Nebraska property U.S. tax liabilities for dual

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Date:           Saturday April 24, 2004
Time:           12:41 PM -0700
QUESTION:
I have resided in Canada for 30 years. I hold American and Canadian citizenship and carry a Canadian passport. I have not filed with the IRS since acquiring Canadian citizenship, believing (or hopeing) that was not required. At this point I have claimed about $250,000 in capital gains exemptions as a farmer, which I presume would create significant tax liabilities if I have been wrong in not filing in the U.S. I have never had any business ties in the U.S. but am considering some real estate investments in Nebraska. What is my tax liability at this point?
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david ingram replies:
As an American citizen, you are required to file a US tax return no matter where you live and no matter what the source of the income.
If you obtained your Canadian citizenship prior to Feb 1977, or even the summer of 1980, you had every reason to think that you lost your US citizenship and had no more responsibilities to the US.  In fact, if you became a citizen any time up to around 1988, most people (including many in authority) did not realize that the laws had changed in both countries and the law no longer presumed that you had lost your US citizenship.
Go to www.centa.com and read the October, 1993 newsletter on dual citizenship between the United states and Canada; read the October 1995 newsletter on the specific responsibilities you have as a US citizen living in Canada and then read the US/Canada Taxation section for another 26 pages on US / Canada taxation.
There are four different sets of responsibilities a person in your position can find themselves in with regard to the IRS.  A person who took out their US citizenship prior to Feb 1977 would suffer no penalties, no interest and would not be required to pay back taxes if they "just now" discovered that they are still a US citizen and wish to reclaim their citizenship.  
That is the best of the four situations.  The worst is that you became a Canadian two years ago and sold the farm the same year and the IRS would want tax on the $250,000 farm plus interest and penalties.
I would be pleased to help you catch up on past filings and guide you through the process no matter where you live.
We can deal by email, snail mail, fax or courier and phone.
I have never met and do not expect to meet at least 200 of our clients who send their work from all around the world 
David Ingram's US/Canada Services
US/Canada/Mexico Tax Immigration & working Visa Specialists
US / Canada Real Estate Specialists
4466 Prospect Road
North Vancouver,  BC, CANADA, V7N 3L7
Calls accepted from 10 AM to 10 PM 7 days a week
Res (604) 980-3578 Cell (604) 657-8451
Bus (604) 980-0321 
[email protected]
www.centa.com www.david-ingram.com
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 & the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent financial, or real estate planner or advisor & appropriately qualified legal practitioner, tax or immigration specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included."
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