5 ms·

I've been watching this story develop over the last few years, and while I think that the current impact is overblown, I don't think that reduces the importance

I've been watching this story develop over the last few years, and while I think that the current impact is overblown, I don't think that reduces the importance or the future impact of the story at all. The way this story gets spun is that the law is for big tax dodgers and the IRS has better things to do than pursue the little guys. I think that's a bit of misdirection. The problem is that, as far as I can tell, every ex-pat is guilty of something and that the U.S can come take large amounts of money from them. It's just a matter of whether they want to or not. It's usually said that the amount of money is just too low and the politics of abusing so many people abroad are idiotic. After 9-11, that doesn't wash with me any more. If citizens living in the states are subject to draconian security measures and it doesn't much seem to matter what sorts of protests there are then it's only going to be worse for people who are more out-of-sight. People in the states can easily be made to feel like every ex-pat with a dual citizenship has something to hide. If you can treat folks who live here like they do, folks living overseas are nothing but a bunch of numbers. Worse yet, we'll see monetary laws made for terrorism being brought to bear in the process. Which leads me to my conclusion that the only thing slowing down the IRS is data processing. They're plugging more and more into the international banking community and will begin automating collection and processing on all of these opportunities. I understand my opinion is just guesswork, but there it is. I think you have two choices. Either collection is a political activity, in which case you're saying that your wealth and freedom is basically dependent on political connections, the optics of the processing, and the mood of the IRS -- a terrible situation to be in. Or you're saying that collection is owed and it simply costs too much to pursue, which I believe to be the case. If this is true, collection is only a matter of time. I'd love to see a U.S. politician stand up for ex-pats, but I don't think it's going to happen anytime soon. P.S. And don't even get me started on the fact that if you're a corporation you are allowed to make money overseas and keep it overseas without paying US taxes, but if you are a regular citizen any money you make could be subject to US taxation on top of local taxation.

Hyena 15y ago
Stand up for ex-pats how, exactly? They owe taxes, that's all.
- yoyar 15y ago
  You don't understand the issue. The IRS is going after people who owe nothing in taxes but haven't filed. Some are senior citizens and may be totally unaware that they were supposed to file. The US gov't is bankrupt and desperate for money and they don't care who's lives they ruin. They're trying to squeeze as much money out of anyone they can lay their hands on.
  - Hyena 15y ago
    I understand the issue perfectly well, thanks; particularly, I understand that it should hardly motivate histrionics.
  - yoyar 15y ago
    @Hyena No, you don't. Which is clearly apparent based on your previous comment, which was incorrect. Calling my statement hysterical isn't an argument either. Claiming that you do understand doesn't make your statement any less incorrect.
    - JoachimSchipper 15y ago
      [Psst, you can reply to deeply nested comments if you click "link" first. Note that there is a reason for the "flamewar timeout", though.]
      - yoyar 15y ago
        Thanks for the Pro-Tip! Now I know. :)
    - Hyena 15y ago
      You're right, apparently I did not understand the issue.
  - TheCondor 15y ago
    The law is that if you're a US citizen, you pay income tax, period. As I understand it, it's income no matter where it is earned. There are some loop holes, you can get out of paying it up to some amount (I think it's in the $90k range) if you claim it as living expenses or something and then the foreign banks and businesses may not report your income to the US but that doesn't oblige you not to pay it. You have to file the return to show that you own nothing and claim the deductions to make that so, and that may well be the case. If you don't file and they can determine your income then can't it be taxed at whatever the rate is for your income? Moreover, there are penalties for not filing, such that it's in your best interest to actually file.
chernevik 15y ago
Everyone ought to see a privacy interest in this sort of thing. The IRS does this, not because these folks have appreciable tax liability, but because they want a compliance environment that exposes anyone who _might_. There is nothing really new in this, the government requires extraordinary disclosures of everyone so it can verify their tax compliance. (The health law included provisions further extending reporting to monitor compliance of those we do business with, but I think the resulting fuss got these rolled back.) On the one hand, no one is in favor of tax evasion. On the other, at some point we might ask whether these disclosures threaten our liberties. Even if the IRS never abuses the information, the requirements set a precedent of government review adopted by other entities large and small. For example, you simply would not believe the intrusion powers of agencies enforcing child protection laws, or the flimsiness of the basis they require to use those powers. I expect the good sense of the electorate to protect us from real abuses, but I'm beginning to wonder where these disclosure requirements will end, and what their unintended effects might be.

Hyena 15y ago

Stand up for ex-pats how, exactly? They owe taxes, that's all.

yoyar 15y ago
You don't understand the issue. The IRS is going after people who owe nothing in taxes but haven't filed. Some are senior citizens and may be totally unaware that they were supposed to file. The US gov't is bankrupt and desperate for money and they don't care who's lives they ruin. They're trying to squeeze as much money out of anyone they can lay their hands on.
- Hyena 15y ago
  I understand the issue perfectly well, thanks; particularly, I understand that it should hardly motivate histrionics.
- yoyar 15y ago
  @Hyena No, you don't. Which is clearly apparent based on your previous comment, which was incorrect. Calling my statement hysterical isn't an argument either. Claiming that you do understand doesn't make your statement any less incorrect.
  - JoachimSchipper 15y ago
    [Psst, you can reply to deeply nested comments if you click "link" first. Note that there is a reason for the "flamewar timeout", though.]
    - yoyar 15y ago
      Thanks for the Pro-Tip! Now I know. :)
  - Hyena 15y ago
    You're right, apparently I did not understand the issue.
- TheCondor 15y ago
  The law is that if you're a US citizen, you pay income tax, period. As I understand it, it's income no matter where it is earned. There are some loop holes, you can get out of paying it up to some amount (I think it's in the $90k range) if you claim it as living expenses or something and then the foreign banks and businesses may not report your income to the US but that doesn't oblige you not to pay it. You have to file the return to show that you own nothing and claim the deductions to make that so, and that may well be the case. If you don't file and they can determine your income then can't it be taxed at whatever the rate is for your income? Moreover, there are penalties for not filing, such that it's in your best interest to actually file.

chernevik 15y ago

Everyone ought to see a privacy interest in this sort of thing. The IRS does this, not because these folks have appreciable tax liability, but because they want a compliance environment that exposes anyone who _might_. There is nothing really new in this, the government requires extraordinary disclosures of everyone so it can verify their tax compliance. (The health law included provisions further extending reporting to monitor compliance of those we do business with, but I think the resulting fuss got these rolled back.) On the one hand, no one is in favor of tax evasion. On the other, at some point we might ask whether these disclosures threaten our liberties. Even if the IRS never abuses the information, the requirements set a precedent of government review adopted by other entities large and small. For example, you simply would not believe the intrusion powers of agencies enforcing child protection laws, or the flimsiness of the basis they require to use those powers. I expect the good sense of the electorate to protect us from real abuses, but I'm beginning to wonder where these disclosure requirements will end, and what their unintended effects might be.