FBAR Penalty in Canada! - Page 17

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  #161 (permalink)  
Old 3rd December 2011, 01:34 PM
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True. But if you have more than 25 accounts you can just list the number of accounts on the fbar form. My theory is that they will accept most quiet disclosures for now, then start clobbering people after they introduce the 8938 form which will force people to fully list all their foreign accounts as well as individual stocks.

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  #162 (permalink)  
Old 3rd December 2011, 03:03 PM
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Originally Posted by Mona Lisa76 View Post
True. But if you have more than 25 accounts you can just list the number of accounts on the fbar form. My theory is that they will accept most quiet disclosures for now, then start clobbering people after they introduce the 8938 form which will force people to fully list all their foreign accounts as well as individual stocks.
I read about a guy who opened up a few extra ING accounts online to get them up to 25 to avoid filling out the form. That's a good idea in the short term to avoid all the paperwork. The IRS however could audit such a person and ask for all the information which you must keep on file.

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  #163 (permalink)  
Old 3rd December 2011, 03:31 PM
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Rumour has it (from an MP and I cannot disclose the source sorry) that when the 'announcement' is made in a couple of weeks regarding the Dec 02 globe and mail article...that the requirement will call for US citizens to begin filing for 2011 only...1040, FBaR, and 8839 (assuming it is cleared from draft form).

This is good new for those who have waited, but late news for those of us who have spent thousands of dollars trying to comply
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  #164 (permalink)  
Old 3rd December 2011, 04:31 PM
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Rumour has it (from an MP and I cannot disclose the source sorry) that when the 'announcement' is made in a couple of weeks regarding the Dec 02 globe and mail article...that the requirement will call for US citizens to begin filing for 2011 only...1040, FBaR, and 8839 (assuming it is cleared from draft form).

This is good new for those who have waited, but late news for those of us who have spent thousands of dollars trying to comply
True, but no one could know for sure. In my case the irony is that I would have been better off not filing at all and starting now rather than filing all these years but with unintentionally under-reported income.

As for fbars being audited, they'll get all the detailed information about the accounts and maximim values from the upcoming 8938 form which will have to be directly attached to the tax return. most of what they'd want to know was already reported on my 8621s so I doubt they'll want to audit me....it wouldn't be viable, especially with me going to them first. Might be different if they'd discovered me or thought I was guilty of fraud, or talking millions...

Think they will be more interested in the low hanging fruit back back home and the cheating billionaires abroad. They are probably mainly reminding us they mean business going forward though.

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  #165 (permalink)  
Old 3rd December 2011, 05:02 PM
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Rumour has it (from an MP and I cannot disclose the source sorry) that when the 'announcement' is made in a couple of weeks regarding the Dec 02 globe and mail article...that the requirement will call for US citizens to begin filing for 2011 only...1040, FBaR, and 8839 (assuming it is cleared from draft form).

This is good new for those who have waited, but late news for those of us who have spent thousands of dollars trying to comply
I will wait for the news to come out before I send anything in. As you saw from a previous post, the IRS is waiting with baited breath for my 2009 return. Does this mean now, that I don't have to send that in? I think not. So you see, the moral of the story, is that if you were being compliant with tax filing obligations from 1998-2008, but had lapsed out of fear of FBAR, you are much worse off than if you had never paid any attention whatsoever to any of the filing requirements.

The only real solution is to stop requiring offshore Americans to file. If they create ad hoc rules like this, it will just lead to further chaos and resentment.
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Old 3rd December 2011, 05:06 PM
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I agree they are going to upset people no matter what they do. But at least it seems they're not being as heavy-handed as we once feared.
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Old 3rd December 2011, 05:46 PM
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We'll see.
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Old 3rd December 2011, 05:48 PM
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I have talked with a few local bank branch managers to find out if they will have to comply with FATCA. One was Canadian Western because I read somewhere that they would not fall under the FATCA umbrella. The first person I had to talk to in order to get to the manager looked at me like I was some wacko off the street. Finally the branch manager came out and told her that I was about the 6th person in a week to ask these questions and they were going to have to get educated about it. Maybe it has something to do with where I live but anybody I talk to about FATCA or FBAR think I am an FNUT. Finally that bank manager told me she had been trying to talk to somebody in the head office but because of holidays it was hard to get the time with the person with the answers. However, they did find it in their system and she felt they would have to comply.

I then made my way to Alberta Treasury Branch and asked an account manager there who had much the same experience as the other manager. Her answer guy was busy with holiday issues in the city and she wasn't able to get answers. It must be nice to be a banker this time of year.

Am I right to assume that all credit unions will be a reasonable place to move our TFSA's and retirement securities? If my husband was to move them (he is Canadian), would I still be considered criminal for doing so before my citizenship is in effect? I feel as if I am just spinning my wheels up here. I don't want to make any mistakes, but I do think it would be a mistake to leave everything where it is now. I am not impressed that our financial adviser didn't know about FBAR until now.

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  #169 (permalink)  
Old 3rd December 2011, 08:19 PM
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Am I right to assume that all credit unions will be a reasonable place to move our TFSA's and retirement securities? If my husband was to move them (he is Canadian), would I still be considered criminal for doing so before my citizenship is in effect? I feel as if I am just spinning my wheels up here. I don't want to make any mistakes, but I do think it would be a mistake to leave everything where it is now. I am not impressed that our financial adviser didn't know about FBAR until now.
Don't assume anything about any financial institution, ask them. My credit union says they won't comply, but an association of credit unions in Canada (to which my credit union doesn't belong) says some of their members may have to eventually, due to dealings with banks. FATCA may have secondary and tertiary-level compliance requirements, that is, a bank can't do business with another institution that isn't compliant, and that may cause problems for some credit unions but perhaps not others. FATCA is incredibly intrusive.

However I think it's fair to assume that credit unions are going to be less sympathetic to FATCA than chartered banks, and that individual credit unions may cut you a little more slack about your citizenship affiliation than will a clerk in a chartered bank. It all depends on how the reporting "requirements" are worded and what documentation is "required" and what the institution will accept, assuming our government actually allows the reporting to occur. It's one thing to report place of birth (in fact to do so for US borns but not for everyone else would be illegal discrimination under Artlce 15 of the Canadian Charter of Rights and Freedoms). It's another thing to ask someone are you a US citizen yes/no -- there's nothing in the Charter preventing discrimination on the basis of citizenship (as distinct from place of birth or other definitions of national origin). Your answer to that latter question may be under penalty of perjury or uttering a false document, but someone has to prove that in court against you

There is absolutely nothing wrong with your moving your money out of a bank and into a credit union, for any reason your heart desires. Ditto selling off any and all US-source investments in your investment portfolio and re-investing only in Canada. It's your money and no bank, no government in Canada, can deny you the right to deposit or invest your money in whatever bloody financial institution you want to. No one can prosecute you for moving your money around, unless you're laundering it into some REAL tax haven outside Canada. If you're dealing within Canada no one can tell you where you can or can't deposit/invest your money under what conditions. That applies to legal residents of Canada regardless of citizenship, as far as I know.

Yes what the US is doing is horrible and outrageous, but don't let paranoia trick you into worrying about things that simply can't and won't happen under any reasonable scenario short of the US becoming an absolute dictatorship and invading Canada. Tempting though it may be to attribute such possibilities to some of the stupidity and craziness of governments on both sides of the border, even I think such a worry would be way over the top. And as an avid NDP supporter and former US draft-dodger I think I can safely say there are very few, if any, people on this forum who are more inherently suspicious of and hostile to the United States and the Conservative Party under Stephen Harper's leadership than I am.

No one is going to arrest you in Canada for moving your money out of a Canadian bank and into a Canadian credit union. And if they did, I don't think such an action would stand up to a federal court challenge for five nanoseconds.
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  #170 (permalink)  
Old 3rd December 2011, 09:07 PM
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This is good new for those who have waited, but late news for those of us who have spent thousands of dollars trying to comply
This is a prime example of why I’m so glad I live in a parliamentary democracy and not in a terminally screwed-up political system such as the US has.

Before Stephen Harper came along (this isn’t the place to get into a rant about everything that is wrong, not to mention not truly conservative, about our present federal governing party), in Canada legislation (and draft treaties and agreements) didn’t (and still shouldn’t) get into first reading in the House, or get signed in the case of international treaties and agreements, unless they’ve first been reviewed by experienced federal public servants in Finance, Treasury Board Secretariat, Foreign Affairs as well as in all affected or related line departments’ and agencies’ policy shops, then by Privy Council Office and by at least part of the federal Cabinet.

In the US, Bubba the Congressman or Bubba the Senator dreams up a crazy idea in a drunken stupor or whatever, moves it as an amendment to some other act of legislation which has little or no relationship to the amendment, no one reads the amendment in detail (and anyone who tries needs degrees in law and Swahili to be able to decipher the obtuse “language” in the amendment), and no one does a serious analysis of costs of administering the thing and possible unintended consequences and balances that against alleged benefits. The thing gets passed into law without any careful, rational analysis of it. Then somebody has to figure out how to administer it once the President signs it (and very few Presidents have the time, training or in some cases even brains to do their own analysis of what they’re asked to sign, nor do a lot of their staff persons).

And in a parliamentary democracy an opposition party or even a lone MP can stand up in Question Period and demand the government to explain why some citizens got screwed over on personal costs for trying to comply with some draconian tax law and those who waited don’t get screwed over, and what is the government going to do to compensate those poor citizens. Don’t hold your breath ever to hear about that happening on the floor of either house of the US congress. Never happens as far as I’m aware.

My blood boils when I think of all the bullcrap teachers pontificated to me in high school about how the US has the best, wisest form of government on the planet. Name me one other country that has adopted that screwed-up, paralyzed, illogical and irrational “checks and balanaces aka terminal gridlock” Rube Goldberg affront to any conception of “good government” that keeps thousands of lawyers, lobbyists and consultants in clover in Washington DC. Gee why aren’t other countries clamouring to have the same system of government they have in the US? Let me guess ...

And you have no recourse here in Canada because this isn’t a Canadian tax law, no one in our government asked for the US to do this, not even Harper would have been that perverse.

If anyone is looking for another reason to shed US citizenship, ponder the above. They did it to you once, they can very easily do it to you again. And they've been passing stupid, bad laws for a very long time.

Not that we're perfect in Canada, but in my experience and observation both from within and outside the federal government, we do a heck of a better job of providing "good government" than my poor beleagered friends and family south of the border get subjected to by their crackpot Congress.
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Last edited by Schubert; 3rd December 2011 at 09:09 PM.
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