# Dying to know



## Zendo (Apr 25, 2013)

I'm not quite sure whether this is the right place to post this thread, but there may be some considerations or repercussions based on the responses to my question that concern monetary (e.g. tax) issues.

I am at an age where one slowly but surely thinks about all those things that have to be taken care of when one is no longer here (i.e. on earth ). My concern is quite simple. Being a life-long, non-compliant dual-citizen (Swiss/USA), I have to know what will or should be considered after my death in relation to the USA and my non-compliance.

Are there any requirements dictating contact to the US embassy after the death of a dual US/Swiss citizen? Are my family and friends here obligated in any way to inform the US embassy after my death because I happen to have been born there and am, in some abstract way, still a US citizen? What happens in such a "situation"?

As far as Swiss jurisdiction is concerned, I have the impression that this would be a local matter.

In any event, I'm curious to know how one should approach such concrete and undeniable questions, as odd or depressing as they may seem.


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## Bevdeforges (Nov 16, 2007)

As long as your death occurs outside the US, and you have no remaining assets remaining in the US, there isn't really much in the way of "obligations" for your friends or family. Generally, any death certificate is issued by the jurisdiction where your death occurs. If it is noted on the death certificate that you are a US citizen, the local authorities may notify the US Embassy/Consulate. But what they do with that information is up to them, I guess. (Main thing might be to notify US SS to discontinue any benefits you are receiving.)

But other than that, I'm not aware of any responsibilities of the survivors. Ultimately, if you do have odds and ends of assets left in the US (forgotten bank accounts, investment accounts, etc.) those may turn up on the abandoned property site for the last state in which you had an address in. Lots of luck to whoever might try to claim those assets - especially anyone from outside the US. And worst possible case, the state retains the use of the money.


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## 255 (Sep 8, 2018)

Zendo -- Based on your comment: "...because I happen to have been born there and am, in some abstract way, still a US citizen..." I would assume you have no ties to the US, i.e. bank accounts, brokerage accounts, real property, social security retirement pension, etc. Normally, a report of a US citizens death abroad is reported to the local US Embassy/Consulate -- https://travel.state.gov/content/tr...report-of-death-of-a-u-s--citizen-abroad.html & https://ch.usembassy.gov/u-s-citizen-services/death-of-a-u-s-citizen/ so a "Consular Report of Death" can be prepared to assist the heirs/executor to move through the respective state "Probate" process. If there are no assets in the US, there won't be anything to probate and your Swiss heirs certainly would have no legal or even moral obligation to contact the US authorities. As far as the tax man making a claim on your Swiss estate, I think that would be highly unlikely. The tax system in the US is designed to be self reporting; although over the last few decades there have been a proliferation of "information" returns that have come into play -- I'd say, if they haven't been interested in tracking you down to date, I suspect they won't after your ultimate demise -- especially if no one tells them. The US Consular's efforts are purely there to "assist" the family -- they are not agents of the IRS and most Government Agencies don't really talk to one another. If my assumption is correct, Your family can just ignore any US reporting without risk of peril. Leaving you to just "ride off into the sunset." Cheers, 255


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## Nononymous (Jul 12, 2011)

Though it's presumably some decades into the future, this has been a concern of mine as well, as a fully non-compliant US-Canadian. It's also something that's been discussed from time to time on the Isaac Brock forum. I have no idea how it works under Swiss law, but in Canada it appears that the executor is responsible for ensuring that the estate meets all its tax obligations, and may even have some personal liability. So the danger then is that an executor learns of the deceased person's US citizenship, panics, and tries to bring the estate into US tax compliance. Even if there's no tax owing, the accounting fees could be ugly, and the delays. So the strategy is to have very little that needs to go through probate, and to ensure that the executor is either completely in the dark, or aware of US citizenship and willing to ignore it. So pick your executor well - don't choose someone with ties to the US!


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## Zendo (Apr 25, 2013)

Bevdeforges said:


> As long as your death occurs outside the US, and you have no remaining assets remaining in the US, there isn't really much in the way of "obligations" for your friends or family. Generally, any death certificate is issued by the jurisdiction where your death occurs. If it is noted on the death certificate that you are a US citizen, the local authorities may notify the US Embassy/Consulate. But what they do with that information is up to them, I guess. (Main thing might be to notify US SS to discontinue any benefits you are receiving.)
> 
> But other than that, I'm not aware of any responsibilities of the survivors. Ultimately, if you do have odds and ends of assets left in the US (forgotten bank accounts, investment accounts, etc.) those may turn up on the abandoned property site for the last state in which you had an address in. Lots of luck to whoever might try to claim those assets - especially anyone from outside the US. And worst possible case, the state retains the use of the money.


I have no odds or ends of assets in the US. However, a question just occurred to me regarding FATCA. I had to submit a W-9 form when it became know that I was born in the US. Now, what "obligations" would the banks have in terms of reporting information directly to the IRS after an account holder has passed away? How would the banks figure into this kind of situation? Not that it would really matter to me after I died. But, it could get complicated for my people here. There would inevitably be some kind of interaction between the local authorities and the banks until the question of whatever money was in my account was cleared. And because of FATCA the bank knows that I am a double national. Would the bank have to notify the US Embassy/Consulate and from there start a rigmarole to the IRS? Or do they have to report directly to the IRS? Does FATCA ruin the possibility from keeping such a story local and saving my nearest ones from a potentially complicated and confusing legal situation for them? I am reluctant to inquire directly by the bank. This kind of information is not provided on the W-9 form or the waiver from the bank. And, I don't suppose they would give me accurate info anyway.


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## Nononymous (Jul 12, 2011)

Have a look at the US-Switzerland IGA, that might be a source of info. What I expect happens is that during whatever process takes place after death, the account is closed and the money removed. At that point there is no account, and nothing to be reported under FATCA. I've seen nothing in the Canadian IGA that suggests a special notification upon the death of an account holder. This doesn't however mean that a Swiss bank might not completely freak out and overreact, given their history of being badly (and somewhat deservedly) spanked by the US government.

There's a risk here of attributing to the US government excessive omniscience and omnipotence. If you pass away and your executor closes your bank account, I strongly suspect that this does not trigger a chain of events that leads to a vast American bureaucracy hunting down the heirs in Switzerland for some potential but likely non-existent tax bill on your estate. (For what it's worth, the State Department doesn't seem to enjoy helping the IRS. Exhibit A, you can still renew a passport or renounce US citizenship without a Social Security Number.)

Your bank doing something stupid would still be a concern, however hypothetical. (On the other hand, if they let you sign a W9 without demanding proof that you've been filing US tax returns - which they have no obligation or right to do, but it's been known to happen - then I would expect them to just behave normally after your passing.) I have no idea how this works in Switzerland but one approach might be to assign a beneficiary so that the account need not be part of an estate? Alternatively, you could renounce US citizenship to prevent any future problems. Tax compliance is not necessary - just get in the queue and prepare to spend $2350.


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## Zendo (Apr 25, 2013)

Nononymous said:


> Have a look at the US-Switzerland IGA, that might be a source of info. What I expect happens is that during whatever process takes place after death, the account is closed and the money removed. At that point there is no account, and nothing to be reported under FATCA. I've seen nothing in the Canadian IGA that suggests a special notification upon the death of an account holder. This doesn't however mean that a Swiss bank might not completely freak out and overreact, given their history of being badly (and somewhat deservedly) spanked by the US government.
> 
> There's a risk here of attributing to the US government excessive omniscience and omnipotence. If you pass away and your executor closes your bank account, I strongly suspect that this does not trigger a chain of events that leads to a vast American bureaucracy hunting down the heirs in Switzerland for some potential but likely non-existent tax bill on your estate. (For what it's worth, the State Department doesn't seem to enjoy helping the IRS. Exhibit A, you can still renew a passport or renounce US citizenship without a Social Security Number.)
> 
> Your bank doing something stupid would still be a concern, however hypothetical. (On the other hand, if they let you sign a W9 without demanding proof that you've been filing US tax returns - which they have no obligation or right to do, but it's been known to happen - then I would expect them to just behave normally after your passing.) I have no idea how this works in Switzerland but one approach might be to assign a beneficiary so that the account need not be part of an estate? Alternatively, you could renounce US citizenship to prevent any future problems. Tax compliance is not necessary - just get in the queue and prepare to spend $2350.


Well, it's reassuring to know that I might be prematurely acting paranoid.  However, it may not be so simple. I don't think that my significant other can just go to the bank and close my account after my death and that would be the end of it. She is likely to have to provide my will to the local government and then there might be some kind of waiting period. I'm not quite sure, I haven't died yet.  But, I've heard some stories. A relative of a friend of hers who had double nationality, Italy/Switzerland, had to wait three years to get some money left from a relative, because the Swiss had to track down every potential relative in Switzerland and in Italy before proceeding. And this was even though the deceased had left behind a will. This may not apply to me, but just the same, I am checking out all possibilities.
You did, however, hit the nail on the head regarding my bank. But, what would be something stupid? Would they call the IRS to tell them that a dual national just croaked? What would be the added value in that?
As far as renouncing I am still considering that option or the option of relinquishing, as I've been in Switzerland almost my entire life. Maybe I should just join the queue as soon as I find out what is better and hope I don't have to go to Bern while the pandemic is still rampant. And at the moment I don't know which is better, renouncing or relinquishing, which boils down to the question of which is more complicated or confusing to initiate.


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## Bevdeforges (Nov 16, 2007)

The banks outside the US generally report only to their own national banking authority. In fact, even when reporting account balances of a "US person" they normally report this to the national banking authority, which is the agency that reports all of the information to the IRS. The obligations of your survivors about "processing" the news of your death are whatever they are in the country in which you are resident. Period.

Even in the US, when a citizen dies, the funeral parlor handling the arrangements (including the issuance of the death certificate) is only required by law to notify the US Social Security Administration so that their pension or other benefits can be stopped. Nobody notifies the IRS unless somebody involved with processing the estate bothers to file a "final" tax return. (I know when my father died in the US, there was no notification of any kind to the IRS because I never bothered to file a "final" tax return for him. He hadn't filed for years - for very legitimate reasons - so I saw no need to "bother" the IRS with a blank return.)

If you have no assets in the US, when you die your survivors need only fulfill the requirements of notification of the country in which you are resident. Now, that may include the local authorities notifying the US Embassy of your death but that's more or less a formality. 

There really isn't a "choice" between renouncing or relinquishing. Either way, you'll be charged $2350 for the Certificate of Loss of Nationality - which is what you need to convince the banks that you aren't a US person any more. The renunciation process is actually quite simple and pretty much painless (other than the potential wait for an appointment - or sometimes two - at the Consulate). The consulate personnel are actually quite pleasant to deal with and you don't even have to give them a "reason" for why you are doing it. You also don't actually need to be "current" with your tax filings either.


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## Nononymous (Jul 12, 2011)

@Bev

I believe that Switzerland has a Model 2 IGA, which means that Swiss banks report FATCA data directly to the IRS, the national tax authority does not collect and forward this information on their behalf.

Regarding renunciation versus relinquishment, there are some differences. They both cost the same $2350 fee. Renouncing is easy, swear an oath and you're done. To relinquish is more complicated, one must demonstrate that they had performed a relinquishing act (such as taking another citizenship) with the intention of losing US citizenship, and the request can be denied if a person did not behave accordingly afterwards (i.e. if they voted in a US election or obtained a US passport). There is generally no reason to bother with the more complicated relinquishment process except that if a person relinquished prior to 2004, they are excused from all tax obligations - they are essentially "compliant" without having to file the (optional) paperwork to exit the US tax system. Not that this matters in the real world, of course, but for some folks it might provide peace of mind.


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## Nononymous (Jul 12, 2011)

@Zendo

I have no idea how this works in Switzerland, but would you not have a joint account with your significant other, so that assets are not held up after one's death?

I'm only speculating as to what counts as stupid on the bank's part. I could imagine the release of assets being held up until it was proved to their satisfaction that the estate had undergone some form of US tax compliance. This is a wild guess on my part, but based on reports early on after FATCA that a handful of banks in Switzerland (and elsewhere in Europe) were asking US-person customers to prove that they were filing US tax returns like good little boys and girls, even though this is not required of them.


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