Remaining a dual citizen (1) : passport renewal

Hello Isaac? It’s me, Ladyhawk. Is there anyone here who still has US citizenship? Well, anyway, in case anyone is interested in how things are going for people like me who are still trying to make the dual thing work, I thought I’d tell you what happened when I went to the US Consulate in Toronto to renew my US Passport.

I’ve been in Canada since 1969, took out Canadian citizenship in 2003, and have no plans to renounce or relinquish my US citizenship. I got my first US passport in 1986 and renewed it in 1996. I had to go to the US Consulate in Toronto both times because that’s the way it was done then. Not a big deal since I live about an hour’s drive away. Since then it has become possible to renew passports by mail, unless your passport has expired and it has been more than 15 years since you last renewed. That was the case for me, so I had to appear in person to renew.

Things have changed. The US Consulate in Toronto is still in the same building, but the big wide welcoming doors at the front on University Avenue are closed, and entry to the building is now at the back, through a smaller door where security is simpler. You don’t get into the building unless you have an appointment, and most people who go are there to get a travel visa for the US. Since I was there for a passport, I was escorted past the lines, through a security checkpoint similar to airport security, and up the stairs to the upper floors by a relay of security guards who kept each other informed about who was coming and going. It was swift and efficient.

At the first window, an agent checked and collected my documents (appointment letter, expired passport, application for renewal, passport photo, and self-addressed Express Post envelope). Then I was sent to the next window where I paid the fee, and from there I went into the waiting room. It was open and uncrowded, with a TV screen on the wall tuned to the CBC news. The resident security guard politely asked if any of us had any questions he could answer while we waited. Within 15 minutes I was called to another window.

Here the agent asked me some questions confirming the information on my application. He noted the state in which I was born and asked if I had grown up there. I said yes, and he smiled and said he was from the state next door, so we were practically neighbours. I smiled back and we chatted a bit about life in that part of the country. He noted my travel plans for the summer and assured me I would have my new passport within two weeks, in plenty of time for my next trip outside of Canada. He asked in a very friendly way about why I had waited more than five years after my passport expired to renew it, and I confessed that I had been very busy with work and family concerns, and had simply not gotten around to it. He did not ask if I had dual citizenship. He did not ask any questions about taxes. I was back on the street in less than 45 minutes.

Since everything was in order, I should have my new passport within a fortnight. The only doubt I have is to wonder whether my information will be checked against my tax status, although I did file taxes (but not FBARs)  for 2010. No one at the consulate said anything about that. If I receive anything from the IRS requesting more tax information before my passport is issued, I will report it here.

All the people I encountered in the embassy, from the security guards on the sidewalk outside to the officials and clerical staff, were uniformly pleasant, friendly, helpful and competent.


96 thoughts on “Remaining a dual citizen (1) : passport renewal

  1. I have never had an unpleasant experience at the Toronto consulate including the two appointments for renouncing. It seems so different from what I am hearing about other consulates/embassy in Ottawa.
    My understanding is that only those with a $50k tax lien will encounter any issues with their passports.

  2. @John: Includes FATCA, doesn’t include FBAR, as far as I can tell. Definitely not just taxes owed. Specifically, Reid’s passport-revocation amendment refers to a “notice of lien … pursuant to section 6323″. (See my old post for the full text). Section 6323 reads:

    The lien imposed by section 6321 shall not be valid as against any purchaser, holder of a security interest, mechanic’s lienor, or judgment lien creditor until notice thereof which meets the requirements of subsection (f) has been filed by the Secretary.

    Section 6321 lists the things that might be a part of that lien:

    If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belonging to such person.

    Keep in mind that there are other kinds of pre-existing fines out there besides FATCA. Any expat living a normal long-term life abroad who has ever been self-employed, bought ETFs, or contributed to some sort of tax-advantages savings scheme, is almost certainly already delinquent on his/her 8858/8865, 8621, or 3520 filings, and would be subject to fines if discovered. Up to now the IRS basically played “don’t ask, don’t tell”, but that’s coming to an end …

  3. @foxyladyhawk: glad to see you’re still around and still hanging on. And that all the negativity about U.S. citizenship from us renunciants and would-be renunciants hasn’t driven you away 🙂

    @all, if you haven’t seen it already, see foxyladyhawk’s inspirational post from January: Why I will not renounce

  4. @Eric, thank you for your kind words. Hard as it is to accept the compliance costs of keeping my citizenship, it is sometimes worse to be an outsider in a community of people who see so clearly that their best interests lie in renunciation. Sometimes the grief and rage they feel lead them to assume that anyone who doesn’t see things their way is blind and perhaps stupid. I fully accept and applaud the decision anyone here makes about cutting ties with the US, and I agree with the denunciations of IRS and US government over-reach, but my chosen path is different, at least for now. With Canadian citizenship, I can stay behind these borders and thumb my nose at the stinking mass of 4-digit forms they keep dreaming up without having to jump through any hoops, and that would be my enthusiastic response to the IRS if they were not holding hostage my love for my family that remain there, and if I did not have this very American conviction that no government should ever have the power to tell me where and how I should live

  5. @MarkPInetree, the Rio de Janeiro Consulate is a fine facility. It was at one time the US embassy when Rio de Janeiro was the Capital of Brazil. It was transformed into the Counsulate when a new Embassy was built in Brasilia after the capital was transferred trom Rio to Brasilia.
    Opening of additional consulates in Brazil is probably the result of the masive increase in Brazilians visiting the US as tourists. Brazilians must obtain visas to visit the US and that requires a personal interview with a US consular offical. If the US would add Brazil to the list of Visa Waver countries which includes Canada, Japan and the Western European countries, there would undoubtedly be an even greater number of Brazilians visiting the US.

    Because Brazil practices reciprocity, it is one of the very few countries that require visas from US citizens visiting that country. But it is much easier for a US citizen to obttain a Brazilian tourist visa than vice-versa. A personal interview is not required.Chile also requires visas from US citizens, but they can be obtained at the airport upoin arrival in Chile, so the process is simpler.

  6. @ ladyhawk You are definitely NOT an outsider. Yours is the more difficulat path, which requires more courage and conviction. To some of us, your path seems too risky, to be sure, but you have put your convictions and principles above expediency. I am so glad you are part of Isaac Brock. But if anyone is going to become a martyr, it won’t be me–despite my public stance. It will be those, like you, who try to remain in compliance. If later, you decide that you can’t do it any more, I will not say I told you so. Rather, I will be sad for what has become of a once great country.

  7. Petros, each of us has a voice, and each of us is being heard, because of what we are doing. The level of renunciations and renouncing is having and will have a cumulative effect. Loss of citizens is being seen politically and will be felt economically. I still think I can make a difference by staying. But I too have my limits and if the price becomes impossible to pay, either financially or morally, I’ll go Galt.

  8. Don’t forget that there are many people who cannot afford to renounce because of the exit tax. A house in Toronto, Vancouver or any European city, plus small retirement savings could easily make one a covered expatriate.

    It is likely that most who are not covered will leave before they become covered. The really interesting question is how many people will be wiling to drop a share of their wealth to leave.

    Only the accountants and lawyers know for sure …

  9. “The really interesting question is how many people will be wiling to drop a share of their wealth to leave.” That is what sets my teeth on edge, renounceuscitizenship, and the resentment I feel at having to fork out a single penny of my Canadian-earned resources to the US or even to an accountant to protect it from an unjustified claim. Cashing out and living under the radar is looking better all the time….

  10. There are many places to drop encumbering wealth. Not all are evil or bureaucratic. Consider charity. The only thing radar is not likely to find is a mattress. Yet even there “thieves break in and steal.”

  11. A person can get a CLN without going through the exit tax procedure–my CLN is proof positive of that fact. Then FATCA is not a problem because the CLN proves to a Canadian bank that you are not US. The exit procedure, for now, is not yet necessary to stop the banks from ratting you out to the IRS, under FATCA.

  12. @foxyladyhawk and all, I am in the middle of OVDI and cannot renounce, but in a way I am relieved in not having to make that decision right now-I really want to see how the dust settles in the next while, if things move more our way…toward sanity. Anyway, how can things get any worse for me by waiting? It chokes me that we have to pay to do our taxes while we wait, more expense associated with this citizenship. Many are renouncing because of the persecution we suffer at the hands of a government that we are, save as taxpayers, invisible to. People are protesting with their feet- it’s an absolute tragedy that it is with the ultimate price.

  13. @foxyladyhawk, I have never felt you were an outsider and I hope nothing I have said has ever contributed to making you feel that way. It is much harder to be in your position (and mona lisa as well). I will never forget that post on the old forum where even Schubert said he had tears, after reading what you wrote.

    @bubblebustin, you certainly can renounce even if you are in the middle of OVDI. There is no connection between IRS and DOS until after your CLN is approved and all that happens is DOS tells them you have renounced/relinquished. You do not notify IRS at the time you renounce, only when you file your last 1040 and the 8854. So you can play with the timing. For instance, I was a bit afraid to imagine “certifying” that all my tax filings/requirements for the 5 yrs prior to renouncing were in order because IRS doesn’t send any confirmation, etc. I renounced early in the year (Jan 20), so I have until 30 June 2013 before filing the last forms. Renouncing stops the clock for future obligation for taxes. If you live in a place with long waits, you might consider getting in line, so to speak. Of course, only offering this if that is what you want to do.

  14. @ bubblebustin Could you please explain why you can’t renounce because you are in the OVDI? Is that one of the conditions of the program. If so, first I’ve heard of it, but it would be very interesting. But if you decide to renounce, why continue to bother with the OVDI?

  15. @nobledreamer, thanks for the valuable information. I can see the importance of timing.
    @petros, no it’s not a condition of the program, but it’s really not clear what the final outcome will be for us at this point. I am getting the impression that many here feel that the only route left in achieving liberty and justice as US persons living abroad is to renounce. Do I want to continue to be a citizen of a country that gives me unnecessary hardship and treats me as though I’m a criminal? No! Do I think anything will change soon? Maybe! Will it be for the better or for the worse? Who knows! Can we effect change? Absolutely! We’ve shown that. In the end, renouncing may be the most practical thing for me to do, but I won’t do it just to make a point, as I feel I would be doing right now. I’d like to think that for the sake of my mental health I wouldn’t continue to care so much about any of this if I were to become a former citizen of the USA, but with the possibility that I may still care (as so many of you do) I want to also be prepared for that. Many of you have proven that you can take the person out of America, but you can’t take the American out of the person. So really Petros, I’m really the one who’s in pergatory right now.

  16. @bubblebustin

    One cannot turn their national identity “on” and “off” like a water faucet — it is part of the DNA.

    The citizenship papers and passport in the pocket are something else — they can be dropped like a bad habit if one chooses to do so.

  17. @all, there is always the threat hanging over the head of the Reed Amendment to the 1996 US Immigration law that the person who renounces US citizenship for tax reasons could be blacklisted and never permitted to visit family, relatives or the US for any other reason.

    What other reason is there for renouncing US citizenship? None. If it were not for the abusive US tax laws which subject all US citzens living abroad to US taxattion just as if they lived in the US, noboty would ever have any need nor bother to pay the fee to renounce. As far as we know that Amendment has never been enfored, but it is on the books. Just remember FBAR reporting was not enforced either until fairly recentlhy and the penalties being assessed for compliance failure today are truly draconian.

  18. @nobledreamer, thanks for your post. While a few have disagreed with my sentiments, no one has made me feel an outsider for my feelings. I sometimes get the impression there are very few here who still want to retain their US citizenship and so I am happy to be proven wrong. Sometimes the passions here are so overwhelmingly negative that they can spill over into anti-Americanism in general. I do sympathize and am not even criticizing anyone who is anti-American. Feelings cannot be controlled and they are real and genuine responses to what someone perceives as an attack on who they are.
    Edited to add: Good reminder, Roger. Part of my complex emotional response to all of this is the deep-rooted fear that the US itself could decide to close the borders to me permanently. That fear was revived with the growing paranoia since 9/11 and the increasingly inaccessible costs of US health care. Still I cannot bring myself to shut that door myself.

  19. @bubblebustin
    About one month ago I was speaking to someone who has chosen to live in Canada for 40 years, raise her family here and has not as yet become a Canadian citizen. She is now caught up in the demand to file U.S. tax returns in addition to Canadian returns. She has chosen to do this going forward, and started with 2010 tax year.
    I told her that, I too, was born in the U.S, had lived in Canada for fifty years and have been a Canadian citizen for 40 of those years. She asked if I was still an American. I explained to her that part of my Canadian citizenship oath included a ‘renunciatory oath’ of allegiance to my former country. She was absolutely appalled at me; actually covered her heart with her hand as she gasped. (For a moment, I actually thought she might rise to her feet and recite the ‘Pledge of Allegiance’.). She then said “How could you do that”. I, quietly, said that I would respect whatever decision she ultimately made regarding her citizenship and she needed to respect the decision I had made some 40 years ago.
    The point of my telling you this story, is that since you have been posting on this site, I have always felt you respected the different choices many of us have either made in the past or are continuing to make now. I also believe most of us here, respect whatever ultimate choice you will make and I have no doubt it will be the best choice for yourself.

  20. @FoxLadyHawk, I hope I haven’t been guilty of making anyone feel like an outsider. I respect everyone’s right to do what is best for them. Yes, I must admit, this has made me somewhat, okay, very, bitter at the US, but I am trying not to let that spill over into anti-Americanism. As I’m sure you know, my position is that I am Canadian only and therein lies my bitterness. I fully respect your right and your feelings in retaining your US citizenship. It’s just not right for me because I gave up US citizenship decades ago and have identified with being Canadian for a very, very long time. I actually do think that you, and the others that feel the way you do, have the harder road to walk and you have my empathy. I have no ties to the US, so it’s pretty simple for me, but I understand it’s not that way for many others. And I respect that.

  21. @Roger, we know how unenforced laws can suddenly rear their ugly heads, but short of stating that one is renouncing because of taxes, how would one know? But I’m glad we’re on the subject of how the Reed Amendment places gags over their citizens mouths in the expatriation process. The US’s dirty secret will remain secret with them firmly in place. I would speculate that they planned it that way, but that would be giving them too much credit.

  22. @FoxLadyHawk, just wanted to add something else… I suspect that if my father was still alive he’d be very torn. On the one hand outraged at what is being done to his wife and children, but on the other hand, he remained a US citizen and did not take out Canadian citizenship. He’d been proud of having been a paratrooper in the US army, and, up until he passed away, he retained very close ties with his family in the US. So, personally, I try to keep in mind that it’s not a black & white issue and there are all shades of grey that need to be considered.

  23. @bubbllebustin, they wouldn’t know, but when it comes to US tax matters your are considered guilty unless and until you prove yourself innocent. Just the thousands of dollars you save in not paying fully qualified IRS-enrolled professional tax advisers to establish and maintain the records you are required to have and to properly and faultlessly prepare all the necessary forms you must submit to the IRS and the Treasury Depearment certainly would be proof enough that you renounced for tax reasons.
    It is for US tax reasons that you are handicappped by not being able to invest in foreign deferred income retirement plans or open or maintain a bank account in the foreign country where you reside unless you renounce your US citizenship.

    I am not forecasting that the Reed Amendment is going to be enforced, but I would not be willing to bet even one dollar that it will not.

  24. @outragedcanadian
    ‘and there are all shades of grey that need to be considered’. That truly sums it up. All of us here would have found this whole journey so much easier if it were all black and white, but, it is not.

  25. @tiger, i understand completely why those who choose to renounce do. But do I amputate my arm because someone is wrenching it? But then I know that under the current conditions, US citizenship outside the US’s borders is proving to be maintainable only to those who earn enough to be able to afford it, or are willing to ignore the law. I just have the feeling that something big is about to happen. I hope it’s not a stroke because my blood pressure has been through the roof because of my constant state of anxiety. By the sounds of it, that may not be relieved by renouncing.

  26. Here’s what the Reed Amendment actually says:

    “Former citizens who renounced citizenship to avoid taxation.-Any alien who is a former citizen of the United States who officially renounces United States citizenship and who is determined by the Attorney General to have renounced United States citizenship for the purpose of avoiding taxation by the United States is excludable.” (right at the end)

    Anything can happen, but I don’t read this as a means to exclude people who owed no taxes, ever, and renounced to avoid the administrative burdens connected to taxation (which are also an administrative burden to the United States, though a self-inflicted one.)

  27. The Reed Amendment is for avoiding taxes. The Reed Amendment is not for us who want to avoid unnecessary paperwork when zero taxes are owed, or are afraid of FBAR fines. I don’t think it would or could ever be applied to the so called minnows. It would be a hard case to make to say renouncing was made to avoid taxes when you don’t owe taxes in the first place. If the Reed Amendment is ever used, it will be used against a Whale as political theater.

  28. @all, not sure what anyone else thinks of this, but the thought of Michael Moore, the TV producer, and campaigner against US govt craziness, popped into my head this morning as someone to get on our side, and/or interested in our various stories. The only contact I could find was to suggest an article, so I suggested 3 articles on our issues, such as the renunciations, the bullying, the invasion of prvacy, etc. Included links to Atossa’s article, as well as links to this site.

    I was thinking if we could engage his interest, it might help?
    In case anyone else is interested, here’s the link:
    Sorry, my browser has messed up and I can’t read what I wrote, not sure if this is making sense or not. I apologize for any typos, etc

  29. Good luck with Michael Moore. I am just afraid he will already have a bias against expats along similar to the comments about Atossa’s article found on HuffPost and Daily Beast.

    The so-called Progressives (whatever it is they actually stand for) don’t seem very sympathetic towards expats.

  30. @Outragedc,

    When the number of renunciations goes up, which is happening as of now, the media will run after the story themselves.

    But thanks for trying and don’t give up!

  31. Sorry, I’ve just managed to delete my original comment on Michael Moore. I said that he goes after the private sector and so would likely not be willing to take on the government. Furthermore, the methods he uses to make his case are full of distortions, smears and misleading presentation of facts. Even if I agreed with his cause, i would not want to be associated with him. His disreputable methods taint the issues he pursues.

  32. @foxladyhawk, I totally agree with your observations with respect to Michael Moore. I would not not want him to touch our cause with a 10-ft. pole becase he could likely do it far more harm than good. If he were to be for it, a large number would automaically be against it just because of Michael Moore.

  33. @Foxyladyhawk
    I really liked Fahrenheit 911 because I agreed with his views on the Iraq war (he was ahead of his time), but I lost interest in him afterwards for the same reasons you wrote above.

    To be frank, I would be really surprised if Moore would empathize with expats. I am more afraid of him portraying Americans abroad the way Carl Levin does–lounging on yachts along the French Riviera while sipping champagne.

  34. I think it would be more effective to try and recruit the Institute for Justice. They are a group of lawyers who do nothing but chase down damaging and counterproductive laws that hurt innocent people. They have just launched a lawsuit against the IRS ( for imposing new regulations that will cut out thousands of independent tax workers who help taxpayers file every year. This would be right up their alley.

  35. Okay, my heart was in the right place, even if it turns out it wasn’t the best idea. Sorry, guys. I was just thinking of media attention, but perhaps you’re right and it would be bad media attention (if we got any)…. sorry….

  36. Don’t apologise, you’re on the right wavelength! All ideas are welcome! PS – I just put up a quick post on the Institute for Justice. I hope people will check it out. Maybe we can use their help.

  37. BTW nobledreamer, I just came across this post: “The IRS is now matching up your US passport with your US tax records and knows if you have not been filing all required US tax returns while you are living Abroad. The IRS will shortly start matching up information received from Foreign Banks with US tax returns and required FBAR forms. If you have not been reporting, now is the time to start. ”
    I found it on this site:
    This guy is a CPA and attorney in California. I wonder if he’s just fishing for clients.

  38. @foxyladyhawk, when I renewed my US passport after several years of expiry there was a new requirement to provide a SSN. My SSN was still in process when I renewed my passport (as I’d never had one ) so I put a series of zeros in the appropriate place. I am prepared to have to provide a SSN and an explanation when crossing the border now, for the fine for deliberately withholding a SSN on your passport application is $500.

  39. @Nobledreamer and Petros, this is probably a dumb question but I’ll ask anyway. If one were to be in OVDI and receive a CLN and end up in a dispute with the IRS, could they deny you protections afforded to citizens only?

  40. Pingback: Institute for Justice is sueing the IRS | The Isaac Brock Society

  41. @bubblebustin, if you have a CLN then I am sure this would not deter the IRS for going after you for anything they perceive you still own to the IRS. From previous posts I am sure that the Canadian Government would not assist the IRS in collecting penalties assessed by the IRS for, as an example, having failed to file FBAR reports. But I am not sure what assistance the Canadian government might provide to the IRS in collecting taxes due from prior to receiving the CLN. One thing is sure, if you owe the IRS anything; taxes, fines or penalties, you will be “live meat” to the IRS if you step across the border into the US, even though you have a CLN in hand. The CLN does not pardon you for past “sins.”

  42. @Roger and bubble, the Canadian government will not assist the IRS in collecting FBAR fines from Canadian residents at all, and they will not assist the IRS in collecting US taxes from any Canadian citizens if those tax obligations occured after the person gained Canadian citizenship. It has nothing to do with the CLN, which is only a US document and means nothing to the Canadian gvernment.

  43. @petros, Understood. But I thought from earlier posts that Canadian banks were prohibitied by Canadian law from asking clients their nationality or citizenship, so do they really know which of their account holders have, or have had, US ctizenship?

  44. As Petros said, with the CLN I do not have to worry about the Canadian banks anymore. That is one reason why I renounced first, and decided to worry about the taxes and FBAR later. Now I need to get a SSN or a taxpayer ID number. It is to bad that renunciation was the only sensible thing to do, although it was easy for me to do emotionally since I consider myself a Canadian first and foremost. The United States was my home as a child and even though I thought I had lost my USC many years ago (not so), I would still be happy to have now if circumstances were a little different.

  45. @ TrueNorth You probably did lose your citizenship. If you have renounced, you don’t have to do FBAR. It is not part of the exit procedure. Why bother getting a SSN number? If you insist on doing the 8854, just do it. I personally would try to stay out of the IRS system altogether.

  46. @ Roger I don’t think that the banks in Canada know what they are going to do for sure. I get the impression that they plan to be compliant.

  47. @Petros and Roger

    I think what Canadian banks will end up doing is very unclear at the moment. I think the big ones of course are taking the default position that they are going to comply however, when you get into the nitty gritty details of how that will happen it becomes quite murky. I don’t see any reasons though if entitled to a CLN not to demand it.

  48. I filled out the DS-4079 form before I went in, they took a copy of it, but I was told they did not think that I has relinquished and I should renounce. I still hope that the State Department may see it a different way. I will know for sure when I see what date they put on the CLN. I kind of wanted it over and done with then and there. I had planed to file five years of returns to avoid being a covered expat, I also thought that I would need to file the FBAR forms as well, but perhaps not as you say. Another thought that has crossed my mind is if they accept my relinquishment date I would be free and clear of FBAR. The tax seems to be up to the date I notify state, not so with the FBAR as far as I am aware. And yet another option may be to check the no box as far as being tax compliant, become a covered expat, I would still be under the approximately $600,000 exemption and so still would owe nothing, that may save me years of unnecessary tax returns. I will let everyone one the site know what happens, I know many think you must become tax compliant before renouncing.

  49. @foxyladyhawk,

    I think the guy is fishing for clients.

    Until FATCAT comes into play, IRS faces a lot of issues getting enough information from DOS to be useful. So far, my research has shown that while the IRS is able to get info from the DOS (i.e, via passport) it has not been effective primarily because what they send is very limited information and mailing addresses are not reliable.

    (This info is from 1998 however, I have looked extensively and not found anything more current ).

    Code section 6039E, added by the Tax Reform Act of 1986, requires DOS to collect certain information from U.S. passport applicants and forward that information to IRS.
    The section provides that any individual who applies for a U.S. passport must provide:
    (i) the individual’s taxpayer
    identification number (that is, the individual’s Social Security number);
    (ii) any foreign country in
    which the individual is residing, and;
    (iii) any other information the Secretary of the Treasury may

    Currently, DOS collects and sends to IRS each applicant’s:
    (i) full name;
    (ii) Social
    Security number;
    (iii) mailing address; and
    (iv) date of birth.

    I was looking into what systems DOS looks at when doing a background check and found this :

    Passport information maintained by Consular Affairs may be disclosed to external agencies under the authority of routine uses published in the Privacy Act system of records titled STATE-26, Passport Records. Under the above arrangement, PIERS is more commonly the system from which passport records are disclosed in a manner consistent with a published routine use.

    *PIERS Passport information electronic records system
    The PII elements collected are the applicant’s surname, date of birth, address, telephone number, social security number, passport, driver’s license or other identifying number(s), education, financial transactions, employment, medical or any other
    identifying attribute assigned to the individual. The source of the information provided to PIERS is the passport applicant.

    With regard to the sharing of information with external departments:
    *Internal Revenue Service for the current addresses of specifically identified taxpayers in connection with pending actions to collect taxes accrued, examination, and/or other related tax activities;
    * Department of Homeland Security for border patrol, screening, and security purposes; law enforcement, counterterrorism, and fraud prevention activities;
    (There are more deparments with descriptions but I don’t want to type out the entire list and make this sooo long)


    •Taking the lead within the Department of State on continuation of negotiations with foreign governments for the international sharing of terrorist lookout information, through the Consular Lookout Support System (CLASS).
    – CLASS Consular Lookout and Support System
    The principal name-check system for visas and passports

    •Continuing to operate its two-way sharing of the CLASS database with the Department of Homeland Security’s (DHS) Treasury Enforcement Communications System (TECS), which is used at ports of entry, and which presently includes approximately 29 million names.
    •Transferring fingerprints collected with visas to the DHS IDENT (PDF) system, and data on lost or stolen passports to Interpol.

    BTW, I like your idea about the Institute for Justice. Could ACLU be of any help?

    I emailed Michal Moore at the very beginning of my involvement here (mid-Oct 2011) and never heard anything back from him, just for the record.

  50. @bubblebustin

    I remember looking through my passports (1982, 1987, 1997, 2007) and the tax info appeared in the last two. This matches info below:

    (vii) Addition of a statement to all U.S. passports issued after early 1993 reminding the holder that all U.S. citizens working and residing overseas are required to file U.S. tax returns and
    report based on their worldwide income;

  51. @bubblebustin & Roger

    The Canadian government will have to collect taxes and forward to the IRS from Americans who are only residents of Canada (i.e., not citizens). The CLN is not what matters, what matters is whether or not one has Canadian citizenship at the time the tax was incurred.

  52. @nobledreamer, do you know for sure that the Canadian government does collect taxes on behalf of the IRS from non-dual US citizens in Canada? I know this is what the Tax Treaty obligates Canada to do. I am aware, from a conversation with an American tax provider in France that she was aware of one case where the French Government indeed did this on behalf of the IRS.

  53. @Roger, the possibility of future enforcement of the Reed Act is one of the main reasons I’m hesitant to renounce. My parents are in their 70s, plus I have brothers and niece/nephews I need to continue being able to visit, plus i’d be heartbroken if I were exiled from my homeland.

    I chose to make a new life in England so have to accept that American exceptionalism is forcing me to pay for a specialized accountant and a degree of double taxation. As I had gone native and had invested like a Brit in local mutual funds in ISAs (tax-efficient savings/investing schemes), I thought I was OK because of my rrsicency and joint UK citizenship. I also naively believed that the tax treaty protected me from double taxation.

    Turns out I was mistaken. Gravely mistaken…had to pay many thousands due to anomalous PFIC taxation on phantom capital gains when all along had assumed that because I was a tax resident of Great Britain that I too could make use of tax free investments here.

    But with hindsight I now realize that I had effectively forgot I was still American and that our system effectively requires us to use accountants, especially as expats. So I blame myself, really. I concluded I had no option but to amend the earlier nominal returns and pay what I owed.

    To not have done so would have been dishonorable. Of course I feel bitter but the law is the law. Hover, I don’t consider my self a tax cheat and didn’t feel that OVDI’s draconian fines of 25% of all my life savings was fair for my situation which had been created unintentionally.

    My accountant agreed. Nevertheless, I have still been hit hard with all the back taxes, interest, and standard penalties. I will owe taxes for 2011 and probably 2012 but because she and a certified financial planner have advised me to move my remaining assets into a FATCA compliant fund, I believe my future US taxes will be at most a few hundred dollars a year which I can live with.

    I will feel safer sticking with this accountant for the next several years, at least till I get through my statutes of limitations for the amended returns which will be around June 2016. And because I had over 25 accounts for FBAR, I am also aware that the DOJ could interrogate me about exactly what I had anytime up till July 2018 because 2011′ s FBAR will have been the last shortened version I will have submitted.

    Once I’m finally in the clear in six years, I’ll then feel safe enough to consider whether I wish to keep my US citizenship…hopefully by then, things will have been reformed but I also realize that they could instead take an even harderline stance via the Reed Act and aggressive audits, etc. But if I keep it, I will by then have a simplified enough situation to be able to switch to a less expensive accountant, most likely.

  54. @nobledreamer – I read the links you provided. OK, now I’m nervous. Isn’t this ridiculous? I keep having to remind myself – “You are not a tax cheat. All you did was fail to report!”

    If the IRS looks for me, they’ll find my 2010 tax return. I did it wrong, but even if I correct it, I won’t owe any taxes. I just…..totally ignored Schedule B. And 8891. Ignorance, pure and simple. Now is when I second-guess even doing that much. Sigh.

  55. @True North,
    When you can and if you wish, we would sure like to include your information on relinquishment vs renouncement, which Consulate you are dealing with, one appt vs two, date of first contact, date of first appointment and second (if applicable) and of course the finale — the date of your CLN.,
    Good luck in your endeavours!!

  56. @Roger

    I have been looking and looking for the reference I’ve seen where it is clear that CRA will have to collect taxes due from American citizens in Canada who are not dual. The context was in the oft-quoted phrases, “The CRA will not collect FBAR penalties” and “The CRA will not collect taxes from those who were Canadians at the time the tax was incurred.”

    I’ll keep looking!

  57. @nobledreamer, I suspect that this “obligation” is in the Tax Treaty signed between Canada and the US. I have not checked the text, but if it is like other US tax treaties I have looked at there is this mutual obligation of one country to assist the other in collecting legitimate tax obligations who are living in the other country.

  58. @Roger

    Yes, I do know it is there. But there was some mention in an article somewhere, that emphasized this would be done as a matter of the Treaty, in spite of the “protection” for FBARS and for taxes if one were Canadian when incurred. It is definitely in the Treaty.

  59. @nobledreamer, not to worry, I was reading your references on passports and taxes and got paranoid about the fact I’m waiting for my renewed US passport to arrive, knowing now that the DOS routinely sends info to the IRS when passports are renewed, and I am still in the process of doing my US taxes and pondering the options I have regarding back taxes and FBARs. I don’t believe there should be any problems with my passport since I have no issues wth the IRS at this point.

  60. @nobledreamer, he seems to be saying that Canada will help the IRS collect taxes, and only taxes, from US citizens in Canada that are not dual Canadian citizens. But if they have Canadaian citizenship then the IRS will get no help from Canada. Am I reading this right?

  61. @calgary 411

    yes, my dear friend, you have provided exactly what I was thinking of, but could not remember!~

  62. …’unless the tax was incurred prior to that person obtaining Canadian citizenship’ is my understanding — CRA will not collect for Canadian citizens (duals) after their date of becoming a Canadian citizen.

  63. @ Roger,

    What you have described is exactly the way I understand it. It would seemingly, be the point that Canada would collect from US citizens in Canada when requested by the US. Below is the Article XXVI A 8
    8. No assistance shall be provided under this Article for a revenue claim in respect of a taxpayer to the extent that the taxpayer can demonstrate that
    (a) where the taxpayer is an individual, the revenue claim relates to a taxable period in which the taxpayer was a citizen of the requested State, and

    (b) where the taxpayer is an entity that is a company, estate or trust, the revenue claim relates to a taxable period in which the taxpayer derived its status as such an entity from the laws in force in therequested State.

  64. @bubblebustin

    I don’t believe your lawyer has advised you correctly with regard to taxes, if you are a Canadian citizen. If you are a US citizen and Canadian, then the CRA will not help them collect taxes. And they will not collect FBAR from anyone.

  65. paranoia runs deep. The US cannot go on a fishing trip and say ‘we think joe ex-pat probably , maybe, perhaps, should owe us some money-please help ‘ They would need specific details of the delinquent amount owing, when, and what for. Merely saying Joe expat is a US citizen residing in Canada and must owe us some taxes would not be enough to gain any traction with Rev. can. and would be laughed at.

  66. @bubblebusting,

    Previously posted, but you may find this useful:

    Summary of a legal article written by Canadian tax lawyers. You need a subscription to read this on-line, but an accountant or tax lawyer could provide a copy, or a law library, or contact the authors’ firm.

    The authors are: Erin L. Frew and S. Natasha of Reid Thorsteinssons LLP, Vancouver (leading tax law firm)

    “US Tax Collection in Canada”, published in “Canadian Tax Highlights” Vol. 19, Number 9, Sept 2011-10-14
    Newsletter of the Canadian Tax Foundation.

    Article documented the difficulty of enforcing US tax claims in Canada.
    The article is about enforcement within the Canadian legal system – in Canada’s jurisdiction. And is no substitute for personalized legal advice.

    Basically article notes:
    – Canadian courts have not enforced US tax revenue claims in Canada
    – Canadian courts also very unlikely to enforce FBAR penality
    – Under the Canada-US tax treaty, Canada Revenue Agency cannot collect US taxes from Canadian citizens, unless the tax claim proceeded their date of citizenship.

    Final summary paragraph:
    “In summary, a Canadian citizen need have little concern about the collection of US tax, interest, and ancillary penalties. However, a US taxpayer who is a Canadian resident and not a Canadian citizen and who owes US tax, interest, and penalties may face collection thereof by the CRA pursuant to treaty article XXVI A. It is extremely unlikely that Canadian citizens or residents will have to face collection of FBAR penalties, except in the very unlikely event that those penalties may be characterized as registrable civil judgments.”

  67. @ bubblebustin,

    Sorry, I don’t think I worded that well. Canada will not collect taxes from Canadians for the US. As long as they were Canadians at the time the tax was incurred. Being dual (at that time) is the protection of the CDN govt.

  68. @ chester, Wondering The cited article actually gives no hard information about which cases the IRS has been able to get the CRA to collect on US persons in Canada. In numerous comments Tim has suggested that it never happens to residents, particularly long term residents of Canada, because the United States has no idea who a Canadian citizen is. I notice however in doing my taxes that CRA does ask if you are a Canadian citizen–for what purpose I am not sure, but certainly not so that they know whether to collect US taxes from you.

    In other words, a long term resident who unlike me, doesn’t blab his mouth off publicly about when he became a Canadian, has little to worry about, since the IRS is hardly going to go on a million wild goose chases trying to use the CRA to collect nebulous tax claims on people who might accidentally turn out to have Canadian citizenship. I speculate that they reserve this for the whales–and I really do wonder when, if ever, that could happen. It may simply be weapon, to get Canadian residents to file, for fear of the CRA. It would then be analogous to the threat of heavy FBAR penalties to steer people into OVDI.

  69. @Petros

    The section where they ask about Canadian citizenship on the T1 is related to voter registration and I believe is only shared with Elections Canada

  70. @Petros. From the CCRA tax guide

    “If you check “No” to one or both questions (or do not make a choice)
    ■ The CRA will not give any of your information to Elections Canada.
    ■ You will not lose your right to vote.
    ■ Elections Canada will not remove your information from the Register if it is already there.
    ■ If there is an election or referendum, your information may not appear or be up to date on electoral lists produced from
    the Register and you may not receive a voter information card. In that case, you will have to take the necessary steps to
    correct your information or register to vote.”

    Filling the citizenship section is optional and is only used to update the voters list..This is an agreement between CCRA and Elections Canada that was cleared by the privacy commissioner.

    Compare to some US states who want to disenfranchise the underprivileged who don’t have photo ID on the spurious notion that voter fraud is widespread.

    As to your second paragraph…. PRECISELY…. GOT IT IN 1

  71. @nobledreamer
    Not only will Canada not collect taxes for IRS against people who were Canadian citizens at the time of the alleged tax liability, under a 2007 reciprocal amendment to the tax treaty, signed by both countries, Canada will not collect taxes for IRS for any period at all for persons who became or were Canadian citizens before November, 1995. No idea why they picked that date, but they did. So the lack of a statute of limitations in the US for certain tax liabilities is not an issue for such persons, even if they were living in Canada for a while before becoming Canadians and didn’t file returns for those pre-citizenship years, Canada won’t collect on any of that as long as your Canadian citizenship pre-dates November 1995.

    Same rule applies if you’re a Canadian person living in the US with US citizenship from pre-November 1995. US won’t collect against them on behalf of Canada, either.

  72. @shubert
    I believe the “pre 1995” exemption may be due to an Federal Court of Canada case:
    – Chua vs Ministry of National Revenue [2000]

    Chua sold a condo in Hawaii and moved to Canada, subsequently becoming a Canadian citizen. Capital gains were assessed by the US retroactively. Chua, now in Canada, ignored the assessment.

    US asked Canada to assist in collection (under the Tax Treaty) of the capital gains assessment, because the tax debt predated Chua becoming a Canadian citizen.

    The court ruled that the Charter equality rights of applicant trumped Mutual Assistance Collection of US Tax by Canadian Tax Authorities – ruled that even if this particular person was not yet Canadian citizen at time of tax debt, they deserved equal protection from the Tax Treaty.

    I believe the Treaty was then changed to extend this protection retroactively to any resident of Canada before the court ruling.

    NB: this was due to US source income from sale of a US-based asset as well.

  73. This 1995 date and the associated court case and reciprocal amendment deserve a writeup with specific references. Can schubert1975 and Wondering provide citations to sources and/or live links?

  74. @Wondering

    I am looking at this Chua case right now. I believe the charter implications regarding Canadian citizens who are “US Persons” are big very big as a result of this case. Like the smoking gun we have been looking for, for months. It also is the first instance I have found of CRA attempting to collect on behalf of the US.

  75. Sorry, link posted previously for the PDF is s NG

    Just Google:
    Strategies for Resolving Cross-Border Tax Controversies fasken

    and dnload the PDF

  76. Another interesting Canadian banking law court decision which ruled :

    – In a conflict between Canadian law and the law of a foreign jurisdiction where they are also present, Canadian banks must first be governed by Canadian law

    – Canadian banks may not act as tax revenue collectors for a foreign state

    Background – in response to US estate tax lien on TD US-based assets, the TD bank attempted to freeze and seize the Canadian account assets of an heir to that estate – but the Ontario court ruled against the bank

    Van deMark vs. Toronto Dominion Bank [1989]
    (quotes from the judgement)
    “There is no dispute between the bank and Kenneth Van deMark and the dispute, if any, is between the bank and the Internal Revenue Service of the United States. The effect of what has occurred is that a Canadian citizen has placed assets in a branch in Canada of a Canadian chartered bank. The bank also does business in the United States and is being threatened by a United States authority.

    “One must sympathize with the position of the bank but that position is the result of its election to carry on business in more than one country and that cannot influence the application of Canadian law.”

    “In any event, while acceptance by the bank of a penalty imposed in the United States might seem to be a hardship, the effect of permitting the Ontario branches to defend the applicants’ claim on the basis of the bank’s liability in New York State would be to enforce indirectly a claim for taxes by a foreign state and one that has, so far as the evidence discloses, not even given rise to a New York or Federal Court judgment.”

  77. @ Tim

    “Smoking gun” indeed…
    The implications of the Van deMark vs. TD judgement could be very significant for FATCA in Canada.

  78. @Schubert,

    Is that in the Fifth Protocol? I don’t see it there….can you tell me where I might find that? Thanks.

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