New IRS policy recasts the same old shameful policy as good and friendly, but we are not buying it

Barrie McKenna of the Globe & Mail wrote yesterday  about the new IRS policy coming:

Americans living in Canada who’ve neglected to pay their U.S. taxes are getting a big break from Uncle Sam.

The U.S. Internal Revenue Service is poised to waive potentially massive penalties for Americans who agree to come clean and don’t owe any taxes, The Globe and Mail has learned.

That’s how McKenna started the article–with two sentences, one paragraph each. That way the sentences don’t have to be coherent. The first one says that those who’ve neglected to pay their US taxes are going to get a break. But the second one says that if they “come clean” and don’t owe any taxes, the IRS will waive penalties. So those who haven’t been paying their taxes (paragraph 1), aren’t going to get a break at all; it’s only those who don’t owe anything that will get the break (paragraph 2). But then it’s only if they come clean, because you are dirty by definition if you are a US person in Canada that doesn’t file tax or fill out FBAR forms. If this is the language of US Ambassador to Canada David Jacobson, McKenna’s source, it shows that the US government still doesn’t have a clue. We are not dirty ones.

Nay, it is the government officials who are the dirty ones: they are the ones requiring us to file trivial returns; furthermore, they are expecting us little people to tell them about everything in all our bank accounts–our own, our spouses’, and our employers’–and they haven’t exempted our RRSP and TFSA or our other retirement pensions. If we don’t tell all, they are threatening to break us and take all our wealth, and in some extreme cases, to throw us in prison. Well, Tony Soprano is fairer than that. Tony only breaks your legs if you owe him money. These IRS folks are threatening us and we can’t possibly owe them money. They are crazy.

Or not. It’s crazy only if it is mindless stupid busy work that keeps government employees in their jobs. But it may not be crazy, for there may be a sinister reason why this government has people inventory their goods; it is so that some day down the road it can know what is out there. Today you have to report your gold. Tomorrow the government confiscates it. If we must assign rationality to government, the idea that they know what they are doing, then all we can assume is that they want to know what’s there so that they can take it later.

Sorry I’m not buying the offer Mr. Jacobson. The US must drop the FBAR requirements. You must also drop extra-territorial taxation of US citizens and all filing requirements. You must also repeal FATCA. Or the US will see a mass exodus of foreign investment. And the US will see millions of people tell them to take this citizenship and shove it. Change the policy. Get the IRS off our backs, or Mr. Jacobson, you folks in the State Department are going to have to start having mass citizenship renunciation ceremonies (a couple hundred people at a time). That will start the day they make an example out of someone like me, who doesn’t cower in the shadows, but stands up to your tyranny. My name is Peter W. Dunn. The world is watching what you are doing, be careful how you handle my case.

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One thought on “New IRS policy recasts the same old shameful policy as good and friendly, but we are not buying it

  1. I agree that the “end game” is to get the U.S. to repeal FBAR, FATCA and citizenship based taxation. In the short run, if the McKenna article is accurate, there may be relief from FBAR penalties. This is a good thing – but the fight to educate the world about FBAR and FATCA must continue. You are clearly one of the “Great Generals” in the war!

    Great post!

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