That Green, Green Grass

Isn't it a peculiarity of the human race to always sneak peeks over the fence to compare ourselves with others? Many Canadians are envious that Americans pay less taxes than are exacted from Canadian workers. Moreover, Americans who own property are privileged to deduct the taxes paid on mortgage loans from their annual income tax returns.

Show me a Canadian home-owner who wouldn't swoon at the opportunity to do likewise? And then, on the other hand, there are always details unknown to the casual observer.

Well, not only to the casual observer, but obviously unknown also to those who should know those details. Those who, because they are unaware of the inconvenient but oh-so-necessary details may be facing tough economic penalties, and other consequences, as well. Say, for example, having the privilege of travelling to the U.S. revoked?

The American Internal Revenue Service requires that all U.S. citizens, irrespective of where they live, where they work to earn their living, where they pay taxes on those earnings, where they own property and all other details of their personal, private financial life, to file annual tax returns. It is incumbent upon all those who hold U.S. citizenship to inform the IRS everything about their financial assets.

This applies whether or not the IRS is owed money, whether or not those citizens earn or do not earn money in the U.S., and whether or not they pay any kind of taxes in the United States. This is the law. An interesting little piece of information that appears to have evaded the knowledge of many of the estimated one million Americans living in Canada, many of whom hold dual Canadian-American citizenship.

Regardless of how long people holding U.S. citizenship have been absent from the United States, even if they were not born in the U.S., but born elsewhere, Canada or anywhere else, to American parents, they have this irrevocable legal obligation. Perhaps it's because the U.S. finds itself in dire financial straits, the IRS has decided to put its legal authority into practise, demanding compliance, prepared to render to the non-compliant crippling penalties.

Anyone with U.S. citizenship must report all foreign bank accounts with a value over $10,000; failure to disclose may result in a penalty of $100,000, or 50% of the existing bank account, whichever represents the greater amount. After which comes the potential for criminal prosecution. It was possible to avoid such penalties by straightforwardly, voluntarily presenting by September 9.

That 'amnesty' aside, those reporting must still understand they will remain subject to penalties, albeit reduced to up to 25% of their assets. And that unfortunate fact doesn't even take into account the tedious paperwork that most will have to pay accountants and lawyers to straighten out for them.

Envy American taxpayers? Not really, thank you very much.