Over the last two years, the number of U.S. expatriations has skyrocketed. For 2013 alone, the number of Americans renouncing their citizenship has increased to 221%. As shocking as this statistic might appear, according to those in the “know,” it is grossly understated. This has inspired many to call the trend, “Ellis Island in reverse.”
What has caused so many to resort to something as extreme as renouncing their U.S. citizenship? None other than the usual suspects, or what I like to refer to as the “dynamic duo” (for all you “Batman” fans): the United States’ system of worldwide taxation, on the one hand and FATCA, on the other. While I could go on endlessly about the harmful effects of global tax reporting and FATCA, the purpose of this blog is to discuss the steps that must be taken in order to expatriate.
DeBlis Law is a boutique litigation firm with a single mission: to provide outstanding legal services to individuals involved in crisis situations. Our firm specializes in civil tax controversies and in all aspects of criminal defense, including white-collar criminal defense and criminal tax defense.
We provide practical and sound advice to assist taxpayers with offshore financial assets to come into compliance with their U.S. tax obligations.
Podcast # 1: International “Double Trouble” Taxation
It’s finally here! The first session of the “Tax Chat” Podcast!
You can download the podcast to your computer by clicking on the image. Additionally, I will be submitting the podcast feed to iTunes soon, so you can subscribe there as well – but I’ll let you know when it’s up and ready to go.
Since this is our first session together (the Maiden voyage), I spend a little bit of time introducing myself and going over the nuts and bolts of U.S. international taxation. Also, I go over the formalities of the show and what to expect from future sessions.
Future shows will have a structured format, and several will include special guests.
Special information about the episode such as items mentioned during the session and action items will usually appear in the “Show Notes.”
Did You Know?
In 1774, Britain passed a series of harsh laws designed to punish colonists who rebelled during the Boston Tea Party. American colonists called them “the Intolerable Acts.”
Test your tax trivia knowledge by answering the following multiple-choice question. Given what you know about southerners’ feelings about the tariffs set between 1816 and 1832, which of the following was the name they gave to the tariff of 1828?
♦ Why did the cannibal tax accountant get disciplined? For buttering up her clients.
♦ Q: Why is a tax loophole like a good parking spot? A: As soon as you see one, it’s gone.
♦ Income tax is Uncle Sam’s version of “Truth or Consequences.”
Walking The Sawdust Trail
Those who responded to the altar call after one of Billy Sunday‘s sermons were said to walk the sawdust trail, because the temporary venues he preached in back in the 1910s and 1920s often had sawdust on the floor as a deodorizer.
Before he became a travelling evangelist, and possibly even before he became a Christian, depending on what source you believe, Mr. Sunday played eight seasons of Major League Baseball between 1883 and 1890. During that time, he roamed the outfield for the Chicago White Stockings, Pittsburgh Alleghenys and Philadelphia Phillies. Mr. Sunday left the game with a lifetime .248 batting average, which was pretty good for the pre-modern era. He was also a speedy player who finished in the top ten in stolen bases three times and led the league in outfield putouts in 1888.
A Message From Uncle Sam to Taxpayers Near and Far: ‘Don’t You Dare Lie To Me!’
Are you looking for a fun way to kill a few minutes when you think the boss isn’t looking, and the company’s firewall restricts access to your favorite website? Google the phrase, “the defendant showed no remorse” and see how many hits you get. I witness this phenomenon firsthand almost every day. When the judge pronounces sentence, either after a trial verdict or as part of a plea bargain agreement, the defendants typically show no emotional response.
A large part of this apathy is “monkey see, monkey do.” That’s the demeanor that fictional and quasi-fictional defendants present on TV, so many of my clients assume they are supposed to behave the same way. Others are in shock after they hear an unfavorable verdict, while others are simply overwhelmed by the process and really have only a vague notion about what’s going on. There are some other reasons as well; for example, a number of defendants, despite what they may say during the allocution, are pleading guilty just to “get it over with.”
The battleground in the government’s ongoing war against financial criminals shifted to a Brooklyn courthouse last month, as another UBS defendant was sentenced after he pleaded guilty to concealing a foreign bank account. Prosecutors alleged that 73-year-old Gabriel Gabella, an Italian citizen, failed to file a
Report of Foreign Bank and Financial Accounts (FBAR) to disclose his ownership of a Swiss bank account held at Union Bank of Switzerland in tax years 2006 and 2007.
Mr. Gabella faced a maximum 60 months in prison, and a guideline range of 24 to 30 months. However, U.S. District Judge Jack Weinstein sentenced him to three years’ probation and a $50,000 fine. In addition, Mr. Gabella paid a civil penalty of $3.1 million, which was about half the value of his account in 2007, and $239,000 in back taxes.