Tag Archives: Keith Redmond

Impressions of the @RepMarkMeadows April 26/17 #FATCA Hearing in Washington, DC – Opportunity to make case to end “taxation-based citizenship”

FATCA Hearings in Washington, DC – April 26, 2017

Beginnings – It all began in July 2016

The purpose of this post is NOT to describe the hearing in detail (that has already been well done), but rather to provide my overall (and perhaps broader) impressions based on actually having attended the hearing.

The April 26, 2017 FATCA hearing in Washington was long in the making. It’s genesis was rooted in a meeting that took place in July of 2016 at the Republican National Convention. The planning and preparation involved the efforts and consistent cooperation (weekly meetings since August) of a number of people in different countries and on different continents. It was a privilege to have been part of this group. A list of the people who worked on making the hearing happen – the  “FATCA prep team” – is  described here. Those efforts culminated in what some  witnessed “in real time” on April 26, and what thousands more will see (thanks to Youtube) in days to come.

The hearing has already been documented IN DETAIL and discussed in various places IN DETAIL, with the best commentary coming from posts at the Isaac Brock Society here and here and various Facebook groups here, here, here and here. (An example of ridiculous commentary is here.) When I say “commentary” I mean NOT ONLY the posts, but the rich and insightful comments. Seriously, this collection of “digital experiences” really is “History In The Making!”

Thinking about FATCA, What is it anyway?

I have written numerous posts about FATCA – “The Little Red FATCA Book” which you will find here. An explanation of how the Meadows “Repeal FATCA” bill would actually work is here. Basically, FATCA is the collective effect of a number of amendments (including the creation of a new Chapter 4 of Subtitle A of the Internal Revenue Code – which has made largely irrelevant by the FATCA IGAs)  which are designed to identify, attack and impose sanctions on:

A. FATCA: Non-U.S. banks and other financial institutions

Forcing them to “hunt down” the financial accounts and entities (examples include mutual funds, corporations, trusts and some insurance policies) owned by “U.S. persons”. The goal is to “turn them over” to the IRS.

This imposes enormous compliance costs on non-U.S. banks. The obvious effect is that they will not want  U.S. person customers. Would you? Interestingly the focus of the witnesses (Mr. Crawford and Mr. Kuettel) was primarily on the denial of basic access to financial and banking services.

Although important, this is only one half of the equation. What happens when “U.S. persons” learn (the vast majority had no idea) that they are subject to U.S. taxation?

B. FATCA: “U.S. Persons” with non-U.S. financial assets and bank accounts

It is not possible for “U.S. citizens” to BOTH: be U.S. tax compliant and live a productive life outside the United States, when they are also subject to the tax laws of other nations. (Digital nomads are the exception.) The reason is that U.S. citizens living outside the United States are living under a system where:

  1. They are presumed to live in the United States (which they don’t); and
  2. Their assets (which are local to them) are presumed to be “foreign” to the United States.

If you don’t understand (or don’t believe) why this is true, you will find an explanation here.

Just remember:

“When In Rome, Live As A Homelander” and do NOT “Commit Personal Finance Abroad!” (It’s UnAmerican)

Although a major effect of FATCA is to subject Americans abroad to a very special set of tax rules (think PFIC, foreign pension, CFC, and a crushing burden of forms that impact ONLY Americans abroad), there was NO witness that even alluded to this as one of the effects of FATCA. (FATCA is the enforcer of the uniquely American policy of “taxation-based citizenship”). There was also no witness that described how a “FATCA letter” can lead to absolute financial ruin for honest taxpayers, who have made a life outside the friendly borders of the United States of America. There was no witness who explained the confiscatory effects of entering one of the IRS “Amnesty – Ministry of Love” programs.

This had had the effect of making it seem as though FATCA (in terms of the effect on Americans abroad) was just a simple “disclosure – Form 8938 issue. Nothing could be further from the truth.

If it were not for “taxation-based citizenship”, FATCA would be no more or less a problem for Americans abroad than it would be for Homelanders (which doesn’t mean it is not a problem). Unfortunately, the hearing did not provide evidence on this point.

(This is NOT a criticism. But, just imagine if there had been witnesses who had been identified as a “U.S. Person” because of FATCA, did NOT know about “taxation-based citizenship” and then were forced into the “Offshore Voluntary Disclosure Program“. Now that would have been a story …!)

It is “taxation-based citizenship” that makes the effects of FATCA so hard on Americans abroad! In 2011, I remember thinking:

The United States can have either FATCA or it can have “taxation-based citizenship” but it CANNOT have both!

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Searching for Uncle #FATCA: Where is he? What does he do? Why is he a danger to America? Can Congressman Meadows and Senator Paul save America?

Outline:

April 7, 2017

Part 1: Prologue – Introducing  Uncle FATCA – Who is he? What does he mean in your life?

Part 2: What is FATCA, what are the FATCA IGAs, what is the Meadows Bill and how do these things interact?

Part 3 – What does it mean to repeal FATCA and how exactly does the Meadow Bill repeal FATCA? A section by section analysis

Part 4: An important reminder – FATCA repeal does not mean IGA repeal

Part 5: The text of FATCA and the text of the Meadows Bill (very dry and technical and not likely to be of interest to the casual reader)

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Prologue: What God Hath Wrought – The #FATCA Inquisition (Review, Identify and Report on “U.S. Persons”) – #Americansabroad and forced renunciation of US citizenship

U.S. Citizenship Abroad in a FATCA and FBAR World

FATCA has inflicted pain on the world. The pain has been most acutely felt by those with a U.S. place of birth. The following report is shocking in its brutality.

Listen to the pain and anguish of the woman interviewed who can’t have a bank account simply because she is a “U.S. person”. Listen to the language she uses. Jen is proud to be an American, feels that she is being forced to renounce U.S. citizenship, and considers the current U.S. government to be a “bunch of extortionists”. She is clearly suffering extreme pain and anguish. Listen to the French citizen and resident, who doesn’t speak English and is claimed by the United States to be a “U.S. person”. Then listen to the unnamed “Voice of the Obama Administration”, which says:

“The U.S. Treasury Department has worked tirelessly to address many of these problems and most have been resolved. All you have to do is look to see how many countries have agreed to the law and how many financial institutions have signed on to the law.”

Clearly the voice of the Obama administration is either a liar or is delusional.

How we got there – A brief backgrounder on “how many countries have agreed to the law and how many financial institutions have signed on to the law”

FATCAHunt2

As you know the U.S. Government is hunting for those they consider to be “U.S. persons”. The hunt is taking place outside the United States. The hunt is intended to identify the residents and citizens of other nations that the U.S. chooses to define as “U.S. persons”. The vast majority of those deemed to be “U.S. persons”, are deemed so because they were born in the United States. To put it simply: The United States exercises taxing jurisdiction based on reasons that include “place of birth”. The fact that somebody is a citizen and resident of another nation is irrelevant. If you were born in the United States, then you are subject to U.S. law and control wherever you may reside. The only defense is to have “relinquished U.S. citizenship”. Relinquishment is a broad term that includes “renunciation”. President Obama promised “change you can believe in”. President Obama delivered. The most enduring legacy of the Obama presidency will be that he has made a “Certificate of Loss of U.S. Nationality” (“CLN”) the most sought after document in the world today.

Furthermore, the United States and the United States alone decides who is a U.S. citizen.

See comments about the BBC Interview here and here.

Some of the interesting comments include:

Great job Keith. Hearing Jen (?) speak was very powerful. Even with understanding what is going on with this mess, to hear her speak just opened the wound a little wider if possible.

How they cannot see how absolutely disgusting CBT/FATCA is and how “exceptionally” abusive they are I will never understand. This mess has taught me what hatred feels like, something I could have well lived without.

and

Made my blood pressure boil hearing Treasury quoted as saying the rest of the world wants FATCA – Mythster Stack is a &%#*}#!!!!

and

Giving up US citizenship is not an alternative. It is a last resort solution. Cutting off one’s arm to escape the trap. One doesn’t get rid of a problem by getting rid of the victims of the problem. The only real solution to this problem is for the US to adopt residence as a standard for taxation, the same as every other country in the world. Only then will non-resident US citizens be placed on an equal footing with other non-resident citizens from other countries and no longer have to suffer the consequences of discrimination.