One of the most obvious effects of FBAR, FATCA, or in other words, CBT, is the toll on the health of the individuals directly affected.
One of the first people to recognize that expatriates facing these effects needed guidance/help outside of tax issues, was John Richardson. He arranged for a meeting where expats could speak freely. The facilitator for that portion of the program was Dr. Donald Young. While no comments of that meeting were recorded (as a matter of policy/protection for the attendees), a commenter on a Forbes article makes reference to a statement of Dr. Young:
In the words of Dr. Donald Young, University of Toronto Dept of Psychiatry:
For those U.S citizens who have elected to live abroad, be it in Canada or elsewhere, American tax policy can place such individuals in a position that engenders constant and severe emotional stress. The vindictiveness of the U.S. position, its unfairness and irrationality, the fact that neither the U.S. government nor tax and legal experts even know the rules and how to rationally proceed, and the constant threat of economic calamity are all factors that can be emotionally devastating. From my observations over the years in people ensnared in this situation, and I would count myself among us, it is common to experience substantial anxiety, depression, feelings of panic and foreboding, guilt over being branded a cheat and a criminal, fear, anger, resentment, and general feelings of helplessness and confusion. I have in fact seen some people who have become virtually suicidal at the prospect of losing everything for the “crime” of not paying taxes to a country they have not lived in for decades if ever at all. I am a clinical psychologist licensed to practice in Ontario with 35 years of experience. I have also been appointed an assistant professor in the Department of Psychiatry at the University of Toronto. In recent years I have had the opportunity to discuss and address these problems with many individuals who are trapped in these tragic circumstances
A submission to the 2015 Senate Finance Committee Study for Tax Reform request for comments includes some specific quotes made by expatriates (on various articles, blogs, etc.) that reference psychological effects (starting at p 119-just click on that section of the index of the submission). It is pathetic that the Committee did not recognize the depth of the harm that expats documented in the entirety of the submissions (i.e., in addition to the submission just referenced).
From the Citizenship Taxation WordPress Blog post #CBTLawsuit – First report of Senate Finance Committee brings citizenship taxation lawsuit one step closer.
As barely, a footnote, the Committee ended with:
F. Overseas Americans
According to working group submissions, there are currently 7.6 million American citizens living outside of the United States. Of the 347 submissions made to the international working group, nearly three-quarters dealt with the international taxation of individuals, mainly focusing on citizenship-based taxation, the Foreign Account Tax Compliance Act (FATCA), and the Report of Foreign Bank and Financial Accounts (FBAR).
While the co-chairs were not able to produce a comprehensive plan to overhaul the taxation of individual Americans living overseas within the time-constraints placed on the working group, the co-chairs urge the Chairman and Ranking Member to carefully consider the concerns articulated in the submissions moving forward.
It is inconceivable after the number of stories sent to the SFC, not only were there no substantial options suggested, but a mere two paragraphs is offered with a suggestion that the concerns be addressed moving forward. This is not good enough. This has been going on since 2009 with the FBAR Fundraiser, the FATCA hunt and so on.
Then there is the case of a particular, much-loved expat, quoted on the home page:
I lived and worked in the USA for 30 years becoming a proud American in 1967. I moved back home, in failing health, with sleepless nights, afraid of losing my small life savings. In a way, I am glad I will not have much long to go in this world. I am beginning to give up.
Marcio de Vasconcellos Pinheiro
Marcio spoke often of how proud he was, coming from Brazil to live in America and becoming a citizen in 1967.
Clearly at the mercy of tax professionals, (or IOW, clearly mislead into entering OVDI), he mentioned $300 per hour lawyer fees and he ended up paying 27.5% of his life savings. Unbelievably, he had a letter from the IRS indicating that his best course of action would be to renounce his US citizenship.
You can read more about Marcio here.
It is sad and then, infuriating to realize what this man went through, and how severely his outlook was destroyed (what to say of his health). I cannot for the life of me understand how any of these people (Shulman, Levin, Obama, et al) can sleep at night. In the end, life is simple in spite of all the “more important issues” the world insists on focusing on. The United States of America has clearly become what most people would describe, as evil. Rest in peace Marcio, along with Roger and Don and OzTeddy and likely many other expatriate Americans who did not deserve the treatment they received at the end of their lives.