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Hello,
You and I have not communicated before, but I have some issues
regarding US
tax and immigration. I got your name from SuperPages and from
browsing your
website it seems as though you are likely to be able to give me
answers.
Let me outline the situation briefly, and perhaps you could get
back to me
with an assessment of your ability to help me conclude these
things,
together with a statement of your fees?
I was born and raised in the United Kingdom and became a
Permanent Resident
of Canada, where I now live with my Canadian wife and our young
son, in the
year 2002. Earlier this year, by chance, I discovered that I had
inherited
US citizenship from my mother (who came from Kentucky originally,
and had
settled in England to marry my English father). I followed this
up with the
US Consulate here in Vancouver and they confirmed that I have
been an
American citizen since my birth. You can imagine that this came
as
something of a surprise; apart from anything else, my mother
always told me
as a child that I was not an American, and I can only assume she
had
misunderstood something the Embassy told her. Anyway, among the
documentation I was given by the Consulate was a notice to the
effect that
as I have been an American all along, I am expected to submit
retrospective
tax returns to the IRS for the last six years, even though I
never set foot
in the US, nor had any dealings with it or its citizens or
corporations,
during that time. So question 1:
1) Is that true? How hard is it to fulfill this apparent
obligation?
Is your firm in a position to help with it, and under what terms?
Secondly, I gather from the Social Security Agency website that I
must
attend in person at their offices in Bellingham, WA, to apply for
an SSN as
I am (well) over eighteen.
2) Is this true? Is there a way around it? My job here in
Canada
can't spare me for a business-hours trip to Bellingham until
October at the
earliest and I am anxious to expedite these matters as promptly
as possible.
Thirdly, on more of an "immigration" subject, I gather from the
SSN website
that American males between certain ages are required to register
for the
Draft. I am well over the maximum age, but -
3) Does this have any relevance to my situation?
I would be very much obliged if you could get back to me with an
assessment
of the difficulty implicit in each of the above, together with
your fee
schedule for helping me with them.
Best regards,
D XXXXXXXXXXXXXXx
=================================
david ingram replies:
1. As an American citizen you are required to file US tax
returns "for ever" even if you have no Income from the United
States. There is NOT usually any tax to pay in this case IF you
file the returns. However, if your citizenship came up with an
IRS agent. you could end up with serious tax bills and be too
late to claim exemptions and tax credits and would owe tax to the
IRS. How often have I seen this happen? Very rarely but my
September 1996 newsletter (go to www.centa.com click on
newsletters, click on 1996, click on September for the whole
text) contains the following comments in maroon italics:
I R S Collection and Enforcement Officer in Vancouver this week
Last year at this time, Nancy Williams was the IRS tax collector
who came to Vancouver from the IRS office in Washington, D.C.
This year, the weeks of September 3 to September 19, 1996 see
Arthur Goe in Vancouver at the U.S. Consulate, 1095 West Pender
Street, Vancouver, B.C., V6E 2M6, Ph (604) 685-4311.
Why do I mention this? Well, You have a chance to come clean and
get your (or your spouse's, or your friend's) US. taxes in order.
With the mutual enforcement and collection procedures agreed to
in the new U.S. Canada Income Tax Treaty which came into effect
on January 1, 1996, Mr Goe's letter to errant U.S. taxpayers is a
little scary to say the least.
Sample of text of letters sent to B C residents by Mr Goe:
"(X) Our records further indicate that you have not filed the tax
returns for the tax period listed below:
Form Tax
Number Form Title
Period
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-88
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-89
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-90
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-91
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-92
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-93
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-94
1040 U.S. INDIVIDUAL FEDERAL INCOME TAX RETURN 12-31-95 "
"I have scheduled an appointment for you to discuss this matter
on (for instance) Thursday, September 3, 1998 at 3 P.M. at the
U.S. Consulate, 1095 West Pender Street, Vancouver.
If you have filed the requested returns with required tax
payments, please be prepared to present proof of payment, in the
form of cancelled checks (legible front and back), and / or a
copy of your tax return (sic) with your original signature."
The next paragraph gives you a method of changing the time and
date of the appointment.
And, the next paragraph gives another option you may want to take
advantage of:
"If you prefer that I visit you at your residence or place of
business, please complete the attached visitation form and return
it to me by mail OR fax no later than August 20, 1996." (this is
a little tough if you were away the last two weeks of August and
did not get back until the 6th of September.)
A balance of over $200,000 owing last year did not receive
statements as threatening as one of this year's letters with an
actual acknowledged balance outstanding of less than $100. This
year's letter goes on to point out the powers that exist. I
quote:
"Because of its serious nature, I must inform you that we may
take any or all of the following actions, if not already done so,
to satisfy your outstanding liabilities - - -
1. File a NOTICE of Federal tax Lien, and levy against your
wages, bank accounts, or any other income.
2. Seize any of your property or rights to property.
3. Provide your account information to the U.S. Customs
authorities for an immediate contact with you upon your re-entry
to the United States.
4. Seek collection assistance from REVENUE CANADA by providing
them with your account information pursuant to the Article 15 of
the U.S. - Canada Convention. (For the rest of the changes to the
treaty which may affect you, ask for the December 95 CEN-TAPEDE.
5. File your returns on your behalf and assess taxes based on
information available to us for the delinquent tax periods.
For this reason, we strongly request you to be present at the
meeting and resolve these outstanding issues.
If you are unable to pay the liability in full at the meeting, we
request you to complete in advance the enclosed form 433-A (and
433-B, if you are self-employed), the Collection Information
statement and bring them with you to the meeting with any
supporting documents to substantiate your financial position.
(Please see enclosed list of "things you should bring" for the
types of supporting documents.) We will discuss various options
for you to resolve your tax liability."
Effective end of letters except for another small paragraph which
suggests that you take the letter with you to the consulate so
that they will let you in the door.
Let me make some observations here.
A. The gloves are off. With the new treaty (ask for the December
1995 CEN-TAPEDE for a copy) Mr Goe can ask Revenue Canada for the
details of your Canadian income from 1985 to 1995 and file
returns for you as in #5 above.
B. Mr Goe can ask a member of Revenue Canada to accompany him to
your home or business.
C. If you or your acquaintance is a U.S. citizen, it is time to
get caught up on old returns before the I R S catches up to you.
Ask for the November, 1993 CEN-TAPEDE for an explanation of how
to claim the $70,000 earned income exemption retroactively to
1986 to avoid Alternative Minimum Tax (AMT).
And, of course, if you need help with the preparation of these
returns, the CEN-TA Group would be pleased to assist you at
913-9133. For other competent help see the February, 1996 issue
of the CEN-TAPEDE newsletter. Note that tax lawyer Roberta
Shapiro has retired.
2. The easiest way to get your SSN (US social security number)
is to go to 104 Magnolia in Bellingham. The Social Security
Office is on the second floor and you need to fill in an SS-5
form which you can find on the net at:
http://www.ssa.gov/online/ss-5.pdf. The Instructions are
included there as well. However, without a US passport, it is
unlikely that they will issue the number to you because you
likely do not have enough information about your mother that they
will accept.
3. The draft is irrelevant in this situation.
4. What you are asking is what we do. To fulfill the US
obligations, we would need copies of your last six years of
Canadian and Great Britain Tax information. Copies of your A-4
returns from the United Kingdom from 1997 to 2001 and copies of
your Canadian T-1 returns will suffice.
Now for the good news. If you want to take part in it, you are
now a major citizen of the world. You need to take your ability
to work in a dozen EU countries plus Canada plus the US to good
use and get a job that requires some international travel (even
if just to Seattle) because you CAN work on both sides of the
border.
I would imagine that our fee for this service would run between
$600 and $1,200 Canadian Dollars.
david ingram - [email protected]
108-100 Park Royal South
West Vancouver, BC, CANADA, V7T 1A2
(604) 913-9133 - (604) 913-9123 www.centa.com
Cell is (604) 657-8451 (10 AM to 10 PM seven days a week)
US/Canada Real Estate Taxation Specialists
US / CANADA / MEXICO
Working Visa and Income Tax Specialists
Disclaimer: This question has been answered without detailed
information or consultation and is to be regarded only as general
comment. Nothing in this message is or should be construed as
advice in any particular circumstances. No contract exists
between the reader and the author and any and all non-contractual
duties are expressly denied. All readers should obtain formal
advice from a competent and appropriately qualified legal
practitioner or tax specialist in connection with personal or
business affairs such as at www.centa.com. If you forward this
message, this disclaimer must be included."
Be ALERT, the world needs more "lerts"
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