Avoid the scrutiny of FATCA/FBAR/Form 8938 by putting your gold in an offshore safety deposit box

Cross posted from the Isaac Brock Society.

Simon Black (Do I Have To Report My Offshore Gold…?) asks whether custodial gold “accounts” (e.g., James Turk’s Gold Money) fall under FATCA provisions and his people think so. However, gold kept in a safety deposit box would not fall under FATCA:

What’s more, in all of those 544 pages, there is not a single mention of the words, “gold”, “silver”, or “precious metals”. So there’s still quite a bit of mystery with respect to the question, “Do I have to report my offshore gold…?”

I’m still having my team go through the rules; after an initial read, though, the language of the regulation does suggest that custodial gold institutions (like GoldMoney, etc.) should be reported. Offshore safety deposit boxes (like Das Safe) do not.

This is good news for “structuralists” like myself. In a discussion with Just Me, I learned that my suggestion of opening a few extra accounts to get one’s total over 25 (thus avoiding a detailed FBAR) could be “structuring”. Structuring is the practice of breaking up a single large transactions into multiple transactions below the reporting threshold. See what happened to this Greek American couple: My Big FAT IRS case. A US Person in Canada could withdraw funds from their FATCA covered account, until it is below $50,000, and then buy legal tender gold coins (Maple Leaf). These coins would go into safe storage–meaning it would be safe from burglers and from the snooping noses of the IRS, for such coins would not be reportable under FATCA, FBAR, or Form 8938. But almost certainly, it would be a violation of United States law for you or me to exercise our Canadian freedom to buy legal tender coins minted by the Royal Canadian Mint and legally purchased in a legitimate Canadian business, providing all kinds of jobs to Canadians. You would become a structuralist.

For those readers in Canada, I suggest that you take few seconds and take a deep breath. Breath in that Canadian air. Isn’t that good? That’s because you are breathing freedom–freedom from the tyranny of the United States.

Bear in mind also the ramifications of these legal tender coins for Form 8854. The current retail buy price of the Maple gold (1 oz of super fine gold, purity of 0.9999) is about $1650 (See Canadian PMX in the Toronto Area), but its face value under legal tender laws is $50 CDN. So let me ask the question: when reporting on Form 8854, does one report the legal tender value or the intrinsic value of legal tender coins? If you had ten million US quarters, you would have to report their face value on Form 8854 (US $2.5 million). It would be illegal to report only the intrinsic value of the coins (ca. $500,000). This is because the US quarter is a legal tender coin and its reportable value is what is marked on the coin. So therefore, if you have 6,000 Gold Maple Leaf coins, you would be required to report CDN $300,000 on Form 8854. Accuse me of being a structuralist vis-a-vis United States law. Just do it! But I am obeying the laws of Canada where I live.

There are some people who say that gold is not a good investment, such as the crony capitalist extraordinaire Warren Buffet. Others point to the gold chart and say that this is why gold is a bad investment. Well, I admit that that argument is slightly counter-intuitive.

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Election day: Get revenge, vote!

Cross-posted from the Isaac Brock Society

I am living, for now, in exile from my land of birth. In a new article at iexpats.com, George Prior explains my situation, “FATCA Critic Fears Arrest by US Authorities“. When George Prior contacted me, I had no idea he would write an article about me nor that he would focus on my fear of returning to the United States. This article appears on Election Day=Revenge Day.

While campaigning, Obama said to a crowd booing Romney, “Get revenge. Vote.” Well, US expats who have suffered the indignities of being treated like criminals without probable clause through the requirement of revealing private information, threats of imprisonment and excessive fines, can get revenge. Some expats who joined the OVDI program have received extortionate penalties designed for homelanders who put money in Swiss bank accounts to hide it from the IRS and avoid paying taxes. I have Canadian accounts to be sure. But I live here in Canada and I pay more taxes than the majority of homelandersHomelanders have never even heard of GST/HST. I pay my fair share.

I can’t vote as I was forced to give up my US citizenship and my right ever to return and to live again in my country of Birth. I and many others here have suffered at the hands of President Barack Hussein Obama. He has allowed the IRS to hound expats, one could even say that he has sicked his dog on expats. Who is to blame: Republican George ‘Dubya’ Bush for signing 2008 HEROES Act which instituted an exit tax for those who would relinquish their citizenship. A democratically controlled Congress pass the legislation and Barack Obama voted for it. The same democrats in Congress passed the 2010 HIRE act, and President Obama signed it; HIRE included the FATCA legislation which tries to force our banks to rat on US expats, even when we are dual citizens of our countries of residence. Yes, Democrats are to blame. But then the lamentable Reed Amendment, which bans those who expatriate for tax purposes, was passed by a Republican Congress and signed by a Democrat President Bill Clinton. We are hounded by dogs of both breeds.

Thus, I urge people to vote against Obama–while not endorsing Romney. I can’t vote. I’ve already lost my citizenship and fear returning to the United States. This is Obama’s America: persecuting and torturing United States citizens living abroad. Yes, I consider forcing an expat to give up the right to return to his or her native land a form of torture:

Exile is torture, and torture is universally condemned around the world. The Ex-Patriot Act would permanently separate persons from their heritage and their families — children from parents, brothers from sisters, nieces and nephews from beloved aunts and uncles. It tears people away from communities and friends. Exile would destroy their lives. It is psychological warfare, condemning people to years of regret, bitterness, and rage.

The above words, I wrote about the torture of being banned as a result of the Ex-Patriot Act. But my fear of arrest at the border for spurning the FBAR filing requirement also results in exile and torture.

Please, there is a way to avenge me and thousands of other expats in my situation. Vote for Obama, NOT.

PS: I will likely e-mail this to members of my family.

Sweeter than Honey II: The purpose of man according to the law

See the first installment of this series:  Sweeter than Honey I:  Introduction

Petros continues the series of posts comparing the law codes of ancient Israel, the United States Constitution, and the Internal Revenue Code.  This post considers what the law implies about the purpose of man.

Laws guide behaviour of people in a community.  They instruct what the member of the community is forbidden to do and what the member of the community must do.  They therefore imply something about the nature of man (both men and women) and his purpose.  We shall therefore look at three different law codes to determine what these they imply about man’s purpose.

The purpose of man in the Ten Commandments and the Torah

The Ten Commandments begin with the line, “I am the LORD your God, who brought you out of Egypt, out of the land of slavery.”  God, who created the heavens and the earth and everything in them, had set apart the children of Israel as people unto himself.  Furthermore, he had demonstrated to them his power and his concern for them by setting them free from the slavery of Pharaoh in the most dramatic fashion.  Therefore, he set the Torah over them as a suzerainty treaty with blessings for those who obey and curses for those who refuse.

Now first, the Ten Commandments  govern  man’s relationship to God:  (1) to worship the God exclusively and to worship no idols (Commands 1-2); (2) to not use his name in vain (Command 3); and to keep the Sabbath day holy set apart for rest and for the worship of God (Command 4).  Secondly, the Ten Commandments (esp., 4-10) guide relationships between humans to maintain peaceful relationships within the community.  The rest of the Torah sets events of the Exodus in a narrative context and provide casuistic embodiment to the Ten Commandments.  Thus, the Pentateuch is a sort of narrative commentary on the basic laws set out in the Decalogue.

The Decalogue can be further epitomized in two commands, “Hear, O Israel: The LORD our God, the LORD is one.  Love the LORD your God with all your heart and with all your soul and with all your strength” (Deut 6.4); and, “… love your neighbour as yourself. I am the LORD” (Lev 19.18).  Each of these commands relies on the nature and character of God and his relationship to the people.  Thus, the Torah claims that man’s purpose under the Law is to love God and to love his neighbour.

The purpose of man in the Constitution and the Bill of Rights

The purpose of man in the Constitution stems from the great awakening of the individual conscience in Western culture that began to blossom with the Renaissance and came to fruition in the Enlightenment:  man is now an individual and his greatest good is to pursue happiness as a free person; this is man’s God-given, inalienable right, as enshrined into the basis of U.S. law by the Declaration of Independence.  The People later established the Constitution in order to form a more perfect government which would protect the rights which the colonists had fought for in their Revolutionary War of independence from King George of England.  The Constitution created three branches of government with limitations of power; each branch could check and balance the others.  Moreover, the Constitution strictly limited these powers.  Yet the states would not ratify this text without a further Ten Amendments, all of which strictly and explicitly limit the power of the Federal Government.  Indeed, the Tenth Amendment says that the United States has only explicit powers and any other power not explicitly laid out in the constitution was to be the sole reserve of the States and the People:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.
Thus, the purpose of man becomes clear in this narrative framework:  man is free to exercise his God-given inalienable rights to life, liberty and the pursuit of happiness.  The Constitution would assure common defence and regulate commerce between states, but it was to leave the People to self-government in their individual states, so that each individual may pursue happiness, without the interference of a far-away government.

The purpose of man in the Internal Revenue Code

The convoluted Internal Revenue Code is too extensive for a layman to discern a coherent narrative.  Therefore, it is perhaps best to allow the IRS, that body created to enforce the code, to explain to us what is the purpose of man.  In a newsroom release, the IRS explains how it is necessary to do past un-filed returns; it offers the following rationale:

Filing tax returns and paying the correct amount of tax is good citizenship. Conscientiously discharging this duty contributes to our nation’s well being and provides peace of mind. And failing to file returns can jeopardize a family’s financial security and future.

This is amazing.  The two inevitabilities of life are death and taxes.  Imagine if everyone believed that our purpose is to die–then what would be the point in continuing?   And yet, the IRS says, in not so many words, “Your purpose is to pay taxes.”  Indeed, we see that this mentality pervades the IRS.  In a recent comment at the Isaac Brock Society, by 30-yr IRS Vet, who worked in the bowels of the IRS as a litigator, we learned the following rational for FATCA (emphasis mine):

FATCA was conceived because our system of voluntarily self-reporting income and deductions was not working. The theory is, in a democratic society, the government has no right or reason to know what assets we hold or the extent of our personal wealth. The theory is that with an enlightened and educated citizenry, we are on our honor to honestly report our gains and losses on our tax returns. Unfortunately, the government concluded that that was not happening and many Americans were using off shore bank accounts and other foreign investments to cheat their fellow Americans by not paying their fair share.

FATCA was designed to target Americans who were cheating on their taxes through the use of offshore accounts. FATCA is a sad commentary on the fact that in some instances, our honor system was not working. No one in the US government was thinking of Canadian citizens who had little or no connection to the United States when FATCA was enacted.

This accurately reflects the mentality of the IRS.  The purpose of man is that each pay his fair share of taxes.  That is the greater good.  In order to achieve that we must sacrifice our working theory of a democratic society, that each individual has inalienable rights, such as the right not to have his castle ransacked by government without a specific warrant–the intent of the Fourth Amendment was to abolish general warrants such as FBAR, which requires citizens to divulge their bank papers to government without the need of a warrant based on probable cause.  But why would Congress create an IRS that had the power to levy draconian fines upon a people for refusing to relinquish voluntarily their Fourth Amendment rights?  Because the purpose of man has changed from that of seeking his own happiness in a free country–to one of paying his fair share of taxes.

The real problem for  Christians, Jews or adherents of any other religion, is that the Internal Revenue Code redefines humans as no longer owing their allegiance first to their god, but it makes the state itself into the god to whom one owes full allegiance.  In a real sense then, the Internal Revenue Code recognizes no other god except the State and expects all others to bow down only to the State.  And the IRS are the priests of this state religion.  It is not the first time that a political power has required worship.  One only needs to look at defied Roman emperors to whom one had to burn incense or die, or at the Chinese emperors or Egyptian Pharoahs who were worshipped as gods on earth.  This is idolatry of the state, and those who actually still believe in the Ten Commandments must resist it, as the First Commandment states:  “You shall have no other gods before me.”  But also to the secularist living in a secular state, the making of the state itself into a god, to whom all allegiance is due, is repugnant.

If Obama is a global citizen doesn’t that make him the President of the world?

The new FATCA legislation, signed by President Obama as part of the Hire Act, requires that every person in the world who owns a bank account declare whether he is a US person.  Imagine if the Chinese required that every bank account holder in American banks fill out a form declaring whether they are a Chinese person for tax purposes!  What would you say?  None of their damn business.

Obama must think he is the president of the world.

 

Isn’t this the way it starts?  With great speeches accompanied by ignoble acts of coercion?

Open Letter to the Executive Director of the Society of Biblical Literature

A letter to the Executive Director of the Society of Biblical Literature, an association with over 8000 members, informing him why the author will not be renewing his membership:  The US Federal Government is persecuting American citizens abroad of whom the author is one.

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