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Discussion about current events, culture, independent candidates, business, education, travel, death and taxes, global mobility, citizenship and residence by investment options, Americans abroad, FATCA, CRS, U.S. citizenship renunciation, Green Card abandonment, citizenship taxation, PFIC, GILTI, foreign trusts, I-407 and more ...
Wednesday Jan 26, 2022
Wednesday Jan 26, 2022
January 26, 2022 - Participants Include:
LJ Eiben - Raymond James - @L_Eiben
John Richardson - @Expatriationlaw
Mr. LJ Eiben first participated as a guest in November of 2021 when we discussed US Social Security for Americans abroad. Today he returns for a discussion about Canada Pension Plan and Old Age Security.
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Mr. LJ Eiben is a Financial Advisor at Raymond James.
The information in this podcast was obtained from sources RJA and believed to be reliable; however, we cannot represent that it is accurate or complete. It is provided as a general source of information and should not be considered personal investment advice or solicitation to buy or sell securities. The views expressed are not necessarily those of Raymond James (USA) Ltd. Raymond James (USA) Ltd. (RJLU) advisors may only conduct business with residents of the states and/or jurisdictions for which they are properly registered.
Raymond James (USA) Ltd. is a member of FINRA / SIPC
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Financial planning has become a necessity for all individuals and families. US citizens living outside the United States face particularly difficult hurdles. Much of this is the result of the requirement of filing taxes in both Canada and the United States. What one tax system gives, the other taxes. As a result, it is essential that US citizens receive specialized financial, investment, tax (and even life) advice. In general the receipt of US Social Security is NOT dependent on being a US citizen. Hence it is available to all individuals who "paid into the system" without regard to citizenship. It is available to Green Card holders returning home, US citizens living abroad and those who renounced US citizenship.
Raymond James as a "cross border platform" which means that (in general) it can hold US investments in Canada for Canadians.
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Canada Pension Plan And Financial Planning:
When it comes to Canada Pension Plan it's important to NOT leave money on the table. In this podcast Mr. Eiben gives his reasons for why it may make sense to delay receiving Canada Pension Plan to age 70 which will result in significantly higher payments. In addition, those higher payments will result in higher spousal/retirement benefits!
Wednesday Jan 26, 2022
Wednesday Jan 26, 2022
John Richardson - @Expatriationlaw
Jimmy Sexton - @JimmySextonLLM
Continuing our podcast series:
For Good And Evil Podcast 1 - October 25, 2021
For Good And Evil Podcast 2 - November 1, 2021
For Good And Evil Podcast 3 - November 8, 2021
For Good And Evil Podcast 4 - November 15, 2021
For Good And Evil Podcast 5 - November 22, 2021
For Good And Evil Podcast 6 - November 29, 2021
For Good And Evil Podcast 7 - December 7, 2021
For Good And Evil Podcast 8 - January 10, 2022
For Good And Evil Podcast 9 - January 17, 2022
In this episode we continue the teaching of Charles Adams - Lesson 10:
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10. "Tax exemptions are inherently unjust unless they actually apply to everyone. If the constitutional principle of equality before the law is ever applied to taxation, then those in control of tax making must bear the same taxes as those on the outside. This means that in an aristocracy or oligarchy, the few would have to bear the same taxes as the many, and in a democracy, the many should bear the same taxes as the few."
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Sunday Jan 23, 2022
Sunday Jan 23, 2022
John Richardson - @Expatriationlaw
Jimmy Sexton - @JimmySextonLLM
Continuing our podcast series:
For Good And Evil Podcast 1 - October 25, 2021
For Good And Evil Podcast 2 - November 1, 2021
For Good And Evil Podcast 3 - November 8, 2021
For Good And Evil Podcast 4 - November 15, 2021
For Good And Evil Podcast 5 - November 22, 2021
For Good And Evil Podcast 6 - November 29, 2021
For Good And Evil Podcast 7 - December 7, 2021
For Good And Evil Podcast 8 - January 10, 2022
In this episode we continue the teaching of Charles Adams - Lesson 9:
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9. "Consent is required for all lawful taxation, either by long-standing custom or by the common consent of the taxpayer. When a state taxes without bona fide consent, regardless of the equities or the reasonableness of the tax, rebellion and civil disobedience are justified."
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Sunday Jan 23, 2022
Sunday Jan 23, 2022
John Richardson - @Expatriationlaw
Jimmy Sexton - @JimmySextonLLM
Continuing our podcast series:
For Good And Evil Podcast 1 - October 25, 2021
For Good And Evil Podcast 2 - November 1, 2021
For Good And Evil Podcast 3 - November 8, 2021
For Good And Evil Podcast 4 - November 15, 2021
For Good And Evil Podcast 5 - November 22, 2021
For Good And Evil Podcast 6 - November 29, 2021
For Good And Evil Podcast 7 - December 7, 2021
In this episode we continue the teaching of Charles Adams - Lesson 8:
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8. "Taxpayer discontent threatens the peace and prosperity of the social order, more so than misbehaving taxpayers do; consequently the criminal arm of the tax system should be directed against oppressive tax agents rather than angry taxpayers."
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Friday Jan 21, 2022
Friday Jan 21, 2022
January 21, 2022 - Participants include:
John Richardson - @Expatriationlaw
Jim Gosart - Vice-President Republicans Overseas
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Attention! We are entering "International Waters"! US Citizens be advised that you may now be subject to double taxation!
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To Whom Much Has Been Given, Much Is Expected!!
Yes, it's true! A US citizen, because and only because of the combination of US citizenship-based taxation coupled with living outside the United States, is likely to be subject to double taxation. The following discussion explains why.
Part A: Introduction – About Citizenship-based Taxation
Part B: How the Internal Revenue Code is designed to mitigate the effects of double taxation in certain circumstances
Part C: Determining what is “foreign source” income
Part D: The problem of international waters …
Part E: The effect of sourcing to the US income earned in international waters by dual tax residents
Part F: Deducting “foreign taxes” paid – although income from international waters may not be foreign, it is still subject to the payment of “foreign taxes”
Part G: Can a US citizen living abroad be saved by a tax treaty? Maybe if he/she lives in Canada****
Part H: Conclusion and the need for “Pure Residence-Based Taxation”
You can read the horrible details here ...
Friday Jan 14, 2022
Friday Jan 14, 2022
January 14, 2022 - Participants Include:
John Richardson - @Expatriationlaw
Max - A former US citizen residing in Germany
The value of US citizenship depends largely on your age. As a general principle, I believe that the value of US citizenship is inversely correlated with age. US citizenship is more valuable to younger people who are in the process of building their careers. After all, there are many job and career opportunities in the United States. The younger you are, the more valuable US citizenship is.
As of late, I am seeing more and more people in their twenties considering renouncing US citizenship. After "tweeting" this trend, Max (a resident of Germany) contacted me and expressed his willingness to explain his reasons for renouncing.
This podcast is a very lucid description of why middle class people living outside the United States are renouncing US citizenship. I suggest that it be spread far and wide!
A special thanks to Max for sharing!
Monday Jan 10, 2022
Monday Jan 10, 2022
January 10, 2022 - Participants Include:
Virginia La Torre Jeker - @VLJeker
John Richardson - @Expatriationlaw
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The Issue:
Is the expatriate required to certify that he is in compliance at the moment of expatriation? Can compliance problems be fixed after expatriation?
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Who Is A Covered Expatriate? - The Statute
The Covered Expatriate - IRC 877(a)(2)
(2)Individuals subject to this section This section shall apply to any individual if—
Sunday Jan 09, 2022
Sunday Jan 09, 2022
January 7, 2022 - Participants Include:
Virginia La Torre Jeker - @VLJeker
John Richardson - @Expatriationlaw
The Background - An Exclusion From Capital Gains
Internal Revenue Code Section 121 provides (in certain circumstances) a $250,000 exclusion from taxation on the capital gain on the sale of a principal residence.
Covered Expatriates, The Exit Tax and "Deemed Capital Gains"
When a covered expatriate renounces US citizenship he/she is subject to a capital gains tax based on the deemed sale of all property. Specifically 877A includes:
All property of a covered expatriate shall be treated as sold on the day before the expatriation date for its fair market value.
The Issue:
Do the words "notwithstanding any other provision of this title" mean that the S. 121 exclusion is not available to "covered expatriates" renouncing US citizenship?
On January 6, 2022 Dubai based US tax lawyer wrote a post discussing this issue:
https://us-tax.org/2022/01/06/covered-expatriates-exit-tax-and-the-principal-residence/
On January 7, 2022 Virginia joined me to explore this issue in this podcast.
Monday Jan 03, 2022
Monday Jan 03, 2022
January 3, 2022 - Participants include:
John Richardson - @Expatriationlaw
Jim Gosart - Vice-President Republicans Overseas
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The United States is the only major country in the world that continues to impose worldwide taxation on its citizens when they move from the country and establish tax residency in another country. But, it gets worse. When US citizens move from the USA and establish tax residency in another country they are subjected to a separate and more punitive form of taxation that that imposed on US residents.
Nothing illustrates this principle better than the story of US citizens who attempt to carry on small businesses outside the United States. As well as the expensive forms and regulation, those US citizens who are "entrepreneurs abroad" risk being subject to tax on income they never received! Yes, it's true. Read on ...
US citizens abroad are generally subjected to various forms of taxation on "fake income" (meaning income they have never received). Some very common forms of "fake income" are found in Subpart F of the Internal Revenue Code. The Transition Tax and GILTI were created by the 2017 TCJA.
In this episode Jim Gosart and John Richardson discuss "fake income" as a general principle (it doesn't apply to US residents on their US based assets). The 2017 Transition Tax and GILTI are the result.
Our point is simple:
The only solution is for the United States to stop citizenship-based taxation and adopt pure residence-based taxation!
Wednesday Dec 29, 2021
Wednesday Dec 29, 2021
December 29, 2021 - Participants Include:
John Richardson - @Expatriationlaw
Diane Gelon - London, UK based New York lawyer - DianeGelon.com
On November 29, 2020 London based US lawyer Diane Gelon joined me for a discussion about the current state of renunciation. That podcast may be accessed here. One year ago, we discussed the fact that the relevant statute - S. 349(a) of the Immigration and Nationality Act - does not require that the renunciation meeting take place inside a US Consulate of Embassy.
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The text of the statute is:
(a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality-
(1) obtaining naturalization in a foreign state upon his own application or upon an application filed by a duly authorized agent, after having attained the age of eighteen years; or
(2) taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or a political subdivision thereof, after having attained the age of eighteen years; or
(3) entering, or serving in, the armed forces of a foreign state if (A) such armed forces are engaged in hostilities against the United States, or (B) such persons serve as a commissioned or non-commissioned officer; or
(4)(A) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years if he has or acquires the nationality of such foreign state; or (B) accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years for which office, post, or employment an oath, affirmation, or declaration of allegiance is required; or
(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State; or
(6) making in the United States a formal written renunciation of nationality in such form as may be prescribed by, and before such officer as may be designated by, the Attorney General, whenever the United States shall be in a state of war and the Attorney General shall approve such renunciation as not contrary to the interests of national defense; or
(7) committing any act of treason against, or attempting by force to overthrow, or bearing arms against, the United States, violating or conspiring to violate any of the provisions of section 2383 of title 18, or willfully performing any act in violation of section 2385 of title 18, or violating section 2384 of title 18 by engaging in a conspiracy to overthrow, put down, or to destroy by force the Government of the United States, or to levy war against them, if and when he is convicted thereof by a court martial or by a court of competent jurisdiction.
(b) Whenever the loss of United States nationality is put in issue in any action or proceeding commenced on or after September 26, 1961 under, or by virtue of, the provisions of this chapter or any other Act, the burden shall be upon the person or party claiming that such loss occurred, to establish such claim by a preponderance of the evidence. Any person who commits or performs, or who has committed or performed, any act of expatriation under the provisions of this chapter or any other Act shall be presumed to have done so voluntarily, but such presumption may be rebutted upon a showing, by a preponderance of the evidence, that the act or acts committed or performed were not done voluntarily.
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The London Embassy continues to deny US citizens wishing to renounce the opportunity to make renunciation appointments.
In this episode Diane and I discuss possible renunciation options that may meet the requirements of the law while not requiring a specific appointment for the purposes or renouncing.
Thanks to Diane Gelon for her creative thinking!
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Appendix:
The description of the November 29, 2020 Diane Gelon podcast was ...
"One the hand one, many Americans abroad are desperate to pay the $2350 USD fee to renounce US citizenship. On the other hand, the US State Department has stopped providing appoints to renounce.
Do US citizens have the right to renounce?
The 1868 Expatriation Act suggests that they have a statutory right to renounce.
R.S. § 1999 provided that: “Whereas the right of expatriation is a natural and inherent right of all people, indispensable to the enjoyment of the rights of life, liberty, and the pursuit of happiness; and whereas in the recognition of this principle this Government has freely received emigrants from all nations, and invested them with the rights of citizenship; and whereas it is claimed that such American citizens, with their descendants, are subjects of foreign states, owing allegiance to the governments thereof; and whereas it is necessary to the maintenance of public peace that this claim of foreign allegiance should be promptly and finally disavowed: Therefore any declaration, instruction, opinion, order, or decision of any officer of the United States which denies, restricts, impairs, or questions the right of expatriation, is declared inconsistent with the fundamental principles of the Republic.”
The 1967 U.S. Supreme Court decision in Afroyim suggests they have a constitutional right to renounce.
The fact is that there is no bar to conducting renunication appointments through video conferencing. It's too bad that the US government won't allow this."
https://prep.podbean.com/e/locked-into-us-citizenship-do-americans-have-the-right-to-renounce/
