Reuter’s article by Atossa Abrahamian

I spoke with Atossa Abrahamian of Reuters regarding my case.  Her article is now available online, and I am pleased with her general tone; she treats us favorably and does not accuse us of being tax cheats, like so many other journalists have done.


120 thoughts on “Reuter’s article by Atossa Abrahamian

  1. @Petros
    Thank you for posting the Reuters article and for speaking to the reporter about your case. It is really an excellent article.

  2. @Petros…

    BTW, congratulations on your efforts and your quotes. You came across in the story as very measured, reasonable and non hyperbolic. Well done… Do you have the email address of the journalist? I could not find it quickly, and want to send an email of appreciation. Thanks

  3. Me too. I want to thank Petros for all he is doing. I would like even to contribute financially for this blog. It became a very important thing in mt life as an American Abroad. I am also many thankful to the reporter and would like to write to her if I know her address. I am sending this artcile to everybody.

  4. Well done Petros for your contribution to the Attosa Abrahim article and my thanks joins with all who have found this site to be a sanity saver.

  5. Peter Dunn is now famous! 🙂

    The author does a great job of “telling it the way that it is..” Before reading this, I was somewhat oblivious to the stress it can cause marriages.

  6. Bravo! A very well done piece with excellent input from Petros and Ms. Serrato from ACA.

    Thank you Ms. Abrahim if you are reading this!

    American’s abroad need to be heard. Our plight is real. People wouldn’t be renouncing their citizenships if it wasn’t.

  7. Here is what I just wrote her…


    You wrote an excellent article at Reuters. Very measured, balanced and right on point! You got the story correct.

    Thanks for helping shine a light on this subject little appreciated in U.S. Media. I continue to be amazed how little it is covered in the US media, and then again, when I think about it, I kind of understand why not.

    Assume you saw David Jolly’s piece in the NYTs just yesterday… Yours coming on the heels of his really helps with homeland American awareness, although I don’t know if they read this in Kansas unless it is reported on Fox News Cable TV. 🙂

    Also, for your reference Amy Feldman wrote a good story at Reuters some time back… Maybe you know her.

    Thank you again. I am sure your story will be passed around amongst those 6.5 million U.S. Expats trying to sort out what to do. “Complain but comply or renounce.” Very difficult decisions for many.

  8. As I have said, I do think it is important to try to email reporters. Here is the response I just got back…

    “Hello, thanks very much for your lovely note! I’m just starting out here so it’s especially reassuring to get good feedback.

    Good luck with your taxes!

  9. This was a very good and huge “eye-opener” article that I hope the moronic politicians that regulate the IRS and Treasury dept read. WIth my recent experience realizing I was in noncompliance for several years with not reporting my foreign bank account and reading horror stories of how the IRS feels it is their God-given right to extort money from hard working Americans abroad like me makes me feel unproud to be an AMerican. The AMercian people need to read this article because I am sure the vast majority have no clue about this issue. I was totally ignorant of this reporting requirement for years and when I found out I scrambled for months trying to get bank statements covering many years. Then I filed FBARs and am waiting for those suckers to come knocking at my door. I have already decided to fight to the end if they try to penalize me for not paying 50.00 bucks in interest over several years and not filing these stupid documents.

  10. @Expat4ever…

    It will be interesting to see how many other mainstream media organizations pick up the story and run with it…

    Also, I would point out this comment, which I think is a good one from Phil Hodgen’s blog…

    “And one more thing. Let’s abuse one more bias commonly held about expatriation. (A bias especially prevalent among politicians, it seems). Did you notice in the article that the people interviewed are living in high-tax countries, both for income tax and death taxes? Isn’t that interesting .” . .

  11. @Petros: WOW. Good job!!! You have succeeded in something we have been wanting for a long time, that is getting our side of the story into a mainstream media service known to homelanders. I hope that this will be the first step in a continuing campaign to get the word out about how the US treats US persons abroad, and especially minnows.

    Thanks Atossa for your interest!

  12. This article is now the headline link on the Drudge Report (as of 10:30am). Well Done! Huge audience – unfortunately the headline is about renouncing citizenship.

  13. @Petros
    I emailed Atossa to thank her for her well researched and thoughtful article that would hopefully inform Americans living in the United States about the draconian laws passed by their politicians. I had an instant reply from her. There should be more journalists like her.
    So thank you Petros for continuing to ‘fight the battle’. I hope you do frame the CLN. Now we need one of us, who ‘relinquished’ decades ago to receive their CLN.

  14. Atossa’s article is extremely well written and it’s being picked up by alot of different news organizations.

  15. I like the “war on women” who are married to foreigners angle in the article.

    There’s also a war on men married to foreigners but nobody seems to care about men these days.

  16. @ Petros. Ha! I think I’ll go hide under my rock now.

    This IRS war on women concept would be great if it helped to spread the word about all the nasty things the IRS is doing to expats.

  17. @All, just this instant as I walked my TV tuned to Fox News Stuart Barney was announcing breaking news on the surge of Americans living abroad who are renouncing their US citizenship because of US tax laws! Is the snowball starting to roll down the mountside? Let’s hope that it is, and that it will come crashing into Congress in Washington. Keep pouring it on by every means possible.

  18. @recalcitrantexpat – I’m glad it’s this article that is getting all the coverage because it’s the most sympathetic to expats. It’s also the most well researched and intelligent article I’ve seen on the subject.

  19. Well Dan, the Drudge Report is a place I never frequent, but I guess you take publicity where ever you get it… This story is spreading… You never know what one will finally have the right hook to go viral. Maybe this is the one! We shall see.

  20. @marvinvanhorn- the U.S. media and the average American citizen is comfortable with only one kind of narrative, which is that only tax cheats and traitors leave America. We can never hope for a fair trial in the States. Unfortunately we don’t have the option of having a change of venue.
    It all goes to show how giving up U.S. citizenship is the only viable route to personal and economic freedom. The fact that we are opting to live in countries that have higher taxes than U.S. does, is completely ignored by the politicians.

  21. @watcher…

    thanks for the link.

    It is the game they all play. Headline to catch attention, not to convey truth or even the story being told in the article. Some worse than others, and Murdoch owned franchises are terrible!

  22. @Watcher…

    I also see that the story comes with the column of Femail Today. Are they targeting me with pictures of bare bums, or do they think this article will only resonant for males if there is some accompanying female flesh? Geeeze
    Murdoch I hope your mother is proud!

  23. @recalcitrantexpat
    ‘We can never hope for a fair trial in the States.’ Of course, we can’t – this just speaks the inward looking, narcissistic attitude of Americans. Anyone who would dare to leave must be doing it for nefarious reasons – ergo, they must be tax cheats.

  24. @justme- have you noticed that all of the publications which employ a title that gives a very unflattering picture of U.S. expats are referring to the same Reuter’s article that makes no such accusations?
    There is definitely a conspriacy against us that is imbedded in the American psyche.
    @tiger- naricissism indeed. Blind patriotism has always been associated with dictatorial societies. America thinks that it can be the exception to the rule but one day it will wake up to find that it was so terribly wrong.

  25. I talked with a credit union recently about FBARs and FATCA and the impact it is having on individuals trying to live a normal life, and save – amidst all the IRS pitfalls and incomprehensible forms, unpredictable deadlines, and barriers to ‘compliance’ and reporting etc. (re TFSAs, RDSPs, etc). They are going to pass on the comments.

  26. Some who have learned that I’ve relinquished my citizenship have said in comments around the internet: “Don’t let the door hit you in the ass on the way out!” I think this response is appropriate, “Don’t let it swing back and hit you in your upturned nose.”

  27. @Petros, they’re happy to see you go, we’re more than happy to have you!
    You know, I was wondering if anything in recent years has had the potential to have a such an adverse effect on Canadian-US relations. I know there was a lot of it over logging, as well, but I think this could be even bigger (if we have our way, anyway). Living in a tourist area that is really hot with US tourists, it will be interesting to see if the already slightly negative attitude many portray around the ‘ugly american’ tourist syndrome worsens. Or becomes even more commonplace.

  28. @outragedcanadian, armchair bitching about the US is a national pastime for Canadians. I learned long ago that what many consider to be politeness in Canadians is actually a passive-aggressiveness that doesn’t need much to manifest as anger, and real threats to sovereignty is reason enough to cause an uproar.

  29. @Bubblebustin, you may be right. Certainly, I hope that the people that are, luckily for them, not personally affected start to get it and start to become as outraged as I am.

  30. @Just Me… #1: Know your enemy – that’s why I check the stories being linked regularly. #2″ 1.9 million people check that site per day – for better or for worse, the folks who will likely make the next government in the U.S. will now be familiar with the issue.

  31. I take your point Dan…

    I often check the Conservative Daily Caller, but nothing there yet…

    Nothing new on Huff Post or Daily Beast. If it shows up there, I will know the Dems are paying attention…

  32. It’s been fun watching this article move around the world these past two days.
    Googling for it led me to discover the other Peter Dunn. Well, this one thinks Petros is the other Peter Dunn. But you get the idea.


    “Things were going so great…until I was mistaken for another Peter Dunn.

    While I try to help people take responsibility for their financial lives, the other Peter Dunn encourages people to leave the United States in order to avoid paying taxes. This mistake was originally brought to my attention by a Twitter follower, but then I noticed the increased web traffic on my website today. People have been Googling “Peter Dunn don’t pay taxes” all day. Ugh.

    So for the record. I pay taxes. You should pay taxes, and the other Peter Dunn needs to stay out of the news. The world doesn’t need two Peter Dunns.”


    Pacifica on April 18, 2012 at 1:34 pm said:

    For sure, the world has plenty of room for two Peter Dunns … but I can see it must have been kind of startling for you to discover another one in this tax context!

    However, it seems both you Peter Dunns have more than a name in common. You both pay taxes.

    I know the other Peter from the Isaac Brock Society. I’ve never heard him recommend anyone should leave the United States or do anything else to avoid paying taxes. As stated in the Reuters article, he has always complied with IRS during his many years as a US citizen, and with Revenue Canada as well … it was the complexity of tracking US tax law changes (and they’re complex) and ancillary matters such as FBAR that caused him concern.

    People relinquish their US citizenship for a variety of reasons. I did it decades ago. I just personally did not like the idea of being a citizen of two countries at the same time. Taxes were not an issue at all in those days, it was a much simpler era.

    Taxes are a big issue today, however, for US persons abroad. But it’s not tax avoidance that’s pushing these people to renounce. In fact, with the Tax Treaty, FEIE, and the US having such low tax rates, most US persons living and paying tax abroad end up not owing one red cent to the IRS,

    It’s the unbelievably (and increasingly) complicated paperwork, along with increasing US restrictions on a US-person-abroad’s ability to live like a normal person (US restrictions on retirement savings accounts where you live, banks refusing to do business with US persons because the banks don’t want to run afoul of incredibly complex US tax law, etc.) that is fueling this rise in relinquishment of US citizenship.

    This whole tax thing not being an issue 40 years ago, it played no role at all in my decision to relinquish. But I do respect the personal decision a person today makes if they feel US tax law in 2012 is making them unable to live a normal life outside the US. These people are not trying to play it both ways and/or choosing to play games with the tax code. They are choosing to give up their rights as well as their responsibilities as a US citizen … end of contract … sounds fair to me.

    Please do check out We post several articles daily on new developments in US tax law for US persons abroad, FATCA, etc, from contributors around the world with a variety of viewpoints. Your posting or commenting, too, would be most welcome!


  33. Great find Pacifica: Here’s my comment to the other Peter Dunn:

    Hi Peter Dunn, nice to make your acquaintance. I can vouch for Pacifica; she really does know me. I blog under the alias Petros, in case you want to read some of what I actually encourage people to do.

    Today I spoke with a very good friend and encouraged her not to file for the taxes that she doesn’t owe (since she hasn’t made anything in years being a house wife, mother and student). But as an American in Canada she is quite scared by the threats coming out Obama’s IRS. I told her that as long as she is poor (house rich, cash poor, like so many folks these days in Canada), the US government won’t be interested in her. But many of the rest of us, how are we supposed to keep up with both the IRS and Revenue Canada?

    Did you know that tax freedom day in Canada is in June. So guess what, that means that I pay a lot more taxes than you or any of your readers, as the average American is done paying taxes sometime in April. I just want to be able to enjoy my after tax wealth like any other person in this country and not have to worry that a far away government, that borrows 53 cents on every dollar it spends, wants shake me down for cash.

    So it’s not that I encourage people to leave the US; I actually am helping people to know how to relinquish their citizenship who already live outside the United States. If you live in the United States, then you are subject to the laws of the United States, for better or worse. But why shouldn’t a person living in another country avail themselves of the right to shed the statutory requirements of a regime in another country? No one can serve two tax masters. My former forefathers, the founders of the United States, felt the same way as I do when they declared independence from King George, who had decided that they needed to pay a little stamp tax on tea. They were willing to fight a war over a little taxation without representation. How much more should we, who live outside the United States, desire freedom from the far off and oppressively evil regime of the IRS, if we can get ourselves free without bloodshed just through the relinquishment of our citizenship?

  34. … but too many commenters haven’t taken time to read the article OR can’t comprehend what it says OR make me glad I haven’t lived there since 1969. I want to scream — it’s not about taxes!

    I appreciate those who have put some thought into their comments and do try to understand.

  35. @ calgary
    Yeah, like Petetheplanner: “PetethePlanner tweeted:
    “That one time when a guy named Peter Dunn didn’t pay his taxes and fled the country… A PR disaster in the making”

    So I commented at his blog:
    By the way, I just want to let you know that I don’t owe any taxes to the IRS, and I didn’t flee the country. I left during peaceful times, and to study abroad. Then, I met my wife in Canada. I never made it back to the US.

    By the way, I think that I’m older than you. That would make you the “other” Peter Dunn, Dontcha think?

  36. Pingback: Who is the other Peter Dunn: Survey | The Isaac Brock Society

  37. @all- I was just on the Yahoo site where the article is and it seems that both we and the poltiicians have seriously under estimated the intelligence of a good portion of the U.S. population.

  38. this is one of my favorites”

    Independence, Ohio • 1 day 2 hours ago

    Those that are renunciating are ahead of the curve.

    Maybe we’re in a better place than we realize 😉

  39. Expat4ever
    Finally, the progressives start to take notice…
    Thanks for keeping a look out. Watch also…

    The other sites I watch that impact NPR, PBS coverage are and and

    If they started writing about it, it then gets into the Public broadcasting world…

    You might email them, as I will do also.. We should target progressive sites so this isn’t seen as just a conservative or libertarian issue…

  40. @recalcitrantexpat,

    That was my impression as well. Here is a small sample from the first couple of pages of over 6,200 comments. I have to admit, I am pleasantly surprised about how many people commenting actually get it.

    “An “exit” tax! LOL They get you coming and going, dont they!”

    “If I was going to or had to live permanently in another country because of a job, I would renounce it as well. There’s no way i’m paying taxes to a country I don’t live in”

    “If I was living abroad and making a good money, I would strongly consider renouncing my citizenship too. Why should I have to send the IRS a check every year when I’m not even living in the United States? I’m not getting any benefits from the United States like police protection, unemploymen/welfare or anything else, so why should I be forced to pay in.”

    “It’s bad enough we’re chasing our own citizens offshore, now we’re taxing them to the point they don’t even want to be Americans anymore? Way to go Congress. The US is becoming more oppressive than many of our old Cold War enemies.”

    “How often I hear that the world wants to come to America. This is the other side of the coin.”

    “Those that are renunciating are ahead of the curve.”

    “They should change the law to exempt Americans from paying taxes on Income made outside the US.”

    “… America is the ONLY country that taxes it’s citizens for money earned outside the home country. It’s a no-win strongarm tactic to come with the money needed to pay our government and it’s subsidiaries. I’m not going to give up my citizenship but I have thought about it. Americans working overseas have to pay taxes to the country they are working in and taxes to the U.S. It’s unfair but that’s the American way: soak your citizens for everything you can, every way you can. Being an American means less and less each year but you owe more and more.”

    “Just to give you an idea how the American dream was just a dream and how things changed – I know a few people, New Yorkers, who went abroad to live better lives. They now live in… of all places…. Poland! And they have no Polish family roots at all.
    Poland is no paradise, but they say they love the freedom and fact that they work to live, not live to work. Imagine that, huh?”

    “Americans living permanently out of the country should not have to pay taxes. They get no benefit of citizenship.”

    “The U.S. Government keeps pointing the finger at other countries for treating their citizens badly, but the U.S. turns it’s head the other way when the tyrant IRS abuses it’s own citizens.”

    “Well, if the time comes whne your citizenship is more a burden than a joy then I guess I can understand renouncing it.”

    “Only politicians would believe raising taxes or adding red tape would not have consequences. People will take action to protect themselves from predatory government actions when they can.”

    “Money earned in the U.S. should be taxed according to the laws of the country, but if I am in another country, it’s not Uncle Sam’s business what I earn in that country. This is ridiculous on all levels.”

    “Taxing Income earned outside the United States by an individual while they residing outside the United States is rediculous.”

    “So the IRS will go after middle class citizens living overseas and making all their money overseas, but wont go after home-based billionaires who keep their under-reported income in off-shore banks.”

    “Taxation without Representation now where have we heard that before..”

    “Dunn says the taxes he pays in Canada are higher than what he would pay in the United States.” Before you folks jump on the same old bandwagon read what the article is saying. They are tired of the methods IRS uses that is why they gave up US citizenship. The taxes in many cases are higher in other countries.”

    “Before the Roman Empire fell they tried the same thing – taxing their citizens to death to sustain it’s military and entitlement programs. It didn’t work then and it won’t work now.”

    “The bottom 30 percent of the USA spend over 50 percent of the income on energy and food cost alone already and the numbers will keep rising. Targeting us expats will not work because many will say no thanks and renounce. What right do they have to my wealthy partners information and finances? None!”

  41. @bubblebustin, remember there’s no such thing as bad publicity. Whatever it takes to get our message out and get a reaction out of Congress is what we need. If we piss them off, it will work in our favor since they might make it easier to renounce. They’ll think they’re hurting us but they’ll actually be helping us.

  42. @omghesstillanamerican- That is one possible outcome but I wouldn’t be so quick to discount the vindictive and spiteful nature of the American politician. It is entirely possible that things could be made worse.

  43. @omg, you mean we’re really in a win-win situation with the media? Never thought of it that way. Maybe that will help keep my blood pressure from spiking when I read anti-expat comments. Thanks.

  44. @recalcitrantexpat, yes politicians can be very vindictive. But in the end they know they really have no real power over us. Messing with us is a waste of time.

    But think for a second like an American politician. All these expats are preventing them from getting bank information on the real tax evaders who are resident in the US but hide money in foreign accounts. Since politicians are self serving, they will say let’s get rid of these expats quickly so we can collect tax dollars from the US residents that are rightfully owed to the IRS.

  45. @bubblebustin, I find sometimes when dealing with Americans that you first have to create an uproar before a resolution can be found.

  46. uh, oh, @recalcitrant just blew all those warm and fuzzies for me…One thing that keeps coming to mind for me is how it’s ingrained in the American psyche that the US is a beacon of freedom in the world. This freedom allows for unfettered access to the rest of the planet, if only to allow Americans to spread that word. When faced with constraints in doing that, manifested in an increase in expatriations, it strikes at the core of this belief. Our treatment is repugnant to many who believe that living, or at least immersing, in another land should be an available and viable option.

  47. @bubblebustin- I have been wondering what will be the reaction of someo of our critics when and if the day comes that they want or need to live overseas only to find out that the U.S. has effectively land locked them? They may suddenly realize that we were right.

  48. American politicians like low hanging fruit. We only become that when we voluntarily offer ourselves up to them and pay confiscatory fines even though we owe no taxes and the Canadian government has offered us their protection.

    The real low hanging fruit is residents of the US … millionaires with offshore accounts who don’t properly report all their income. These are the people they would have access to if they found a way to remove expats from the equation. There could be billions of dollars that can be collected from US resident tax evaders with foreign accounts. American politicians are not stupid when it comes to money … I’m just surprised they haven’t figured out already that the easiest solution is to let expats renounce without jumping through hoops.

  49. More and more of the world’s biggest companies will choose non-Americans as their Presidents to avoid the US citizenship taxation problem. This means the power base is moving away from the US. Even GE said their next President is likely to be a non-American.

    Imagine you are a US citizen who’s gone to the best schools and you are not hired because it’s easier to hire any other nationality except Americans. Now that gives a whole new meaning to American Exceptionalism.

  50. Perhaps (let´s hope) Alexis de Tocqueville was right. America always do the right thing, after trying everything else.

  51. @thatisme: I also thought it was Winston Churchill who said that.

    I agree completely with OMG. How much more can they screw things up? Even teenagers don’t usually mess up this often and this badly.

  52. @omghesstillanamerican, maybe we should rebrand it American exclusionism.

    When an American becomes the CEO of a large multi-national headquartered outside of the US, he has to submit FBAR reports which include detalis all of the foreign companies bank accounts in banks outside of the US. That task alone takes quite a work force and thousands of hours of time in the most unproductive waste of money work you could possibly imagine. All foreign currency accounts must be converted to equivalent US dollar values for FBAReports. Tell me, what does the IRS do with a mountain of paperwork like this, or how does it veryify that the numbers are correct? Can you think of anything more absurd since the foreign corporation is not subject to US income tax on its non-US earnings.

    Since he is personally responsible for submitting these FBAR reports, I hope he is declaring as personal “in-kind “income the corporate cost of preparing these massive and detailed reports. By US tax law that his personal taxable income.

  53. @Just me,

    It’s still a good first start. I actually expect more empathy from the Tea Party people than from the Occupy crowd.

    In any case, unless an American has lived abroad for a significant amount of time, it will be difficult for him/her to understand the problems expats face.

    One thing is for sure, an increase in renunciations grabs the headlines. It directly challenges the myth of the American dream.

  54. I believe that perhaps the time arrived for us Americans Abroad to start to express how we would like to be treated by the USA government. My first wish : adopt like all other countries residency based taxation. Of course continue to tax citizens, dual citizens and greencarders residing in the USA their earnings in foreign investments but giving credit for the taxes they pay in foreign countries (this is what Brazil does) . If the USA decides to continue to tax us give us unlimited earned income exclusion. Continue to give tax credits to the taxes we pay in our country of residence. May continue to require FBARs but give amnesty to anyone living abroad who sends his first FBARs. Notify every American Abroad in form 1040 about the need to send FBARs and start penalizing the ones who don ‘t comply in the next tax year. Give SS tax credit for SS paid in the country of residency. Do not tax income that is not taxed in the country of residency. Hmmm, how am I doing? I don ‘t like to complain without making suggestions. Finally, no double forms and …simplify all the forms.

  55. @tiger, I agree. Adopt residece based and drop citizenship based taxation. That is the only viable solution. Achieving that solution is going to requre foreign governments taking a firm stand in opposition to the US policy of collecting taxes from US citizens who reside within their borders as being a violation of their national sovereignty. That hasn’t happened yet and I have not detected any stirrings in that direction..

  56. ACA has these proposals for change very well outlined and carefully done. I am not sure US Congressmen are willing to listen. And so far all I can see is all the contries catering to the USA demands. Just follow the money. If we had representation in the US Congress they could be fighting for us. Let me suggest that for some reason public opinion is against us in the USA and in all countries. How can we try to change this? I was in touch with a Congressman from the State I last lived in the USA. He said that he was in the Americans Abroad Caucus because he lived abroad… but he never was clearly in our side… I wrote to the White House about us saying as a Democrat that President Obama should give us some support in order to get our absentee votes. They answered very nicelly explaining President Obama´s view on taxing the rich (I agree) but no word about Americans Abroad. In the mean time the GOP is taking a clear stand in our favor and against FATCA trying to get our votes. But it is difficult for me to support what theyrepresent… The Democrats Abroad Brazil don´t want to discuss this issue, This puzzles me. Aren´t they affected by the demands of the IRS?… They keep saying that we should focus on winning the elections…Complicated, no?

  57. @Markpinetree, the Democrats in Brazil’a ignoring of this issue to concentrate on Obama’s re-election is akin to the Jews in Nazi Germany supporting the shipping of fellow Jews to the concentration camps. And I do not exaggerate.

  58. I know Roger… See the Facebook Democrats Abroad Brazil: I don´t understand why these fellow Americans Abroad in Brazil are not as distressed as I am. Mistery. The same for Democrats Abroad. They at least mentioned the problem and said that they are working on it, but when I talked about the issues of Americans Abroad no big support. On the other hand as we know Republicans Abroad Europe are really addressing these issues. I feel sorry because I am a Democrat and want Obama to be Re-elected. But it is conflicting for me.

  59. @markpinetree- and there is the rub. If you let your political affiliations override your own self interest then the silence that you get from the Brazilian branch of Democrats abroad is the result.
    The party should be the vehicle for the expression of the will of its members and not the other way around.

  60. recalcitrant wrote: “The party should be the vehicle for the expression of the will of its members and not the other way around.”

    Too true! That’s a great way to put it.

  61. @broken man Yeah, you gotta love Godwin’s law. (note to self: do not compare the Obama adminstration to the Nazis in the interview with Pete the Planner in half an hour).

  62. I must say that I continue to support President Obama and the Democrats when I conpare them with the Republicans. But as an American Abroad we should not take sides. We are going to welcome anyone who understands our plight and supports us. We are not the same as Americans in yhe USA who are investing dollares earned in the USA in foreign banks,

  63. “We are not the same as Americans in yhe USA who are investing dollares earned in the USA in foreign banks,”
    Now you may want to break that stereotypes. There are so many immigrants in the US who can be considered Americans in the US (canadian-americans, indian-americans, chinese-americans) and who have left assets in their home countries before moving to the US. They may be in a similar situation with respect to their assets left outside before moving to US.

  64. @Kumar, when persons from other countries relocate to the US and become green card foreign residents, indeed the income from assets they beomes taxatble by the US, and those assets have to be reported to the IRS so they can make sure you are paying taxes on them.

    I have a question: When persons from other countries relocate to Canada and become permanent residents of Canada, is income from assets they left behind taxed by Revenue Canada? I know there is no Canadian equivalent to FBAR and FATCA, but the question is whether the income from those assets and the capital gains if they are sold abroad for a prorfit are subject to taxation by Canada.

  65. @Roger
    Yes income from US assets is supposed to be reported by Permanent Residents of Canada. It’s called worldwide income and it is taxable. My husband received a 1099 for a tiny bit of interest years ago which he included on his Canadian tax return. I think it’s the same for capital gains but the only thing we had was a house and because it was a primary residence it was all tax exempt when we sold it.

  66. @Roger Conklin
    I have spent years preparing Canadian income tax returns. Canadians (and I mean both citizens and residents of Canada) are taxed on their World Income. Now having said that, I can’t help but believe that since our tax system is an honour system, there are people in Canada that are not reporting income and capital gains from abroad. Certainly, if I had a client who I suspected was being less than forthright about their world income, I would refuse to do their tax return.

    The Canadian tax return also has a question on the front information page: :”Do you own any foreign property with a cost base greater than $100,000.00″. If the answer to that question is yes, there is a special form (1135) to be filled out where you list the value of the foreign assets such as, Greater than 100,000 or greater than $300,000 etc and then report the amount of income you are reporting on the return from those assets. Many people are under the impression that by ‘foreign property’ they mean ‘real property’. However, it refers to any foreign assets, such as, real property, stocks, securities, business etc. Again, I wonder if all individuals are honest with their answers. I have gotten to know my client base quite well and I believe they all answer that question honestly.

    Many years ago, when I was working for someone else, I remember doing a tax return for a foreign born, permanent resident of Canada. The only income being reported was ‘social assistance’. The individual had enough gold jewelry on that had it been melted down they could have lived for 25 years or more. I saw them drive up to the office in a Mercedes. I suspect they did not answer many questions honestly. But it was not my job to accuse them of dishonesty.

  67. Thanks to all who responded with respect to the taxation of foreign income to residents of Canada. These comments clarifity the situation. Thanks very much.

    Does Canadian tax law allow a foreign tax credit offset against the Canadian tax on such foreign source income?

    On foreign capital gains is the tax calculated on the difference betwen the acquisition and sale price, both expressed in Canadian dollars, or is it calculated on the gain in foreign currency converted to Canadian dollars?

    The diffence between these two methods can be substantial if the foreign currency has significantly changed in value over the years between purchase and sale. In the US the purchase and sale price have to be in dollars at the excange rate in effect on those transaction dates.

  68. I have a nagging question that I never got a clear answer. An American Living and Working in Brazil, if he is Self Employed, he has to pay SS Self Employment Tax to the IRS USA, even if has to pay the same to Brazil. But if the same American is an employee of a Brazilian Company he only pays Social Security Tax to Brazil, not to the USA. Can anyone explains the rationale for this? As Self Employed in Brazil I have to pay SS Self Employment Tax in both countries. Right there is 32% tax. And I have no return in terms of SS pension. It is a donation. How can I survive this?

  69. About this question of citizens in their own country, as well as resident aliens (green cards) that left or started accounts in a foreign country. Of course they have to report. For instance if I reside in Brazil and have investments in the USA I have to repport this in my Brazilian Income Tax return. But Brazil will give me credit for the taxes I pay in the USA and only will charge me the difference, if any, of the taxes I would have to pay in Brazil. So it is not the way is being said that I will have to pay taxes in investments I have in another country. I hope this is the same for Canadians and others, otherwise this would be double taxation.

  70. @markpinetree, I might be able to explain it. Under US tax law if you live and work outside of the US for a foreign employer you do not pay US social security tax and you are not covered by any US social security benefits. If you work abroad for a US employer or a subsidiary of the US company, that that US company may optionally elect to include in in US social security if it inclues ALL of its US expartriate personnel. In this situation you pay the employees portion and the US parent company or US employer pays the employer’s portion.n this case the decision is made by the US employer or parent company. If you are a US person abroad and are self-ermployed, that you are obligated to pay the self employment tax (which is the social security tax.) Don’t ask me to explain the logic behind this, but those are the rules.

    Now that I am retired and receiving US social security retirement benefits, the years I worked for a Braziian employer and did not pay US social securithy tac did not count in determining my US social security pension.

  71. @Roger Conklin

    In answer to your previous post. Yes, there is an allowable Foreign Tax Credit. Regarding Capital Gains, – the tax is calculated on 50% of the difference between Adjusted Cost Basis (purchase price) and Proceeds of Disposition. These amounts would be converted to Canadian dollars on both purchase date and sell date. So you are correct – it can make a huge difference because of the exchange rate differences.

  72. Roger isn´t this complicated? In a way I am glad that I paid SS Self Employment Tax all the years I worked in Brazil as a dual citizen. This gave continuity to my SS contribution and allowed me to be retired today receiving a SS US Pension. I also paid Brazilian SS Taxes and for the same reason I do have a small Brazilian SS income now (I contributed less because I worked less time in Brazil) When I lived and worked in the USA I did not have to pay income tax or SS tax in Brazil. But now at 79 and retired in both countries, being in Brazil I have to pay SS Self Employment Tax in both countries and this will not increase my social security income in neither. It is now a donation. I guess there is no way to change this but it is very difficult for me to afford. The money I left invested in the USA -earned there- I must declare in the Brazilian Income Tax Return. And I get credit for the taxes I pay in the USA. The problem however are the forms, endless forms to be filled in Brazil and in the USA. It takes a lot of time even if I end up not having to pay taxes because of tax credits. Yes, moving to live and work in a foreign country – not your own – complicates things a lot. This is especially true if you ar an American because the US IRS goes after you. Perhaps in the future as more people do this, there will be an easier way.. Thank you.

  73. @Markpinetree. Thank you. I totally agree with you. There is nothing that is either reasonable or just about the US citizenship-based tax system. But it is the law.

    When I lived and worked in Brazil I paid Brazilian Social Security Tax for the 6 years of those years that I was employed by a Brazilian company. For about 6 of those years I was on the payroll of either a US employer or the Brazilian subsidiary of a US employer, during which I paid double social security taxes to the US as well.

    I am 81 years old. Currently I receive US Social Security retirement benefits. Living outside of Brazil do I have a right to any retirement benefits for those 6 years I paid Brazilian Social Security taxes? How would I proceed to file for those benefits living outside of Brazil? I have never thought much about it because, as I recall when I lived in Brazil retirees there had to appear personally at a bank every month to collect their reirement benefits and have a Certidao de Vida in hand to prove that they were indeed alive in order to collect them. Also there were exchange control laws at that time which allowed benefits to be paid only in Brazilian currency which could not be converted to dollars or any other foreign currency for remittance outside of the country.

  74. Roger I did not quite understand. I then paid Brazilian SS (INSS) for six years. Is this what happened. Did you have a Brazilian SS (INSS) number? Give me sometime and I will try to find the answers.

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