EU Study on FATCA

I completely missed this one when it came out but, thankfully, someone clued me in. (Thank you, Rebecca!)  But I was very pleased to see that the topic is still alive at the EU and that they are taking a serious look at how this legislation is working for the EU and its citizens.

In May of this year, the European Parliament’s Policy Department for Citizens’ Right and Constitutional Affairs released a study about the US Foreign Account Tax Compliance Act (FATCA) and its impact on people in the EU (and elsewhere).  You can find the full study here.

You can also watch this 17-minute presentation of the study by Carlo Garbarino, Professor of Tax Law, Bocconi University, Milan.

What I Did During Summer Vacation – Midterm Election Project

Like a lot of Americans abroad I grumble about our representation in the US Congress.  Our issues like citizenship-based taxation and banking don’t seem to be on anyone’s agenda.  Are they listening?  If so, what exactly are their positions on the things that I and others care deeply about?

This summer I stopped grumbling and started working.  I’m a member of the Association of Americans Resident Overseas and it seemed to me that this was a great place to try to do something positive, practical, and useful.  Thus, the AARO Midterm Election Project was conceived as a way to answer the above questions for me and for my fellow Americans abroad BEFORE the election.

AARO selected 9 states for this pilot project and project team volunteers sent messages to all the candidates of all parties (this initiative is 100% non-partisan) for the US House and Senate inviting them to answer three questions about taxation, services and banking.  Candidates were also given space to send a personal message to their overseas constituent voters.

You can learn more about the project and read the candidate responses (see the right-hand side bar and select a state) on the AARO website at the following link:

AARO 2018 Midterm Election Project

I’ve been pleasantly surprised by the responses received so far.  Some candidates are indeed listening and have written thoughtful responses.  Some understand us very well because they are former Americans abroad or have family members who are.  I am also surprised that the state with the most responses so far is Texas.

So head over and have a look.  And then please share the responses with your fellow Americans abroad.  This is a midterm election resource for ALL of us from Suresnes to Stockholm to Shanghai.

If you would like to be notified when new responses come in the project team is publishing updates on the AARO Facebook and Twitter feeds. If you have any questions about the project, just email the project team at AARO2018@aaro.org.

And if you happen to be a constituent/voter of one of the 9 states and you see that the candidates in your home state and/or district have NOT replied, here’s how you can nudge them into answering in three easy steps.

Because if they don’t answer then that says to me that they aren’t listening.  And the last thing Americans abroad need are representatives that don’t listen and won’t take a stand on the issues that matter most to us. My .02.

A Video That Makes Me Want to Vote

I’ve been paying a lot of attention to the US midterm elections these days because of a project I’m working on.  A strictly non-partisan project, mind you.  And today a member of the project team sent me this campaign video by Air Force veteran M.J. Hegar who is running for Congress in Texas (District 31).

It’s really well done and I empathize  with where she’s coming from because, hey,  as someone who has haunted the halls of Congress and fought for meetings with my Congressional Reps at their offices in Seattle, I’ve had that same feeling that just being a mere constituent doesn’t necessarily get you very far with some (not all) US politicians.

 

Flophouse Stock and Crop Report

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“Don’t let the chickens roam in your garden!  They will destroy it and you’ll get nothing.”

That’s what I’d always heard and believed.  It seemed intuitively true.  Lord knows, when I was growing up I saw many a chicken run with bare dirt because those little tornadoes ate every last bit of grass.

That turned out to be contempt before investigation.  The last three days I’ve allowed the hens the run of the garden and so far it’s working out.  In fact, they are turning out to be the best garden helpers I’ve ever had.

Continue reading Flophouse Stock and Crop Report

Chicken Run – Flophouse Style

This morning we picked up our chickens.  Two lovely hens that we “adopted” courtesy of the city of Versailles.  The price was right:  Ten euros.

Messy little beasts – in a few short hours they had overturned their feed and water and have dug down at least two centimeters into the earth in their little run.

Watching them peck at the dirt and gargle their water is, well, rather hypnotic.  There was a family in the apartment next door who had their window open and loud male voice cried out, “Les poules sont arrivées!” and they leaned out the window to see their new neighbors.

They eventually closed the window but their little girl stayed and had her face glued to the glass watching the chickens do their thing.  I’m with her – it’s a great stress reliever.

We will be letting them free-range.  Sort of.  We have constructed a moveable “playpen” with tunnels going from their main run to a larger area.

Meet Bonnie the Black and Buffy the Red.

 

For Americans Abroad There is a New Tax in Town

As some of you may recall in the last round of tax reform in the US Territorial Taxation for Individuals was out but tax reform for US corporations with activities abroad was in.

At that point I just stopped paying attention because, hey, I’m not Google and I don’t know anyone abroad who is.

That was a mistake on my part because, as it turns out, Americans abroad with businesses big or small abroad are affected by provisions in the new legislation that were meant to encourage big US companies to bring their foreign-stashed cash back to the United States.

Repatriation Tax.  This is a one-time tax on profits earned between 1986 and 2017 in a business outside the US of 15.5 percent.  This tax is applied even if the business owner isn’t planning to bring those profits back to the US.  It can be paid over 8 years but if the owner elects to do this, the first payment is due on June 15, 2018.

It gets better with something called the Global Low-Taxed Income or GLTI.  This is an annual tax on businesses outside the US  and for the life of me I can’t figure out under what circumstances an US business owner abroad has to pay it and at what rate.  This is one, I think, that merits a consultation with a professional.

Now I don’t own a business in my country of residence but in the various places I’ve been in the past few years I’ve met a lot of Americans abroad who do.  Folks who own English schools, translation companies, law firms, dental and medical practices, IT consulting companies, and many small and medium businesses that are often owned jointly with a spouse.

If you are one of those American entrepreneurs abroad this is one I strongly suggest you look into.  A good place to start is a free webinar offered by an international tax lawyer in Israel, Monte Silver.

Webinar:  The impact of the Repatriation and GILTI taxes on American business owners living abroad

Thursday May 31, 2018 

10:00 am London, 11:00 am Paris/Germany, 17:00 Beijing/HK, 18:00 Seoul/Tokyo

The 2017 US tax reform created two new taxes: the Repatriation and GILTI taxes. Although intended for US multinationals like Google and Apple, these taxes have a severe impact on American citizens and Green-card holders who are professionals or business owners living outside the United States (“Expats”).

This web-seminar, intended for American tax professionals and American business owners living outside the United States, will discuss the following:

  • The problem these taxes came to address.
  • Understanding the new tax laws
  • The impact these laws have on Expats.
  • Compliance timelines, planning around the taxes, and tax advocacy activity aimed at exempting Expats from these taxes

To sign up for the seminar click on this link:   Register for the Repatriation Tax/GLTI Seminar

And lest you think that Mr. Silver is just trying to drum up business for himself, be aware that he himself is subject to these taxes the way the law is written.  In other words, he is in the same boat as all the other American business owners living abroad and he’s not very happy about it.

So in addition to trying to inform American business owners abroad on this issue, Mr. Silver has a petition up that you can sign and he’s working on efforts to get Americans abroad exempted from these taxes.

Democrats Abroad is also working on it  I haven’t seen anything from Republicans Overseas but if someone has a link, pass it along and I will add it. as is Republicans Overseas (thank you, JC) which is asking for Americans abroad to submit comments to Congress here.

How did we get here?  Short answer is:   Same Old Story.  Lawmakers, lobbyists, interest groups, political parties, and the general homeland public write, support or pass laws without thinking about the impact they may have on US citizens who don’t live in the US.   And then we have to chase after them to wake them up and clean it up.

And here we are off to the races once again….

This Ageing Migrant

In my youth I dreamed of being old, evil, and rich.  Around 50 I realized that rich is relative, old is inevitable, and evil is just too damn much work.

I just finished reading Atul Gawande’s Being Mortal: Medicine and What Matters in the End.  Nothing like a light topic to kick off the week after Easter.

Gawande is a second-generation American.  His parents came from India and were doctors for many years in the US. He himself became a surgeon.  Gawande reveals a great deal about the struggle he and his mother had during his father’s illness and eventual death.  He compares how these events might have played out in India versus the United States.  Because of migration his family was caught between their perceptions about the old cultural script for old age and death, and the very chaotic one in the destination country.  Why chaotic?  Because that script is still in process in the US and in many other modern industrialized nation-states.

What Gawande understands about old age and dying in India  provokes in him a nostalgia for a country he’s never lived in.  What appeals to him, I think, is the certainty that comes from following a cultural script which tells us what is the right thing to do:  old people are to be respected and venerated; they are to be cared for by family; dying is done at home surrounded by children and grandchildren.

In the US older people seem to prefer independence to respect.  Their idea of ageing gracefully is about the freedom to live as they wish, to travel, to enjoy life without the boss, their parents, or their children telling them what to do.  This poses a real dilemma when older people can no longer live by themselves.

That day will come.  I had a taste of it when I was diagnosed with cancer. One of the reasons I wanted to buy our house is that it is small and almost everything is on one floor.  I don’t have to climb a flight of stairs to go to bed.

I have not thought beyond that.  To be honest I am not sure what the cultural script is here in France for old age and dying.  I know that some older French go to retirement homes and some live with their children.  There are also visiting nurses, doctors who make house calls, assisted-living retirement communities and there is hospice.

In every migrant’s mind there are times when we look back at where we came from and wonder if there is better than here. There is an “illusion of return” – the idea that one could always go back and thus staying in the host country is a choice to be considered and reconsidered over the course of one’s life.

However, if a migrant has aged in situ there comes a point where one’s choices become limited and return is revealed for the illusion it is. (Unless, of course, we are rich enough to overcome most of those limitations.)  When we are old and becoming more dependent on others, it is, I think, reasonable to wonder if where we are is the very best place for us – a place where what we want is doable.  To be clear, if we wait too long the decision will be out of our hands. Our children and/or a spouse will decide or, if we don’t have them, the state will do so.

It’s worth conducting a thought experiment here.  Project yourself into the future, into old age (or illness) at a point where you will need assistance of some sort.  Consider the options available to you based on your resources and on the country in which you live as a migrant or naturalized citizen.

Most importantly, think about what matters most to you.  Is the host country still appealing if you can no longer use the public transportation, walk to the market, work in the garden, watch television, participate in neighborhood events, or manage your administrative affairs without help? Do you value your life in your own home and are there resources to make that possible as long as possible?  Could you accept life in a nursing home here?  If your resources are limited, what happens to the indigent elderly in this country and are you OK with that? Are you comfortable with the idea that the local government will make decisions for you if you can’t make them for yourself?

When you are dying what kind of care do you want?  Can you die at home in the host country? Do you want support from family and will they have to come to you or you to them?  Are you allowed to have a “living will” and to reject treatment that you understand might prolong your life but at the cost of destroying your quality of life?  For some the option of “assisted dying” might be important and that is dependent on local laws.

Better to think about these things now than to have to face them (as Gawande’s family did) in a state of confusion and when one is already in a state of dependence.  Gawande’s father, for example, insisted that he did not want to go to the hospital and die there. And yet, when there was a crisis, his wife and son took him there anyway because between his wishes and their doubts about what they should do and fear, fear won.

I started this post with what I used to want in my old age.  Now that I am getting closer and have seen what my life might be like as I approach the end, my priorities have changed.  Gawande was absolutely right when he wrote:

As people become aware of the finitude of their life, they do not ask for much.  They do not seek more riches.  They do not seek more power.  They ask only to be permitted, insofar as possible, to keep shaping the story of their life in the world – to make choices and sustain connections to others according to their own priorities.

It does not take much these days to make me happy:  a good book, the presence of my spouse, news from the Frenchlings, the garden in the springtime. Being mortal doesn’t bother me as much as it did when I was younger.  And I don’t fear dependence nearly as much as I did here in France because I’ve been there and it can be a very serene place as long as there is room and respect for my wishes.  There was and that is a great comfort.