It went from $500 earlier this week to $2,300. The jump is explained due to American consulates and embassies being flooded with people wanting to relinquish their citizenship.
The reason behind all this is the new FBAR (foreign bank account report) law which forces every American citizen living abroad to advise the IRS of every penny they own in foreign banks. For example, an American working in Tokyo uses a Japenese bank while working there. He has to let the IRS know every single account he owns in that bank with the amount he has in them. Every account opened in a non American bank is now considered an off shore account.
^Not entirely true. There is a de-minimis rule, I just don’t remember what it is. I think it’s ~10k or so.
The annoying thing about the FBAR is that you already have to report that information to the IRS on your 1040. But you have to report the EXACT SAME INFORMATION to the department of the Treasury (which the IRS belongs to) on the FBAR report. Makes zero sense.
I really don’t plan to get my US citizenship at this rate… one day just pack my bags, transfer my Interactive Brokers account to a Bermuda address, and go live on an island.
^ If you plan to live elsewhere, you’re probably better off not getting US citizenship. Not the best country to be a dual citizen of, unless you like paperwork and hiring accountants.
^ honestly, my game plan at this point includes living in the US/abroad for my working career, making bank, then for retirement (if that ever happens) returning to Canada and spending 6 months +1 day there a year to keep health coverage and spend the rest of the year in some cheap tropical place.\
Canada isn’t a great place to earn an upper middle class salaried living due to taxes and cost of living, but a good place to residence for golden years. Aside from the cold, of course. Just my humble opinion…
^ It does have subpar healthcare. But it’s “free”. If I’m retired in the US and not covered by medicare (which by then will likely be means tested to the point I don’t get it) I’d be better off waiting months in Canada than paying retail in the US. Or maybe I should just get all my stuff done in Mexico.
^ Canada is like a DB pension. It might not be as lucrative, but you know your ass is covered here. There are attractive aspects to that as you age.
If you’re a young single person, sure, the US is the place to be, at least low tax states. But having a family and getting older are two factors that definitely favour Canada.
^ Absolutely, I agree 100%. My dad is in his mid 60s and isn’t following the lead of his friends who are buying places in Arizona or Florida. He’s like, why would I risk leaving now, after all the years of being a very net tax payer. He’s ready to collect what he’s due. All $2k/mo in CPP and OAS, or whatever paltry amount it is (very much like US Social Security).
^ I probably would have considered a job in the US up until my kid was born. Now I’d be more likely to consider a job in Europe, if I was to move (which I likely wouldn’t). There is just something about the social security system (and education system per the other thread) in the more “socialist” countries that lets you sleep a little better at night, especially when you have dependants or you’re in a situation where you’d be less able to help yourself (like when old).
^ but you’re basically stuck in the University of Calgary or University of Alberta.
I was recently discussing my opinion of this with a friend at work here in the US. The lifecycle of being born in Canada (unless you have well off parents like I did) is go to high school in your hometown, go to uni in your hometown (if you’re lucky you live in the capital city of the province and have an entire two choices instead of one), get a job in your hometown, marry a chick from your hometown, and then die in your hometown (or Phoenix).
The more self aware folks in Alberta might have a more diverse outcome, but for the most part I think my model fits most Canadians.
^ That’s pretty accurate for most. Many outsiders don’t understand the local schooling thing here either. The big BSDs here would be shocked to hear that if you’re applying for a job in Edmonton, Alberta, going to the University of Alberta is probably considered nearly on par to a Columbia degree. There is huge local bias in Canada. Mostly because of what you said, everyone kind of sticks around. Everyone hiring in Calgary went to Calgary. Everyone hiring in Edmonton went to UofA. Everyone hiring in Vancouver went to UBC.
It’s funny to see Ivey or Rotman grads get subpar consideration here to local educated guys, despite being from vastly superior schools. Obviously if you want to jump south, Rotman is superior to Haskayne, but in Calgary it wouldn’t be.
Alberta draws in the super ambitious, that’s true, as it’s one of the few places you can actually earn good money and keep it in this country. So it’s more diverse in terms of what Canadians call this place home (lots of internal immigration here). But most Albertans stay in Alberta, by far. I’d guess >95%.
I’m not from the province where I live, by the way (born in one, raised in three different ones).
Bringing the thread back on track: Alberta also draws in the most Americans, over 10% of the Calgary population (Edmonton is too cold for the thin blooded yankees). It may be the biggest market for Greenie to set up shop and council his American peers on how to comply with/evade FBAR and other requirements.
^ You’d be surprised. Our local TV news ran a story about an old lady that is pretty much broke as the IRS slammed her dead husband with a $95k penalty on his estate, taking away much of her nest egg. She’d like to renounce her citizenship so the IRS doesn’t try to finish her off, but she’s pretty much bankrupt at this point. Neither had even been to the US in something like two decades and hadn’t lived there for 45 years.
There are lots of average guys living in Canada especially that are dual citizens. Many have been dual citizens at birth due to parentage and may have NEVER lived in the US or even rarely visited. These are just regular guys. $2,300 isn’t the end of the world mind you, but it’s not like everyone getting slammed by the IRS and their own government here are millionaire tax inversion guys. The cost of complying with the most ridiculous tax regime in the world for these guys is huge, and they risk trouble if they don’t.
Well, I was born in a small town And I live in a small town Prob’ly die in a small town Oh, those small communities
All my friends are so small town My parents live in the same small town My job is so small town Provides little opportunity
Educated in a small town Taught the fear of Jesus in a small town Used to daydream in that small town Another boring romantic that’s me
But I’ve seen it all in a small town Had myself a ball in a small town Married an L.A. doll and brought her to this small town Now she’s small town just like me
not sure i agree completely. it may be this way out west but in Ontario the majority of people actually leave their hometown but go to somewhere within earshot. i grew up in the GTA and i’d say easily less than half of my highschool class went to GTA schools (UofT, York, Ryerson, UofO) and most went to nearby schools in different cities (UWO, UW, WLU, UofG, McMaster, Brock). most kids, including Canadian kids, want to get away from mom and pop (and thus not live in the same town), but not too far that they can’t see them when they want to.