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When ”Beneficial Ownership” Constitutes A Financial Interest And Triggers An FBAR Requirement

When ”Beneficial Ownership” Constitutes A Financial Interest And Triggers An FBAR Requirement

September 29, 2022

September 29, 2022 ...

 

When it comes to an FBAR filing requirement a recent decision in the Katholos case confirms:

“Although an ownership interest in an entity would certainly be considered a financial interest in that entity, ownership is not necessary to have a financial interest."

_______________________________________

 

Virginia La Torre Jeker - @VLJeker

and

John Richardson - @Expatriationlaw

discuss this issue in the context of the life of Americans abroad.

On August 10, 2022 a US District Court issued a ruling on the ongoing Katholos FBAR saga.

https://casetext.com/case/united-states-v-katholos

 

Of particular interest is the following paragraph:

 

"Here, it is undisputed that Katholos was a beneficial owner of the Storchen Finance Account. In general, a “beneficial owner” is “[o]ne recognized in equity as the owner of something because use and title belong to that person, even though legal title may belong to someone else; esp., one for whom property is held in trust.-Also terms equitable owners Owner, Black's Law Dictionary (11th ed. 2019). Though Katholos denies that her status as a beneficial owner is “tantamount to having a ‘financial interest' in the account that may give rise to the FBAR reporting requirements,” Dkt. 98-1, ¶ 25, the Court concludes that, as a beneficial  owner, Katholos had an equitable claim or right to the Storchen Finance Account- even if she did not have legal title. And because “interest” includes equitable rights to property, Katholos's arguments regarding legal title, who funded the account, and direct interest are not dispositive. See Continental Cas. Co. v. Bowen, No. 2:09-cv-00810-TC2011 WL 222340, *4 (D. Utah Jan. 21, 2011) (“Although an ownership interest in an entity would certainly be considered a financial interest in that entity, ownership is not necessary to have a financial interest.”). Thus, based on her status as a beneficial owner, the Court concludes that Katholos had a financial interest in the Storchen Finance Account."

Bottom Line: The Katholos decision reinforces the principle that one can't avoid the FBAR filing requirement by keeping your name off the account.

 

 

 

 

@MiAzhikwan - The Importance Of Love - The First Lesson

@MiAzhikwan - The Importance Of Love - The First Lesson

September 27, 2022

September 27, 2022 - Participants include:

Janine Seymour - @MiAzhikwan

 

John Richardson - @Expatriationlaw

 

Love  As An Antidote To Fear - The First Lesson

MiAzhikwan is a lawyer, LL.M., independent candidate and a member of the Bear Clan near Kenora, Ontario in Treaty Three Territory.

 

This is my third podcast with MiAzhikwan. The first was during her run as an independent candidate in the May 2022 Ontario election:

https://independentcandidates.substack.com/p/meet-janine-seymour-aka-miazhikwan#details

The second was on September 5, 2022 and explored the teaching of forgiveness:

https://independentcandidates.substack.com/p/miazhikwan-choosing-forgiveness-the#details

 

 

@MiAzhikwan -  Choosing Forgiveness - The Eighth Lesson

@MiAzhikwan - Choosing Forgiveness - The Eighth Lesson

September 19, 2022

September 5, 2022 - Participants include:

Janine Seymour - @MiAzhikwan

 

John Richardson - @Expatriationlaw

 

Forgiveness - The Eighth Lesson And Letting Go Of Rage

MiAzhikwan is a lawyer, LL.M., independent candidate and a member of the Bear Clan near Kenora, Ontario in Treaty Three Territory.

 

This is my second podcast with MiAzhikwan. The first was during her run as an independent candidate in the May 2022 Ontario election:

https://independentcandidates.substack.com/p/meet-janine-seymour-aka-miazhikwan#details

 

 

 

 

 

When It’s All Said And Done (And It’s Done): ”All Roads Lead To Renunciation”

When It’s All Said And Done (And It’s Done): ”All Roads Lead To Renunciation”

September 16, 2022

September 16, 2022 - Participants Include:

John Richardson - @ExpatriationLaw

Keith Redmond - @Keith__Remond

Anthony Parent - @IRSMedic

_______________________________________________

My (John Richardson) interpretation of the current situation:

 

1. The problems experienced by US citizens living outside the United States can be solved ONLY by severing US citizenship from US tax residency. In other words: citizenship cannot be the criterion for being subject to the Internal Revenue Code. No other country in the world (except Eritrea) imposes worldwide taxation based on and only citizenship. All other countries in the world have residence based taxation which means that residence and not citizenship is the criterion for tax residency. The only way to solve the problems for all Americans abroad, in all circumstances and for all time is to sever citizenship from the definition of US tax residency.

2. There is a difference between a "wish" and a "goal":

"The dictionary defines a wish as: to want; desire; to long for. Goals on the other hand are defined as: the result or achievement toward which effort is directed. The difference is profound not only in semantics, but also in how each can shape your thought process, your actions (or lack of), and ultimately, your life."

3. Individual Americans abroad have a "wish" for residence based taxation. That said, "residence based taxation" is NOT their goal. Their goal (if any) is to solve "their" problem (how they experience citizenship taxation) and not "the" problem "citizenship taxation itself. For example, solving the FATCA problem will NOT solve the problem of citizenship taxation.

4. No organizations except SEAT and Republicans Overseas have the specific goal of severing citizenship from tax residency.

5. Without pressure from large numbers of individual Americans abroad (which simply doesn't exist)  there is no political impetus for any legislative change to residence taxation.

 

In summary, there is little support for the "goal" of severing citizenship from tax residency.

In addition ...

The situation for Americans abroad is NOT getting better and has in fact gotten worse over the last ten years. I will continue to work with "like minded" people and "organizations" to achieve the goal of severing citizenship from tax residency. That said, this will take more time than this generation of Americans abroad has!

What all of this means is that ...

"All Roads Lead To Renunciation" (as soon as that goal is possible). 

For Good And Evil: The Teaching Of Charles Adams Lesson 17
For Good And Evil: The Teaching Of Charles Adams Lesson 16
Jim Bennett Of Fair Tax: Taxation, Fairness And Fairness In Taxation Both At Home And Abroad

Jim Bennett Of Fair Tax: Taxation, Fairness And Fairness In Taxation Both At Home And Abroad

September 2, 2022

September 2, 2022 - Participants Include:

Jim Bennett - @FairTaxOfficial

John Richardson - @ExpatriationLaw

Adopting the Fair Tax would create fairness in taxation for both US residents and Americans abroad. Generally the Fair Tax would:

- simply the tax code (The Fair Tax is only 131 pages)

- remove the need for the IRS

- move the United States to a system of territorial taxation

- end the practical application of US citizenship taxation

- ensure that every US resident actually paid federal tax

- and more ...

How will the increase in IRS funding impact the culture of taxation in the United States?

Previous podcasts with Jim Bennett and Steve Hayes include:

How The Fair Tax Would End Tax Residency, Worldwide Taxation And Taxation Of Americans Abroad - March 17, 2022

Rethinking Taxation: Continuing The "Fair Tax" Discussion With Jim Bennett And Steve Hayes - April 13, 2022

Steve Hayes Of FairTax.org: When It Comes To Taxation "Simplicity Is Virtue" (And Moral) - June 4, 2022

 

 

 

 

Request To Contribute To The Book Of: ”Letters Of Americans Abroad To Their Congressmen”

Request To Contribute To The Book Of: ”Letters Of Americans Abroad To Their Congressmen”

August 27, 2022

August 26, 2022 - Participants Include:

SEAT President Dr. Laura Snyder - @TapInternation

John Richardson - @ExpatriationLaw

Send us your letters to: letters at seatnow dot org

_________________________________

 

The “Readers Digest” Version – SEAT Seeks Copies Of Your Letters To Your Congressman And Their (Non) Response In Order To Create A “Book Of Letters”

Background – People Have Been Writing Their Congressmen and Congresswomen: Americans abroad are constantly encouraged to send letters to their Congressmen and Congresswomen requesting changes to the US tax rules impacting Americans abroad. Thousands of individuals have sent letters. In almost all cases the responses are notable only in that they reflect little awareness, understanding or concern about the impact of citizenship taxation on the lives of Americans abroad. In short, the responses indicate that Congress doesn’t care.

Objective – To Create A Book Documenting The Letters Of Individuals And The Lack Of Response To Their Letters

In 2014 Patricia Moon, as part of a submission to the Senate Finance Committee, created a fantastic 192 page book which compiled certain comments of Americans abroad in Social Media channels. That book was an amazing “Message In A Bottle” which documented the horrors inflicted on Americans abroad. That book was intended to provide a “snapshot” of the lives of Americans abroad. It was not specifically for the purpose of documenting the “Cries For Help” that individuals have written to Congress. The purpose of this book is to document those letters expressing those “Cries For Help” and lack of response. Dworkin would say that citizens are entitled to the “equal concern and respect” of the legislatures. The responses to the letters from Americans abroad suggests that citizens abroad receive no concern or respect from Congress.

What We Are Asking You To Do:

1. Find your letters to your representatives and/or letters you have written to the Senate Finance Committee. Please prepare them in a word file (deleting your hame and address if you wish).

2. Find the response from from your representative. Please delete any information that identifies you.

3. Please email both attachments to: letters at seatnow dot org

Our goal is to create a book which documents the difficulty of motivating your Congressional Representatives to acknowledge, understand and respond to the issues facing US citizens who live permanently outside the United States.

http://seatnow.org/2022/08/16/proposed-publication-letters-from-americans-abroad-to-their-congressmen-and-women/

 

Treating Plantar Fasciitis And Treating FATCA Both Require Focusing On The Original Source Of The Pain

Treating Plantar Fasciitis And Treating FATCA Both Require Focusing On The Original Source Of The Pain

August 25, 2022

August 25, 2022 - Participants Include:

Personal Trainer Coach Coutts - @CoachCoutts1

John Richardson - @ExpatriationLaw

 

_________________________________________________

 

The problem of plantar fasciitis does not originate in the feet. Its treatment depends on determining the cause and treating that cause (possibly a focus on the lower back or neck).

The problems of FATCA and other ailments affecting Americans abroad  originate with the "original sin" of US citizenship taxation. The treatment of those problems is to join the movement to end citizenship taxation.

Ending citizenship taxation with end the tax problems of ALL Americans abroad, in ALL circumstances for ALL times!

 

 

 

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For Good And Evil: The Teaching Of Charles Adams Lesson13
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