# OVDI Program Information, Updates and Stories



## Deckard1138

This new thread is laser-focused on the IRS's OVDI program (Offshore Voluntary Disclosure Initiative for Offshore Accounts). There is a great deal of uncertainty about how this program is being administered, especially now that the September 9th, 2011 deadline has long-since passed and we are waiting for what new policy initiatives might be coming next from the IRS.

I hope that this thread can become a one-stop shop for anyone wanting to know more about this specific program: its history (including its 2009 predecessor), the status of current cases in the process, IRS policies now that the deadline has expired, anecdotal stories from OVDI participants etc.

What motivated me to start this thread were two very long and detailed critical assessments of both the 2009 and 2011 OVDI programs that I came across today. They were both co-written by Scott D. Michel and Mark E. Matthews, who have both had extensive involvement with the IRS, both from the inside, as staff, and outside, as professional tax advisors.

These two articles provide a rare and stunning insider's look at how the IRS has implemented these programs and how even the most loyal apologists for the department have become dismayed at the clumsy, heavy-handed tactics the IRS has deployed through these initiatives.

I have one family member who has just received her first notification from the IRS after her accountant convinced her to enter this program in August 2011. If there is a God, may he have mercy on her soul. You too may feel the same way after reading these articles:

OVDI #1 (2009):
http://www.morganlewis.com/pubs/TaxReport_OffshoreAccounts_21sept10.pdf

OVDI #2 (2011) and beyond:
http://www.morganlewis.com/pubs/TaxNotes_OVDI-is-Over_18oct11.pdf


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## Guest

Deckard1138 said:


> OVDI #2 (2011) and beyond:
> http://www.morganlewis.com/pubs/TaxNotes_OVDI-is-Over_18oct11.pdf


The absolutely most chilling and infuriating sentence in the second report is the following (about halfway through the report, if you can stand to read that far into it):

"We acknowledge that the entire offshore account
issue may eventually disappear if FATCA in its
current form remains the law of the land *(or, more
accurately, the law of the world)."*

There you have it, folks. The US Congress is in their eyes and the eyes of their consultants who wrote this report, the Master of the Universe. A law passed in Washington (FATCA) will be the "law of the world." 

So much for democracy. So much for national sovereignty for anyone other than the US. So much for "no taxation without representation."

We have met the Enemy, and he is THEM.

I have no trouble comprehending the motives of those who want to renounce US citizenship. I have significant trouble understanding how any intelligent, logical person can read something like this, reflect for 30 seconds on what they learned in US history in US high school (at least back in the 50s and early 60s), and still want to remain a US citizen. Or ever vote a single one of these arrogant monsters back in office. Any of them, Republican or Democrat.

Do not let ANY Canadian government grovel before them or cowardly submit to this. Watch carefully what our politicians do, and remember it for the next election (that is, if the US allows anyone outside their borders to have a free election again).

GOD am I glad I'm no longer an American citizen and haven't been one for the past 36 years. You can't blame these wingnuts on me, fellow humans of the rest of the world! I didn't vote for these lunatics!

Maybe I will get a Canadian Passport without the place of birth showing. I'm seriously doubting that I want ever to cross the US border again, even though I actually can with my Certificate. I'm ashamed for anyone to know that I was born and grew up there. I'd feel like a leper if someone saw that annotation on my passport, below my photograph.


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## Deckard1138

*1984 has fully, finally arrived*



Schubert said:


> The absolutely most chilling and infuriating sentence in the second report is the following (about halfway through the report, if you can stand to read that far into it):
> 
> "We acknowledge that the entire offshore account
> issue may eventually disappear if FATCA in its
> current form remains the law of the land *(or, more
> accurately, the law of the world)."*


Yeah, that one kind of stood out for me as well. Nut, meet nutshell.

Another one is this:

_Iron Fist and Velvet Glove Strategy Works

The lesson is obvious: If the IRS wants people to come forward voluntarily, it needs to couple its VDP with well-publicized tax enforcement. A VDP without the enforcement component will prompt only the sorts of anecdotal disclosures we all saw before 2008. With the iron fist hammering away, however, thousands of people will come forward._

Now I might be missing something here, but how likely are most sane people to voluntarily _come forward_ directly into the path of an _iron fist hammering away_ ? And exactly which aspect of the OVDI program could be characterized as a Velvet Glove?

If this were a concentration camp, it would be like offering a prisoner the choice between cutting off his own testicles or gouging out his own eyeballs.

1984 has fully, finally arrived.

You know, we haven't talked about this yet, but I also wonder if there might be any possible recourse with the U.N., if only for the symbolism and embarrassment?

The Universal Declaration of Human Rights

BTW, it was much quicker for me to determine which articles _don't_ apply to these actions of the U.S. (including OVDI, FBAR, FATCA as well as expatriation and cross-border penalties and restrictions).

I have nightly dreams now of a shiny, golden Certificate of Loss of Nationality - my very own winning Wonka ticket. :hail: I shall not rest until I am holding it in my hands, gazing at it in wonder, giddy with happiness and relief... :dance:


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## Cafreeb12

Deckard1138 said:


> Yeah, that one kind of stood out for me as well. Nut, meet nutshell.
> 
> Another one is this:
> 
> _Iron Fist and Velvet Glove Strategy Works
> 
> The lesson is obvious: If the IRS wants people to come forward voluntarily, it needs to couple its VDP with well-publicized tax enforcement. A VDP without the enforcement component will prompt only the sorts of anecdotal disclosures we all saw before 2008. With the iron fist hammering away, however, thousands of people will come forward._
> 
> Now I might be missing something here, but how likely are most sane people to voluntarily _come forward_ directly into the path of an _iron fist hammering away_ ? And exactly which aspect of the OVDI program could be characterized as a Velvet Glove?
> 
> If this were a concentration camp, it would be like offering a prisoner the choice between cutting off his own testicles or gouging out his own eyeballs.
> 
> 1984 has fully, finally arrived.
> 
> You know, we haven't talked about this yet, but I also wonder if there might be any possible recourse with the U.N., if only for the symbolism and embarrassment?
> 
> The Universal Declaration of Human Rights
> 
> BTW, it was much quicker for me to determine which articles _don't_ apply to these actions of the U.S. (including OVDI, FBAR, FATCA as well as expatriation and cross-border penalties and restrictions).
> 
> I have nightly dreams now of a shiny, golden Certificate of Loss of Nationality - my very own winning Wonka ticket. :hail: I shall not rest until I am holding it in my hands, gazing at it in wonder, giddy with happiness and relief... :dance:


The only people I've talked to who are keeping U.S. citizenship are in a financial position to do so and travel there frequently. For most of us it makes zero sense in any way to keep it. Part of my reason for renouncing is this reaching across the borders and imposing U.S. laws on others. You're already a lesser citizen by "virtue" of the fact you left the U.S. at all in many people's eyes, as this is what the government there encourages them to think. So what's the value in hanging on to this so called citizenship. They've treated ex pats like crap for years and years, now they've demonized us and attempted to fine our families and control the laws of the countries we live in.

Contacting the U.N. or any other action that can be taken which will draw negative attention to this issue and embarrass the U.S. is worth it whether or not it makes an impact on "their" laws.


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## Guest

*No relief*

Thanks for posting these. I have read both in their entirety and there isn't one thing in them that convinces me I have anything to gain by not renouncing. If anything, promises of 40% penalties etc ad nauseum, simply terrify me more.
It sounds as if there is no hope of convincing them that one had never heard of FBARS (in addition to being unaware of the requirement to file tax returns). And to be expected to accept ANY penalty, as if it were some sort of gift, just fuels me more. I want out, nothing to do with them and as others have said, this is simply not the America I grew up with. :boxing:


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## Cafreeb12

nobledreamer said:


> Thanks for posting these. I have read both in their entirety and there isn't one thing in them that convinces me I have anything to gain by not renouncing. If anything, promises of 40% penalties etc ad nauseum, simply terrify me more.
> It sounds as if there is no hope of convincing them that one had never heard of FBARS (in addition to being unaware of the requirement to file tax returns). And to be expected to accept ANY penalty, as if it were some sort of gift, just fuels me more. I want out, nothing to do with them and as others have said, this is simply not the America I grew up with. :boxing:


Nobel I've been thinking about that too, what if it IS the American we grew up with and we just didn't realize it as much as we do now due to the way we were taught to see things there. After ALL have we not *America* been going all over the world imposing our will for decades and decades now against poor people in other countries? This is hard to face and to say but, I'm starting to think THIS IS what it's been about for millions of others. We were just not told the truth about it. Not that the U.S. has only done bad but, it certainly has whenever they needed to and always, excused these actions. Covered over with a lot of flag waving. There are a lot of good people there, they just don't see this or a lot of other things because of the way everything is spun. LOOK at the trouble we are having explaining this to citizens who never have lived outside the country? The only thing making this hard for them to comprehend is the lies they've been told about ex pats...how many other issues are like this. I think we all knew it deep down and just wanted to believe something else. 

I'm seeing a lot of things differently now and I was starting to before this even happened. Shubert is right about many things he alludes to here. It's got me thinking for various reasons. As long as I can see my father and family I am caring less and less about the "cost" of renouncing. It's sad to say but, all this has done is wake up a lot of people as to what the U.S. government is capable of against innocent citizens AND foreign persons too.


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## Bevdeforges

Deckard1138 said:


> You know, we haven't talked about this yet, but I also wonder if there might be any possible recourse with the U.N., if only for the symbolism and embarrassment?
> 
> The Universal Declaration of Human Rights


The Universal Declaration of Human Rights is one of many UN documents the US has steadfastly refused to sign over the years. Just so you know...
Cheers,
Bev


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## Deckard1138

Figures.


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## Guest

*IRS criminal behaviour documented in those reports*

Something else caught my eye and mind in reading those two reports.

In one of them, I forget which, the authors mention approvingly cases of which they are aware in which the IRS, through its 25%-of-the-penalty-reward whistle-blower program, got at least one bank teller and at least one computer operator or programmer in a foreign financial institution to divulge client information to the IRS, leading to penalties and the 25% reward.

I am reasonably certain that in all countries, certainly those with reasonably advanced legal systems, bank tellers and computer operators have to sign confidentiality and non-disclosure agreements as part of their employment contract. Employment contracts are legally binding documents. Moreover, in most jurisdictions, there is a concept of “duty of care” and another concept of “breach of trust,” which apply to everyone regardless of employment contracts and non-disclosure agreements.

There is also a legal concept of “suborning,” that is, bribing someone to commit a crime. 

In the above-mentioned cases, it seems to me there is a solid case for charging the IRS with suborning tellers and computer operators in those countries to commit a breach of trust against account holders and probably also a breach of contract with their employers. Not sure how you’d enforce the charges against IRS, though, since the US refuses to sign the international court agreements that might hold their own soldiers responsible for crimes against humanity, or just plain murder, in other countries. US “exceptionalism” means “we can do whatever we want, wherever we want, however we want, and have to answer to no one but ourselves.”

I’m not really surprised, though. Nor would anyone else who has ever looked at the long, horrible track record the US has regarding its treaties with every First Nation it ever encountered on this continent.

There are legal processes for trying to get information. They involve things like search warrants, which require an application to a judge or a court, showing probably cause. That isn’t what has been going on in these cases.

The IRS, which claims to be going after “tax cheats” and “tax criminals,” is itself engaging in illegal behaviour and criminality in other countries. The evidence is right there in those two reports.


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## Cafreeb12

Schubert said:


> Something else caught my eye and mind in reading those two reports.
> 
> In one of them, I forget which, the authors mention approvingly cases of which they are aware in which the IRS, through its 25%-of-the-penalty-reward whistle-blower program, got at least one bank teller and at least one computer operator or programmer in a foreign financial institution to divulge client information to the IRS, leading to penalties and the 25% reward.
> 
> I am reasonably certain that in all countries, certainly those with reasonably advanced legal systems, bank tellers and computer operators have to sign confidentiality and non-disclosure agreements as part of their employment contract. Employment contracts are legally binding documents. Moreover, in most jurisdictions, there is a concept of “duty of care” and another concept of “breach of trust,” which apply to everyone regardless of employment contracts and non-disclosure agreements.
> 
> There is also a legal concept of “suborning,” that is, bribing someone to commit a crime.
> 
> In the above-mentioned cases, it seems to me there is a solid case for charging the IRS with suborning tellers and computer operators in those countries to commit a breach of trust against account holders and probably also a breach of contract with their employers. Not sure how you’d enforce the charges against IRS, though, since the US refuses to sign the international court agreements that might hold their own soldiers responsible for crimes against humanity, or just plain murder, in other countries. US “exceptionalism” means “we can do whatever we want, wherever we want, however we want, and have to answer to no one but ourselves.”
> 
> I’m not really surprised, though. Nor would anyone else who has ever looked at the long, horrible track record the US has regarding its treaties with every First Nation it ever encountered on this continent.
> 
> There are legal processes for trying to get information. They involve things like search warrants, which require an application to a judge or a court, showing probably cause. That isn’t what has been going on in these cases.
> 
> The IRS, which claims to be going after “tax cheats” and “tax criminals,” is itself engaging in illegal behaviour and criminality in other countries. The evidence is right there in those two reports.


The cognitive dissonance here does not surprise me. There was recently an article about how hard this administration has been on "whistle blowers" after saying they would support them more. In fact even harder on them than the previous administration. So, we have them not supporting any sort of whistle blowing in the U.S. while encouraging it in other countries. Also, they have been trying to get around and make laws which do not require search warrants. They can already delve into your online activities, your email etc. if they want to without any warrant. The so called "Patriot Act" as well as the dubiously named "Homeland Security" caused a lot of this. What they once again ignore are the laws of other countries. Harper has recently been leaning towards passing similar legislation that would allow searches without a warrant. This has to be stopped. 

The U.S. is going to use every trick in the book, count on it. That's why I have little faith in any safety with a major bank.


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## AmTaker

Schubert said:


> Something else caught my eye and mind in reading those two reports.
> 
> In one of them, I forget which, the authors mention approvingly cases of which they are aware in which the IRS, through its 25%-of-the-penalty-reward whistle-blower program, got at least one bank teller and at least one computer operator or programmer in a foreign financial institution to divulge client information to the IRS, leading to penalties and the 25% reward.
> 
> ..
> In the above-mentioned cases, it seems to me there is a solid case for charging the IRS with suborning tellers and computer operators in those countries to commit a breach of trust against account holders and probably also a breach of contract with their employers.


The IRS did not 'get' these people to come forward, for the most part. They came forward on their own, notably the UBS whistleblower because they were interested in this reward money (the UBS whistleblower went to jail in the US because he tried to keep secrets and protect a billionaire client, but that is another story ..). That alone would blow a hole in your argument about charging the IRS since I don't think there was any direct suborning, the whistleblowers came forward on their own and approached the US government. 

The US is hardly the only or even the first country to obtain such information through whistleblowers. Germany, France and the UK obtained such information on tax cheats in Switzerland and Luxembourg from various whistleblowers recently. I think the CRA is trying something similar too. 

Besides, the clients were not exactly innocents. Pretty much all were big time tax cheats, and the banks were not exactly unwitting dupes either, but knowing accomplices in tax evasion, helping tax cheats (possibly even a few with illegal source income) to smuggle money out, set up trusts and foundations etc. etc. 

I admit that these whistleblowers hardly have clean hands -- they are generally purely out for money, or disgruntled staff members, and the like. But they are exposing behavior that is clearly illegal and criminal in the US, and in most jurisdictions. Even Switzerland considers tax fraud a crime. 

Your dislike for the US seems to be leading you to defend the indefensible -- banks and countries that actively encourage tax evasion. And its far worse for poor third world countries -- vast amounts of money has been looted from these countries by despots, crooked politicians, bureaucrats and businessmen and stowed in these banks.


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## Cafreeb12

AmTaker said:


> The IRS did not 'get' these people to come forward, for the most part. They came forward on their own, notably the UBS whistleblower because they were interested in this reward money (the UBS whistleblower went to jail in the US because he tried to keep secrets and protect a billionaire client, but that is another story ..). That alone would blow a hole in your argument about charging the IRS since I don't think there was any direct suborning, the whistleblowers came forward on their own and approached the US government.
> 
> The US is hardly the only or even the first country to obtain such information through whistleblowers. Germany, France and the UK obtained such information on tax cheats in Switzerland and Luxembourg from various whistleblowers recently. I think the CRA is trying something similar too.
> 
> Besides, the clients were not exactly innocents. Pretty much all were big time tax cheats, and the banks were not exactly unwitting dupes either, but knowing accomplices in tax evasion, helping tax cheats (possibly even a few with illegal source income) to smuggle money out, set up trusts and foundations etc. etc.
> 
> I admit that these whistleblowers hardly have clean hands -- they are generally purely out for money, or disgruntled staff members, and the like. But they are exposing behavior that is clearly illegal and criminal in the US, and in most jurisdictions. Even Switzerland considers tax fraud a crime.
> 
> Your dislike for the US seems to be leading you to defend the indefensible -- banks and countries that actively encourage tax evasion. And its far worse for poor third world countries -- vast amounts of money has been looted from these countries by despots, crooked politicians, bureaucrats and businessmen and stowed in these banks.


Perhaps but, what I got from his post was a reference to whether or not these incentives would be used against us as well. Most of us not owing them any tax when FATCA comes into play. We are not "tax cheats" Of course most countries consider tax cheating and fraud illegal and yes, the U.S. caught "some" people with these methods but, the fact that they have decided to include places like Canada *not a tax haven by any means* in FATCA and the huge FBAR penalities, not taxes at all..seems daunting. This entire debacle is due to innocent people being lumped in with the people you described above. What is to day we aren't going to continue to be treated as they are going forward.


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## AmTaker

Cafreeb12 said:


> Perhaps but, what I got from his post was a reference to whether or not these incentives would be used against us as well. Most of us not owing them any tax when FATCA comes into play. We are not "tax cheats" Of course most countries consider tax cheating and fraud illegal and yes, the U.S. caught "some" people with these methods but, the fact that they have decided to include places like Canada *not a tax haven by any means* in FATCA and the huge FBAR penalities, not taxes at all..seems daunting. This entire debacle is due to innocent people being lumped in with the people you described above. What is to day we aren't going to continue to be treated as they are going forward.


I doubt it, because most of the whistleblower incentives are based on a %age of tax actually collected from the people involved. I think the UBS whistleblower will get 25-75M or something after he leaves prison. When there is no tax due, there is no incentive for whistleblowers and little incentive for the US government. 

I agree that its silly to think of 'concealed' accounts in non tax haven countries, and even tax havens have innocent expats, although most are not likely to have the sort of 'private bank' accounts that are used to conceal money. And yes, I think FATCA is way overkill (at least for expats).


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## Guest

Cafreeb12 said:


> Nobel I've been thinking about that too, what if it IS the American we grew up with and we just didn't realize it as much as we do now due to the way we were taught to see things there. After ALL have we not *America* been going all over the world imposing our will for decades and decades now against poor people in other countries? This is hard to face and to say but, I'm starting to think THIS IS what it's been about for millions of others. We were just not told the truth about it. Not that the U.S. has only done bad but, it certainly has whenever they needed to and always, excused these actions. Covered over with a lot of flag waving. There are a lot of good people there, they just don't see this or a lot of other things because of the way everything is spun. LOOK at the trouble we are having explaining this to citizens who never have lived outside the country? The only thing making this hard for them to comprehend is the lies they've been told about ex pats...how many other issues are like this. I think we all knew it deep down and just wanted to believe something else.
> 
> I'm seeing a lot of things differently now and I was starting to before this even happened. Shubert is right about many things he alludes to here. It's got me thinking for various reasons. As long as I can see my father and family I am caring less and less about the "cost" of renouncing. It's sad to say but, all this has done is wake up a lot of people as to what the U.S. government is capable of against innocent citizens AND foreign persons too.


Um, I don't think I've been naive about what the US is doing for a long time. Mostly due to a teacher I had in Grade 10 (in the States). The course was "World Cultures" and the section was "Latin America." Boy, did I ever learn what we were really about. Supporting dictators so we could have access to natural resources, owning more than 51% of companies, etc etc. Just before was Vietnam and just after was Watergate.......but my attitude changed a bit after seeing "Farenheit 911" and the election of Obama. I heard Michael Moore talking about the movie and what he said reminded me that I need not be embarrassed for being American, that we _were_ about values and all that good stuff....I wasn't even aware of who Obama was until quite late in the primaries. My sister was telling me how over 100 people would come on a Saturday to volunteer and that he was recharging our psyche.I think it boils down to- there is the American government and then, there are the American people, most of whom, I still experience and believe, are more good than bad. My family and friends are totally supportive of my renouncing and they do not believe for a minute that any of us are "tax cheats" or living in luxury while not paying a dime. So it is all quite a mix of good and bad and I doubt there is much I can do to change it. I am just grateful that there was no letter from the IRS in today's mail and that I am on the list for the next "group" appointment in TO. :clap2:


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## Cafreeb12

nobledreamer said:


> Um, I don't think I've been naive about what the US is doing for a long time. Mostly due to a teacher I had in Grade 10 (in the States). The course was "World Cultures" and the section was "Latin America." Boy, did I ever learn what we were really about. Supporting dictators so we could have access to natural resources, owning more than 51% of companies, etc etc. Just before was Vietnam and just after was Watergate.......but my attitude changed a bit after seeing "Farenheit 911" and the election of Obama. I heard Michael Moore talking about the movie and what he said reminded me that I need not be embarrassed for being American, that we _were_ about values and all that good stuff....I wasn't even aware of who Obama was until quite late in the primaries. My sister was telling me how over 100 people would come on a Saturday to volunteer and that he was recharging our psyche.I think it boils down to- there is the American government and then, there are the American people, most of whom, I still experience and believe, are more good than bad. My family and friends are totally supportive of my renouncing and they do not believe for a minute that any of us are "tax cheats" or living in luxury while not paying a dime. So it is all quite a mix of good and bad and I doubt there is much I can do to change it. I am just grateful that there was no letter from the IRS in today's mail and that I am on the list for the next "group" appointment in TO. :clap2:


Noble, my vote and many others were stolen because of Obama's "wonderful" campaign. The press never reported on what went on there but, his lawyers sued in two cases to prevent certain votes counting and he lost all credibility with me from there on. I voted third party in the G.E. because of it and it was the ONLY time I went out of my way to vote. I know many people fell in love with the guy but, I saw too much shenanigans behind the scenes and am jaded by that as well as his real actions that also never got reported on. That time along with this have really made me feel just totally disillusioned. YES, there are good people there the vast majority of whom toil in service and never are lauded in the press or by anyone else. They just do it, to live good lives. 

I will miss and mourn what I "thought" was my countries ideals in some ways but, for me this journey to "enlightenment" started several years ago. I've almost got to the point of seeing my renouncing as the only thing I can do and still hold to MY values. Oddly enough values I learned in the Untied States...something about standing up for what is right no matter what, no matter how unpopular. 

At any rate this process is messy and painful more for some of us. Others will just be glad it's over. I think there will always be a wistfulness at times around these issues but, I bet you anything when you get done with this renouncing you will feel like a ten ton weight has been lifted from your shoulders.


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## Ladyhawk

*anti-americanism*



Schubert said:


> I have no trouble comprehending the motives of those who want to renounce US citizenship. I have significant trouble understanding how any intelligent, logical person can read something like this, reflect for 30 seconds on what they learned in US history in US high school (at least back in the 50s and early 60s), and still want to remain a US citizen....Watch carefully what our politicians do, and remember it for the next election (that is, if the US allows anyone outside their borders to have a free election again).
> 
> GOD am I glad I'm no longer an American citizen and haven't been one for the past 36 years. ....Maybe I will get a Canadian Passport without the place of birth showing. I'm seriously doubting that I want ever to cross the US border again, even though I actually can with my Certificate. I'm ashamed for anyone to know that I was born and grew up there. I'd feel like a leper if someone saw that annotation on my passport, below my photograph.


Don't be shy, Schubert - tell us how you REALLY feel!

I come to this forum and these specific threads for two reasons: 1) information and 2) support from, and for, people who are in this with me. So I am dismayed at the increasingly personal and borderline accusatory tone of the anti-Americanism here, where the intelligence, the motives and the loyalty of people on this forum who are retaining US citizenship is questioned. It's divisive and the atmosphere is taking on a hostile and exclusionary feel to it. 

I have no quibble with robust and passionate discussions here about the IRS nightmare we are in, nor about renunciation of citizenship, nor about politics in general. We are a diverse bunch and we can learn from each other. We should be able to disagree without being disagreeable. We all have strong feelings about what is happening to us, but we also have our own feelings toward America and toward Americans back home that spring from our own circumstances (in my case, extensive and very close family ties) and from our own values, and which lead us to make our own choices.

I understand that people have anti-American feelings. I've endured 40 years of it in this country. Anti-Americanism is practically in Canada's DNA. I do not share this vehement hatred for "America" and some days, I am thoroughly sick of it. I agree with nobledreamer that "there is the American government and then, there are the American people, most of whom, I still experience and believe, are more good than bad." I am not where cafreeb is but I understand her feeling that "I've almost got to the point of seeing my renouncing as the only thing I can do and still hold to MY values. Oddly enough values I learned in the United States...something about standing up for what is right no matter what, no matter how unpopular." 

Those values matter to me too, but I choose to fight for them in a different way. I won't renounce, no matter how bad it gets. Nor would I renounce my Canadian citizenship if this country's government began persecuting me for some reason. Unthinkable? Think of the aboriginals, who have watched Canada break every treaty. Think of the Japanese Canadians who were deprived of their liberty and property in the 1940's. No government is entirely trustworthy. Power and money are corrupting, and governments have the largest accumulation of both. And they have the power to make the laws, and then enforce them.

But I do not believe that the actions of a government are what define a country or a people. I am lucky enough to hold dual citizenship in two countries with so much beauty, wealth, and freedom. The aboriginals call North America "Turtle Island" based on their creation story. Well I was born on Turtle Island and it is my home, not some artificial division of the land where self-important officials draw lines in the sand and pretend they are defending some morally superior way of life. 

If you need to go on ranting about how much you hate America, please open a new thread so I do not have to wade through it to get to the information and support I am looking for. Schubert, you are very helpful about finding information and offering templates for letters of complaint. I'd rather have you on my side than the other. But so many of your posts are so bitter they are turning this forum toxic. You have no skin in this game. Why are you here?


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## Guest

Schubert said:


> Maybe I will get a Canadian Passport without the place of birth showing. I'm seriously doubting that I want ever to cross the US border again, even though I actually can with my Certificate. I'm ashamed for anyone to know that I was born and grew up there. I'd feel like a leper if someone saw that annotation on my passport, below my photograph.


Couldn't you get a passport with just the city showing and not the three digit country code? Passport Canada does this automatically for people born in Jerusalem. That way you would be able to travel and your passport wouldn't draw unwanted attention. I guess this only works if you were born in a city that doesn't immediately scream USA like New York or Seattle. But if it is something vaguely English sounding of which there are numerous duplicates, like Rochester (One in Canada and in the US) or Winchester (tons of them in the US and one in Canada and the UK), you would just look like a Canadian born in Canada.

The UK issues passports only with the city name showing, for example, so someone born in "Boston" could have been born in more than no less than 8 countries:

http://en.wikipedia.org/wiki/Boston_(disambiguation)

I was born in a US city with a Spanish name that also happens to have an exact twin in Italy, so people commonly mistake my place of birth sometimes as being this city, but in Italy. This works well in some EU countries where they only ask you which city you were born in and have no concept of dual nationality, so lots of my records just mention a city name and Italian nationality. 

Just saying


----------



## Peg

Today I received a Registered Letter from The Department of the Treasury, IRS, Criminal Investigation that "voluntary disclosure has been preliminarily accepted". I could type it out later but what makes my heart sing is the signatory:

Director, Global Financial Crimes
IRS, Criminal Investigation


Now I know who to address my Opt Out letter!


----------



## Peg

Oh, and they also gave me an actual phone number to call! Will be doing that...


----------



## Guest

Peg said:


> Today I received a Registered Letter from The Department of the Treasury, IRS, Criminal Investigation that "voluntary disclosure has been preliminarily accepted". I could type it out later but what makes my heart sing is the signatory:
> 
> Director, Global Financial Crimes
> IRS, Criminal Investigation
> 
> 
> Now I know who to address my Opt Out letter!


Yikes! I guess that *is* good news Peg??? I will try to get more familiar with "Opt out" as I haven't really followed that yet.......How long ago did you send your stuff?


----------



## Peg

nobledreamer said:


> Yikes! I guess that *is* good news Peg??? I will try to get more familiar with "Opt out" as I haven't really followed that yet.......How long ago did you send your stuff?


It's not good news since I never should have entered OVDI but at least my wait to hear from them is over... My submission got in on the deadline of September 9. Their letter was dated October 26.

I am going to opt out; need to write the letter - regular, chaotic life got in the way of my battle against the US gov. :boxing:


----------



## Peg

I still cannot believe that my name is on the same page as Criminal Investigation! I am the person who tells the clerk that they have given me too much money. I do not watch pirated movies, we pay for our music on iTunes and our e-books on Amazon. When I was self-employed I declared every penny of my cash income. How can I remotely be considered a criminal?

It is still surreal...


----------



## Cafreeb12

Peg said:


> Today I received a Registered Letter from The Department of the Treasury, IRS, Criminal Investigation that "voluntary disclosure has been preliminarily accepted". I could type it out later but what makes my heart sing is the signatory:
> 
> Director, Global Financial Crimes
> IRS, Criminal Investigation
> 
> 
> Now I know who to address my Opt Out letter!


oy! Financial crimes? Criminal Investigation...that program was such a sorry scam. Do you plan to call them?


----------



## Guest

Ladyhawk said:


> You have no skin in this game. Why are you here?


People I love deeply are worried sick about having the rest of their retirements ruined by an arbitrary and arguably illegal US declaration that they are "still" US citizens when it was very clear to everyone, or so we all thought, when they became Canadians that meant losing US nationality, decades ago.

These people are not dual citizens and never wanted to be that nor considered themselves that.

You're right we do need a separate thread for these folks, I tried to set one up yesterday but it got taken down on Canada (still is under General, I'm trying to correct that). Maybe it needs a different header than the one it has ...

Once that new thread is set up, that's the one I'll inhabit, not this one or the other ones.

And I'm doing this because of the very fact that I'm safe from FATCA and FBAR and can speak out for others who are literally terrified of somehow being identified and pursued if they speak out. If it didn't affect someone very near and dear to me, and thereby me as well, I'd happily ignore the whole issue, say "who cares this doesn't affect me" like far too many Americans and Canadians are doing, or may do once they find out about this issue, and spend my time and energy on something a lot more fun and rewarding. But that isn't the case, and part of me would feel very guilty if I remained silent even if this didn't affect me as it does.

I too have family and friends in the US and love them dearly. But I hate their government, which is in my perception alienated from its own people and they from it, increasingly.

Over and out until the other thread is up so I can present whatever I think I can contribute there.


----------



## Cafreeb12

Peg said:


> I still cannot believe that my name is on the same page as Criminal Investigation! I am the person who tells the clerk that they have given me too much money. I do not watch pirated movies, we pay for our music on iTunes and our e-books on Amazon. When I was self-employed I declared every penny of my cash income. How can I remotely be considered a criminal?
> 
> It is still surreal...


Welcome to the Hire legislation. Lovely isn't it? I know what you mean Peg, I wasn't going to claim Social Security because I didn't morally feel since I'd been out of the country so long that would be fair. I felt since the program was being cut and with so many in trouble in the U.S. that it might help a little if I didn't claim my "share" How bout them apples? And yes, it's people like you and me they are calling "criminals" Really an outrage.


----------



## Ladyhawk

Peg said:


> I still cannot believe that my name is on the same page as Criminal Investigation! I am the person who tells the clerk that they have given me too much money. I do not watch pirated movies, we pay for our music on iTunes and our e-books on Amazon. When I was self-employed I declared every penny of my cash income. How can I remotely be considered a criminal?
> 
> It is still surreal...


Best of luck Peg, keep us posted.


----------



## Mona Lisa76

Peg said:


> It's not good news since I never should have entered OVDI but at least my wait to hear from them is over... My submission got in on the deadline of September 9. Their letter was dated October 26.
> 
> I am going to opt out; need to write the letter - regular, chaotic life got in the way of my battle against the US gov. :boxing:


I'm also thinking of you and hoping for the best but would like to think they'll be understanding about you opting out. After all, the ovdi was really meant to be against US persons RESIDENT in the US, hiding money offshore rather than expats or accidental Americans such as yourself. I'm cynical enough to believe they'll use it as a cash grab by entrapping gullibles but at least you were fortunate enough to become informed enough to consider opting out, etc.


----------



## Peg

:ranger: My letter to opt out of OVDI is done! :clap2: I have put enough personal details in the letter that if the USA tries to penalize me, some journalist could have a field day with the draconian nature of the US Gov!

Tomorrow I will write the letters to accompany my IRS returns and FBARs plus get all of the forms triple-checked and organized and then Hello FedEx! My family and I are so ready for this ordeal to be done...

:canada:


----------



## Peg

Mona Lisa76 said:


> I'm also thinking of you and hoping for the best but would like to think they'll be understanding about you opting out. After all, the ovdi was really meant to be against US persons RESIDENT in the US, hiding money offshore rather than expats or accidental Americans such as yourself. I'm cynical enough to believe they'll use it as a cash grab by entrapping gullibles but at least you were fortunate enough to become informed enough to consider opting out, etc.


The frustrating part is the not knowing since the US gov may never acknowledge that I am in the clear!


----------



## Guest

Peg said:


> : Tomorrow I will write the letters to accompany my IRS returns and FBARs plus get all of the forms triple-checked and organized and then Hello FedEx! My family and I are so ready for this ordeal to be done...:canada:


Peg, I had a talk with my sister tonite (she's a CPA in the States) and she had a few suggestions for the wording of letters (which she says, has always served her well)....

"I respectfully request the _abatement of penalties_...."
"I was unaware of the filing requirements but once I knew about them, I requested bank records, etc etc" and made a _good faith effort _to complete......"

She said the trick is to look at how they word their suggestions for rectifying a situation and to put your information in that same context.

"attach a statement explaining why the reports are filed late. No penalty will be asserted if the IRS determines that the late filings were due to _reasonable cause_

ray:


----------



## Ladyhawk

Peg said:


> The frustrating part is the not knowing since the US gov may never acknowledge that I am in the clear!


Since this is OVDI stuff, I'd guess you'd hear something within a couple of months if they want anything. If they don't want to bother further with you, no news is good news, Peg!


----------



## The_Animal

My wife's talking to H&R Block tomorrow and we plan to get the filing part of it sorted out (FBARs & late 1040EZs) but I dunno what's going to happen. Frankly, I'm incensed because as a Canadian citizen PRIMARY account holder with an FFI account jointly held by my US citizen wife, the IRS gets to nose around in MY BUSINESS! I'd just love to be able to drag an IRS lawyer up here and have him explain to a court judge here, why they contravened the Privacy Act of BC. When we have to do transactions, my wife has to get permission from me to do anything with regards to the account. All she is is just a signatory, yet because she's a citizen of the US they get to monkey around in MY account.


----------



## Peg

nobledreamer said:


> Peg, I had a talk with my sister tonite (she's a CPA in the States) and she had a few suggestions for the wording of letters (which she says, has always served her well)....
> 
> "I respectfully request the _abatement of penalties_...."
> "I was unaware of the filing requirements but once I knew about them, I requested bank records, etc etc" and made a _good faith effort _to complete......"
> 
> She said the trick is to look at how they word their suggestions for rectifying a situation and to put your information in that same context.
> 
> "attach a statement explaining why the reports are filed late. No penalty will be asserted if the IRS determines that the late filings were due to _reasonable cause_
> 
> ray:


Really appreciate that! 

While I like the "respectfully request", the *'abatement'* part concerns me because abatement in some dictionaries is reduction or decrease rather than elimination.

I really like the "but once I knew about them" sentence.

As for the wording to match theirs I did that a couple of times


----------



## Peg

What are the odds that today, the day I am trying to complete my IRS returns and FBARs, the IRS.gov website is down!


----------



## Deckard1138

Peg said:


> What are the odds that today, the day I am trying to complete my IRS returns and FBARs, the IRS.gov website is down!


Go Anonymous!


----------



## Peg

I am looking for answers to questions --- I will be filing paper copies of everything.


----------



## AmTaker

Peg said:


> Really appreciate that!
> 
> While I like the "respectfully request", the *'abatement'* part concerns me because abatement in some dictionaries is reduction or decrease rather than elimination.
> 
> I really like the "but once I knew about them" sentence.
> 
> As for the wording to match theirs I did that a couple of times


Try waiver of penalties. 

Note that the IRS manual for its agents itself says

"Penalties should be asserted only to promote compliance with the FBAR reporting and recordkeeping requirements. In exercising their discretion, examiners should consider whether the issuance of a warning letter and the securing of delinquent FBARs, rather than the assertion of a penalty, will achieve the desired result of improving compliance in the future. "



I would also add comments such as (depending on how they hold for your case)
1) No US source income
2) Left the US many years ago
3) Was unaware of filing requirements until recently
4) Little to no tax due
5) Total compliance with CRA
6) etc. etc.


----------



## Bevdeforges

Peg said:


> What are the odds that today, the day I am trying to complete my IRS returns and FBARs, the IRS.gov website is down!


Is the site actually down? I've found that if I only put "irs.gov" in the box on my browser, I can't get into the site. Be sure to type in the "www" part as well and you may have better luck.
Cheers,
Bev


----------



## Peg

AmTaker said:


> Try waiver of penalties.
> 
> Note that the IRS manual for its agents itself says
> 
> "Penalties should be asserted only to promote compliance with the FBAR reporting and recordkeeping requirements. In exercising their discretion, examiners should consider whether the issuance of a warning letter and the securing of delinquent FBARs, rather than the assertion of a penalty, will achieve the desired result of improving compliance in the future. "
> 
> 
> 
> I would also add comments such as (depending on how they hold for your case)
> 1) No US source income
> 2) Left the US many years ago
> 3) Was unaware of filing requirements until recently
> 4) Little to no tax due
> 5) Total compliance with CRA
> 6) etc. etc.


I did cover points 1 through 5 plus a few etceteras!

Like the waiving of penalty except that I am requesting to Opt out of OVDI so it's not even a waiver per se. All suggestions appreciated! (I'm off to work now but will return...)


----------



## Peg

Bevdeforges said:


> Is the site actually down? I've found that if I only put "irs.gov" in the box on my browser, I can't get into the site. Be sure to type in the "www" part as well and you may have better luck.
> Cheers,
> Bev


It is back up now - I had googled different terms, used a link etc and none worked. Thanks Bev.


----------



## The_Animal

Peg said:


> What are the odds that today, the day I am trying to complete my IRS returns and FBARs, the IRS.gov website is down!


Well, ain't that bloody convenient, eh?


----------



## Cafreeb12

Deckard1138 said:


> Go Anonymous!


LOL!! :cheer2::lol::lol::lol:eep:


----------



## Deckard1138

Cafreeb12 said:


> LOL!! :cheer2::lol::lol::lol:eep:


Thanks, Cafreeb - at least _you_ got the reference!


----------



## Cafreeb12

Deckard1138 said:


> Thanks, Cafreeb - at least _you_ got the reference!


They successfully ran a certain organization away from a university campus near me, saving innocent students from all manner of dangers, so I've an affinity for some things they have accomplished. In fact said organization no longer even exists in my city.


----------



## Peg

Peg said:


> Like the waiving of penalty except that I am requesting to Opt out of OVDI so it's not even a waiver per se. All suggestions appreciated!


Decided on simplicity: *The penalties under the OVDI do not apply ... *(then gave my reasons).

To "waive" means that I think they should apply. 

As I said in an earlier post: using "I respectfully request the abatement of penalties...."
bothered me as 'abatement' in some dictionaries is reduction or decrease rather than elimination.

I left a message for OVDI today and they called me back when I was at work - hope I connect with him tomorrow!


----------



## Vangrrl

Good luck Peg!

I didn't even mention fines in my letter because as far as I am concerned fines are for people who did wrong and that's not me!

I mentioned living in Canada for most of my life, that as a dual citizen since the age of 5 years old and the only USC in my family, I was completely unaware that US taxation rules applied to me, that I have never made any income in the US and have no current financial ties and that I owed zero taxes. I ended with something along the lines of "Please accept my past returns/fbars with my assurances that I will be complying with US taxation laws going forward". Can't remember the exact wording, but it sounded good at the time!


----------



## Peg

Vangrrl said:


> Good luck Peg!
> 
> I didn't even mention fines in my letter because as far as I am concerned fines are for people who did wrong and that's not me!


Was that for quiet disclosure? My wording is for my Opt Out of OVDI letter... 

I will have a much simpler letter for my not-so-quiet-disclosure.

:canada:


----------



## Vangrrl

Peg said:


> Was that for quiet disclosure? My wording is for my Opt Out of OVDI letter...
> 
> I will have a much simpler letter for my not-so-quiet-disclosure.
> 
> :canada:


Oh, I'm sorry I misunderstood! I thought this was your quiet disclosure that was running parallel to OVDI.

Your letter sounds perfect for Operation OVDI Opt-Out


----------



## owlonabranch

Mona Lisa76 said:


> I'm also thinking of you and hoping for the best but would like to think they'll be understanding about you opting out. After all, the ovdi was really meant to be against US persons RESIDENT in the US, hiding money offshore rather than expats or accidental Americans such as yourself. I'm cynical enough to believe they'll use it as a cash grab by *entrapping gullibles* but at least you were fortunate enough to become informed enough to consider opting out, etc.


Please don't characterise OVDI program participants as gullible. It makes it sound as though what happens to them is their fault rather than the fault of the IRS.

Everyone in this situation is gambling in one way or another - whichever option you take. You are all expecting/hoping/betting that the option you choose will lead to your "innocent minnow" status being recognised and the draconian (and probably bankrupting) official penalties for e.g. fbar nonfiling not being applied, since you are not tax evaders or criminals. I was too, when I did this in 2009.

If you opt for OVDI (or OVDI then opting out), you're hoping that examination of your situation will lead to recognition of your minnowness, and fair treatment. If you opt for quiet disclosure, you're essentially hoping for the same thing - that the IRS won't want to look at you closely because they can see how small you are. If you opt for compliance going forward, you're hoping no one will bother to look back further. If you opt for ignoring it all full stop, you're hoping FATCA won't lead to bank hassles that bring it on you anyway. At the end of the day, every option is a gamble.

At the moment, avoiding OVDI does seem like it might be a better choice for many people, but it hasn't always been that clear-cut, and in any case different people have different situations (different balance histories and so on) that can affect their choice.

Two years ago when I did this there was almost nothing online about it so I was flying blind. Those of you making decisions now have the benefit of our experiences, and also the benefit of feeling that there are many of you in the same situation. If that leads you to a better outcome then that's lucky for you, but it doesn't mean that people (even now) who either don't have that information or have different circumstances are 'gullible'.

At the end of the day, it shouldn't matter how someone sorts their situation out with the IRS if they do it in good faith and are not criminals - the fact that innocent people in identical circumstances have very different outcomes inside and outside of OVDI is a fault of the system, not of the people making those choices.


----------



## Mona Lisa76

owlonabranch said:


> Please don't characterise OVDI program participants as gullible. It makes it sound as though what happens to them is their fault rather than the fault of the IRS.
> 
> Everyone in this situation is gambling in one way or another - whichever option you take. You are all expecting/hoping/betting that the option you choose will lead to your "innocent minnow" status being recognised and the draconian (and probably bankrupting) official penalties for e.g. fbar nonfiling not being applied, since you are not tax evaders or criminals. I was too, when I did this in 2009.
> 
> If you opt for OVDI (or OVDI then opting out), you're hoping that examination of your situation will lead to recognition of your minnowness, and fair treatment. If you opt for quiet disclosure, you're essentially hoping for the same thing - that the IRS won't want to look at you closely because they can see how small you are. If you opt for compliance going forward, you're hoping no one will bother to look back further. If you opt for ignoring it all full stop, you're hoping FATCA won't lead to bank hassles that bring it on you anyway. At the end of the day, every option is a gamble.
> 
> At the moment, avoiding OVDI does seem like it might be a better choice for many people, but it hasn't always been that clear-cut, and in any case different people have different situations (different balance histories and so on) that can affect their choice.
> 
> Two years ago when I did this there was almost nothing online about it so I was flying blind. Those of you making decisions now have the benefit of our experiences, and also the benefit of feeling that there are many of you in the same situation. If that leads you to a better outcome then that's lucky for you, but it doesn't mean that people (even now) who either don't have that information or have different circumstances are 'gullible'.
> 
> At the end of the day, it shouldn't matter how someone sorts their situation out with the IRS if they do it in good faith and are not criminals - the fact that innocent people in identical circumstances have very different outcomes inside and outside of OVDI is a fault of the system, not of the people making those choices.


I agree that if they cottoned on to information being exchanged on public forums such as this that they could try to discover who's posting on here and possibly choose to examine their quiet disclosures to help prevent a smug attitude developing.

I also agree that every decision involves a calculated risk. In many ways I was more comfortable with joining the ovdi because it would have offered more certainty and closure. I would have hopefully qualified for the new lower 5% penalty as a longterm expat with hardly any US-based income. With the higher accounting fees, tax penalties (i think 20% negiglence penalty on tax balance with interest) and the 5% fbar ovdi penalty on my highest aggregate balance would have probably cost me $125,000-150,000 instead of the $45,000-50,000 my total bill will have turned out to be. Even that seems unduly harsh given that I've made my life in Britain and reported all my Worldwide income to the UK taxman. I'd assumed the spirit of the treaty meant that I didn't have to worry about possible double taxation and had mistakingly believed that to file a nominal US return was sufficient, especially as the IRS could have requested information from HMRC, etc. I am certainly not a cheat!

I take nothing for granted and live in fear everyday because the draconian laws are on the books which they could well decide to start consistenly enforcing. I have a six year ststute of limitations to get through because of unintentionally unreported pfic phantom gains. My accountant didn't feel that ovdi was appropriate though so trusted their advice.

However, I still know I could wind up losing everything and it's terrifying. I am a deer frozen in the headlights and feel desperately vulnerable but genuinely had not been aware of pfic taxation on what were tax free investment in the UK.

Could I ask you what your circumstances andoutcome was if you're willing to talk about it?


----------



## Peg

owlonabranch said:


> Please don't characterise OVDI program participants as gullible.


Thank you for your post - I never caught the gullible slam on my first read of that post. My friend was advised to go into OVDI by their experienced accountant and a tax lawyer friend. I found out last minute about everything and quickly had to make a decision - definitely did not have time to seek expert advice. With hindsight I would not have joined OVDI but at least I found the wisdom on this forum and other places and am now opting out.

I would label myself as panic mode when I learned of OVDI and FBARs...


----------



## Mona Lisa76

Peg said:


> Thank you for your post - I never caught the gullible slam on my first read of that post. My friend was advised to go into OVDI by their experienced accountant and a tax lawyer friend. I found out last minute about everything and quickly had to make a decision - definitely did not have time to seek expert advice. With hindsight I would not have joined OVDI but at least I found the wisdom on this forum and other places and am now opting out.
> 
> I would label myself as panic mode when I learned of OVDI and FBARs...


But that's just the thing: how we've all wound up in panic mode like headless chickens running around.

I hope I didn't offend either of you by the gullible tag; it's just that I'm sure that accountants and attorneys are no doubt enjoying all the work this is bringing them... I also agree that it's unfair that people get inconsistent results. 

There are rumours on another expat accountant's blog that quiet disclosures could also be being funnelled into ovdi as a way of trying to treat everyone more consistenly though.

Owl, is there any way you could subsequently seek back any penalties you paid, especially if you could have gotten a better deal under the 2011 programme's terms? I understand that it offered lower penalties than 2009's for people with less than $75,000 and/or for longterm expats wuth below $10,000 annual US-based income?


----------



## Peg

My reasonable cause for not filing IRS returns and FBARs was that I did not know it was required until 2 months ago.

Given that hundreds of thousands of Canadians (likely millions elsewhere) did not know either and many still do not know I consider that reasonable cause.

If the US Gov wants to penalize me for not knowing about *their* requirements then I will fight them and in the meantime not return to the USA. If that means I cannot see my elderly father or terminally ill relative then I will seek the assistance of the media. The one thing I will not do is pay a penalty to them --- as soon as I learned of their requirements I fulfilled them.


----------



## 416

Mona Lisa76 said:


> There are rumours on another expat accountant's blog that quiet disclosures could also be being funnelled into ovdi as a way of trying to treat everyone more consistenly though.


Famous last words, but I don't think that's practical. The IRS says, right on the label:



> 2. What is the objective of this initiative?
> The objective remains the same as the 2009 OVDP – to bring taxpayers that have used undisclosed foreign accounts and undisclosed foreign entities to avoid or evade tax into compliance with United States tax laws.


My four years of nil returns, soon to be five years of nil returns, all show no taxes owing to the US. So unless they're a total fabrication, I haven't been using my undisclosed foreign accounts to avoid or evade US taxes.


----------



## Mona Lisa76

I didn't fail to list my UK passive income in order to deliberately avoid US taxation on those investments but I worry that it could look that way since, as it turns out, that I did wind up owing substantial taxes. I think it looks far more innocent to not have been filing at all then to been filing with under-reported income.

Anyway, what will be will be. I just hope they will understand my innocence and desperate good faith attempts to put everything right with a profuse apology...and it would appear that the IRS is taking a merciful line at the moment (at least in its London office).

But even if they turn nasty, there is always the Tax Advocate plus the fact that they'd have a difficult time pursuing ineqitable fines through the foreign courts which resent US enchroachments on their sovernity. Furthermore, though FBAR fines are administered by the IRS, they can't just automatically enforce these penalties; instead, the Dept of Treasury would have to seek out a court order. The irs could impose but not directly enforce the fbar fine because it's not technically a tax penalty.

This is how I understand it anyway...but even if they tried it on, we would be able to argue that such a draconian fine is unconstitutional in its harshness, plus they would then have to treat each case identically. My gut feeling is that they'd dread to see a grandma win a court case against them.

This is what the OVDI affectively did: it requires participants to sign away many of their rights which enable the irs to thus impose its fbar penalty in those cases. It also extends the ststute of limitations back to 2003 rather than 2005.


----------



## The_Animal

Mona Lisa76 said:


> I didn't fail to list my UK passive income in order to deliberately avoid US taxation on those investments but I worry that it could look that way since, as it turns out, that I did wind up owing substantial taxes. I think it looks far more innocent to not have been filing at all then to been filing with under-reported income.
> 
> Anyway, what will be will be. I just hope they will understand my innocence and desperate good faith attempts to put everything right with a profuse apology...and it would appear that the IRS is taking a merciful line at the moment (at least in its London office).
> 
> But even if they turn nasty, there is always the Tax Advocate plus the fact that they'd have a difficult time pursuing ineqitable fines through the foreign courts which resent US enchroachments on their sovernity. Furthermore, though FBAR fines are administered by the IRS, they can't just automatically enforce these penalties; instead, the Dept of Treasury would have to seek out a court order. The irs could impose but not directly enforce the fbar fine because it's not technically a tax penalty.
> 
> This is how I understand it anyway...but even if they tried it on, we would be able to argue that such a draconian fine is unconstitutional in its harshness, plus they would then have to treat each case identically. My gut feeling is that they'd dread to see a grandma win a court case against them.
> 
> This is what the OVDI affectively did: it requires participants to sign away many of their rights which enable the irs to thus impose its fbar penalty in those cases. It also extends the ststute of limitations back to 2003 rather than 2005.


Frankly, what the Canadian government needs to do is "grow a pair" and inequivocably and irrevocably tell the U.S. Government and its IRS "where to go and how to get there".


----------



## Pathologic1

I think the chances of them actually trying to collect the draconian FBAR penalties in Canada is less than winning the lottery. And first they have to spend the money to win in a US court and give you notice. If they win there, unless you have US property, collection is hopeless for them. They have no way to collect. And they look bad. And then no one will be worried about them after that. It's much better for them to have the phantom boogeyman that they can still use to instill fear in expats.

And if they tried to collect, I think the chances of them getting a Canadian court to agree would be far less than the chances of winning three lotteries in a row.

It's just never going to happen. Don't let it frighten you. Not going to happen.



Mona Lisa76 said:


> ... Furthermore, though FBAR fines are administered by the IRS, they can't just automatically enforce these penalties; instead, the Dept of Treasury would have to seek out a court order. The irs could impose but not directly enforce the fbar fine because it's not technically a tax penalty.
> 
> This is how I understand it anyway...but even if they tried it on, we would be able to argue that such a draconian fine is unconstitutional in its harshness, plus they would then have to treat each case identically. My gut feeling is that they'd dread to see a grandma win a court case against them....


----------



## Baird68

*Baird68*



Pathologic1 said:


> I think the chances of them actually trying to collect the draconian FBAR penalties in Canada is less than winning the lottery. And first they have to spend the money to win in a US court and give you notice. If they win there, unless you have US property, collection is hopeless for them. They have no way to collect. And they look bad. And then no one will be worried about them after that. It's much better for them to have the phantom boogeyman that they can still use to instill fear in expats.
> 
> And if they tried to collect, I think the chances of them getting a Canadian court to agree would be far less than the chances of winning three lotteries in a row.
> 
> It's just never going to happen. Don't let it frighten you. Not going to happen.


If someone were to renounce their American citizenship after having filed the past 5 years of taxes all with $0 owing, but FBAR fines subsequently imposed, would the the renunciation be rescinded?


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## Pathologic1

I can't see that happening 
There is no penalty until they take it to court and its a civil penalty not a criminal matter and wouldn't change any answers on the renunciation form that I am aware of. 
I suppose they could still take you to court and "fine you" because your citizenship status is irrelevent in this respect. As long as you have filed and paid all of your taxes honestly and the other answers on the renunciation form are correct, they can't say it's null and void after the State Dept OKs the renunciation. If there is something incorrect they could of course say it's invalid.

It's really moot though, if you owe zero they won't be contacting you for anything anyway. You're home free.



Baird68 said:


> If someone were to renounce their American citizenship after having filed the past 5 years of taxes all with $0 owing, but FBAR fines subsequently imposed, would the the renunciation be rescinded?


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## Guest

Baird68 said:


> If someone were to renounce their American citizenship after having filed the past 5 years of taxes all with $0 owing, but FBAR fines subsequently imposed, would the the renunciation be rescinded?


I don't think they could "rescind" a renunciation. Many of us are planning to do exactly what you describe. I guess I have another topic to research this afternoon!


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## Vangrrl

Baird68 said:


> If someone were to renounce their American citizenship after having filed the past 5 years of taxes all with $0 owing, but FBAR fines subsequently imposed, would the the renunciation be rescinded?


Renunciation isn't retro-active so renouncing doesn't excuse you from taxes/penalties/fines assessed against you while you were a US citizen. So from that perspective all of us whether we chose to renounce or not are still in the same boat regarding our past non-filings. By renouncing you should be avoiding any obligations to the US for years going forward.


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## Peg

Your tax liability to the US Government stops calculating on the day of your renunciation but are still liable for anything before the renunciation date.

I am FedExing my IRS forms and FBARs a week before my renunciation appointment - would have done it sooner but did not have them ready.


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## Peg

Today I spoke with someone from the OVDI Hotline and explained my plan to file my IRS returns and FBARs right now and to opt out of OVDI and then renounce a week later. He said that sounded fine but, in his words, I clearly knew more than he did!

He did say that when submitting my FBARs to ask that they not assess a penalty since I did not know about the requirement to file them.

He does not have the power to make decisions but they do pass on information from people calling the hotline. He was kind and understanding and felt frustrated on my behalf --- he asked if I had contacted our politicians. I simply said that for now all I want is to get it over with and that I don't want to wait for the politicians to figure it out.


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## Baird68

nobledreamer said:


> I don't think they could "rescind" a renunciation. Many of us are planning to do exactly what you describe. I guess I have another topic to research this afternoon!


Thanks, Pathologic and Nobledreamer. I am giving all my files to the accountant tomorrow and will try to get an appointment with the consulate ASAP. I hope to have this "done" before the end of the year.


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## Baird68

Peg said:


> Your tax liability to the US Government stops calculating on the day of your renunciation but are still liable for anything before the renunciation date.
> 
> I am FedExing my IRS forms and FBARs a week before my renunciation appointment - would have done it sooner but did not have them ready.


Good luck! I'll be thinking of you.


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## Baird68

Vangrrl said:


> Renunciation isn't retro-active so renouncing doesn't excuse you from taxes/penalties/fines assessed against you while you were a US citizen. So from that perspective all of us whether we chose to renounce or not are still in the same boat regarding our past non-filings. By renouncing you should be avoiding any obligations to the US for years going forward.


That is comforting. Also, they might lower the exemption threshold again next year, so it is better to exit sooner than later.


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## Guest

Baird68 said:


> Thanks, Pathologic and Nobledreamer. I am giving all my files to the accountant tomorrow and will try to get an appointment with the consulate ASAP. I hope to have this "done" before the end of the year.


You are welcome. If you email the consulate at [email protected]
they will get back to you within 2 days if you ask them the right info....tell them you are a US/Canadian citizen; that you want to renounce and are aware of the two appointments, the $450 fee and the time period involved. Ask them to 
provide the appropriate forms to start the process. You will receive an email from a wonderful lady who will ask for your current address and telephone number. Once you send it, she will phone you and send you the paperwork. :thumb:

They are doing the first appointments in groups because there are so many people. The first group appointment was Oct 20; I am on the list for the next meeting but have yet to hear when it will happen; she indicated early December as most of November is taken up with second appts from the Oct 20 meeting. I will certainly pass on any info I receive once I hear anything more. :gossip:


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## 416

nobledreamer said:


> They are doing the first appointments in groups because there are so many people. The first group appointment was Oct 20; I am on the list for the next meeting but have yet to hear when it will happen; she indicated early December as most of November is taken up with second appts from the Oct 20 meeting.


I'm on the list for that meeting too - we should go for coffee or something.


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## Guest

416 said:


> I'm on the list for that meeting too - we should go for coffee or something.


That would be great! pm me and we can make a time :tea:


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## 416

nobledreamer said:


> That would be great! pm me and we can make a time :tea:



There's a Tim's - all we need is a date.


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## Guest

416 said:


> There's a Tim's - all we need is a date.


how bout early next week, say Tuesday? you name the time, my schedule is very flexible


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## owlonabranch

Mona Lisa76 said:


> I agree that if they cottoned on to information being exchanged on public forums such as this that they could try to discover who's posting on here and possibly choose to examine their quiet disclosures to help prevent a smug attitude developing.
> 
> I also agree that every decision involves a calculated risk. In many ways I was more comfortable with joining the ovdi because it would have offered more certainty and closure. I would have hopefully qualified for the new lower 5% penalty as a longterm expat with hardly any US-based income. With the higher accounting fees, tax penalties (i think 20% negiglence penalty on tax balance with interest) and the 5% fbar ovdi penalty on my highest aggregate balance would have probably cost me $125,000-150,000 instead of the $45,000-50,000 my total bill will have turned out to be. Even that seems unduly harsh given that I've made my life in Britain and reported all my Worldwide income to the UK taxman. I'd assumed the spirit of the treaty meant that I didn't have to worry about possible double taxation and had mistakingly believed that to file a nominal US return was sufficient, especially as the IRS could have requested information from HMRC, etc. I am certainly not a cheat!
> 
> I take nothing for granted and live in fear everyday because the draconian laws are on the books which they could well decide to start consistenly enforcing. I have a six year ststute of limitations to get through because of unintentionally unreported pfic phantom gains. My accountant didn't feel that ovdi was appropriate though so trusted their advice.
> 
> However, I still know I could wind up losing everything and it's terrifying. I am a deer frozen in the headlights and feel desperately vulnerable but genuinely had not been aware of pfic taxation on what were tax free investment in the UK.
> 
> Could I ask you what your circumstances andoutcome was if you're willing to talk about it?


I'm an accidental American who had filed no fbars and had other problems with forms. I went through the 2009 VDP and ended up with zero tax due, but an fbar penalty, which I paid. The penalty could have been worse, theoretically, although if it had been much more I could not possibly have paid it (my non-USC spouse is unhappy enough about the situation as it is). 

I was probably a good candidate for opting out, but by the time opting out started to be discussed, I was so far through the process it was safer just to finish it off. So my thought was, at least it's all over, I'm just going to pay and move on with my life. I just wish my penalties weren't counted up with those of US-based tax evaders and trumpeted in the media as the results of a drive against 'tax cheats'.

It is so stressful and expensive and it seems so hard to believe that it's actually cost effective for the IRS. Good luck with your situation, it sounds like you've had some good advice at an early stage and that's key.


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## Mona Lisa76

owlonabranch said:


> I'm an accidental American who had filed no fbars and had other problems with forms. I went through the 2009 VDP and ended up with zero tax due, but an fbar penalty, which I paid. The penalty could have been worse, theoretically, although if it had been much more I could not possibly have paid it (my non-USC spouse is unhappy enough about the situation as it is).
> 
> I was probably a good candidate for opting out, but by the time opting out started to be discussed, I was so far through the process it was safer just to finish it off. So my thought was, at least it's all over, I'm just going to pay and move on with my life. I just wish my penalties weren't counted up with those of US-based tax evaders and trumpeted in the media as the results of a drive against 'tax cheats'.ğup
> 
> It is so stressful and expensive and it seems so hard to believe that it's actually cost effective for the IRS. Good luck with your situation, it sounds like you've had some good advice at an early stage and that's key.


That's so unfair for you though; in fact, it's outrageous!! Would you be willing to say how much your fbar penalty turned out to be? I'm quite happy for you to tell me in a pm, etc.


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## Peg

owlonabranch said:


> ...I went through the 2009 VDP and ended up with zero tax due, but an fbar penalty, which I paid. The penalty could have been worse, theoretically, although if it had been much more I could not possibly have paid it (my non-USC spouse is unhappy enough about the situation as it is).
> 
> I was probably a good candidate for opting out, but by the time opting out started to be discussed, I was so far through the process it was safer just to finish it off. So my thought was, at least it's all over, I'm just going to pay and move on with my life...


That is disturbing to hear that. Disturbing because it never should have happened and also disturbing because it DID happen.

Makes me very nervous that I am opting out...

Like MonaLisa, I would be very curious to know the amount of your penalty if you are willing to share.


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## owlonabranch

I don't think I can pm yet. I had a four-figure penalty.

It is unfair but I think whoever said we are 'collateral damage' was probably right.


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## owlonabranch

Peg said:


> That is disturbing to hear that. Disturbing because it never should have happened and also disturbing because it DID happen.
> 
> Makes me very nervous that I am opting out...
> 
> Like MonaLisa, I would be very curious to know the amount of your penalty if you are willing to share.


I don't think it should make you nervous that you're opting out. Everyone's situation is different. It seems the IRS have more flexibility in dealing with people outside of OVDI than inside it, so that should work in your favour.


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## 416

nobledreamer said:


> how bout early next week, say Tuesday? you name the time, my schedule is very flexible


Let's wait for the date to be set.


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## Guest

416 said:


> Let's wait for the date to be set.


no problem


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## Mona Lisa76

Peg said:


> Today I spoke with someone from the OVDI Hotline and explained my plan to file my IRS returns and FBARs right now and to opt out of OVDI and then renounce a week later. He said that sounded fine but, in his words, I clearly knew more than he did!
> 
> He did say that when submitting my FBARs to ask that they not assess a penalty since I did not know about the requirement to file them.
> 
> He does not have the power to make decisions but they do pass on information from people calling the hotline. He was kind and understanding and felt frustrated on my behalf --- he asked if I had contacted our politicians. I simply said that for now all I want is to get it over with and that I don't want to wait for the politicians to figure it out.


Peg, I would consider it risky to ever admit to the IRS your intentions to renounce as it could lay you more open to an examination if you do opt out.


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## Mona Lisa76

Pathologic1 said:


> I think the chances of them actually trying to collect the draconian FBAR penalties in Canada is less than winning the lottery. And first they have to spend the money to win in a US court and give you notice. If they win there, unless you have US property, collection is hopeless for them. They have no way to collect. And they look bad. And then no one will be worried about them after that. It's much better for them to have the phantom boogeyman that they can still use to instill fear in expats.
> 
> And if they tried to collect, I think the chances of them getting a Canadian court to agree would be far less than the chances of winning three lotteries in a row.
> 
> It's just never going to happen. Don't let it frighten you. Not going to happen.


I think you're correct which is all the more why they want to force all Americans abroad to fully report all their foreign assets directly with their 1040 on the upcoming 8938 form which will be far more onerous than FBAR. Even if the form doesn't get released until, say, 2013, it will still nonethless have to be retroactively filed back to 2011. This will have the stealthy effect of extending the statute of limitations for at least 2011 since the clock won't start running till the 8938 is filed.  

This will be a requirement for any American citizen living abroad who has more than $200,000 at the end of the tax year or more than $400,000 at any time during the year. This pertains to those married filing seperately and are doubled for those filing jointly. While it might sound like a lot, I think it's very easy to go over these amounts after taking the value of one's home and pension funds into consideration.

These requirements will be in addition to fbars which will still need to be filed.

It will thus be far easier for the IRS to directly fine people who fail to disclose all their income and assets.

It's also a stealthy way that they could argue that anyone wanting to renounce will not have been fully compliant for the past five years since this bloody 8938 fatca form will have had to be retroactively filed for 2011 and possibly 2012...after all, it could be two or three years before the finalized form is released. They're certainly being rather sneaky in this regard, so watch out for the pitfalls.

They could even insist on five years of full tax compliance before renounciation is in fact five actual tax years going forward rather than merely filing delinquent or amended returns. I would urge people to thus tread VERY carefully...


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## Peg

Mona Lisa76 said:


> Peg, I would consider it risky to ever admit to the IRS your intentions to renounce as it could lay you more open to an examination if you do opt out.


I thought about that but did make it very clear to them that I would be renouncing.


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## Cafreeb12

Peg said:


> I thought about that but did make it very clear to them that I would be renouncing.


Peg, how did they take that information? Were they pleasant about it? Just wondering since you're not supposed to renounce for tax purposes whatever that really means. I would owe them no tax and that's not why I'm renouncing. It's about FBAR penalties and FATCA.


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## Mona Lisa76

Peg said:


> I thought about that but did make it very clear to them that I would be renouncing.


Fair enough; I'm sure it wouldn't have surprised them anyway but I wouldn't have told them, myself.


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## Peg

Cafreeb12 said:


> Peg, how did they take that information? Were they pleasant about it? Just wondering since you're not supposed to renounce for tax purposes whatever that really means. I would owe them no tax and that's not why I'm renouncing. It's about FBAR penalties and FATCA.


When I spoke with the kind gentleman on the OVDI hotline I asked specifically about timing for opting out and renouncing. He didn't think it would be a problem. My Opt Out letter was just delivered to Houston this morning :canada:

I am not renouncing for tax reasons. I could live with the IRS annual returns - I got really good at them  and now I only have Earned Income. The years where I had other sources of income were a pain. Did you know that Self-Employment Tax is not offset by the Foreign Tax Credit and it amounted to 14% of my Self-employment earnings? Even though my self-employment earnings one year were only $600 I still had to pay the 14% and it is AFTER all deductions, foreign tax credit and even the tax calculation. If I were to remain a US citizen I would think very hard about whether to be self-employed! 

The FBARs are my main reason for opting out! That is not a TAX reason. The renunciation guide online also said that it is no longer the case about not being able to renounce for tax reasons.


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## Cafreeb12

Peg said:


> When I spoke with the kind gentleman on the OVDI hotline I asked specifically about timing for opting out and renouncing. He didn't think it would be a problem. My Opt Out letter was just delivered to Houston this morning :canada:
> 
> I am not renouncing for tax reasons. I could live with the IRS annual returns - I got really good at them  and now I only have Earned Income. The years where I had other sources of income were a pain. Did you know that Self-Employment Tax is not offset by the Foreign Tax Credit and it amounted to 14% of my Self-employment earnings? Even though my self-employment earnings one year were only $600 I still had to pay the 14% and it is AFTER all deductions, foreign tax credit and even the tax calculation. If I were to remain a US citizen I would think very hard about whether to be self-employed!
> 
> The FBARs are my main reason for opting out! That is not a TAX reason. The renunciation guide online also said that it is no longer the case about not being able to renounce for tax reasons.



Thanks Peg, yes I knew about the self employment rules after reading so much this last few weeks. You also can't use any deductions for unearned income as in inheritance even though you DO have expenses there. I don't get the same treatment my brother and sister who live in the U.S. will get when filing on inheritance either..i.e. I will be subject to some different reporting rules. I just spoke with BBC World today who are interested in doing a radio interview with someone who has renounced over these issues..I haven't renounced yet as I'm not done filing but, it's good to know someone there is interested in this story. The interviewer was not there when I called so I guess I'll speak with her tomorrow. She would like to talk with one of you who has already renounced if possible. BBC World is heard globally.


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## Mona Lisa76

Relieved to hear the ovdi guy seemed pleasant. I suspect they privately feel badly for the collateral damaging many are facing though I still think it's risky to tell them anything they don't need to know.

I'm guessing that they will be fine with you opting out and that good faith quiet fbar disclosures will also be mostly forgiven. It will be the upcoming fatca 8938 which will be their real method of punishing going forward since it will bring all the disclosures directly to the IRS rather than indirectly via Fbar.


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## Peg

Mona Lisa76 said:


> Fair enough; I'm sure it wouldn't have surprised them anyway but I wouldn't have told them, myself.


To me, complete honesty is the best for my situation. They cannot accuse me of hiding anything. My IRS returns, FBARs and Opt Out letter were all delivered today and my renouncement is next week.

When I was searching for the address to mail my completed IRS returns I happened to find the mileage rate used for self-employment expenses. Since I had not found it previously I figured I would just use the Canadian rate. Turns out the USA rate is lower so I redid 2 years of returns for the stupid $60 difference in my income each year. Just another reminder to me that I am not a criminal since I literally could not submit it knowing there was that error!


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## Peg

Mona Lisa76 said:


> Relieved to hear the ovdi guy seemed pleasant. I suspect they privately feel badly for the collateral damaging many are facing though I still think it's risky to tell them anything they don't need to know.
> 
> I'm guessing that they will be fine with you opting out and that good faith quiet fbar disclosures will also be mostly forgiven. It will be the upcoming fatca 8938 which will be their real method of punishing going forward since it will bring all the disclosures directly to the IRS rather than indirectly via Fbar.


Given that my Opt Out letter was delivered just one week before my renouncement appointment that was booked 5 weeks ago I think they could figure it out that I had planned to renounce when I wrote the Opt Out letter


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## Nanman

Peg said:


> To me, complete honesty is the best for my situation. They cannot accuse me of hiding anything. My IRS returns, FBARs and Opt Out letter were all delivered today and my renouncement is next week.
> 
> When I was searching for the address to mail my completed IRS returns I happened to find the mileage rate used for self-employment expenses. Since I had not found it previously I figured I would just use the Canadian rate. Turns out the USA rate is lower so I redid 2 years of returns for the stupid $60 difference in my income each year. Just another reminder to me that I am not a criminal since I literally could not submit it knowing there was that error!


My thoughts will be with you when you take your renunciation journey. Good luck in Calgary. I found them very pleasant to deal with.


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## Peg

Nanman said:


> My thoughts will be with you when you take your renunciation journey. Good luck in Calgary. I found them very pleasant to deal with.


Thank you Nanman. Although I have been a Canadian by citizenship and at heart for many years I find myself nostalgic and sad right now knowing that I will be giving up my US citizenship. I still search for a Canadian flag to look at when singing Oh Canada even though that was instilled from proudly reciting the Pledge of Allegiance in elementary school in the 70s. At sporting events I liked being one of the few people who knew all of the words to the Star Spangled Banner. July 4, 1976 holds special memory as my family watched the amazing bicentennial fireworks just 2 years after I left the USA. It took me many years to say Zed and toque because they just didn't feel right. 

One of the coolest gifts I ever received was a custom-made sweatshirt with a large Maple Leaf filled with the US flag. I wore it proudly and many people wanted to get one too. Now, I don't even like seeing the colours red, white and blue together because of the stress and hassle of OVDI and FBARs.

Renouncing was not an easy decision but one that I feel forced into because of the FBAR requirements.


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## Peg

p.s. my search for the Canadian flag when singing Oh Canada has made many students think that I am watching them when in fact they just happen to stand in front of the only Canadian flag in the classroom! :canada: Sometimes I explain to them, sometimes I don't...


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## Cafreeb12

Peg said:


> Thank you Nanman. Although I have been a Canadian by citizenship and at heart for many years I find myself nostalgic and sad right now knowing that I will be giving up my US citizenship. I still search for a Canadian flag to look at when singing Oh Canada even though that was instilled from proudly reciting the Pledge of Allegiance in elementary school in the 70s. At sporting events I liked being one of the few people who knew all of the words to the Star Spangled Banner. July 4, 1976 holds special memory as my family watched the amazing bicentennial fireworks just 2 years after I left the USA. It took me many years to say Zed and toque because they just didn't feel right.
> 
> One of the coolest gifts I ever received was a custom-made sweatshirt with a large Maple Leaf filled with the US flag. I wore it proudly and many people wanted to get one too. Now, I don't even like seeing the colours red, white and blue together because of the stress and hassle of OVDI and FBARs.
> 
> Renouncing was not an easy decision but one that I feel forced into because of the FBAR requirements.


Oh Peg, I wish I could hug you. I feel the exact same as you and I know this is hard...I feel forced into it too. Best of luck with the rest of this journey. In the end you know you are doing what is right for your situation and family. It's just that no one should have been put in this position.


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## Pathologic1

*Reasons for renunciation*

There are just so many reasons to renounce, it is hard to pick which one to use. 

The member of my family that is renouncing is telling them he cannot remain a citizen of a country that allows GW Bush to remain free and without trial for his lies and crimes against humanity. Personally I think he could get off by claiming insanity.

I fear the USA is just going to make it harder and harder to renounce..


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## Nanman

Peg said:


> Thank you Nanman. Although I have been a Canadian by citizenship and at heart for many years I find myself nostalgic and sad right now knowing that I will be giving up my US citizenship. I still search for a Canadian flag to look at when singing Oh Canada even though that was instilled from proudly reciting the Pledge of Allegiance in elementary school in the 70s. At sporting events I liked being one of the few people who knew all of the words to the Star Spangled Banner. July 4, 1976 holds special memory as my family watched the amazing bicentennial fireworks just 2 years after I left the USA. It took me many years to say Zed and toque because they just didn't feel right.
> 
> One of the coolest gifts I ever received was a custom-made sweatshirt with a large Maple Leaf filled with the US flag. I wore it proudly and many people wanted to get one too. Now, I don't even like seeing the colours red, white and blue together because of the stress and hassle of OVDI and FBARs.
> 
> Renouncing was not an easy decision but one that I feel forced into because of the FBAR requirements.


I feel for you. Shame on the politicians for making the decision to renounce the best one available. I keep thinking of the bumper sticker: 'I love my country but I'm afraid of my government'


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## Baird68

nobledreamer said:


> You are welcome. If you email the consulate at [email protected]
> they will get back to you within 2 days if you ask them the right info....tell them you are a US/Canadian citizen; that you want to renounce and are aware of the two appointments, the $450 fee and the time period involved. Ask them to
> provide the appropriate forms to start the process. You will receive an email from a wonderful lady who will ask for your current address and telephone number. Once you send it, she will phone you and send you the paperwork. :thumb:
> 
> They are doing the first appointments in groups because there are so many people. The first group appointment was Oct 20; I am on the list for the next meeting but have yet to hear when it will happen; she indicated early December as most of November is taken up with second appts from the Oct 20 meeting. I will certainly pass on any info I receive once I hear anything more. :gossip:


Thanks for the information. I have forms downloaded from the internet too. I'm anxious to hear how your second meeting goes.


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## Peg

My brother got his letter from OVDI and it said that it was incomplete because he did not indicate if his spouse was to be included or excluded. He has 15 days to respond and if he doesn't then his request to participate will be declined. LUCKY HIM!

His OVDI paperwork arrived after the Sept 9 deadline due to mishap with the Delivery Company.


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## Guest

Peg said:


> My brother got his letter from OVDI and it said that it was incomplete because he did not indicate if his spouse was to be included or excluded. He has 15 days to respond and if he doesn't then his request to participate will be declined. LUCKY HIM!
> 
> His OVDI paperwork arrived after the Sept 9 deadline due to mishap with the Delivery Company.


Sometimes Fate works in wonderful ways!


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## Grace72

Peg said:


> Did you know that Self-Employment Tax is not offset by the Foreign Tax Credit and it amounted to 14% of my Self-employment earnings? Even though my self-employment earnings one year were only $600 I still had to pay the 14% and it is AFTER all deductions, foreign tax credit and even the tax calculation.
> 
> 
> 
> My accountant attached a "Self-employment tax statement" that said "Under the Canada/US totalization agreement, self-employment income subject to Canada Pension Plan in Canada is exempt from self-employment tax in the US. IRC Section 1401 (c)" and I didn't pay any self-employment tax.
> 
> Of course, my package only just arrived at the OVDI office in texas so I doubt anyone has looked at it yet.
> 
> Edit: Sorry, don't know how to make the quote work right.
Click to expand...


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## Guest

nobledreamer said:


> Sometimes Fate works in wonderful ways!


and God Bless the delivery company!


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## Peg

Grace72 said:


> Peg said:
> 
> 
> 
> Did you know that Self-Employment Tax is not offset by the Foreign Tax Credit and it amounted to 14% of my Self-employment earnings? Even though my self-employment earnings one year were only $600 I still had to pay the 14% and it is AFTER all deductions, foreign tax credit and even the tax calculation.
> 
> 
> 
> My accountant attached a "Self-employment tax statement" that said "Under the Canada/US totalization agreement, self-employment income subject to Canada Pension Plan in Canada is exempt from self-employment tax in the US. IRC Section 1401 (c)" and I didn't pay any self-employment tax.
> 
> 
> 
> Those years I did not pay CPP premiums because my self-employment and earned income was too low. I was a stay-at-home parent who did a bit of work.
> 
> Click to expand...
Click to expand...


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## Ladyhawk

Cafreeb12 said:


> Oh Peg, I wish I could hug you. I feel the exact same as you and I know this is hard...I feel forced into it too. Best of luck with the rest of this journey. In the end you know you are doing what is right for your situation and family. It's just that no one should have been put in this position.


To both you and Peg - I join in your sorrow. My feelings have been evolving throughout the last few months. I will become, and stay, compliant at this point because all of my immediate family is in the US and I have no children. I still harbour (Cdn spelling!!) a faint thought of moving back to the US if my spouse dies and I have no means of caring for myself. I still love the principles I grew to believe in and remember every time I see an American flag.

But in the last few weeks especially, as I watch in mounting grief and horror at the criminally insane new laws being passed that are slowly turning every American on the planet into a criminal, and new tax concerns about the possibility of my innocent spouse coming under IRS scrutiny due to the intertwining of our financial resources, I have for the first time considered the possibility of renouncing. 

This growing spider-web of US government power, enhanced by the intrusion of worldwide electronic surveillance which itself started out based on communications with so much promise for enhancing people-to-people interactions, is creating the dream of every tyrant - truly global power over every human on earth. And by the country that STILL claims to be the freest nation on earth. 1984 and Animal Farm are happening. Words have come to mean the exact opposite of their original definitions. And the US has become a government of men, not laws, where your future depends on the whims of a nobody in an obscure IRS office in the dust bowl somewhere. And where, most ironic of all, virtually any freedom fighter in any other country defends American principles of individual liberty with more passion and integrity than any elected American official who has pledged to uphold the Constitution of the United States. People still yearn to breathe free - but not in America.


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## Guest

Ladyhawk said:


> To both you and Peg - I join in your sorrow. My feelings have been evolving throughout the last few months. I will become, and stay, compliant at this point because all of my immediate family is in the US and I have no children. I still harbour (Cdn spelling!!) a faint thought of moving back to the US if my spouse dies and I have no means of caring for myself. I still love the principles I grew to believe in and remember every time I see an American flag.
> 
> But in the last few weeks especially, as I watch in mounting grief and horror at the criminally insane new laws being passed that are slowly turning every American on the planet into a criminal, and new tax concerns about the possibility of my innocent spouse coming under IRS scrutiny due to the intertwining of our financial resources, I have for the first time considered the possibility of renouncing.
> 
> This growing spider-web of US government power, enhanced by the intrusion of worldwide electronic surveillance which itself started out based on communications with so much promise for enhancing people-to-people interactions, is creating the dream of every tyrant - truly global power over every human on earth. And by the country that STILL claims to be the freest nation on earth. 1984 and Animal Farm are happening. Words have come to mean the exact opposite of their original definitions. And the US has become a government of men, not laws, where your future depends on the whims of a nobody in an obscure IRS office in the dust bowl somewhere. And where, most ironic of all, virtually any freedom fighter in any other country defends American principles of individual liberty with more passion and integrity than any elected American official who has pledged to uphold the Constitution of the United States. People still yearn to breathe free - but not in America.


Ladyhawk I think this is the first post I've seen on this forum that brought tears to my eyes, a lump to my throat, and a chill down my spine. Even after all these years of bitterness over Vietnam (which sparked precisely the same reaction you're having in the hearts of those of us who opposed that insane vicious and utterly pointless war and came up here decades ago).


Bless you and good luck. A thumbs-up doesn't begin to do justice to your statement.


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## Pathologic1

*Well Said*

WOW!!
That's truly a great last paragraph. It pretty well sums up modern man's plight today!!
You must be a writer or something. 
I'm impressed.


Ladyhawk said:


> .....
> This growing spider-web of US government power, enhanced by the intrusion of worldwide electronic surveillance which itself started out based on communications with so much promise for enhancing people-to-people interactions, is creating the dream of every tyrant - truly global power over every human on earth. And by the country that STILL claims to be the freest nation on earth. 1984 and Animal Farm are happening. Words have come to mean the exact opposite of their original definitions. And the US has become a government of men, not laws, where your future depends on the whims of a nobody in an obscure IRS office in the dust bowl somewhere. And where, most ironic of all, virtually any freedom fighter in any other country defends American principles of individual liberty with more passion and integrity than any elected American official who has pledged to uphold the Constitution of the United States. People still yearn to breathe free - but not in America.


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## Guest

Ladyhawk said:


> To both you and Peg - I join in your sorrow. My feelings have been evolving throughout the last few months. I will become, and stay, compliant at this point because all of my immediate family is in the US and I have no children. I still harbour (Cdn spelling!!) a faint thought of moving back to the US if my spouse dies and I have no means of caring for myself. I still love the principles I grew to believe in and remember every time I see an American flag.


Yes, as Schubert says, this brings tears. Thank you Ladyhawk.


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## RSharma

*Ovdi reopened!!*

Offshore Voluntary Disclosure Program Reopens With Higher Penalties – No Set Deadline see january 9th news.. on Tax News Page - on SKTaxes . com


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## byline

Peg said:


> Grace72 said:
> 
> 
> 
> 
> 
> Peg said:
> 
> 
> 
> Did you know that Self-Employment Tax is not offset by the Foreign Tax Credit and it amounted to 14% of my Self-employment earnings? Even though my self-employment earnings one year were only $600 I still had to pay the 14% and it is AFTER all deductions, foreign tax credit and even the tax calculation.
> 
> 
> Those years I did not pay CPP premiums because my self-employment and earned income was too low. I was a stay-at-home parent who did a bit of work.
> 
> 
> 
> I'm self-employed in my _very_ small sole proprietorship business, and as far as I know I have never owed any taxes in the Canada or the U.S. My accountant in Halifax verified this when he did my U.S. tax returns. I did pay CPP premiums my last two years, because my income was just barely high enough, but I can't remember if I paid it that third year (I sent three years' worth of back tax forms).
> 
> Click to expand...
Click to expand...


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## jimmyjam

*tip of the iceberg*



Ladyhawk said:


> But in the last few weeks especially, as I watch in mounting grief and horror at the criminally insane new laws being passed that are slowly turning every American on the planet into a criminal, and new tax concerns about the possibility of my innocent spouse coming under IRS scrutiny due to the intertwining of our financial resources, I have for the first time considered the possibility of renouncing.
> 
> This growing spider-web of US government power, enhanced by the intrusion of worldwide electronic surveillance which itself started out based on communications with so much promise for enhancing people-to-people interactions, is creating the dream of every tyrant - truly global power over every human on earth. .


I also never thought I would view my birth country from EXILE, after having been PERSECUTED to the point where I do not even want to go back for a visit or a holiday.

Part of the problem is, when other regimes have done what the US is doing at least once people got out they found safe haven in the host country they emigrated to. What we see here is an (initial, at least) overall attitude of compliance coming from banks and governments everywhere, since understanding the situation we are facing takes time and effort.

Have you seen the news about the NDA that recently passed; now Obama and consorts have the power to detain for unlimited time any suspect that someone in the government targets as a threat. When I tell US citizens about this they are like "Blah, so what".
Do you know what GOULAG means? Governments who detain citizens without a trial: Stalin, communist russia, china, etc.... Here's a scoop: US citizens are now living in such a country! And nobody cares until Sarah Palin's cousin gets elected president and they start having government roundups at 4 am in your neighborhood!

National Defense Authorization Act Outrage Continues To Grow Online - Business Insider


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