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[quote=”Imxploring”]…. and now they want to keep US citizens from leaving!
Pretty soon having a passport and playing by the rules will be more of a burden then it’s worth.
[/quote]
True … but even with the oppressive fees that they have levied in order to renounce your US citizenship … you still won’t live long enough to get an appointment to do so …
It’s too late for us … we can only worry about the children …
Properly structured … death can be the opportunity of a lifetime …
The text of the bill relating to passports
[quote]SEC. 32101. REVOCATION OR DENIAL OF PASSPORT IN CASE OF CERTAIN UNPAID TAXES.
(a) In General.—Subchapter D of chapter 75 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:“SEC. 7345. REVOCATION OR DENIAL OF PASSPORT IN CASE OF CERTAIN TAX DELINQUENCIES.
“(a) In General.—If the Secretary receives certification by the Commissioner of Internal Revenue that any individual has a seriously delinquent tax debt in an amount in excess of $50,000, the Secretary shall transmit such certification to the Secretary of State for action with respect to denial, revocation, or limitation of a passport pursuant to section 52102(d) of the Transportation Funding Act of 2015.“(b) Seriously Delinquent Tax Debt.—For purposes of this section, the term ‘seriously delinquent tax debt’ means an outstanding debt under this title for which a notice of lien has been filed in public records pursuant to section 6323 or a notice of levy has been filed pursuant to section 6331, except that such term does not include—
“(1) a debt that is being paid in a timely manner pursuant to an agreement under section 6159 or 7122, and
“(2) a debt with respect to which collection is suspended because a collection due process hearing under section 6330, or relief under subsection (b), (c), or (f) of section 6015, is requested or pending.
“(c) Adjustment For Inflation.—In the case of a calendar year beginning after 2016, the dollar amount in subsection (a) shall be increased by an amount equal to—
“(1) such dollar amount, multiplied by
“(2) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting ‘calendar year 2015’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $1,000, such amount shall be rounded to the next highest multiple of $1,000.”.
(b) Clerical Amendment.—The table of sections for subchapter D of chapter 75 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:“Sec. 7345. Revocation or denial of passport in case of certain tax delinquencies.”.
(c) Authority For Information Sharing.—(1) IN GENERAL.—Subsection (l) of section 6103 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
“(23) DISCLOSURE OF RETURN INFORMATION TO DEPARTMENT OF STATE FOR PURPOSES OF PASSPORT REVOCATION UNDER SECTION 7345.—
“(A) IN GENERAL.—The Secretary shall, upon receiving a certification described in section 7345, disclose to the Secretary of State return information with respect to a taxpayer who has a seriously delinquent tax debt described in such section. Such return information shall be limited to—
“(i) the taxpayer identity information with respect to such taxpayer, and
“(ii) the amount of such seriously delinquent tax debt.
“(B) RESTRICTION ON DISCLOSURE.—Return information disclosed under subparagraph (A) may be used by officers and employees of the Department of State for the purposes of, and to the extent necessary in, carrying out the requirements of section 52102(d) of the Transportation Funding Act of 2015”..”.
(2) CONFORMING AMENDMENT.—Paragraph (4) of section 6103(p) of such Code is amended by striking “or (22)” each place it appears in subparagraph (F)(ii) and in the matter preceding subparagraph (A) and inserting “(22), or (23)”.
(d) Authority To Deny Or Revoke Passport.—
(1) DENIAL.—
(A) IN GENERAL.—Except as provided under subparagraph (B), upon receiving a certification described in section 7345 of the Internal Revenue Code of 1986 from the Secretary of the Treasury, the Secretary of State shall not issue a passport to any individual who has a seriously delinquent tax debt described in such section.
(B) EMERGENCY AND HUMANITARIAN SITUATIONS.—Notwithstanding subparagraph (A), the Secretary of State may issue a passport, in emergency circumstances or for humanitarian reasons, to an individual described in such subparagraph.
(2) REVOCATION.—
(A) IN GENERAL.—The Secretary of State may revoke a passport previously issued to any individual described in paragraph (1)(A).
(B) LIMITATION FOR RETURN TO UNITED STATES.—If the Secretary of State decides to revoke a passport under subparagraph (A), the Secretary of State, before revocation, may—
(i) limit a previously issued passport only for return travel to the United States; or
(ii) issue a limited passport that only permits return travel to the United States.
(3) HOLD HARMLESS.—The Secretary of the Treasury and the Secretary of State shall not be liable to an individual for any action with respect to a certification by the Commissioner of Internal Revenue under section 7345 of the Internal Revenue Code of 1986.
(e) Revocation Or Denial Of Passport In Case Of Individual Without Social Security Account Number.—
(1) DENIAL.—
(A) IN GENERAL.—Except as provided under subparagraph (B), upon receiving an application for a passport from an individual that either—
(i) does not include the social security account number issued to that individual, or
(ii) includes an incorrect or invalid social security number willfully, intentionally, negligently, or recklessly provided by such individual,
the Secretary of State is authorized to deny such application and is authorized to not issue a passport to the individual.
(B) EMERGENCY AND HUMANITARIAN SITUATIONS.—Notwithstanding subparagraph (A), the Secretary of State may issue a passport, in emergency circumstances or for humanitarian reasons, to an individual described in subparagraph (A).
(2) REVOCATION.—
(A) IN GENERAL.—The Secretary of State may revoke a passport previously issued to any individual described in paragraph (1)(A).
(B) LIMITATION FOR RETURN TO UNITED STATES.—If the Secretary of State decides to revoke a passport under subparagraph (A), the Secretary of State, before revocation, may—
(i) limit a previously issued passport only for return travel to the United States; or
(ii) issue a limited passport that only permits return travel to the United States.
(f) Effective Date.—The provisions of, and amendments made by, this section shall take effect on January 1, 2016. [/quote]
It has passed the House and is expected to pass the Senate without ammendment before recess.
The POTUS is expected to sign withot objection.And here we go again with another mass shooting in a place with the toughest gun laws on the planet.
In order to get a CCW permit in California, you have to be able to show that you have significant cause to believe that your life, or the life of family member, is in immediate peril. Pretty much the same standard as for using deadly force. Simply wanting to carry for self defense doesn’t cut the mustard though a pending court case, Perula v California is attempting to change that.
If those same gunmen had tried that in Texas, you would have had to take a number and wait in line to get up front and get a shot at them.
[quote=”Scott”]
If we managed our own personal finances like most governments, we would all destitute, homeless and literally starving to death![/quote]True enough … but …
We don’t get to enslave the masses and force them to feed the machine …
They do …
I’m pretty sure most any country on the planet will take money from anyone. In the case of rental property income, the most important thing is to make sure that you’re paying the 13% VAT.
http://insidecostarica.com/2014/08/07/vacation-rental-costa-ricas-taxmen-message/
It is very easy for them to go to VRBO and see how much a property rents for and how many weeks it is reserved.
Income on this type of activity is more of an accountant’s game as it is levied on profits i.e. income minus expenses, depreciation, etc.
Do you know the difference between an engineer and an accountant?
If you ask an engineer what 2+2 is, he’ll tell you 4.
If you ask an accountant what 2+2 is, he’ll ask you how much you want it to be.
Take care.
And now, they are going to hold your passport hostage.
http://tax-news.com/news/Americans_Abroad_Advised_To_Ensure_US_Tax_Compliance____69765.html
tonto,
The $200K was a reporting threshold for Form 8938 for a specific set of circumstances … a couple filing “married filing jointly” and residents of the US.
These thresholds change depending on your filing status and place of residency.
I do not consider myself competent to advise on these matters. You may want to check out the “Instructions for Form 8938.”
If there is a foreign corporation involved, and you own 10% or more, your reporting requirement may start at $0. You may want to check out the “Instructions for Form 5471.”
Also, if you transferred money to the foreign corporation so that it could purchase the house, that’s where the Form 926 comes in.
And all these forms change depending on whether you formed an SA or SRL.
And again, I’m NOT a qualified individual when it comes to advising on legal or tax matters.
Good luck.
You are free to republish as you see fit.
No credit is needed … and the example may not be entirely accurate as the obligation to file the 8938 may have just began in the mid-2000s … but the gist remains the same.
Folks just need to get prepared.
I mentioned Don Nelson at taxmeless elsewhere on this site. He has been an invaluable resource to me on international taxation issues. He is someone that can advise you as a tax attorney and as an international tax accountant. He doesn’t work for free but I don’t think that any of us try to. BTW, we live a country apart and I don’t get kickbacks, incentives or otherwise for recommending him. I tell people about him because he has been a great help to me and most folks don’t understand the total ramifications of all of their actions when acquiring assets abroad.
Being an officer of the court, Don can’t advise you to do anything that isn’t specifically legal, however, there is a conventional wisdom that folks that aren’t compliant should simply try to slide sideways into the system i.e. start filing the proper forms as if your obligation just began. Unfortunately, it may be too late for that.
Take care.
Thanks for posting this Scott. She’s a smart girl but she did leave out some critical info. In the interview, the HIRE act and “pay fors” were mentioned but they really didn’t tie in the relevance. Every US bill has to have a provision as to how it is payed for. The HIRE act was payed for by imposing a 45% “exit tax” on the assets of people, above a certain threshold, who wanted to renounce their US citizenship. i.e. another lock on the door.
Imagine this, you and your wife are throwing a party, shortly after arriving, guests want to leave. Do you a) try to figure out why they want to leave and correct the problem or b) nail all the windows and doors shut so that they can’t get out? It is pretty obvious which choice the US has made.
Now, FATCA isn’t the entire problem. It is just how folks are going to get caught. You see, the problem is “disclosure penalties” that have been on the books for a very long time. Imagine this, a young girl from Niagara Falls, New York falls in love with a boy from Niagara Falls, Ontario only a Rainbow Bridge away. They marry and raise a family in St. Catherine’s. Then, one day, a letter comes in the mail from the IRS telling them that they owe a million dollars, not in taxes, but in disclosure penalties. It has gotten so bad that the head of Revenue Canada sent an open letter to the United States that basically said, “Our people live under one of the most heavily regulated financial systems on the planet. BACK OFF of our people!”
There are many in CR that have been flying under the radar for a long time. FATCA is how they are going to get caught! And it isn’t going to be pretty. The US has had access to the National Registry in CR and now, with FATCA, they not only have access to the officers, but also the directors and beneficial owners.
You may want to check out this example that I put together as an illustration.
http://www.galtsgulch-cr.com/?page_id=24
Thanks again for posting this as a lot folks are going to have heart attacks when they get the letter in the mail.
[quote=”rfs1975″]The end result of Socialism is you eventually run out of other peoples money.
[/quote]
Margaret Thatcher once said that “The trouble with Socialism is that eventually you run out of other people’s money.”
Costa Rica and the United States have not yet learned this lesson … but they will eventually …
If you want to live like an American in CR, it will cost from one fourth to one half more than living in the US.
I loved Maggie Thatcher !
[quote=”Scott”]HHowever Costa Rica “voluntarily” turns that information over already.”
[/quote]
This is all due to FATCA
Starting mid last year, any in bank transaction in a CR corporate account required a certification from an attorney of who the officers and directors are. If there is a US person in there anywhere, they had to immediately come to the bank and sign a W-8BEN-E or the account was frozen. I had this happen last December when my Canadian partner attempted to add a CR permanent resident as a signatory on a CR corporate account at BCR. Luckily, I just happened to be in country. But, get this, they handed me an IRS tax form to sign that didn’t have a word of English on it anywhere.
http://www.therealcostarica.com/residency_costa_rica/costa_rica_residency.html#comp
As a permanent resident, the only “in country requirement” is that you visit CR once per year.
That said, these rules are in a perpetual state of flux.
You’re pretty much screwed.
You have 2 choices …
1. Pay him off … or …
2. Find a very unfriendly individual to convince him that he doesn’t want to do that.
Either way, you’re going to pay and you should be thankful that he’s not claiming squatter’s rights on your property or selling those rights to a third party, though he still might I suppose. He probably can’t claim to be an employee and a squatter.
Giving anyone possession of your property without a legal agreement executed in front of a trustworthy Notario was really not very smart.
Regardless of your perception, I doubt if you have many “true” Tico friends. A friend will help you move. A true friend will help you move a body.
If you decide to pay him, do it in a Notario’s office and make sure he signs a full release to any further employment claims and any claims to your property. Admit no guilt or employment in the agreement … just a settlement to avoid litigation.
[quote=”Scott”]
If these things – tax evasion and making sure people have the correct insurance coverage – are a serious concern for you, you’ll survive a week living in Costa Rica.
[/quote]
ROFL …. Zactly !
I’ve never gotten a receipt for solicited bribes in CR either … it’s almost like they don’t want there to be a record of it. 😆
[quote=”Scott”]99.99% of the “huddled masses” can’t enter places like Villa Real….
[/quote]True … and therein lies the true meaning of “exclusive”. Most folks use the term without thinking that what it really means is to exclude or deny the overwhelming majority.
That is where the former presidente and her husband live, right ? I guess if you finance the Caldera highway, you get your own entrance/exit ramps. I like it’s proximity to Escazu and all that goes with that, but having spent most of my life living two miles north of the sixth busiest airport on the planet, you can’t imagine how much it means to me to sit on top of a hilltop and look south and see an eastbound flight into Juan Santamaria … and not be able to hear it.
Valle del Sol has little appeal to me. It reminds me of that song that was the introduction to the Netflix series [b]Weeds[/b] … “Litle boxes, Little boxes …” Of course, in fairness, I guess much of the appeal is lost if you don’t play golf. Personally, I’ll chase that little white ball when I’m too old to chase anything else.
[quote=”Scott”]I LOVED my [url=https://www.welovecostarica.com/public/Scotts_Mountain_Home_With_Unbelievable_Views.cfm]home in the mountains[/url] which was most definitely at the end of the road but, then encountered a ‘muscle disease’ which forced us to sell…
[/quote]
I love your mountain home too. Those views are nothing short of stunning! However, I have abused my lungs for far too long to ever consider living at 7000 feet. It also looks like it would have been a solid two hours to the CIMA hospital, which would have been another deal-breaker. When you work, sometimes you get hurt and somebody has to patch you up and get you back out there. And even work aside, mother nature can be a cruel old hag sometimes.
[quote=”Scott”]
Thankfully at age 55, I am healthier and fitter now than I have been in 15 years.
[/quote]I have no problem at all believing that. I’m a year behind you but I can spend 5 days in CR, eat like a pig, and lose 8-10 pounds. What you’re eating makes a ton of difference i.e. a banana vs. a can of Pringles.
[quote=”Scott”]
Have a great weekend![/quote]You do the same !
