# Filing taxes



## Debzinuk (Jun 17, 2017)

Hi
I'm British, lived in California for 20 years, got citizenship and moved back to UK 11 years ago. I filed my US taxes yearly as I had property still in US but sold it all in 2017 and paid a lot of taxes. I did self tax last in 2018 but haven't bothered to do taxes since. Why? I have no property, no bank account. All I have remaining is an IRA account.
Should I be continuing to file taxes?
Thanks


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## Crawford (Jan 23, 2011)

Debzinuk said:


> Hi
> I'm British, lived in California for 20 years, got citizenship and moved back to UK 11 years ago. I filed my US taxes yearly as I had property still in US but sold it all in 2017 and paid a lot of taxes. I did self tax last in 2018 but haven't bothered to do taxes since. Why? I have no property, no bank account. All I have remaining is an IRA account.
> Should I be continuing to file taxes?
> Thanks


Definitely ..... as US citizen


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## nyclon (Apr 3, 2011)

I have moved your post to the tax forum where you should get more help.


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## Bevdeforges (Nov 16, 2007)

What Crawford said. See IRS Publication 54 for details. About Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad | Internal Revenue Service


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## Crawford (Jan 23, 2011)

Must ask something here.... while I KNOW that one is mandated to do a US tax return each year - even when not living in the country - if you do not intend to ever revisit the US and have no property or assets there, what harm would it do if you did not? What could the IRS do about it?

Just musing......


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## Nononymous (Jul 12, 2011)

Crawford said:


> Must ask something here.... while I KNOW that one is mandated to do a US tax return each year - even when not living in the country - if you do not intend to ever revisit the US and have no property or assets there, what harm would it do if you did not? What could the IRS do about it?


In general, there's nothing much the IRS can do about it. They could not touch a UK resident. Any dual citizen without US assets is completely free to file nothing - which is what over 90 percent of them (don't) do.

However, the OP does have an IRA account still in the US. I don't know how those work, but potentially there would be issues in making withdrawals if not filing, or just having the account "hostage" in the unlikely event that the IRS noticed and objected to ongoing non-compliance. More research required.

If the OP doesn't want to use the US passport again, doesn't want to continue filing US taxes, and is worried about the IRA, they could renounce US citizenship. More research into the consequences for the IRA is required here. The fee to renounce is $2350, but by filing for 2019 there's now $1800 in stimulus benefit to be had, and it could easily increase again.

Because the OP is a UK citizen born outside the US, they could also explore the "partial compliance" option. Ensure that no UK financial institution is aware of US citizenship, so that there is no FATCA reporting. File only the minimum the IRS requires for the remaining US assets without reporting any UK assets or income. That might be the easiest path forward given the IRA.


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## Moulard (Feb 3, 2017)

Crawford said:


> What could the IRS do about it?


Purely from a hypothetical perspective these are the four aces up their sleeves... (we know that the IRS cheats at poker (the bogus 3250 and 3250-A penalties anyone) ... so there are probably a few more.)

If the sums involved were sufficiently large ... there are a few things that the IRS can in fact do about it, but they are lengthy and costly... and the length and cost goes up exponentially as you go down the list.

If you lived in a country that had a mutual enforcement clause in the tax treaty, they could file a substitute return, and then apply to the local tax authority to enforce it.
Absent a mutual enforcement clause, they could apply to have the US passport revoked once the outstanding liability (tax + penalties + interest) exceeded $US 50k
In some cases, the IRS could also apply for a US court order, and they having received one then apply to a foreign court to enforce it.
Lastly the IRS could rely on mutual assistance agreements to gather evidence of tax crimes, which ultimately could form the basis of a US court ruling, that could lead to extradition if tax evasion or fraud were included in the relevant treaty
One example of point 4, local to me, Larry Williams eventually consented to extradition to the US from Australia for evading about $1.5 million in US taxes after having been arrested by Australian Federal Police on an extradition warrant on his arrival in Australia.









Episode 685: Larry vs. The IRS


A lot of people dream of not paying their taxes. Larry Williams scoured the fine print of IRS code, talked to lawyers, settled on a plan, then just stopped paying taxes.




www.npr.org


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## Nononymous (Jul 12, 2011)

Regarding point #1, those agreements exist with 5 countries only - Canada, Denmark, France, Netherlands and Sweden - and they *specifically exclude* each country's own citizens. So it's not a consideration for the UK.

Regarding the others, #2 doesn't matter if you don't care about the passport, I don't know that #3 has ever worked, and #4 is very expensive for the IRS so it's not a threat unless you owe a sh*t-ton of money or there's a political reason to make your life miserable.


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## Moulard (Feb 3, 2017)

I don't disagree with any of your points... the question was "what could the IRS do", not "what will they do", or even "what might they do", or "where are they more likely to do it".


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