# Good News about FBARs(?)



## Guest

Hello,

Thought I would share some good news as there has been much doom and gloom. 

As I am in the process of figuring out the steps for renunciation, this has led me to converse with many Lawyers and Accountants here in Canada yesterday and mostly today.

I invariably have been asking them about the chances of being hit by penalties under the FBAR...and the answer is a resounding NO.

To date over 5,000 (five thousand) quiet disclosures in Canada have been completed and filed. ...not one has come back with a penalty.

There have been meetings these past couple of months between Accountants and Lawyers across this country (Canada)on the present situation and how to determine if one is 'compliant' for the purpose of renunciation. (As you know you have to be 'compliant' in order to renounce)... and if you sign the documentation that you are compliant and are not...you have just put yourself in a bad situation as this would be purgery. (spelling sorry).

In other words...filing your back taxes and FBARs does not technically mean you are compliant until an Accountant firm confirms this for you. (Also must get a signed document from the aformentioned firm and bring this to your Lawyer for confirmation).

In conversations with the IRS (not me, but them) they are confident that you will not hear anything back...even those who opted out of the OVDI. However...due to the large backlog in paperwork, it will be sometime before you are cleared as being 'compliant'.

I asked again about OVDI and they told me that this program is for people who have not paid taxes on investment income (which is basically impossible to do in Canada...if you have then you are on the radar with Revenue Canada as well).

The OVDI program also goes through differrent channels and fines and penalties HAVE to be attached.

NO ONE WHO HAS PAID TAX IN CANADA....IS LAW -ABIDING...AND IS NOT HIDING MONEY IN OFFSHORE ACCOUNTS SHOULD GO THROUGH THE OVDI PROGRAM...PERIOD!


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## Pathologic1

The other good news is that if you are a Canadian Citizen they cannot collect taxes, tax penalties or any of the FBAR bull at all anyway. 

Canada will not help he US or anyone else collect taxes from their own citizens.

I am in favor of renunciation but it's a lot of work if you live far away from any city and since the US cannot collect anyway why bother.


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## Peg

I consider compliant to be that I filed the 5 years of IRS returns and FBARs with the promise to complete the 6th sets. 

The renunciation does not relieve me of any taxes or penalties - it just stops further tax liability.


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## Mona Lisa76

Mach7 said:


> Hello,
> 
> Thought I would share some good news as there has been much doom and gloom.
> 
> As I am in the process of figuring out the steps for renunciation, this has led me to converse with many Lawyers and Accountants here in Canada yesterday and mostly today.
> 
> I invariably have been asking them about the chances of being hit by penalties under the FBAR...and the answer is a resounding NO.
> 
> To date over 5,000 (five thousand) quiet disclosures in Canada have been completed and filed. ...not one has come back with a penalty.
> 
> There have been meetings these past couple of months between Accountants and Lawyers across this country (Canada)on the present situation and how to determine if one is 'compliant' for the purpose of renunciation. (As you know you have to be 'compliant' in order to renounce)... and if you sign the documentation that you are compliant and are not...you have just put yourself in a bad situation as this would be purgery. (spelling sorry).
> 
> In other words...filing your back taxes and FBARs does not technically mean you are compliant until an Accountant firm confirms this for you. (Also must get a signed document from the aformentioned firm and bring this to your Lawyer for confirmation).
> 
> In conversations with the IRS (not me, but them) they are confident that you will not hear anything back...even those who opted out of the OVDI. However...due to the large backlog in paperwork, it will be sometime before you are cleared as being 'compliant'.
> 
> I asked again about OVDI and they told me that this program is for people who have not paid taxes on investment income (which is basically impossible to do in Canada...if you have then you are on the radar with Revenue Canada as well).
> 
> The OVDI program also goes through differrent channels and fines and penalties HAVE to be attached.
> 
> NO ONE WHO HAS PAID TAX IN CANADA....IS LAW -ABIDING...AND IS NOT HIDING MONEY IN OFFSHORE ACCOUNTS SHOULD GO THROUGH THE OVDI PROGRAM...PERIOD!


This is also what my accountant who is an enrolled agent who specializes in expats in the UK has told me. She did, however, point out that Americans abroad will probably start being clobbered if they fail to disclose their foreign accounts and assets on the ucoming 8938 form which will be directly attached with the 1040.


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## Peg

Mach7 - really appreciate you sharing your intel!


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## Guest

No problem Peg,

I would be cautious about the renunciation before you are cleared by the IRS. It is my understanding that if you sign the rnunciation form admitting that, in your eyes, you are compliant and you are not. It could mean that you have just comited purjury.

It might even be 5 years before they get to your paperwork.


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## 416

Mach7 said:


> No problem Peg,
> 
> I would be cautious about the renunciation before you are cleared by the IRS. It is my understanding that if you sign the rnunciation form admitting that, in your eyes, you are compliant and you are not. It could mean that you have just comited purjury.
> 
> It might even be 5 years before they get to your paperwork.


I'm not a lawyer, but if you're submitting honest and complete returns (regardless of technical errors made in good faith) I wouldn't worry about a perjury charge.


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## Peg

Irrelevant in my case anyway since I already did renounce. I think submitting honest and complete returns and not hiding anything is as much as I can do.

Given that the IRS may never contact me I was not prepared to sit around waiting. I made my dissension clear by renouncing!


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## Peg

Mach7 said:


> There have been meetings these past couple of months between Accountants and Lawyers across this country (Canada)on the present situation and how to determine if one is 'compliant' for the purpose of renunciation. (As you know you have to be 'compliant' in order to renounce)... and if you sign the documentation that you are compliant and are not...you have just put yourself in a bad situation as this would be purgery. (spelling sorry).
> 
> In other words...filing your back taxes and FBARs does not technically mean you are compliant until an Accountant firm confirms this for you. (Also must get a signed document from the aformentioned firm and bring this to your Lawyer for confirmation).


Would this group of tax accountants and tax lawyers have much to gain by having all 1,000,000,000 dual Canadian-US citizens confirm with both and accountant and a lawyer that they are compliant with the IRS?


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## Guest

Probably


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## Peg

Mach7 said:


> (As you know you have to be 'compliant' in order to renounce)... and if you sign the documentation that you are compliant and are not...you have just put yourself in a bad situation as this would be purgery. (spelling sorry).


Perjury: the willful giving of false testimony under oath or affirmation


I strongly feel that saying that I (or others in my situation) committed perjury by not having documentation that I am compliant with the IRS is not appropriate. 

If I had signed the renunciation forms knowing that I was hiding investments or income then that would be perjury. But to have declared every single financial detail of my life to the IRS for the past 5 years is compliant to me.


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## Mona Lisa76

Peg said:


> Would this group of tax accountants and tax lawyers have much to gain by having all 1,000,000,000 dual Canadian-US citizyens confirm with both and accountant and a lawyer that they are compliant with the IRS?


That's a billion lol


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## Arlington

Peg said:


> Perjury: the willful giving of false testimony under oath or affirmation
> 
> 
> I strongly feel that saying that I (or others in my situation) committed perjury by not having documentation that I am compliant with the IRS is not appropriate.
> 
> If I had signed the renunciation forms knowing that I was hiding investments or income then that would be perjury. But to have declared every single financial detail of my life to the IRS for the past 5 years is compliant to me.


You go, Peg. I agree with you completely.


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## Peg

Mona Lisa76 said:


> That's a billion lol


:ranger: Thanks! Too funny because as I typed it I tried to count the zeroes but I spent all of last night in the ER with one of my kids and am running on fumes right now... Especially funny considering there are nowhere near 1billion in Canada...


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## Guest

Peg...when you put it that way it makes sense.

Probably the Accountants want that extra bit of money to make the call for confirmation. But I think in my case I will call the IRS directly and make sure.


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## Vangrrl

Peg said:


> Would this group of tax accountants and tax lawyers have much to gain by having all 1,000,000,000 dual Canadian-US citizens confirm with both and accountant and a lawyer that they are compliant with the IRS?


I don't understand how an accountant can certify that you are tax compliant. An accountant works for you (the client). The only one who can certify that you are compliant is the IRS. And since they don't do that, the best you can do is have your 5 years of filings done.


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## pwdunn

Peg said:


> Perjury: the willful giving of false testimony under oath or affirmation
> 
> 
> I strongly feel that saying that I (or others in my situation) committed perjury by not having documentation that I am compliant with the IRS is not appropriate.
> 
> If I had signed the renunciation forms knowing that I was hiding investments or income then that would be perjury. But to have declared every single financial detail of my life to the IRS for the past 5 years is compliant to me.


Peg, you are innocent. We all know it. It is the US government which is run by criminals.

You don't have to sign any papers saying you are in compliance on the renunciation forms, do you? I signed nothing when relinquishing my citizenship saying I was in compliance. This is creating a problem out of nothing.

It is the IRS Form 8854 wherein you have to state that you are in compliance with filing requirements. Most of the time, you can't lie on this form about whether you've filed a 1040 or not because they will know. As for FBAR, that's another story.

I contemplated perjuring myself on the tax forms, not to get out of taxes but to avoid FBAR charges. I decided it is better to file a Fifth Amendment 1040. This is where any lines that may incriminate you, you write, "Fifth Amendment", instead of the information requested. This is an effective method used by mob bosses to report income without revealing the source of the income. The method arose after Al Capone went to prison for tax evasion.

So you see, US citizens abroad, your US government has presumed that you are guilty of hiding money in foreign bank accounts. Your best defence is to study how mob bosses protect themselves from the Feds.

Thus, don't commit perjury on the forms; use the Fifth Amendment.

This finally reveals why FBAR is a useless law and an embarrassment to Congress which passed it. Any child could see that if a person is committing a crime such as terrorism, money laundering or criminal tax evasion--the crimes the Bank Secrecy Act (FBAR) was meant to thwart, that he or she would not fill out the stupid FBAR form to tell the Treasury Department which bank accounts they were using to commit their crimes. So the law can't work as intended, and now is only used to extort money out of the law abiding.

A law that catches in its net the law abiding but lets the crooks free is not useful, at least not to the People. It may indeed be useful to a criminal government which is looking to extort money from the People. FBAR needs to be repealed.

The Obama administration is more tyrannical than King George ever was, and he is creating the conditions which will lead to another war like the one in 1776.


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## AmTaker

Mach7 said:


> Hello,
> 
> Thought I would share some good news as there has been much doom and gloom.
> 
> As I am in the process of figuring out the steps for renunciation, this has led me to converse with many Lawyers and Accountants here in Canada yesterday and mostly today.
> 
> I invariably have been asking them about the chances of being hit by penalties under the FBAR...and the answer is a resounding NO.
> 
> To date over 5,000 (five thousand) quiet disclosures in Canada have been completed and filed. ...not one has come back with a penalty.
> 
> There have been meetings these past couple of months between Accountants and Lawyers across this country (Canada)on the present situation and how to determine if one is 'compliant' for the purpose of renunciation. (As you know you have to be 'compliant' in order to renounce)... and if you sign the documentation that you are compliant and are not...you have just put yourself in a bad situation as this would be purgery. (spelling sorry).
> 
> In other words...filing your back taxes and FBARs does not technically mean you are compliant until an Accountant firm confirms this for you. (Also must get a signed document from the aformentioned firm and bring this to your Lawyer for confirmation).



I don't intend to renounce right now, but this sounds very self serving to me. Why do you need an accountant and lawyer to 'bless' your renunciation ? There is NO such requirement under US law, AFAIK. 

Side note :I was in the US visiting family members for Thanksgiving and I did ask around a little too. I did hear (not sure how reliable the information is) about some quiet disclosures that had been asked for more information by the IRS (which I presume is essentially an audit). However, I believe the people involved did have some tax due and had been filing US returns, so I think they were likely not long term expats (may have been US residents or people who move cross border regularly).


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## Guest

*Did anybody notice this?*

I was reading some older threads and came across this from post 9 (Phil Hodgen) on "US Taxation for Dual Citizen / Renouncing Citizenship/Disappearing from US Radar

"4. Here is a really interesting point. That "I'm up to date with the last 5 years of tax obligations" DOES NOT INCLUDE THE FBAR PROBLEM. So you can be completely hosed on that point and still legally and correctly log yourself out of the US tax system. Then if you never enter the US again (hard, given what your comments are about family), you can cheerfully tell the IRS to go stick its bureaucratic nose in a dead bear's bum if they pester you for penalties."

I am curious where this idea that FUBARs are not included in the last 5 years of tax obligations comes from. If that is so, it would seem entering the US again would be no problem and there would be no need to worry about penalties when renouncing.

Anybody know anything about this?


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## pwdunn

nobledreamer said:


> I am curious where this idea that FUBARs are not included in the last 5 years of tax obligations comes from. If that is so, it would seem entering the US again would be no problem and there would be no need to worry about penalties when renouncing.
> 
> Anybody know anything about this?


FBAR is not a tax law but part of the Bank Secrecy Act. Therefore it has nothing to do with tax compliance. The Canadian government has therefore refused to collect any FBAR fines under the tax treaty because it is not related to taxes.

The IRS has signed in inter-agency agreement with Treasury (FinCEN) to enforce FBAR, by assessing and collecting civil penalties. They cannot indite someone with criminal charges but can only make a recommendation of criminal FBAR to the Justice Department. You cannot be deported to the US for criminal FBAR, because it is not in the extradition treaty between Canada and the US. Criminal charges are extremely unlikely, if you are not living in the United States, since the US government would have a hard time proving wilfulness, and because if you were law abiding person living in Canada, a criminal FBAR violation would be like hanging jaywalking (as one blogger put it) or actually, more like, imprisoning people for using the sidewalk. I.e., what jury in their right mind would ever put any one of us in jail, unless we've been stashing away millions in a Swiss or Cayman account? You can still travel to the US with a civil penalty, as far as I know, for there is no debtors prison in the US (does anyone know about this?).

FBAR compliance would seem therefore unnecessary, in my view, to exit the Hotel California, since it is not a tax. But remember: "you can check out any time you'd like but you can never leave", unless you're an adopted half-korean who wants to stay. This is because they keep changing the rules.


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## eucitizen

*NO STATUTE OF LIMITATIONS so don't get too happy too soon*

Indeed I have heard this too; but do not get too excited.

If you live abroad you get no statute of limitations on any tax issues.

They can come back with your penalty 10 years from now when things have quietened down.


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## Guest

PetrosResearch said:


> You can still travel to the US with a civil penalty, as far as I know, for there is no debtors prison in the US (does anyone know about this?).



Thanks Petros. I am very familiar (now, at least :mmph: ) with BSA and FBAR comes from DOJ and all of that. However, I am only concerned at this point, with practical reality, if you know what I mean. While I hope I don't receive any penalties and will refuse to pay them even if are assessed, I just wondered if there was some quick and easy sort of aspect I could count on. I really dislike anxiety, which we have all had quite enough of and would not want to enter the US with some sort of civil penalty hanging over my head.


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