illegals” who would want nothing so much as the green card that will start them on the road to full U.S. citizenship, the most wonderful status available to any human being on the face of the earth. (And in addition, there are thousands more would-be illegals marshalling on the southern border of the United States).

All other citizenships pale by comparison. All are inferior to the glorious American nationality.

So why, in the name of all that is “holy”, would anyone ever consider giving up American nationality. This is what produces a reaction of “mystification” on the part of many, probably most, Americans. The United States is “My Country, grandest on earth,” so giving up its citizenship is beyond comprehension.

Antipathy and Punishment.

But there is another “religious”response. All religions are familiar with what can be called “heresy” or “apostasy”. And fully expatriating, divesting oneself of U.S. citizenship, aside from being incomprehensible, is clearly “heretical” and “apostastic.” What is more, it is very threatening to the true believers, especially if perpetrated by persons who were given the “kool-aid” at an early age and had the opportunity to drink it into their adult years. They must be extremely misguided at the least, deranged at the extreme. Because, in practice, expatriates have done what no reasonable believer could possibly have done: denied the tenets of the faith, denied that the U.S. is the “grandest” country on earth. What is more, they have advanced the heresy that other countries may be much better places in which to live.

For heretics, no punishment can be too great, no pain too exquisite. The medieval and renaissance Christians punished heretics by burning them at the stake, an absolutely horrifying punishment, employed because it was believed that fire purifies..

But justified.

So, if expatriate Americans suffer, no problem. It’s a punishment fully justified by their heretical denials of the greatness of the United States, that inherent belief attested to at every football game in America by thousands who keep the faith and know the truth. If those who want to leave are forced to jump through hoops, again, no problem. Like those heretics who were purified by fire, the apostatic expatriate may be purified by delay. Then he or she will hopefully return to seeing the light. (As it was believed the purification by fire might, at last, “save” the heretic).

No. No punishment is too great in the defence of the faith.

Dialling down the burden–the shrug..

There is one more dimension on which the American state religion sheds light and it is this. Many religions, in varying degrees, demand “service” to the deity. In some instances that demand is so extreme that “service” becomes “servitude”, and it seems to me that the American state religion demands something approaching “servitude”.

“Service” involves a wide degree of “choice” and personal freedom and integrity, “servitude” is a situation in which the deity may demand much of the “server,” up to and including the surrender of life, without allowing much in the way of choice. The United States has always seemed to me to be on that end of the scale. Now I will admit to a personal bias here, since I have always resented the fact that the U.S. thought that I should be “pursuing happiness” in places like Nha Trang or Da Nang. I was not entitled to plan my life, had no choice as to whether or not I wanted to pursue my happiness in a land war in Southeast Asia. Servitude, pure and simple.

I was fortunate. I was able to avoid that awful mess. Legally. But it bespeaks a mentality. The United States is the greatest nation on earth. Citizenship in such a nation is so incredibly valuable that absolutely anything can be demanded of the citizen. Hence the nonsense: “Ask not what your country can do for you…”

For this mentality, the subjection of citizens to “internal” taxation when they do not live within the borders of the United States makes perfect sense. In effect, the prize of citizenship in the greatest country that has ever been has to be paid for. The United States is not required to actually do anything in return for tax monies collected–“Ask not what your country can do for you…”–as one political thinker would have required. Servitude in worship of the deity makes perfect sense to those who have drunk the kool-aid.

The United States is not the greatest country on earth in any particular other than obscene wealth and military muscle. It regularly scores relatively low on “pursuit of happiness” scales. For the living of ordinary life, the U.S. is inferior to any number of other countries on the planet.

When I was eighteen, I entered one of those countries (Canada) as a student. I very quickly realized that I was in a better place, a kinder, gentler, caring place. My fellow students were able to start planning their lives without having to think about giving up a minimum of two years to the great god (or goddess) of the state. By the time I had entered my second year of “university,” I knew where it was that I wanted to live and it was not the U.S.

I have been a Canadian in my mind ever since, and in reality for nearly 50 years. The United States is an alien government as far as I am concerned, and were it not a thug and a bully, it would actually observe the rule of law that it gives mere lip service to. One of the rules of that rule of law is that you do not get to create legislation which, (by any expedient pretext) allows you to reach across your territorial border and touch people and things in other countries. Instead the American thug visits upon me unlawful taxation requirements and the possibility of crippling penalties. And this is completely justified–in American eyes–because “servitude” requires that the “server” provide whatever is demanded.

Those Homeland Americans who have drunk deeply of the kool-aid will not care that this “servitude” is something they do not have to share. After all, not everyone was drafted. But the accepting of burdens, any burden at all regardless of whether or not it is shared, is a perfectly legitimate demand made by a state which is god.

Understanding of the clear wrongness of all of this is beyond those who worship at the shrines of Lady Liberty and The Flag. They don’t even recognize their military defeats, so how likely is it that they will admit to international wrongdoing.

Rather than being surprised by it, we should expect confusion and mystification when we want to leave. Rather than imagining that we will avoid it, we should expect punishment. Rather than hoping Americans will see how wrong they are, we should expect that they will shrug their shoulders and return to worshipping the Flag.

It’s their Faith. And faith, according to St. Augustine, is irrational. By definition.

Don’t let fear push you into overcomplying, overpaying and losing your sanity!


This is a comment that stands alone as a post in itself. It was made in response to a post on the IsaacBrock Society

Petros, who authored the post this comment is a response to, is the pen-name of the founding administrator of the Isaac Brock Society. He has started this series of Petros Principles as a means of communicating guidelines which he believes have helped him and others deal with the United States’ world-wide tax invasion. He says:

Inordinate fear of the IRS is dangerous because it has caused some people to lay down all of their normal defense mechanisms and like an innocent lamb to stand paralyzed before the toothless lion.

One of the major roles of the cross-border compliance industry has been to frighten their clients and the public about the IRS’s power, and the media has too often created panic by consulting the compliance industry as their principle experts for information on US expat tax issues

The following response, by USCitizenAbroad will be of great help to anyone who is (understandably), in a confused and frightened state and in danger of being so overwhelmed, that reason and a considered assessment of what can/cannot be done by the IRS, that they simply over-comply, over-pay and lose way too many LCU’s.
USCitizenAbroad says
July 18, 2016 at 10:26 am


With due respect and appreciation for ALL the comments on this thread, this comment is to remind people of what Petro’s original point is (I think):

Petros is saying that fear can be such a dominant factor that it overwhelms all else and makes it much harder to make a “decision”. When “fear” is the dominant factor, people will “react to the fear” and NOT “decide on the facts”. There is NO way to know for certain what would be the result of any one decision.

Petros is not (I don’t think) saying that people should be “fearless”. He is simply saying that one cannot allow decisions to be made primarily based on fear. On this point, I do agree (for what it’s worth) with him.

My perception of the Fear, The IRS, The Condors and Americans (so called) abroad:

About the fear:

I seriously doubt that long term Americans abroad are on the radar of the IRS. But, I don’t know and nobody really knows. Nevertheless, there is no indication to think that they are.

When people experience fear and the trauma associated with the fear they seek safety which includes certainty. They incorrectly believe they have a “tax problem”. They don’t a tax problem they have a “compliance” (maybe) problem. Suggest you read an old post on this issue:

The Taxpayer, the IRS and the Professionals; Where to Go From Here

About the tax compliance community

If you go to a “tax lawyer/accountant” you will achieve CERTAINTY. But, the CERTAINTY will be at the cost of (possibly) turning over a lot of money to the process (U.S. taxes, compliance fees, etc.). Understand that if you go to a “cross border professional” they will approach the problem in terms of compliance with the Internal Revenue Code. Actually, in most cases they will suggest “heightened compliance” (“we are not really sure if this form is required, so you should file it anyway” – WRONG, WRONG, WRONG and WRONG). Understand that U.S. tax law is NOT enforced by the IRS. It is enforced by the tax compliance community.

About the Internal Revenue Code

Because the Internal Revenue Code is a U.S. law which applies outside the USA, there is no way to know with certainty whether you are ever in compliance anyway. I don’t think (just my opinion) that you respond to this uncertainty with “over compliance”. I think (just my opinion) that you solve it by “defensible compliance”. “Over compliance” means that you have absolutely and completely entered the “prison of citizenship taxation”. Your life is absolutely over unless you renounce. “Defensible compliance” means that you are doing the best can, but when things are ambiguous (“Not even your IRS knows for sure”), you don’t resolve ambiguities in favor of the IRS. One example of this would be the ongoing discussion of whether TFSAs and RESPs are “foreign trusts”. Although this example is “overdone”, it is an example where tax compliance people are likely to say: “Well, we don’t know for sure, so why not fill out these forms!” Well: you are not the one who must live with the consequences of filling out the forms!

About Americans abroad

If the “compliance process” costs you a significant percent of your net worth (and it could depending on your situation), you will no longer have “fear” but you will have extreme (dangerously so) “anger”.

In other words, you will have converted the disabling emotion of “fear” into the disabling emotion of “anger”. As a great and late trial lawyer used to say in his closing remarks to the jury:

“It’s not what you take from them, it’s what you leave them with”

See this older post:

Collective psychotherapy – U.S. citizens outside U.S. – Not what they take from you, it’s what they leave you with

My point is largely this:

Whether you are in U.S. tax compliance or not you have a problem. The problem is that you have a U.S. connection. After destroying Americans abroad, the USA will begin destroying the Homelanders (who will think it is just great).

So, you have three options:

1. Take steps to get a CLN (usually renunciation) so that you CANNOT be accused of being American. In most cases this means the 5 years of compliance and renunciation. If you can achieve this for the cost of a used car you are doing well. The difference is that:

– used car is just a depreciating “asset”

– a CLN is simply the best investment that any human being can have in the world. It will grow in value every second of every minute, of every hour, of every day, of every month, of every year for the rest of your life!

2. Take steps to understand why you are NOT American so that you can defend the accusation of being American. (The FATCA IGA specifically allows for this possibility).

3. Live your life and ignore the whole thing.

I am neither discouraging this nor encouraging this. It depends entirely on you. In some cases, the cost of “buying your freedom” is so low that it might be worth doing. In fact there are many Canadian citizens (who with the help of the tax community”) have actually “pretended they are Americans” (even though they know they are NOT) so that they can renounce and get a CLN.

The people who have paid the highest price in emotional and financial terms are the ones who have turned this over to the lawyers and accountants to “do the right thing”. And I am NOT saying that ALL lawyers and accountants are a problem. But, enough are they you should be VERY careful in your choice of adviser. For a recent example, have a look at the following post from Jack Townsend’s blog where he references the story of two women in their 90s and one in her 80′s who tried to do the “right thing”. It was NOT the decision of the three elderly women to enter OVDP. It was the decision of their lawyer. Now, we can’t tall all the factors leading to the lawyer’s decision to enter OVDP, but we can certainly see the consequences of the decision. Returning to the original point, this is what happens when people have so much fear that they cannot think clearly (or at all).

New Case Filing Challenging Streamlined Transition Disparity with Streamlined

In conclusion:

Petros is not saying ignore fear. Petros is not saying don’t have fear. What Petros is saying is:

Do NOT allow the fear to overcome everything else – a point that I do agree with!

What would FDR likely say about this crisis and trauma?

It is NOT true that the ONLY thing we have to fear is fear itself!

It IS true that the most dangerous thing we have to fear is fear itself!

Why Boris Johnson must relinquish US citizenship on the occasion of his appointment as British Foreign Minister

cross-posted from the citizenshipsolutions dot ca blog

A recent post (July 7, 2016) on this blog began with:

Prologue – U.S. citizens are “subjects” to U.S. law wherever they may be in the world …

Yes, it’s true. In 1932 (eight years after the Supreme Court decision in Cook v. Tait), Justice Hughes of the U.S. Supreme Court, in the case of Blackmer v. United States ruled that:

While it appears that the petitioner removed his residence to France in the year 1924, it is undisputed that he was, and continued to be, a citizen of the United States. He continued to owe allegiance to the United States. By virtue of the obligations of citizenship, the United States retained its authority over him, and he was bound by its laws made applicable to him in a foreign country. Thus, although resident abroad, the petitioner remained subject to the taxing power of the United States. Cook v. Tait, 265 U.S. 47, 54 , 56 S., 44 S. Ct. 444. For disobedience to its laws through conduct abroad, he was subject to punishment in the courts of the United States. United States v. Bow- [284 U.S. 421, 437] man, 260 U.S. 94, 102 , 43 S. Ct. 39. With respect to such an exercise of authority, there is no question of international law,2 but solely of the purport of the municipal law which establishes the duties of the citizen in relation to his own government. 3 While the legislation of the Congress, unless the contrary intent appears, is construed to apply only within the territorial jurisdiction of the United States, the question of its application, so far as citizens of the United States in foreign countries are concerned, is one of construction, not of legislative power. American Banana Co. v. United Fruit Co., 213 U.S. 347, 357 , 29 S. Ct. 511, 16 Ann. Cas. 1047; United States v. Bowman, supra; Robertson v. Labor Board, 268 U.S. 619, 622 , 45 S. Ct. 621. Nor can it be doubted that the United States possesses the power inherent in sovereignty to require the return to this country of a citizen, resident elsewhere, whenever the public interest requires it, and to penalize him in case of refusal. Compare Bartue and the Duchess of Suffolk’s Case, 2 Dyer’s Rep. 176b, 73 Eng. Rep. 388; Knowles v. Luce, Moore 109, 72 Eng. Rep. 473.4 What in England was the prerogative of the sov- [284 U.S. 421, 438] ereign in this respect pertains under our constitutional system to the national authority which may be exercised by the Congress by virtue of the legislative power to prescribe the duties of the citizens of the United States. It is also beyond controversy that one of the duties which the citizen owes to his government is to support the administration of justice by attending its courts and giving his testimony whenever he is properly summoned. Blair v. United States, 250 U.S. 273, 281 , 39 S. St. Ct. 468. And the Congress may provide for the performance of this duty and prescribe penalties for disobedience.

It’s that simple. If you are a U.S. citizen, some would argue that you are the property of the U.S.government.

On the other hand (and this will be the subject of another post), the Supreme Court decisions in Cook v. Tait and Blackmer v. The United States were decided in an era where there was no U.S. recognition of dual citizenship. It is reasonable to argue that these decisions have no applicability in the modern world.

There will be those who will say: Come on! Get real! The United States would never rely on these old court decisions. Well, they still do cite Cook v. Tait. Mr. FBAR lay dormant until it was resurrected by the Obama administration as the “FBAR Fundraiser“.

Dual Citizenship: What is the “effect” of a U.S. citizen also holding the citizenship of another nation?

The State Department description includes:

However, dual nationals owe allegiance to both the United States and the foreign country. They are required to obey the laws of both countries. Either country has the right to enforce its laws, particularly if the person later travels there. Most U.S. nationals, including dual nationals, must use a U.S. passport to enter and leave the United States. Dual nationals may also be required by the foreign country to use its passport to enter and leave that country. Use of the foreign passport does not endanger U.S. nationality. Most countries permit a person to renounce or otherwise lose nationality.

The life and times of Boris Johnson – A United States taxpayer by birth

Assumptions about Mr. Johnson’s citizenship …

I am assuming that he became both a U.S. and U.K. citizen by birth. I also assume that he remains both a U.S. and a U.K. citizen.

A U.S. Centric Perspective: As a U.S. citizen, Mr. Johnson is defined primarily in terms of taxation. On the occasion of Mr. Johnson’s recent appointment as the U.K. Foreign Minister, the Washington Times published the following article.

The article referenced in the above tweet provides an interesting summary of the Mr. Johnson’s adventures with the U.S. tax system. The article demonstrates how U.S. “place of birth” taxation is used to extract capital from other nations and transfer that capital to the U.S. Treasury. (As always the comments are of great interest.)

A non-U.S. Centric Perspective: Mr. Johnson is a “poster boy” for the problems of the U.S. “place of birth taxation” (AKA “taxation-based citizenship”). Mr. Johnson’s “IRS Problems” resulted in raising the profile and awareness of U.S. tax policies. A particularly interesting article written by Jackie Bugnion and Roland Crim of “American Citizens Abroad”.

At a minimum, Mr. Johnson is subject to IRS jurisdiction, IRS reporting requirements, IRS threats and penalties and IRS assessments.

Boris Johnson has now been named the U.K. Foreign Minister …

How does his United States citizenship impact on this situation? Is it possible for him to be both a U.S. citizen and the British foreign minister? The “logical answer” is “Yes he can”. That said, having a U.S. citizen as the U.K. foreign minister raises many questions.

These questions include:

1. What effect (if any) does Mr. Johnson’s acceptance of this position have on his retention of United States citizenship as a matter of U.S. law?

2. If his acceptance of the position were a “relinquishing act” (under U.S. law) would Mr. Johnson be subject to the United States S. 877A Exit Tax?

3. Assuming that Mr. Johnson were to retain “dual” U.S./U.K. citizenship, how would his “divided loyalties” impact on this ability to serve as the British foreign minister?

4. Assuming that Mr. Johnson were to retain “dual” U.S./U.K. citizenship, how does the fact that the IRS has the jurisdiction to threaten him with fines and penalties impact the situation? What about the reporting requirements?

5. Should Boris Johnson formally relinquish his U.S. citizenship in order to avoid the conflict of interest that would arise because of divided loyalties?

Each question will be considered separately. Here we go …
Continue reading Why Boris Johnson must relinquish US citizenship on the occasion of his appointment as British Foreign Minister

Is the State Department Shutting Down Expatriation Appointments in Canada?


An interesting conversation is taking place on the FB group American Expatriates. Journalist Serena Solomon from the publication VICE has requested stories from expats describing the emotional effects of renouncing. You might want to go over and take a read as many are quite interesting. It is a public group so I believe one can read without being a member; not sure if one needs a FB account.


Earlier today, there was the following comment, which forms the basis for this post:

Tom Paine A question for those in Canada: It appears that few or no renunciation appointments have been confirmed since January of 2016 when they switched to a centralized Renunciation system for all of Canada. Has anybody in Canada received a renunciation appointment in Canada who applied after February 1, 2016. If so, where was the appointment location? Again, I am asking about those who have applied for an appointment NOT those who had pre-existing appointments under the old system. For those outside of Canada, what has happened is that the demand to renounce in Canada is so great, that DOS has created a centralized renunciation system for all of Canada.


The change to a centralized renunciation system for Canada occurred this past February. A detailed post describing the procedure can be found here.

From the Globe & Mail:

“It’s very clear that there is no particular attempt to make it easier to get out – to provide more resources or expedite the process,” complained John Richardson, a Toronto citizenship lawyer, who has guided numerous Canadians through the complex process. “Toronto may be the renunciation capital of the world,” Mr. Richardson said.

A U.S. embassy spokesman would not comment directly on the reasons for the long wait times, but he confirmed that it currently takes anywhere from 45 days to 10 months to arrange a mandatory meeting, depending on the location. He acknowledged that the process is not meant to be easy, even as the embassy works to “refine” it.

“Due to the serious implications the decision to renounce U.S. citizenship carries, the process is intended to be deliberative in order to permit individuals to reflect upon their decision before returning to execute the Oath of Renunciation,” the official said.

Is this man serious? A 15 month wait is required to contemplate the seriousness of the action? Since only one appointment is now the norm, the wait is from application until the appointment. Sorry, but this is ridiculous beyond belief. The previous policy of requiring two appointments was designed to accommodate this perceived need to reflect. I originally scheduled my second appointment a week following my first. Seven days. Point being, there was no huge wait necessary before. What could possibly justify the difference between waiting a week and waiting 19 months for an appointment? Are there that many people renouncing and if so, why does the Federal Register not reflect those numbers? We know the Federal Register falls short of what is reported on the FBI’s NICs list. Something just doesn’t add up here (in more than one way).

The original attitude of the Toronto consulate back in the last quarter of 2011 was to try and accommodate the new surge of people applying. I remember phoning Mrs. Anderson at the Consulate for an appointment in late October and she told me it would have to wait until the 2nd appointments of those 22 people were finished. My first appointment was November 30, 2011.

An interesting comment from Kevyn Nightengale:

Over a year and a half before this change of procedure (November 4, 2014), Stephen Kish had a most interesting discussion with 2 members of the U.S. Consulate in Toronto.

I had conversations with the C-G and two Consular officials on the wait time to obtain a renunciation meeting in Toronto.

This evening I attended a Toronto meeting of students, Democrats, Republicans, and Toronto US Consular officials which was sponsored by the Munk School of Global Affairs. U.S. Consul General James Dickmeyer gave a short speech and I had conversations with the C-G and two Consular officials on the wait time to obtain a renunciation meeting in Toronto.

Consular Official “R” — I pointed out to R that there are many Canadians in the Toronto area with unwanted U.S. citizenship who need to renounce this citizenship. R advised that the wait time is now up to September 2015, in part because of a three week or so delay caused by the Pan AM games (yes, you heard that right).

C-G — I then spoke to the C-G, explained the situation that these unfortunate people need to get on with their lives, and asked that since he is the “boss” he needs to reorganize staff duties and shorten the time to a renunciation appointment as bookings are now in September. There was some confusion as he felt that I must have meant September past (I believe that he was unaware of the wait time). Once this was clarified he argued that the boss really does not have that much power and that I should go back and speak to R (apparently the man with the money) which I did (see below).

We debated a few points: C-G feels that citizen-based taxation is not “so bad” as taxes are never owed to the IRS because Canadian taxes are higher (I corrected this impression). C-G complained that Canadians are “only now” coming to renounce. I explained that many are only now finding out that the U.S. considers them to be U.S. citizens. I mentioned our FATCA IGA lawsuit and C-G responded by saying that we will just hurt the banks etc…

Consular Official R (second conversation) — Told R that his boss claims that R has the power to shorten renunciation wait times. R responded by saying that the renunciations are a low priority that do not compare with high priority activities such as passport renewals, and that there will be no change in priority. R advised that Toronto people should go to Calgary or Montreal to renounce. I asked R how would a low income person find the funds to do this.

IRS compliant American — Happened to get into conversation with American very proud of filing tax returns to IRS for 30 plus years and paying no tax. Feeling nasty I asked him what does he think will happen when he sells his expensive house that he has lived in for all these years (now he knows).

Dems Abroad — In a short speech Dems Abroad promised that Americans abroad should not worry about the safety of voting in an election because the information is not passed on to the IRS (I think the fellow was serious). One DA presented to R their approach to FATCA (modify but do not kill). I explained that the Alliance and Republicans Overseas want to kill the entirety of the beast.

There was nothing else for me to say, so I left.

Could an official’s personal perception (negative) have an effect on policy? We have seen before, that the State Department is sometimes slow to follow changes that they are legally required to make. One instance of this concerns the issue of CLNs for reqlinquishment via an expatriating act and intent. This affects thousands of Canadian citizens who relinquished in the late 1960’s – 1980 when case law began to include “intent” as a factor in whether citizenship was lost by performing an expatriating act. The difficulty is that those relinquishants were not advised to come down and apply for a CLN. Since at least the 1940 Immigration and Nationality Act (INA), the State Department was supposed to issue CLNs (see Section V Miscellaneous – Paragraphs 501 & 502-but this in no way amounts to a a relinquishment being valid only if one has a CLN).

Another post appearing on FB today:

Today (July 13) Just received an email from Milano Consulate saying to contact them in September for the 2nd appointment for renunciation. My first appointment was in April in Genoa – Her lame explanations were that they are backed up in Milano because of all the renunciations from Switzerland being handled and that there are 200 death certificates to handle.

Why such a difference time-wise? Yes, likely more Canadians trying to renounce but less than 2 months compared to over a year? What gives?

At what point would the actions of the State department amount to disregard for the law and the right of citizens to expatriate?


To reiterate, the primary focus of this point is to determine if the State Department is shutting down/seriously limiting the number of renunciations in Canada by making it more difficult/longer to obtain an appointment. In order to verify that, we need to know/ask:

  1. Has anyone who has applied for renouncing in Canada since mid-February received an appointment (your application would have been processed through Vancouver via the email address:
  2. Has anyone who has applied for renouncing in Canada under the new system actually completed an appointment?

NB: We are NOT asking if anyone has actually renounced after this date because the appointment may have been made before these changes took place.

The Internal Revenue Code does NOT explicitly define “citizenship” or require “citizenship-based taxation”

reposted from citizenshipsolutions dot ca
UPDATED July 6 afternoon. Some text additions and I have clarified that the author of this post is John Richardson, B.A., LL.B., J.D. (Of the bars of Ontario, New York and Massachusetts), Toronto citizenship lawyer and Co-chair of the Alliance for the Defence of Canadian Sovereignty and the Alliance for the Defeat of Citizenship Taxation.

It is widely understood that the United States Internal Revenue Code requires that “U.S. citizens” are subject to U.S. taxation wherever they may live in the world. Although this is true, the Internal Revenue Code:

  1. Does NOT explicitly say that U.S. citizens are subject to U.S. taxation on their world income wherever they reside;
  2. and

  3. Does NOT explicitly define the term “citizen” or “U.S. citizen”. (This contrasts with the the terms: “U.S. Person”, “Permanent Resident”, “Substantial presence”, etc. that ARE explicitly defined in the Internal Revenue Code here and here. This means that the starting point for the definition of “U.S. citizen” is in the 14th Amendment of the Constitution and the United States Immigration and Nationality Act.

Some thoughts on each of these points …

Q. Who (according to the Internal Revenue Code) is subject to U.S. taxation on world income?

A. S. 1 of the Internal Revenue Code states that taxation is imposed on: “individuals”, “heads of household”, “estates”, “trusts”, etc. Note that the word “individual” is broad enough enough to include “citizen” but is NOT restricted to “citizen”. Put it another way: The Internal Revenue Code of the United States presumes that ALL individuals throughout the world are subject to U.S. taxation. Yes, it’s true …

Note that S. 1 of the Internal Revenue Code also defines which filing status one should use. (“Single”, “Head of Household”, “Married Filing Separately”, etc.) It also prescribes different rates of taxation for different filing statuses. Note that the most punitive status is “married filing separately” – which actually imposes a “hidden tax” – and is commonly used by Americans abroad.

U.S. citizens are subject to taxation on their world income because they are “individuals”.

The Internal Revenue Code does NOT define the meaning of “citizen”!

S. 7701(a)(50) creates the concept of the “tax citizen“. It doesn’t define who is a citizen, it merely states that, citizenship is not lost for tax purposes until the individual meets the requirements of Internal Revenue Code S. 877A(g)(4). Specifically S. 7701(a)(50) reads:

(50) Termination of United States citizenship
(A) In general

An individual shall not cease to be treated as a United States citizen before the date on which the individual’s citizenship is treated as relinquished under section 877A(g)(4).

Whoa!! How does any individual in the world escape U.S. taxation?

We look to S. 2 of the Internal Revenue Code which it title:

“Definitions and Special Rules”

S. 2(D) reads:

(d) Nonresident aliens

In the case of a nonresident alien individual, the taxes imposed by sections 1 and 55 shall apply only as provided by section 871 or 877.

In other words, if you are a “nonresident alien” you are taxable only on income connected to the United States. (By the way, S. 55 is the Alternative Minimum Tax. To see if you are required to pay it, see the Alternative Minimum Tax Assistant from the IRS.)

So, what’s a “nonresident alien”? Where is “nonresident” alien defined?

The answer (since January 1, 1984) is found in S. 7701(b) of the Internal Revenue Code. This section of the Internal Revenue defines the circumstances under which an “alien” has sufficient ties to the United States to move (or be
converted) from being a “nonresident alien” to being a “resident alien”.
I wrote an extensive post on this question here.

But, the starting point in the definition of “nonresident alien”

Internal Revenue Code S. 7701 (b) definition of resident alien and nonresident alien

(1) In general For purposes of this title (other than subtitle B) (JR NOTE: SUBTITLE B IS THE ESTATE AND GIFT TAX SECTION) —

(A) Resident alien An alien individual shall be treated as a resident of the United States with respect to any calendar year if (and only if) such individual meets the requirements of clause (i), (ii), or

(i) Lawfully admitted for permanent residence Such individual is a lawful permanent resident of the United States at any time during such calendar year.

(ii) Substantial presence test
Such individual meets the substantial presence test of paragraph (3).

(iii) First year election
Such individual makes the election provided in paragraph (4).

(B) Nonresident alien

An individual is a nonresident alien if such individual is neither a citizen of the United States nor a resident of the United States (within the meaning of subparagraph (A)).


Two ways of converting the “nonresident alien” to the “resident”
alien …

1. “Green Card” – Most of the focus of S. 7701(b)(6) is on Green Card Holders. A “Green Card” is a “permanent resident” VISA and is valid only as long as the person intends to reside permanently in the United States. This is both a matter of Immigration law and a matter of tax law (the Internal Revenue Code).

2. “Substantial presence test” – be very careful with this. The question is how many days is one entitled to spend in the United States each year before being treated as a “resident” for tax purposes. (I have seen people enter the United States on various “work related visas but then stay long enough to meet the “substantial presence” test.


An IRS perspective is here:

The bottom line is that …

Every individual in the world is subject to full U.S. taxation on his/her world income unless he/she is a “non-resident alien”.

Think of it!!

John Richardson

Republicans Overseas July 5, 2016 Appeal of U.S. FATCA Lawsuit Dismissal


cross-posted from: Isaac Brock Society

by Stephen J. Kish

The Plaintiffs (of which I am one of seven) of the Republicans Overseas United States FATCA lawsuit, filed, on July 5, 2016 in U.S. Sixth Circuit Court of Appeals, a “Brief” arguing that the U.S. District Court erred in dismissing the FATCA lawsuit.

We are suing: United States Department of the Treasury, United States Internal Revenue Service, and United States Financial Crimes Enforcement Network. SEE THE BRIEF.

“The district court held that no Plaintiff has standing for any of the eight counts (Dismissal Order, RE 42), even with added plaintiffs and facts in the proposed Amended Complaint (RE 32-1).”

“Preliminarily, note that while the Government asserts interests in fighting tax evasion, money laundering, and terrorism, Plaintiffs are ordinary people abroad seeking freedom from serious harms from challenged provisions and IGAs. Plaintiffs are not alone. An extensive, careful survey,[from Democrats Abroad…]”

“The Government has other, successful tools to catch scofflaws without the unconstitutional, intrusive, bulk-data-collection approach of the challenged provisions and IGAs that so harm ordinary Americans.”

“Taxpayer information was recently stolen from the IRS itself because the IRS has not prevented hacking of its own systems and theft of taxpayer information.”

“Thus, people do have a reasonable expectation of privacy from the U.S. and foreign governments in their bank accounts under the situations at issue here. They reasonably do not expect the bulk, blanket reporting of information under challenged provisions and IGAs, including to foreign governments, without any hint of wrongdoing and without judicial oversight, the lack of which makes such searches “per se unreasonable.”18 So Plaintiffs have a cognizable privacy interest.”

“…Plaintiffs rely on no third-party standing, though they provide information about relevant third parties to demonstrate how FATCA negatively affects their lives and relationships. Rather, they rely on their own interests, especially the constitutionally protected interest in not disclosing information they do not want to disclose.”

“The district court said that because Plaintiffs harms, particularly problems in getting banking services for essential everyday-living accounts,20 are not fairly traceable to government action, Plaintiffs lack standing to challenge provisions motivating FFIs not to provide services to Americans abroad….So the argument is not that, e.g., the IRS persuaded some bank to deny services to Plaintiffs Crawford or Kuettel, but that FFIs don’t accept Americans’ accounts because of FATCA/IGA burdens. Where a provision/agreement harms a person by causing FFIs to deny services (or by disrupting marital joint accounts or the ability to open an account in a minor’s name), that harm is fairly traceable to the government responsible for the provision/agreement.”

“The law on causation for standing recognizes such indirect harm. For example, Plaintiffs affected by FATCA/IGAs have standing for the reasons stated regarding Count 1 because the FFI Passthrough Penalty is designed to punish noncompliance by account holders. And Plaintiffs would like to be noncompliant because they are burdened by FATCA/IGAs, which they believe are unconstitutional, but cannot be recalcitrant because of the Passthrough Penalty.”

“Furthermore, Plaintiffs alleged that they reasonably fear that they will be subject to the Willfulness Penalty for willful failure to file FBARs, indicating that they are filing FBARs. The FBAR report is a trap for the unprepared, uninformed, unwary, imposing this excessive penalty on those who know of the report but for some reason fail to get it done.”

“Moreover, Plaintiffs’ harms will be redressed by requested relief as to this Count. See Part I.C. Any notion that they must await a penalty or enforcement action is erroneous because one need not await enforcement to challenge unconstitutional provisions/agreements. And Plaintiffs would not file FBAR reports—and so become subject to this penalty—but for the challenged provision. So Plaintiffs have standing for Count 6…”