PREP Podcaster - ”Success Favours The PREPared Mind”

The Landmark Case of Afroyim v. Rusk: A Historical Insight

June 1, 2024

 

John Richardson - @Expatriationlaw

 

This podcast introduces a the oral argument in the U.S. Supreme Course in the seminal case of Afroyim v. Rusk. Afroyim has been referenced and discussed from time to time in the 16 part podcast discussing Laura Snyder's "Working Paper Series" (found on the SEAT website here).

The case was about whether Mr. Afroyim could be stripped of his U.S. citizenship for voting in an Israeli election when he was a resident but not a citizen of Israel. Interestingly, during the oral argument, the U.S. government lawyer - Charles Gordon - tried to expand the issue into whether Mr. Afroyim should have been stripped of his U.S. citizenship by later accepting Israeli nationality under Israel's "right of return" law. Fortunately, the Court did NOT allow the government to do this. Mr. Gordon was a major figure in U.S. immigration law. His 1999 death rated an article in the New York times. Interestingly the article included a reference to his involvement in the Afroyim case.as follows:

"He spent several years in private practice before joining the Immigration and Naturalization Service in 1939. He stayed for 35 years, rising to general counsel in 1966.

While at the immigration agency, Mr. Gordon argued eight cases before the Supreme Court. ''He was known as a liberal and someone in favor of a more open, fairer immigration policy,'' Mr. Roberts said, but sometimes he had to argue positions with which he disagreed.

In one such instance, three decades ago, Mr. Gordon lost the case of Afroyim v. Rusk, in which the Supreme Court ruled that a naturalized citizen cannot lose his citizenship against his will by voting in a foreign election."

 

 

Please see the following AI generated description and listen to the argument as it took place in 1967 in the Supreme Court of the United States here:

 

https://www.oyez.org/cases/1966/456

 

AI Description:

"Good evening, this is John Richardson speaking with you from Toronto, Canada. Today is June 1st, 2024. All Americans abroad will understand or should understand the significance of the 1967 U.S. Supreme Court decision in Afroyim v. Rusk. That's Afroyim v. Rusk.

Essentially, the case held that the U.S. Government could not involuntarily strip U.S. Citizens of their U.S. citizenship, a practice that continued right up until the 1986 amendments to the Immigration and Nationality Act. Afroyim was the seminal case, and it was decided in 1967. The facts revolved around Mr. Afroyim's voting in an Israeli election in 1951, despite not being a citizen of Israel.

Interestingly, today I discovered a website - Oyez.org - that replicates the exact arguments made before the Supreme Court of the United States in various decisions, including Afroyim v. Rusk. I just finished listening to it, and it is absolutely fascinating. I thought you might be interested in listening to this as well. Please click on the link in the description and enjoy yourself. It's about an hour and ten minutes and highly, highly informative.

Thanks for listening."

 

Once again, the link is here:

 

https://www.oyez.org/cases/1966/456

 

 

Navigating the Complexities of Foreign Trust Reporting And The 2024 Proposed Treasury Regulations: A Conversation with Dr. Karen Alpert

May 25, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

John Richardson - @Expatriationlaw

On May 8, 2024 Treasury issued proposed regulations designed to clarify and provide certain exceptions for Form 3520 and Form 3520A reporting for foreign trusts.

 

The announcement and proposed regulation can be found here:

 

https://www.federalregister.gov/documents/2024/05/08/2024-09434/transactions-with-foreign-trusts-and-information-reporting-on-transactions-with-foreign-trusts-and

 

Comments from taxpayers can be found here:

 

https://www.regulations.gov/document/IRS-2024-0022-0001/comment

 

This podcast features a discussion between Dr. Karen Alpert and John Richardson where they explore how the IRS proposed rules might impact U.S. taxpayers in Australia and their Australian Superannuations.

 

 

 

AI generated description:

"Good afternoon, this is John Richardson speaking with you from Toronto, Canada. Today is May 25th, 2024, and my guest is Dr. Karen Alpert, who joins us from Australia. In this episode, we delve into a proposed Treasury regulation concerning foreign trusts, including pension plans and tax-favored accounts outside the United States.

We explore the intricacies of what constitutes a foreign trust under U.S. law and whether common Australian pension plans fall into this category. The discussion highlights the stringent reporting requirements, specifically IRS Forms 3520 and 3520A, and the severe penalties associated with non-compliance.

Dr. Alpert provides a detailed analysis of the proposed regulations, discussing the criteria for determining if an account is a tax-favored foreign retirement trust. We also consider the complexities and potential pitfalls for U.S. citizens living abroad, especially those with no direct connection to the United States.

The conversation touches on the broader implications of citizenship-based taxation and proposes a more straightforward approach to identifying exempt accounts using FATCA IGAs. Join us for an insightful discussion on the challenges and possible solutions to foreign trust reporting."

SEAT Working Paper Series - Extraterritorial Taxation #16: Understanding Cook vs. Tate - Unraveling the Transformation of US Citizenship and Taxation

May 21, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

Dr. Laura Snyder - @TAPInternation

John Richardson - @Expatriationlaw

The purpose of SEAT has been and continues to be to conduct research (including the SEAT survey), prepare position papers, make submissions by SEAT to various governments, facilitate advocacy by individuals impacted, file amicus briefs and provide a centre for educating interested parties about the U.S. extra-territorial tax regime. (SEAT's work may be found on the SEAT website.)

SEAT believes that the problems caused to Americans abroad by the U.S. extraterritorial tax regime can be ended ONLY by severing citizenship from tax residency. We encourage the United States to join the rest of the world by taxing individuals on the basis of residence and source and NOT based on the citizenship of an individual.

Part of SEAT's work has been break our research into specific issues and categories. These categories are expressed as "SEAT Working Papers". In order to make the "SEAT Working Papers" available in podcast form, SEAT co-founders Karen Alpert, Laura Snyder and John Richardson are developing a series of podcasts - featuring interactive discussion - where we distill the "working paper" into conversational format. It is our hope that these podcasts will make SEAT's content available to a larger group of people.

 

Extraterritorial Taxation #16: Cook Is Ripe for Revisiting

This paper contains three concurrent timelines detailing the step-by-step expansion of U.S. extraterritorial taxation as well as of citizenship and equal protection, since the 1924 U.S. Supreme Court decision Cook v. Tait. These timelines underscore how Cook is ripe for review.

Available at: https://ssrn.com/abstract=4466275

____________________________________________

 

AI Description:

"Understanding Cook vs. Tate: Unraveling the Transformation of US Citizenship and Taxation

In this absorbing episode, join our host John Richardson alongside guests Laura Snyder and Karen Albert as they discuss the intriguing changes in US citizenship and taxation. Delve into Laura Snyder's working paper series, focusing particularly on the 16th paper which explores extraterritorial taxation and revisits the pioneering Cook vs. Tate case. Discover how this landmark 1924 US Supreme Court decision underpinned the US extraterritorial tax system and understand its continued relevance in the evolving landscape of citizenship and taxation.

Be enlightened as Laura Snyder delivers a concise summary of Cook vs. Tate, emphasizing that it was a defining case more about citizenship rather than taxation. Listen to Karen Albert as she navigates through the expansion and complexity of the US tax system post-1924, shedding light on the changing perceptions of foreign income and assets. This insightful episode is essential for anyone interested in understanding the impact of legal decisions on present-day citizenship and taxation issues and the evolution of legal interpretations against different historical contexts.

Dive deeper into the intricacies of American tax laws, especially concerning U.S. citizens residing abroad. Explore historical discrimination precedents like the Plessy v. Ferguson decision in 1896 and understand its lasting impact on lawmaking. Transition into the United States v. Caroline Products Company case in 1938 that introduced the era of ‘levels of scrutiny'. Acknowledge the evolution of equal protection through landmark court cases like Hirabashi v. United States and Bowling v. Sharp.

Focusing on tax laws, the hosts raise valid questions on their susceptibility to constitutional challenge and express concern over the limited societal understanding of constitutional, human, and tax rights in America. The episode wraps up with a spirited discussion on the application of equal protection principles in the arena of tax laws.

Join the conversation as the hosts delve into taxation, equal protection, and their influence on modern-day US citizenship. Hear about historic cases like gay marriage intersecting tax benefits and equal protection. This discussion will challenge listeners to contemplate the potential dangers of tax laws breaching equal protection rights.

Understand the significant transformation of citizenship's constitutional standing, from being a nexus of obligations to a nexus of rights. Reflect on the relevance of Cook v. Tate and the need for re-examining the current citizenship taxation system. This conversation is a gateway to a fresh perspective towards the taxation of overseas Americans, sparking hope for a future where the voices of Americans living abroad are valued in policy-making."

Insights and Solutions Into The Problem Of US Citizenship Or Holding A Green Card

April 18, 2024 - Participants include:

Darren Coleman - Coleman Wealth

John Richardson - @Expatriationlaw

This podcast is crossposted from Darren Coleman's Two Way Traffic podcast. The original podcast and description is here:

"Canadians who return to the country after working south of the border may face “punitive” exit taxes from the U.S. and it doesn’t matter if their leaving is due to a divorce, illness or something else.

Darren’s guest is John Richardson of Citizenship Solutions, a Toronto-based lawyer who was born in the U.S. and has lived most of his life in Canada. His practice is largely devoted to assisting Americans who live outside the U.S. John says Americans living in Canada are often treated “unjustly” by the IRS.

 “As far as the U.S. is concerned, there are two principles at play,” he says. “First, one never leaves the land of the free for free. Second, everything in the U.S. is taxable.”

 

Darren and John discuss a wide range of issues – everything from potential troubles for Green Card holders to compliance matters when dealing with two countries that have very different tax regimes to immigration problems."

 

https://twowaytraffic.transistor.fm/episodes/leaving-las-vegas-or-anywhere-else-in-the-us-exit-taxes-and-the-price-of-leaving-america

 

 

AI generated description:

"In this insightful episode of "Two-Way Traffic", Darren Coleman engages with renowned cross-border attorney John Richardson of CitizenshipSolutions.ca, in a comprehensive and enlightening discussion around the legal, taxation, and financial complexities associated with living and holding wealth across the U.S and Canadian borders.

The conversation brings into sharp focus the hefty regulations and penalties American citizens and green-card holders are subjected to, regardless of their physical presence in the U.S territory. Richardson talks extensively about the seemingly maze-like tax landscapes which often lead to inadvertent non-compliance with the U.S tax laws.

Adding more depth to this complex scenario, Richardson emphasizes the importance of professional guidance for understanding individual situations and mitigating the emotional distress associated with unfamiliar tax landscapes. The dialogue concludes with a look at the alternatives available for those looking to untangle their U.S. affiliations and reduce the risk of potential penalties.

Featuring an in-depth exploration of treaty residency provisions, potential tax liabilities and punitive exit taxes, this conversation serves as a valuable guide for understanding and navigating the intricacies of U.S taxation laws and their potential repercussions, especially for Green Card holders moving back to Canada. Our expert panel's reflections on the 'closer connection rule' and ‘tax treaty tiebreak provisions’ offer practical insights for individuals trying to navigate their tax obligations.

Rich with real-life experiences, tips and essential cautionary insights, this podcast's ending note underlines the importance of specialized tax advisory in managing cross-border financial matters. This episode of 'Two-Way Traffic' serves as an engaging and informative guide into the intricate world of cross-border finance, giving listeners a deeper appreciation of tax laws and estate management, and insight into next steps towards strategic financial planning."

SEAT Working Paper Series - Extraterritorial Taxation #15 - Taxing in Respect of Rights

April 29, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

Dr. Laura Snyder - @TAPInternation

John Richardson - @Expatriationlaw

The purpose of SEAT has been and continues to be to conduct research (including the SEAT survey), prepare position papers, make submissions by SEAT to various governments, facilitate advocacy by individuals impacted, file amicus briefs and provide a centre for educating interested parties about the U.S. extra-territorial tax regime. (SEAT's work may be found on the SEAT website.)

SEAT believes that the problems caused to Americans abroad by the U.S. extraterritorial tax regime can be ended ONLY by severing citizenship from tax residency. We encourage the United States to join the rest of the world by taxing individuals on the basis of residence and source and NOT based on the citizenship of an individual.

Part of SEAT's work has been break our research into specific issues and categories. These categories are expressed as "SEAT Working Papers". In order to make the "SEAT Working Papers" available in podcast form, SEAT co-founders Karen Alpert, Laura Snyder and John Richardson are developing a series of podcasts - featuring interactive discussion - where we distill the "working paper" into conversational format. It is our hope that these podcasts will make SEAT's content available to a larger group of people.

SEAT Working Paper Series #2023/15

Extraterritorial Taxation #15: Taxing in Respect of Rights

This paper: (1) cautions against any new U.S. tax system that would perpetuate the constitutional and human rights violations of the current system, (2) explains how other countries are able to further the legitimate purpose of preventing tax abuse while also respecting fundamental rights, and (3) describes the salient features of the right system for the United States.

Available at: https://ssrn.com/abstract=4466241.

__________________________________________

 

AI Description:

"In this engaging podcast, we delve into the pressing topic of extraterritorial taxation in a comprehensive overview of 'Taxing in Respect of Rights', the fifteenth installment of the Seat Working Paper Series. Joined by internationally based experts, we dissect the potential switch from citizenship taxation to the controversial concept of "Residence-Based Taxation." This episode explores the fear and reluctance towards this replacement, shedding light on alleged misconceptions and bringing to fore the unique set of issues faced by Americans overseas due to systemic disconnects and loopholes in the tax system.

We take up the dialogue around citizenship-residency correlation errors and their inherent systemic misrepresentations. We emphasize the need for Americans to normalise the idea of their fellow citizens living abroad. The discussion expands to trace the roots of extraterritorial taxation issues and probes into potential legislature proposal flaws, along with possibilities of misconduct within the IRS.

While dissecting the taxation bias towards Americans abroad, we value the need for a complete disconnection between citizenship and taxation. In our diverse conversation, we traverse through tax complications around U.S. citizenship, contrasting it with global practices, and analyze how U.S. tax laws might impose needless constraints on global citizens.

As the discourse intensifies, we illuminate the significant differences in dual and single U.S. citizenship rules, exploring the subtly embedded system of privilege and disparity in U.S. tax policies. We also unravel the historic role of U.S. citizenship, highlighting the arduous challenges faced by dual citizens in the contemporary era owing to outdated legislative constructs.

Our conversation reaches a climactic conclusion as we call for a long-overdue end to the American system of extraterritorial taxation, advocating for a fair and balanced system where citizenship and tax residency are dissociated. With a wealth of information available on seatnow.org, join us in exploring the complexities of 21st-century taxation issues in a globalized world."

Canada's New Capital Gains Tax And Navigating Wealth Management Strategies in Canada

April 23, 2024 - Participants include:

 

Darren Coleman - Coleman Wealth

 

John Richardson - @Expatriationlaw

 

Introduction:

 

On April 16, 2024 Canada's Finance Minister released introduced a budget which included major tax increases for Canadian residents.

The question is:

What are the implications for financial planning in Canada?

Joining me today is Darren Coleman of Coleman Wealth Management.

What follows is the AI generated version of our discussion ...

______________________________________________

 

"Join us in this riveting dialogue between John Richardson and guest Darren Coleman, an experienced wealth manager and financial planner, as we dive deep into the nuanced world of capital gains taxation. We dissect the recent changes reflected in the Canadian budget, and consider their retroactive impact on individuals and businesses. Our discussion digs into the potential risk to entrepreneurship and brain drain that may stem from these changes. More than just an intellectual exercise, this episode equips you to navigate your wealth management strategies with greater clarity and insight.

We cover aspects such as the tax implications for Canadians selling family properties, and the complexities of including capital gains income inside corporations. Notably, we address the plight of professionals using Canadian-controlled private corporations for their pensions and the precarious situation they find themselves in between the provincial and federal governments.

Our analysis further shines a light on possible effects on retirement planning and other strategic financial decisions. As we scrutinize the current tax scenario, we also delve into the housing market, examining potential implications of taxing gains on the sale of primary residences. Wrapping up, we offer expert insights into estate planning, suggesting techniques to optimize your finances amidst evolving tax regulations. Be privy to this comprehensive discourse and master the hedge maze of capital gains taxation."

SEAT Working Paper Series - Extraterritorial Taxation #14 - Revenue Neutrality Makes No Sense

April 22, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

Dr. Laura Snyder - @TAPInternation

John Richardson - @Expatriationlaw

The purpose of SEAT has been and continues to be to conduct research (including the SEAT survey), prepare position papers, make submissions by SEAT to various governments, facilitate advocacy by individuals impacted, file amicus briefs and provide a centre for educating interested parties about the U.S. extra-territorial tax regime. (SEAT's work may be found on the SEAT website.)

SEAT believes that the problems caused to Americans abroad by the U.S. extraterritorial tax regime can be ended ONLY by severing citizenship from tax residency. We encourage the United States to join the rest of the world by taxing individuals on the basis of residence and source and NOT based on the citizenship of an individual.

Part of SEAT's work has been break our research into specific issues and categories. These categories are expressed as "SEAT Working Papers". In order to make the "SEAT Working Papers" available in podcast form, SEAT co-founders Karen Alpert, Laura Snyder and John Richardson are developing a series of podcasts - featuring interactive discussion - where we distill the "working paper" into conversational format. It is our hope that these podcasts will make SEAT's content available to a larger group of people.

SEAT Working Paper Series #2023/14

Extraterritorial Taxation #14: Revenue Neutrality Makes No Sense

Conditioning the end of the U.S. extraterritorial tax system on revenue neutrality is nonsensical and a barrier to genuine reform.

Available at: https://ssrn.com/abstract=4466208.

The Life And Times Of Nova Scotia's Atlantica Party - With Ryan Smth

March 15, 2024 - Participants Include:

 

Ryan Smyth - Official Agent

John Richardson - @Independents

____________________________

On March 13, 2023 I received the following message:

"To our esteemed members, supporters, and the wider community of Nova Scotia,

Today, we reach out with a bittersweet announcement: the journey of the Atlantica Party Association of Nova Scotia is drawing to a close. This decision, reached after much deliberation and heartfelt consideration, marks the end of an era for us and, we know, for many of you as well.

Why Now?

Our journey was fueled by passion, commitment, and the shared belief in the principles and visions that defined the Atlantica Party. It is important to clarify that our decision to conclude this chapter is not a reflection of financial challenges or a lack of support for our party's ideals. On the contrary, thanks to the generosity of our donors and the faith of our supporters, we remained financially resilient and ideologically vibrant until the end.

The crux of our decision lies in the challenges of sustaining the volunteer-driven momentum necessary for our operations. The dedication of time and effort, though abundant in spirit, has become increasingly scarce in practice. This shortage of volunteer support has led us to this juncture, a decision we know may disappoint some. To those who feel let down, we extend our sincere apologies and hope you understand the difficult position we’ve found ourselves in.

Acknowledgments

As we prepare to file for voluntary deregistration with Elections Nova Scotia effective April 30th, 2024, we want to take a moment to reflect on the contributions of everyone who has been part of this remarkable journey. To the candidates who championed the Atlantica cause in provincial elections, your bravery and dedication have been the backbone of our efforts. To our volunteers, whose tireless work behind the scenes made every campaign, event, and initiative possible, we owe a debt of gratitude that words cannot fully express. To our supporters, who have stood by us, advocated for us on social media, and provided financial backing, your belief in our mission has been our driving force.

Looking Ahead

While the Atlantica Party Association of Nova Scotia will no longer be active, the principles we stood for and the conversations we sparked will endure. We encourage our community to continue advocating for the values we hold dear and to remain engaged in the political landscape of Nova Scotia. The end of this organization is not the end of our collective journey towards a brighter future for our province.

In closing, we extend our deepest thanks to each and every one of you who have been a part of the Atlantica Party Association of Nova Scotia. Though our paths may diverge, the memories of what we accomplished together will forever unite us.

With heartfelt appreciation,

Kyle Woodbury, Leader of the Atlantica Party Association of Nova Scotia

 

and

Ryan Smyth, Official Agent and Treasurer for the Atlantica Party Association of Nova Scotia"

_______________________________________________

 

It's hard to create and maintain a political party in a world dominated by mainstream parties. But, amazingly the Atlantica Party lasted for the better part of 20 years. I had been on their mailing list for most of that time - sometimes reading their message and sometimes ignoring them.

But, the Atlantica Party was a success. Only those who have attempted to create political parties will understand that a party that lasted for as long as it did was a success.

In this podcast I talk with Ryan Smyth (Official Agent and Treasurer for the Atlantica Party Association of Nova Scotia) about the "Life and Times" of the Atlantica Party.

 

 

 

 

SEAT Working Paper Series - Extraterritorial Taxation #13 - Other Countries Have A Duty To Act

April 4, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

Dr. Laura Snyder - @TAPInternation

John Richardson - @Expatriationlaw

The purpose of SEAT has been and continues to be to conduct research (including the SEAT survey), prepare position papers, make submissions by SEAT to various governments, facilitate advocacy by individuals impacted, file amicus briefs and provide a centre for educating interested parties about the U.S. extra-territorial tax regime. (SEAT's work may be found on the SEAT website.)

SEAT believes that the problems caused to Americans abroad by the U.S. extraterritorial tax regime can be ended ONLY by severing citizenship from tax residency. We encourage the United States to join the rest of the world by taxing individuals on the basis of residence and source and NOT based on the citizenship of an individual.

Part of SEAT's work has been break our research into specific issues and categories. These categories are expressed as "SEAT Working Papers". In order to make the "SEAT Working Papers" available in podcast form, SEAT co-founders Karen Alpert, Laura Snyder and John Richardson are developing a series of podcasts - featuring interactive discussion - where we distill the "working paper" into conversational format. It is our hope that these podcasts will make SEAT's content available to a larger group of people.

__________________________________________-

Extraterritorial Taxation #13: Other Countries Have a Duty to Act

This paper explains what the officials of other countries must understand about the U.S. extraterritorial tax system, what they must do about it, and why they have a duty to act. This paper concludes with first-hand testimony from residents (many dual citizens) of 33 countries.

Available at: https://ssrn.com/abstract=4466153.

The US Tax Treaty Saving Clause As A Vehicle To Tax Residents Of Other Countries On Non-US Income

April 1, 2024 - Participants include:

 

Dr. Karen Alpert - @FixTheTaxTreaty

 

John Richardson - @ExpatriationLaw

 

____________________________________________

Understanding what citizenship taxation really is ...

Like the optical illusion where some people see an old woman and others see a young woman, citizenship taxation is viewed by different people in different ways.

Some people (tax academics, politicians and many tax professionals) view citizenship taxation as simply the US taxing its nonresident citizens with no consciousness of the reality that those citizens live in and are taxed by other countries.

Others (individuals who are actually subjected to citizenship taxation) view it as the U.S. imposing taxes, forms and penalties on the residents of other countries.

Because of these two different perceptions, it is difficult to have a helpful discussion about citizenship taxation.

 

U.S. Citizenship Taxation

 

The U.S. is currently the only major country that treats all its citizens as tax residents. There has often been speculation as to what would happen if other major countries employed citizenship taxation. Because countries already tax based on residence and source, citizenship taxation would have practical meaning ONLY for a country’s nonresident citizens. This is because “citizenship taxation” would create dual “tax residency” for the nonresident citizens of a country.

Generally, treaties allow dual tax residents to use a treaty to become a tax resident of ONLY one country. The exception is when a treaty includes a “saving clause”. A “saving clause” is when a treaty allows a country to tax its citizens (whether resident or nonresident) without regard to the treaty. In this way the “saving clause” prevents an individual with “dual tax residency” from using the treaty to become a treaty tax resident of ONLY one country. Practically speaking, the “saving clause,” by denying individuals the opportunity for “dual tax residents” to become tax residents of only one country, allows the country with the “saving clause” to impose worldwide taxation on the tax residents of another country!

The effect of Country A (the United States) including a “saving clause” in its tax treaty with other country B means that U.S. citizens are always “dual tax residents” because the "saving clause" prevents them from becoming treaty nonresidents..

Therefore, because  dual tax residency cannot be prevented by treaty, the treaty allows for:

Country A (the United States) to impose “worldwide taxation” on the tax residents of country B on non-US source income.