My story

My family moved from the U.S. to Canada in 1966. My parents’ dream was to farm, and that was simply not affordable for them in Texas. However, homesteading was possible in Alberta in the 60’s, so we packed up and moved over 4,000 kilometers to a new life, which I’ve certainly never regretted.

In 1974 my mom obtained Canadian citizenship because she wanted to be able to vote and to take part in local politics.  My sister became a Canadian in 1977. I obtained my citizenship as a minor, in 1976, because I had the opportunity to go to France through school, and we were told it would be faster to get my Canadian citizenship and passport than it would be to get a U.S. passport. To my surprise, however, I found that while my primary motivation was expediency, once I became a Canadian citizen, I was very proud of being Canadian. Giving up my American citizenship (as I thought at the time) didn’t bother me, because by then I’d lived here for ten years, arguably my most formative years, and truly felt Canadian.

My dad and brother didn’t see any compelling reason in their lives to go through the process and they remained U.S. citizens.  So, we’ve been a mixed lot, which I suspect is similar to a lot of other families that have immigrated to Canada. Most of our relatives still live in the United States, and we’ve visited back and forth over the years.

We were never told that there would be any need to report on our income to the U.S. while living in Canada, and in fact, I really thought I was no longer considered a U.S. citizen. So, imagine my surprise – and yes – outrage, when I just recently discovered that I am still considered a U.S. citizen and that there is a burden on me to file income taxes to the IRS and to report on financial accounts.  And, that because I haven’t complied with a law I had no way of knowing affected me, the IRS can penalize me.

The reality is that this situation affects every member of my family, as well as our spouses, our children, both our financial well-being and our emotional well-being. It’s not easy living under the threat of having huge penalties levied against you – potentially for tens of thousands of dollars, or even much more.

It’s tempting to stick my head in the sand and hope it goes away. It’s not realistic, though. Hence this blog, my first. Somehow we have to get the attention of our government about not only the financial impact this will have on Canada, but also the need for Canada to protect it’s citizens from a foreign government.

 

37 thoughts on “My story

  1. I am so sorry that this insanity affects you and your family. Your life changes from the moment you find out about the US’s citizenship-based taxation and what it means for you. I really don’t think sticking our heads in the sand and hoping it will all go away is an option so the sooner we decide what to do in each of our cases, the sooner we may regain some normalcy. I can only imagine how difficult it is for all of you right now to have this overshadow all other aspects of what was your life.

    I starting filing my back US tax returns in 2008 when I came to the realization that what I absolutely thought when I became a citizen in 1975 was no longer true. I had not really relinquished my US citizenship as I was warned — the US had changed the rules and I now all had US citizenship again. Since I didn’t come to Canada until I was in my mid-20’s, my children, born and raised in Canada, are “accidental Americans”. I don’t think that anyone other than those going through this can really comprehend how citizenship-based taxation works, how we were duped into believing we had no tax obligations. I have gained my strength from other US persons in Canada who do know and are coming to grips with how to deal with this. I feel, though, there are so many that still don’t know. I am so glad to be a citizen of Canada, to have raised my family here and for so many other reasons. May our government representatives listen and stay strong in helping us stand up for our rights in this.

    I am now US tax compliant since 2005 with returns and Foreign Bank Account Reports. Essentially, with the help of a good tax lawyer in Calgary, I will correct my returns to include IRS Forms 3520 and 3520A for my and my husband’s TFSAs and my adult son’s RDSP (Registered Disability Savings Plan). The step for me and my husband after we know that all is as the US requires, will be expatriation — renunciation once and for all, with a Certificate of Loss of Nationality in hand, which will be my most important document. I still, though, have to somehow figure out how to have my son renounce the US citizenship he is said to have though he was born and raised in Canada, never registered with the US Consulate, never lived in the US nor had any benefit from the US. One does get weary. But I will (and you will) make it through this.

    Awareness and support for others in our situation is so important. Blogging as your part in this will help you gain strength with the realization that you are taking steps to do something constructive — for yourself, for your family and for others with less of a voice.

    Congratulations on your first steps.

    • Thanks, Calgary411. I admire your perseverance and bravery in going through this horrific and bizarre process to get compliant with the laws of a foreign country. We can only hope that our true government steps up to protect us – and sooner rather than later!

  2. Biblitz is having a bit of a dust-up with CRA at the moment over another matter which also involves tactics that can only be called fascism. I’m reading Anne Applebaum’s book on the history of gulags in the Soviet Union and there are disturbing parallels. I note with interest that CRA is now compelling jail time for small business owners purported to owe a few thousand dollars. Jail time! And the judges are going along with it.

    Mr. Harper has been very secretive about most things, I find, but to even consider signing an agreement to enforce FACTA, a law we did not even help create let alone pass in Parliament, is unconscionable. It’s an act of war, really, a deliberate smack at Canadian sovereignty. Surely no other country is even contemplating such an agmt.

    We’re giving you a boost at our Facebook blog in the hopes that others will write as you so eloquently have done to protest this act of cowardice and treachery by our federal govt.

  3. Alas, ignorance of the law is no excuse to break it, and tax authorities in both Canada and the U.S. pursue especially small business taxpayers very aggressively. Banksters and financial terrorists somehow get a free pass but that’s another story. That said, however, our tax treaty with the U.S. was created to prevent people like you from having to pay tax on the same income twice. I also run a tax blog, which provides contact info for a few advisers that have passed muster at least with me. Either their websites are helpful or they have helped clients. Feel free to visit and test the links for info. I think a good adviser could help you sort this fairly easily. I would think that providing copies of your Cdn returns to IRS would suffice. If no records, it should be possible without too much trouble to come up with reasonable estimates of what you would have paid based on previous returns and that year’s statute. We’re not expected to keep all of our records indefinitely. Something as regular as farming shouldn’t be all that difficult. If for some reason the tax treaty doesn’t assist to preclude double-recovery, you must take it up with the minister and prime minister.

    Leo Bibltz
    Vancouver, BC

    P.S. I did, in fact, prevail in my dispute with CRA. Gosh, what a fight, though, and over a grand total of about $5K. Senators and their lawyer husbands with offshore accounts to hide income rarely enjoy such attention, though this could change.

    • P.P.S. I did take my fight with CRA up with both minister and PM and minister intervened. CRA is still afraid of the minister and PM … for now. Happy to help anyone seeking similar gov’t intervention in a tax matter.

  4. I was born in the U.S. to a Canadian mother but have lived in Canada since I was a kid (I am now 38). I am a Canadian citizen and have always considered myself only Canadian. I have never worked in or earned income of any kind in the U.S. I was unaware that I was expected to file tax returns in the U.S. and to be honest I have no intention of complying now that I do know, as I consider the U.S. to be a foreign country (I have only even visited a handful of times in my adult life). My question is how my bank would know that I am considered a “U.S. person” under American law. I don’t think there is anything they would have on file that would identify me as such. I don’t have income from the U.S., don’t own property there, don’t have addresses there. How would the ID me?

  5. @Nick,sorry to hear you’re caught up in this mess. Right now your bank doesn’t know if you’re considered a US person or not. However, FATCA is set to go into effect this July. When/if it does, my understanding and belief is that anyone opening a new bank account will be asked to prove their non-US status to the bank. Banks will also be trolling through their accounts looking for US ‘indicia’ – any indication of ties to the US. What I don’t know, and I don’t think anyone does yet, is if something like this would kick in when renewing your mortgage, for example. Our only hope is to keep the pressure on our government to protect our rights. Banks requesting citizenship, and then informing on certain citizens to a foreign country is absolutely in violation of of our charter of rights and freedoms. For your own sake, I would highly suggest you do some research. Maplesandbox.ca has some really good information for people who’ve just found out about this mess. Good luck, and let’s hope Harper & Flaherty show some guts in defying the US.

  6. Hi, I’m US born, moved when I was 1 and moved to Canada when I was 4. Been in Canada ever since.

    I’m starting to put this mess together for myself but upon sitting in the accountant’s office, I was informed I need a Social Security Number before I’m to file taxes. I am making a trip to Washington state next week to apply for the SSN. (I will laugh if they give me a hard time at the border crossing regarding taxes as that’s the purpose of the trip)

    However, I’ve been told by my accountant that he will need about a week to prepare my returns. Once they are filed (I’m hoping early April), they will take upwards of 1 year for the IRS to process.

    I need to consider FBAR fines that I will not be able to pay. That said, I would like to take my young son to Disneyland for his first time (and potentially, our last trip to the US together) and I feel that I should do this sooner than later in case of FBAR fines.

    That all said, as you just made a trip to Las Vegas, do you think I would have issue travelling to the US on a CDN passport, with the understanding that I have filed my taxes via my accountant (with zero owing) and now am awaiting the IRS to process?

  7. @CBValley – first of all, I have to say I’m sorry to hear you’re caught up in this travesty. Secondly, I just have to ask – are you SURE that you need to get a SSN and file taxes? You’ve done nothing that could be considered an expatriating/relinquishing act? You became Canadian, right? When did you do that? I don’t mean to second guess you, but from other people’s stories, you are heading down a road from which there’s no going back. Of course, if you haven’t done anything that could be considered relinquishing, then obviously you need to do whatever is the best solution for you and your family, and what gives you the most peace of mind.

    Whatever you decide to do – don’t forget that the Canada Revenue Agency will NOT collect taxes or fines on behalf of the US government, as long as you were a Canadian citizen when the monies were earned. In your comment you do seem to have a Canadian passport, so depending upon when you became Canadian…

    So, past all that, and on to my trip. I travelled on my Canadian (and only) passport, which does show my place of birth as being the US. There was no mention made of that whatsoever – just the standard questions (business or pleasure). Nothing was asked about my citizenship, or taxes or anything else. I can’t guarantee anything, of course, but my experience, in Calgary, shows that we are still able to travel back and forth. Frankly I was concerned, but it turned out I had been worrying for nothing.

    So it seems to me you should be fine crossing the border in the near future.

    (But, I have to admit I’m concerned a bit about what might be coming down the pipe a year or so from now.)

  8. @CBValley: Do NOT get a SSN–at least not yet.

    May I ask what the accountant suggested you do?

    I’m glad to see you have posted some questions over at Maple Sandbox. I hope we can help you to work through this quagmire.

    Are you near Calgary or Edmonton? There are information sessions being held there in April, which you may want to attend before doing anything.

    There is information on the sessions at Maple Sandbox.

  9. Neither of these responses properly addresses the issue here and I seriously doubt that accountant has properly interpreted the law on either side of the border. The questions for you are these:

    Are you a Canadian citizen/resident for tax purposes?

    If so, does the cross-border tax treaty apply such that you are only required to pay tax in Canada? The purpose of the treaty is to ensure taxpayer pays just once.

    If not, how much is your potential liability to U.S. tax authorities and what defence/s, if any, are available to you to overcome it?

    What effect, if any, does the new FATCA have on your potential liability?

    Until you can answer these questions with sufficient authority, you would be a fool to risk crossing the border – a fool. Border guards are likely to detain you maybe for a good, long time. Few of us appreciate fully the machinery available to tax authorities in both countries. Once you are on U.S. soil, you are effectively theirs. Their laws and rules apply – not ours. The U.S. also not long ago unhelpfully overturned the old common law revenue rule that precluded nations from litigating foreign tax. Unless you know John Baird personally and he owes you a favor, it’s unlikely help would be forthcoming.

    Strongly suggest you satisfy yourself that you have no outstanding tax owing to the U.S. before you contemplate crossing the border.

  10. Thank you for the responses. To be brief:

    I obtained Canadian citizenship at the age of 8. I have been told that this would not be favorable in terms of relinquishment as I was too young to have intent to relinquish my US citizenship (although, now I wish I had accepted that BC government job a few years back)

    Yes – to file US taxes, I will need a SSN or ITIN. As a US citizen, I need a SSN. This is as per my local accountant.

    Are you a Canadian citizen/resident for tax purposes? No. I am a Canadian citizen and resident because that’s the life I want to live. I moved to Canada when I was 4. I have never set foot back in the US other than vacations. I am now in my 30’s. I have a home, family, job, life in Canada. I do not live in Canada for tax purposes.

    My accountant has already prepared my returns (waiting on the SSN) and I will not owe any monies. I am NOT worried about owing back taxes to the US as I have honestly filed taxed to CRA. I am worried about FUTURE FBAR penalties.

    At this point, I do not think I can relinquish. I can *try* but I think it will be denied. I think at this point, my path is:

    1) Obtain SSN
    2) File 3 years tax (2010 – 2012), 6 yrs FBAR.
    3) Later this year before June, file for 2013.
    4) In 2015, file for 2014 taxes. At this point, I will have 5 years under my belt and can begin the renunciation process (correct me if I am wrong in this process as I have read too many differing opinions).
    5) Renounce in 2015. Celebrate.
    6) In 2016, file 2015 taxes (to the point of renunciation) and whatever forms (not completely sure).
    7) Celebrate again.

    Please correct me if I’m wrong in any of the above or if there are grand things I am missing. Your input is greatly appreciated.

  11. @Leo
    You said: “Strongly suggest you satisfy yourself that you have no outstanding tax owing to the U.S. before you contemplate crossing the border.”

    I am unable to file US taxes until I have a SSN. I am only able to apply for a SSN in the US. I will need to cross the border to get it.

    To be honest, I am not worried about crossing the border at this juncture of the process. I mean, I would hope the border guard (if they gave me any grief at all) would see the necessity of my trip. The purpose of my trip is to be compliant. They are going to deny me the chance to be compliant because I am not yet compliant?

  12. Again, rely on accountant for a legal opinion and you risk detention if you cross the border. You would be well advised to take legal advice on citizenship for tax purposes to ensure you are taking proper steps to protect yourself. In my view, you are at serious risk.

    Remember that those born in the U.S. are forever U.S. citizens to U.S. authorities and as such you may find yourself having to prove from a U.S. jail cell how you paid tax in Canada all these years. It might be useful to have someone to call who has that information if in fact you are detained. I know about this b/c a householder chez Biblitz a few years ago did relinquish U.S. citizenship.

    In short, accountant may have prepared your taxes but can’t be held liable for not knowing the law. That would be beyond the scope of his expertise.

    Lawyers are usually unpleasant and always overpriced for the actual service one gets if you can call it that but once you retain them they are obliged at least to be accurate in their understanding of the law. If they make a mistake and it costs you, you can sue them. If accountant makes a mistake on applicable law, authorities would argue that you were a fool to rely on his advice and you would have to take your lumps. That’s the difference.

    As you wish to be Canadian rather than American SIN is the appropriate ID to carry.

  13. @Leo, while I agree with your statement to get legal advice on citizenship, I think you’re being quite alarming about possible detention. We’ve heard of NO ONE who has been detained – if we are wrong, and it is happening, please do let me know, as that’s very important information we need to share with people.

    @CBValley, another option is to DO NOTHING for the moment, until you manage to attend one of the information sessions to get some real facts and advice. The only reason you would have, I believe, to get a SSN and file taxes, etc,etc, is so that you can travel to the US in the future – IF things get tighter at the border re: asking ‘are you up-to-date on your US tax returns?’ or some such.

  14. People here in Canada are jailed often enough over unpaid GST of even a few thousand dollars! Clearly, you don’t read the tax cases. I do. I can only imagine how roughly the U.S. deals with foreign nationals they believe to be U.S. citizen tax evaders. They certainly have the authority to detain in those circs. and probably do.

    I am reminded of the U.S. prosecution of UK Internet gambling companies whose CEOs also believed they were operating within the law. The U.S. detained them at the border, instituted civil forfeiture proceedings against company assets and extracted a settlement that involved enormous fines. It destroyed the industry. Some were jailed. None of them believed in extra-territorial reach of U.S. law. Their lawyers, too, were unaware until it was too late.

  15. I backfiled my taxes two years ago and twice I called up the IRS international office in Philly and they said things were fine. But my tax situation is simple, I owed them a minus 4 thousand every year. I did not claim deductions because when you owe such a negative amount nothing needs to be claimed. I am happy to report that I was chatting with Peter Dunn on facebook the moment that the IGA was announced for Canada. I had a swear word. Outraged: please email me at kermit.ritland_at_ubc.ca. I like the picture of the glacier. I have always been a mountain person and this is coming back to haunt me. http://genetics.forestry.ubc.ca/ritland/cornice.htm. This guy did the real thing a month ago off the cornice on a mountain a couple miles away.

  16. Hi kermitzii, I modified your email address in the comment so it’s not as easily picked up by bots.

    I imagine you did have a swear word. I was SO disappointed, I actually did hope that the Canadian govt would protect it’s citizens. Naive me.

  17. Help.
    I am a Canadian born in the US who has only lived there for a total of seven years before the age of 14. I do not have a social security number. I have lived 40 years in Canada. I did not become a citizen until 2005, but have been travelling on that passport ever since. I married a Canadian and my children are not eligible to be naturalized through me. I have no intention of ever returning to the states and do not consider myself an American. I have recently heard about all this and feel overwhelmed and saddened at what it would take for me to comply, not the least of which is travelling to the United States just to get a social security number. I make very little money and have nothing to hide. How do I apply for a CLN and is this possible for me? Should I consult a lawyer? Thanks.

  18. Before you contemplate paying the exorbitant fees of an immigration lawyer, start here http://www.cic.gc.ca/english/citizenship/rules/index.asp to determine whether and how you would qualify. Your income and intention to remain are not determinative. Follow the links until you understand fully any gaps and what’s needed to overcome them. Kids should apply for citizenship cards ASAP.

    As you can see from the website, you are not at all alone. This in itself should make any procedure/s required to ensure Canadian status somewhat easier to bear.

  19. Leo,

    I have taken the oath to the Queen 10 years ago and have my Canadian citizenship card. My children are not eligible to be naturalized through me according to US law, as I did not live there after the age of 14. They are solely Canadian. I will try to relinquish, but the forms states that I should consult a lawyer before doing so. It also states that I need to sign it before a consular employee, which would still involve a 2.5 hour trip north. I want to make sure I fill out the form correctly. Any more advice you have would be much appreciated. Thank you.

  20. Sounds to me like you are pretty much free and clear. But the U.S. does have a long arm. See http://www.td.com/fatca/index.jsp for a good summary of tax implications:

    When does FATCA take effect?

    FATCA implementation begins July 1, 2014.

    Who is impacted by FATCA?

    Non-U.S. (“foreign”) financial Institutions will need to identify and report all “financial accounts” for specified U.S. persons and certain U.S. owners of non-U.S. entities. Financial accounts include bank, brokerage and other custodial accounts.

    What is the definition of a U.S. person?

    Under U.S. tax law, you are considered a U.S. person if you are:

    A citizen of the U.S. (including an individual born in the U.S., but resident in Canada or another country who has not renounced their U.S. citizenship.)
    A permanent resident of the U.S.
    A U.S. green card holder
    You may also be considered a U.S. person if you spend considerable time in the U.S. in one year or over a period of years.

    U.S. corporations, partnerships, estates and trusts are also U.S. persons.

    After that, see http://canada.usembassy.gov/consular_services/dual-citizenship.html, which provides:

    If you are a U.S. citizen who has acquired or plans to acquire Canadian citizenship, and you intend to relinquish your U.S. citizenship or wish to relinquish your U.S. citizenship, please discuss with the U.S. Embassy or Consulate the procedures necessary to formalize this. There will be a US$450 fee to document formal renunciation of U.S. citizenship. More information relating to the loss of citizenship is on this Travel.State.Gov information sheet. In addition, please review this page, regarding the making of a citizenship claim.

    When spouse relinquished all the ridiculously overpriced lawyer wanted to establish was that applicant would not be stateless. This happens in some cases and it’s difficult. There were some nervous moments at the U.S. embassy such that spouse was somewhat relieved to have mouthpiece there. One way or another, they seem to want to soak you for a min. $450. Ask embassy what the risks are in your case. Get it in writing! Then assess risk to determine whether mouthpiece worth the fee. It’s certainly free money for them. They don’t actually do much if anything.

  21. Just spoke with spouse, who reminded me of two issues mouthpiece resolved thereby earning his fee:

    The U.S. requires a statement of net worth that must be provided by an accting firm with special embassy approval. Mouthpiece arranged this. This cost about $800. Probably more now. Mouthpiece also assisted with forms. If you’re worth quite a bit as spouse was not the U.S. takes a final bite before they let you go.

    Mouthpiece also arranged the embassy mtg needed to complete the renunciation process. This required considerable back and forth, spouse reminded me. At the actual mtg, U.S. officials asked reason for renouncing. ‘I live in Canada, was born here, just trying to simplify my life including for tax purposes,’ was the reply.

    Atty was Ron Zisman in Vancouver. Spouse said he seemed to be known to embassy officials here which may have been helpful.

    Think of it as a one-time thing. You do this and it’s all over.

  22. @ProudlyCanadian,

    I am certain you must sign the CLN form before a consular employee, not so certain you MUST consult a lawyer. I know of several people who have relinquished who have not – however, you must do what feels right to you.

    To relinquish, you must have performed a relinquishing act, AND have done nothing to repudiate that afterward (ie travel on a US passport, pay US taxes, etc). Whether you qualify for a CLN is a particular to each person, there is no one determination for all – you must do some research on this. You can check out:

    http://maplesandbox.ca/2012/renunciation-and-relinquishment-what-are-the-differences-is-there-a-difference/

    particularly the section called Relinquishment by Other Means.

    Did you work for the federal govt at any point and sign an oath of allegiance, by any chance? Any supporting facts you have to convince the US state dept that you intended to relinquish and considered yourself a Canadian-only will help bolster your case for obtaining a CLN.

    Also check out some posts on the Isaac Brock Society:

    http://isaacbrocksociety.ca/department-of-state-forms-and-procedure-manuals-for-renouncingrelinquishing/

    and, again at Maple Sandbox,

    http://maplesandbox.ca/2014/synopsis-solving-u-s-citizenship-problem-london-ontario/

    I will also be applying for a CLN, which is a recent decision, and I haven’t started the process as yet. Personally, I don’t think I will be consulting a lawyer, but I WILL be running this by my cohorts at Maple Sandbox to make sure I’ve dotted my i’s and crossed my t’s.

    At both Maple Sandbox and Isaac Brock Society, no legal advice is given, it’s strictly personal advice, based upon people’s experiences and personal knowledge.

    Good luck with this. As for me, as I move through this process, I will be posting about it, I’m sure.

     

  23. I was born more than 55 years ago in the US and was only there because of an accident of birth. I was there only for my first two years on planet Earth and for more than 50 years have been a very proud citizen of Canada. I have never taken one plug nickel from the US and have never worked, studied or lived there. (Nor do I intend to.) In fact, as a tourist I have given them more than I’ve ever received.

    I only recently discovered when crossing the border into the US that I may be still considered a US citizen because I allegedly did not renounce properly when I became a Canadian citizen at age 17.

    I have contacted a couple of immigration lawyers who have suggested that the price for renunciation may be filing past tax returns of up to 5 years. To do that I would need a social security number which I don’t have. If I proceed I would be on the IRS radar. I’m wondering if a better strategy is to do nothing. Any comments on that?

    This approach by the US using FATCA is nothing more than blackmail goon tactics harbouring on extortion of law abiding people (and they call themselves a democracy. HA!! – is it any wonder why the US government is hated all over the world and even by their own citizens.) And what of our own Canadian government who are mushy and spineless to stand up for us.

    FOLKS we have a federal election coming up in 2015. I know I’ll be making some noises about this to the candidates. Hope you will do the same.

  24. @Azi Seeit, I’m truly sorry to hear you’ve been caught up in this. Before you get a SSN and start filing tax returns, which will tell the US that you consider yourself a US citizen, make sure you do all your research. There are some acts that you may have taken over the last 50 years which might help you relinquish rather than renounce. Did you by any chance ever work for the federal govt and sign an oath of allegiance? Did you work for a provincial govt and swear an oath?  I have heard that someone got their CLN based upon working for Alberta Health Services. And I”ve heard of several that successfully got their CLN based upon working for the feds.

    Some people will tell you to do nothing, others will say you have to come into compliance – just make sure you are very sure of what works best for you before you do anything.

    BTW, from my research, the US won’t recognize your (or mine) oath upon becoming a Canadian because we were minors, had not reached age 18. However, that, plus another relinquishing act could be what helps us get our CLN.

    I totally agree this is sheer blackmail. I hope you have written to your MPs and other politicians to tell them your story and how you feel. The more of us that do that, the better chance we have of having some influence.

    If the IGA goes through as planned, there will be a constitutional challenge – please check out maplesandbox.ca for more information on that. Me, I will most certainly be donating to that very worthy cause, although I don’t have a lot to give, I will give what I can.

    Research, research, research. Don’t just believe what the tax professionals tell you – it’s in their vested interest for you to pay them large sums of money!

  25. If you are a U.S. citizen who has acquired or plans to acquire Canadian citizenship, and you intend to relinquish your U.S. citizenship or wish to relinquish your U.S. citizenship, please discuss with the U.S. Embassy or Consulate the procedures necessary to formalize this. There will be a US$450 fee to document formal renunciation of U.S. citizenship. More information relating to the loss of citizenship is on this Travel.State.Gov information sheet. In addition, please review this page, regarding the making of a citizenship claim. See http://canada.usembassy.gov/mobile//consular_services/dual-citizenship.html.

    A person wishing to renounce his or her U.S. citizenship must voluntarily and with intent to relinquish U.S. citizenship:

    appear in person before a U.S. consular or diplomatic officer,
    in a foreign country (normally at a U.S. Embassy or Consulate); and
    sign an oath of renunciation.

    Renunciations that do not meet the conditions described above have no legal effect. Because of the provisions of Section 349(a)(5), U.S. citizens cannot effectively renounce their citizenship by mail, through an agent, or while in the United States. In fact, U.S. courts have held certain attempts to renounce U.S. citizenship to be ineffective on a variety of grounds, as discussed below. See the rest here http://travel.state.gov/content/travel/english/legal-considerations/us-citizenship-laws-policies/renunciation-of-citizenship.html.

    On the facts you provide I see no reason to file US tax returns. The Canada-US tax treaty was executed to prevent double taxation. It still has force and effect. This should protect you when the U.S. consulate reviews your estate before they allow you to renounce. They will tell you what you need to bring on the day – probably Cdn tax returns, title to real estate you may own here – that sort of thing.

    What’s galling about FATCA is the privacy breach and the not insignificant fee attached to an obligation created by a foreign govt to ‘turn yourself in’ by deliberately placing yourself on the US radar. This is a new obligation created by the US solely for the enrichment of the U.S. Canada pays for increasing US access to our assets and personal information. It flies in the face of so many democratic principles but Canada under Harper signed on. And we have no Opp anymore in this country.

    This guy http://www.blakes.com/English/WhoWeAre/FindPerson/Pages/Profile.aspx?EmpID=101698 was advising Flaherty against signing. I plan to write to him regarding the possibility of legal action. The banks here should find a way to make the US pay for this outrage. They have legions of lawyers on staff for this sort of thing. Hogg gets a lot of credit for const’l mojo. Let’s see what the great man has to say about it now.

  26. I worry that the mere act of walking into the US Consulate and making inquiries puts me on “their” radar. A friend told me of an incident where she made such an inquiry (didn’t actually renounce) and was later harassed at the border when entering into the US. The customs official saw on his screen that she had made an inquiry and grilled her.

    Does just the mere act of inquiring with the Consulate then also put me on the IRS radar?

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  28. Yes, walking into the embassy without an appointment is an invitation to trouble. No reason to do it. You research renunciation online, prepare, update and assemble your documents, consult atty if necessary, then you make appointment at your nearest U.S. embassy, where an official will review your ‘estate’ (they think of you as dead to them) and final tax records and so on as well as your citizenship to ensure you will not be stateless.

  29. Just saw this one – http://www.economist.com/news/leaders/21605907-americas-new-law-tax-compliance-heavy-handed-inequitable-and-hypocritical-fatcas-flaws – in The Economist. Worth a read.

    ‘The costs of complying with FATCA are likely to dwarf the extra revenue it raises (see article). The law is also having unfortunate unintended consequences. The 7m Americans living abroad now wear a scarlet letter (presumably an “F”), thanks to FATCA. Many have been rejected by foreign providers of banking services, insurance and mortgages because, given the amount of paperwork needed to satisfy Uncle Sam, American clients are simply too much hassle. Foreign firms are less keen to hire Americans because of the extra tax complications. Not surprisingly, the number of Americans renouncing their citizenship has quadrupled since FATCA was hatched.

    Moreover, American citizens are not the only victims. The law’s definition of a “US person” includes green-card holders and anyone with a substantial connection to the country, whatever that means. Nobody knows—so yet more confusion, and yet more fees for lawyers and accountants.’

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