ACA in the News 2015
Wall Street Journal Blog (website, December 13, 2015)
"Tips For U.S. Expats Coping With New FAST Law Affecting Passports"
"...Here’s the view of Charles M. Bruce, an American lawyer with Bonnard Lawson in Lausanne, Switzerland, who advises American Citizens Abroad, an expat group: 'The revocation or denial of passport provision in this bill is exactly the kind of tax legislation that drives Americans overseas crazy. It’s attached to a huge bill mainly dealing with a subject totally unrelated to the one affecting them. There were never any hearings at which they could present their views. No one seems to know who pushed for this legislation.'
"He added, 'No one seemed willing to take into account the fact that communications from the IRS to taxpayers living abroad sometimes go astray. Also, the ability for these taxpayers to resolve a collections matter, which has never been easy, has been made harder by the closure of IRS foreign offices.'"
My International Adventure (website, December 1, 2015)
"Why are Americans Renouncing their Citizenship?"
"...Serrato said that to alleviate the lock-out that still exists by many foreign financial institutions, ACA has proposed a “Same Country Exemption,” which would remove from FATCA reporting, for both individuals and banks, financial accounts located in the country where the U.S. citizen is a legal resident.
"The ACA proposal has been reviewed with key staff at the IRS and the U.S. Treasury department and has been well-received, according to Serrato."
Forbes (Dec. 2, 2015)
"IRS Poised to veto passports"
Within days, the IRS will be able to revoke your passport for unpaid taxes. This bad idea has been kicking around for several years. This time, it is buried within 1300 pages of highway legislation. The government will surely see it as a nice complement to FATCA, the Foreign Account Tax Compliance Act. That massive law penalizes foreign banks that don’t hand over American account holders.
Not everyone is happy about giving the IRS power over passports. A group called American Citizens Abroad ACA has urged Congress to reject tying tax collection to passports. Their press release is worth reading. But Congress is poised to pass H.R.22, which has already passed both the House and the Senate. It is in conference, but is not expected to change. So, get ready for new section 7345 of the tax code, called “Revocation or Denial of Passport in Case of Certain Tax Delinquencies.”
Wall Street Journal (Nov. 20, 2015)
"Americans: Pay Your Taxes--Or Lose Your Passport"
The Wall Street Journal has an article dated 20 Nov. 2015 about ACA's objection to a new law expected to take effect in January 2016 (as part of the new "Highway Bill") which would block Americans with "seriously delinquent" tax debts from receiving new passports and which would also rescind existing passports. Revoking passports of Americans living abroad would cause serious problems as often it's their only means of identity in a foreign country.
http://www.wsj.com/articles/americans-pay-your-taxes-or-lose-your-passport-1447971424(subscription may be required)
Financial Times (October 9, 2015)
"Banks give up US expats’ data in tax evasion crackdown"
ACA Director Marylouise Serrato was quoted in this article about new FATCA reporting requirements:
"Bank details belonging to hundreds of thousands of American expats have been passed to Washington, marking the start of a new era of data exchange by governments intent on cracking down on tax cheats.
"Many US expats who have failed to file US tax returns will be eligible for a partial amnesty, known as the 'streamlined' programme which does not impose penalties on people who can say they had not wilfully failed to comply with their obligations to file returns.
"Marylouise Serrato, executive director of American Citizens Abroad, which publishes a directory of tax return preparers, said: 'It doesn’t necessarily follow you have to find a preparer in the country where you live. We are hoping there will be competitive pricing that will help alleviate the high cost of compliance.'"
http://www.ft.com/intl/cms/s/0/0f18a506-6e91-11e5-aca9-d87542bf8673.html#axzz3oMFc4Vg2(subscription may be required)
Tax Notes (Sept. 14, 2015)
"Theories for Expatriation Numbers Abound, but Answers Are Elusive"
Two directors of ACA, Inc. were quoted in a Tax Notes article (Sept. 14, 2015) on the growing number of renunciations:
"...Charles Bruce of Bonnard Lawson, who is also legal counsel for American Citizens Abroad [said] 'Before FATCA, one of the things that drove a big spike years ago were news stories [involving renunciations] being written up in Forbes magazine.' He added that recently, FATCA had also led to renunciations, not so much because of a desire to save on taxes, given high foreign tax rates, but more to avoid the compliance burden. 'People are getting a paper blizzard,' he said, also citing the complexities in reporting foreign bank and financial accounts and completing Form 8938 'Statement of Specified Foreign Financial Assets.'
"'It’s hard to know from these figures what is really behind renunciations,' said Marylouise Serrato, executive director of American Citizens Abroad. 'Clearly in the last couple of years, with the increase in compliance, it’s obvious that there was a huge community of Americans overseas who had no real understanding of how they were supposed to file or that they were supposed to file.' She added that the recent media attention given to overseas compliance resulting in increased awareness of duties may have played into increased renunciations."
Full article (pdf reproduced by permission)
Bloomberg BNA (August 26, 2015)
"Plaintiffs Fire Back at Justice Department in Case Over FATCA"
"Battle lines have been drawn in a case seeking to get the Foreign Account Tax Compliance Act and its accompanying intergovernmental agreements declared unconstitutional...The case highlights the fact that while many overseas Americans agree FATCA is causing financial havoc and other problems, U.S. citizens abroad don't agree on how to fix the problems...'We think a same country safe harbor is highly achievable,' ACA spokeswoman Marylouise Serrato said Aug. 25, noting that her group was one of the first to support that approach. 'It's the most doable, the most practical, we stand by that.'"
(Reproduced with permission from Daily Tax Report 166 DTR K-3 (Aug. 27, 2015). Copyright 2015 by The Bureau of National Affairs, Inc. (800-372-1033) <http://www.bna.com>)
Migrationpolicy.org (July 29, 2015)
"Americans Abroad: A Disillusioned Diaspora?"
Academic researcher Dr. Amanda Klekowski von Koppenfels, Lecturer in Migration and Politics at the Brussels School of International Studies, recently published an article entitled “Americans Abroad: A Disillusioned Diaspora.” Dr. Klekowski highlights some of ACA’s work. Dr. Klekowski speaks to the frustrations and problems of the Americans overseas community and the opportunity for productive engagement by the United States with the community.
ExpatForum.com (June 8, 2015)
"Foreign tax rules may be unfairly targeting US expats"
"An organisation that represents American expats has called on the United States Treasury to amend tax regulations to exempt those living abroad from the Foreign Account Tax Compliance Act (FATCA).
"Where a US person truly resides in a foreign country and has a normal financial account at a bank or similar institution in the same country, ACA is recommending the FFI should treat it as if it belonged to someone who is not a US taxpayer, and the latter would not have to list the account when reporting a Statement of Specified Foreign Financial Assets.
"‘If the account in question is a garden variety bank account and it sits in a bank down the street in the same country, it’s realistic to assume that this account is used for normal, everyday purposes such as to buy groceries, to pay the rent, to pay for vacation travel, and so forth,’ said Marylouise Serrato, executive director of ACA.
"‘This type of account should not be affected by FATCA. With this exemption, foreign bankers could relax a bit when dealing with their American customers. And Americans living outside the US would not need to feel that they are being unfairly targeted,’ she added."
The Wall Steet Journal (June 5, 2015)
"The New Rules of Offshore Accounts"
"For expatriates, the annual income-tax filing deadline is normally June 15, , instead of April 15. In addition, all U.S. taxpayers with offshore accounts totaling more than $10,000 in 2014—regardless of where they live—have until June 30 to file FinCen Form 114, known as Fbar, a report giving details of the accounts.
"But new issues are cropping up. Bills with support in the House and Senate could allow the revocation or denial of passports to people with unpaid taxes of more than $50,000, says Marylouise Serrato, executive director of American Citizens Abroad. The group worries that if the provisions become law, expats could suffer. Some could owe taxes they are unaware of and lose their passport, even though the debt might later be reduced or eliminated by the IRS. 'For Americans living overseas, a U.S. passport is the only official document proving they’re American,' Ms. Serrato says, so being without one can make living abroad not only difficult but risky."
Reuters Press Release (May 26, 2015)
"New survey finds US expat voting could impact 2016 Presidential Election"
"Greenback Expat Tax Services conducted this survey with over 1,800 US expats in cooperation with the American Citizens Abroad Global Foundation (ACAGF), a section 501(c)(3) charitable organization focusing principally on educational matters to promote the interests of Americans abroad.
"Both organizations intended for the survey to gather the opinions of overseas Americans on the issues that impact them most. One clear message the data reflected was the growing frustration with US tax laws, such as Foreign Account Tax Compliance Act (FATCA), a major US initiative to uncover US taxpayers hiding money overseas to avoid paying American taxes. FATCA requires individuals to report their offshore assets if they exceed certain thresholds and foreign financial institutions are now required to report information about the accounts of their American clients to the US. [...]
"The respondents who answered said that they didn't vote were for the following reasons: 15% didn't know how to vote while living abroad, 9% didn't feel their vote would make a difference and 10% didn't feel that voting as an expat was important. [...]
" 'The results of the survey are very important to the work that ACAGF and American Citizens Abroad, Inc. are doing on behalf of Americans living and working overseas. Identifying the problem areas and the concerns of this community helps our organizations better formulate policy and supports ACA, Inc.'s advocacy efforts with the legislature,' said Marylouise Serrato, Executive Director, American Citizens Abroad (ACA, Inc.), a sister section 501(c)(4) organization to American Citizens Abroad Global Foundation (ACAGF), a publicly-supported charity under section 501(c)(3).
" 'ACA Global Foundation understands the importance of identifying the issues facing the community of Americans living and working overseas. Better understanding of our members' and supporters' issues helps us educate everyone, including Congress, as to the real needs of Americans living and working overseas,' said Charles Bruce, Chairman of ACAGF."
Expatbriefing.com (May 8, 2015)
"FATCA: No Respite For US Expats-Yet"
Following another call from US expat pressure group Americans Citizens Abroad (ACA) that the United States Treasury amend tax regulations to exempt Americans residing in a foreign country from the Foreign Account Tax Compliance Act (FATCA), this feature provides an overview of this controversial tax reporting law and recent FATCA developments.
Commenting on the problem, Marylouise Serrato, Executive Director of ACA said: "If the account in question is a garden-variety bank account and it sits in a bank down the street in the same country, it's realistic to assume that this account is used for normal, everyday purposes: To buy groceries, to pay the rent, to pay for vacation travel, and so forth. This type of account should not be affected by FATCA. With this exemption, foreign bankers could relax a bit when dealing with their American customers. And Americans living outside the US would not need to feel that they are being unfairly targeted."
"All these reporting requirements, and the threat of penalties if the reporting is not complete and accurate, are causing some foreign banks and other financial institutions to cut off access by Americans overseas to foreign financial tools, such as mortgages, bank accounts, insurance policies, and pension funds, all of which are essential financial tools for survival overseas," ACA observes.
Tax-News.com (April 23, 2015)
"Residence-Based Taxation Proposed For Americans Abroad"
"American Citizens Abroad (ACA) has submitted a proposal to the US Senate Finance Committee individual and international tax reform working groups for the enactment of residence-based taxation (RBT) for American expatriates. It said lawmakers should enact RBT instead of the present citizenship-based taxation (CBT) because it would reduce compliance burdens for expatriates, provide more efficient taxation, and improve competitiveness...."
Accounting Today (April 21, 2015)
"Taxpayer Advocate Recommends Merging FATCA and FBAR Reporting Rules"
The National Taxpayer Advocate has recommended that the reporting rules under the Foreign Account Tax Compliance Act and for foreign bank account reports in effect be merged to simplify the duplicative disclosure requirements that make it difficult for American expatriates to have bank accounts in the foreign countries where they live.
The expatriate advocacy group Americans Living Abroad [ACA, Inc.] has been pushing for relief from the onerous requirements of FATCA, which was included as part of the HIRE Act of 2010. FATCA requires foreign financial institutions to report on the holdings of U.S. taxpayers to the Internal Revenue Service, or else face stiff penalties of up to 30 percent on their U.S. source income. The older rules for foreign bank account reports, or FBARs, require taxpayers themselves to report on their holdings in overseas bank accounts. Both sets of requirements are aimed at discouraging taxpayers from hiding their assets in secret bank accounts abroad, but have also led many U.S-born expatriates to face difficulties in maintaining bank accounts, even if they haven't lived in the U.S. for years.