More Ex-Pats Living In Canada Because Of U.S. Tax Crackdown. Happy Fourth!
Remember when liberals who didn’t want to go to war were called unpatriotic for moving to Canada? Well, it’s likely those who object to paying their fair share of taxes aren’t the libs. Now who is running scared from America?
D.B. Hirsch is a political activist, news junkie, and retired ad copy writer and spin doctor. He lives in Brooklyn, New York.
Anomaly 100 July 4th, 2014 at 8:43 am
Good. Let them go. Be gone!
mea_mark July 4th, 2014 at 8:54 am
We better get catch some really big tax cheaters or we are sacrificing Americans living abroad for nothing. It really is shameful how we treat Americans that are no longer living in the states. It is like they don’t count at all anymore. There really should be some sort of representation for them in American government. They are after all American, at least until they are forced to give up their citizenship because of the way they are treated by their government.
Carla Akins July 4th, 2014 at 11:32 am
Exactly. Shouldn’t this effort be focused on American’s living in America yet hiding their assets abroad – like the Caymans?
Dwendt44 July 4th, 2014 at 12:30 pm
“:There really should be some sort of representation for them in American government.”
Why? Citizens of Washington D.C., Porto Rico, and the several U.S. possessions in the Pacific have no real representation in American government. They have a ‘non voting’ delegate that has no power and little, if any, influence in the matters that affect them.
mea_mark July 4th, 2014 at 12:57 pm
It used to be taxation without representation. What we have now is excessive taxation and regulation without representation. I guess you don’t have your right to privacy either when living abroad. I really do hope that we can kick enough republicans out of congress soon, so we can start fixing things.
Robert M. Snyder July 5th, 2014 at 12:04 am
If I recall correctly, the Republicans tried to repeal FATCA in January 2014.
Flspeedy July 4th, 2014 at 10:11 am
If they are avoiding paying U.S taxes on money that the are earning working in Canada , then I agree that this amounts to unfair taxation. However , if their income is coming through working in the U.S and living in Canada , or if they are reaping the benefits of investments in U.S financial markets , then I have absolutely no sympathy for them. And I wonder how many of them are using the same dual citizenship gambit to avoid paying the considerably higher Canadian taxes too?
mea_mark July 4th, 2014 at 10:37 am
The law was poorly written and puts undue duress on innocent Americans while trying to catch tax cheats. If we had a functional congress this could be fixed. Unfortunately congress is inept and the people being affected by this the most don’t have representation. So in the end nothing is getting done and we are giving the shaft to Americans living abroad, just because.
Flspeedy July 4th, 2014 at 10:51 am
This is the first I’ve heard of the law , so I don’t yet know what it entails , but given the present state of our Congress , it wouldn’t surprise me in the least to find that it’s a hot mess. I do find it amusing though that people that have and aversion to taxes would choose Canada as a haven. Our present tax levels are relatively cheap in comparison.
Robert M. Snyder July 4th, 2014 at 11:15 am
I don’t think people are fleeing to Canada to avoid US taxes. But people who were born in the US will have US citizenship, even if they have lived their entire lives in Canada where they paid Canadian taxes. The US government requires all US citizens to file a tax return with the IRS every year, but this was never enforced in the past. Now the US is requiring all foreign banks to identify all of their clients who have US citizenship. The banks will pay a financial penalty in their dealings with the US if they don’t comply. So many people who never set foot in the US since birth will be required to pay back taxes and penalties owed to the US government. This amounts to extortion (against the foreign banks) and double taxation (of “accidental Americans”). The intent of the FATCA was to prevent wealthy Americans from moving money overseas to avoid taxation. The problem is that the law is poorly designed, and it is having serious unintended consequences. There are only two countries on earth that require you to pay domestic tax on income that you earn abroad.
Robert M. Snyder July 4th, 2014 at 10:39 am
A similar situation exists in Germany where someone who is born into a Catholic, Protestant, or Jewish family is required to pay the Kirchensteuer (church tax) which amounts to 8-9% of annual income. In order to avoid the tax, a person has to make an official declaration that they are leaving the faith, after which they are no longer permitted to participate in confessions, confirmation, become a godparent, or participate in parish activities. More than 181,000 German Catholics left the church in 2010, and 126,000 left in 2011. It appears that religion and citizenship are both accidents of birth that can be costly in adulthood.
Carla Akins July 4th, 2014 at 11:30 am
I’m not sure how I feel about taxing people of faith, but I sure as hell am in favor of taxing the churches themselves.
Robert M. Snyder July 4th, 2014 at 12:20 pm
Many people who are not affiliated with religious communities selflessly donate their time and resources to charitable causes such as giving rides to seniors who can no longer drive or cutting a disabled neighbor’s lawn every week. Some commercial businesses also donate staff time and resources for the benefit of their communities. I don’t think the government should be in the business of trying to decide which organizations are “charitable” and which are not. So I would prefer to see all organizations treated equally, including commercial, religious, charitable, educational, and political. Education has become a big business, and many religious and charitable organizations provide lavish accommodations and salaries to their directors. Just keep it simple and treat all organizations alike, IMO.
Carla Akins July 4th, 2014 at 12:45 pm
I agree, believing in an imaginary Deity should not exempt you from paying your share of taxes (I’m talking to you Joel Osteen) I am fine with a non-tax status for a true charity. Homeless shelter, food kitchen, orphanage but things like the NFL and state colleges that that earn millions due to their sports programs, not so much. As for churches, both they and their property holdings should be taxed. If segments of their church provide actual charity (food pantry/orphanage) those segments can remain non-taxable but not the rest. As for that part charity, part political groups 501/503 – those should simply go away. It’s simply a disaster and inducement for cheating.
arc99 July 4th, 2014 at 10:54 am
So Canada has a lower tax rate and universal health care? You mean “socialist tyranny” actually costs less than corporate slavery, er I mean freedom? All those right wing talk radio entertainers and bloggers were wrong? How could that be?
I am stunned!
Happy Independence Day everyone.
Robert M. Snyder July 4th, 2014 at 11:24 am
People who have lived all of their lives in Canada and paid Canadian taxes, but who also have US citizenship because they were born in the US, are expected to pay income tax to the US government by virtue of their US citizenship. So the issue is not whether taxes are higher or lower in Canada. The issue is double taxation. Before FATCA, these “accidental Americans” flew under the radar screen, and many probably didn’t even realize that they had US citizenship or that the US government expected them to pay income taxes to the US. FATCA changes that by requiring all foreign banks to supply the IRS with the identities of any clients who happen to have US citizenship.
Dwendt44 July 4th, 2014 at 4:26 pm
Since this seems to be a growing and contentious problem, why not a reciprocity agreement with Canada like some states have with other states that border them. Taxes would be which ever is higher, with those taxes paid to the lower as an offset.
mea_mark July 4th, 2014 at 4:37 pm
FATCA is actually pretty complicated in other areas as well as just taxes. If you want to look into the issue a little more I would recommend going here for some opinions and articles https://www.democratsabroad.org/group/fbarfatca