News

Are you a US citizen operating a business in Canada? Please read this and act today!

TAX CUTS & JOBS ACT HAS A NASTY SURPRISE FOR BUSINESS OWNERS ABROAD

A great many flaws exist in the Tax Cuts & Jobs Act due to inadequate consultation and hasty drafting. One of those flaws causes enormous harm for Americans abroad who own businesses in their countries of residence.

If you are an overseas American with a business abroad, click here to reach out to Washington and demand a remedy!

Background

The new tax law ushers in a system of Territorial Taxation for Corporations. The new system has 2 troubling components.

  1. Repatriation Tax: In transitioning to the new system, overseas subsidiaries of U.S. corporations who have profits that have not been repatriated to the U.S. parent company will be subjected to a Repatriation Tax on profits going back to 1986. The profits will be deemed to have been repatriated to the U.S. parent, even if there is no movement of cash or on paper, and then taxed at a discounted corporate rate, after certain offsets and credits for tax paid to the country of incorporation. If the offshore company is owned by a U.S. Person living abroad, rather than a U.S.- based corporation, the deemed profits are afforded no offsets nor credits for tax already paid. Clearly, this is an error in drafting.
  2. Global Intangible Low-Tax Income (GILTI) Tax: Disregard the name entirely because it is a misnomer. Going forward foreign businesses owned by U.S. based corporations and individuals and U.S. Persons living abroad will, again, be subjected to U.S. corporate tax on their profits, less about 10%, whether or not the profits are repatriated to the U.S.. As with the Repatriation Tax corporate owners of foreign businesses are afforded deductions (50%) and offsets (80% of foreign taxes paid) (in many instances the result will be no taxes owing) that U.S. Persons owning foreign businesses are not afforded. The U.S. Person owner of a foreign business will be paying tax twice on the same dollar of income. Clearly, this is another grievous error in drafting.

Last week a Democrats Abroad delegation spoke to members of the Senate Finance Committee and House Ways and Means Committee about, amongst other things, the need for an urgent remedy for this policy flaw. Congress is working on an Omnibus appropriations bill to approve spending for this year that must be passed no later than 23 March. This matter is on, we understand, a lengthy list of Tax Cuts and Jobs Act problems that need to be addressed. Sadly, we also understand that very few of them will be addressed in the appropriations bill.

Demanding a remedy

Democrats Abroad and a number of others are demanding an urgent remedy for this policy flaw. Our proposal:

Americans abroad with interests in foreign corporations should be exempt from the Repatriation Tax and from the GILTI regime for any given year so long as two conditions are met.

  1. We meet the conditions required for exemption under IRC Section 911 (bona fide non-resident for tax purposes), and
  2. We are individual U.S. shareholders.

In the absence of Congressional action, we will urge the Treasury and IRS to take the following actions:

  1. Issue an immediate notice stating that for Americans abroad, the first payment under IRC Section 965 (transition tax on untaxed foreign earnings) is due the earlier of October 15, 2018, or the issuance of further guidance.
  2. Issue a further notice in line with our proposal.

As in all matters requiring the attention of lawmakers and regulators, robust outreach from affected parties is essential. Repatriation Tax declarations are to be made in 2017 filings, so time is of the essence.

Time to take action!

If you are the owner of a foreign business impacted by the Repatriation and GILTI Taxes we need you to send this email right now.

The script for this letter has been prepared by third party taxation advocates, in collaboration with Democrats Abroad’s Taxation Task Force. Democrats Abroad supports the collaborative, non-partisan campaign behind this grassroots advocacy initiative and believes it is essential for addressing this problem urgently.

Letter Campaign Contacts

Department of Treasury

Mr David Kautter
Assistant Secretary of the Treasury – Tax Policy
david.kautter@treasury.gov

Mr Chip Harter
Deputy Assistant Secretary (International Tax Affairs)
lafayettechip.harter@treasury.gov

Mr William Paul
Acting Chief Counsel, IRS
william.m.paul@irscounsel.treas.gov

Arlene Preston
Assistant to Mr Paul
arlene.preston@irscounsel.treas.gov

Leni C Perkins
Office of IRS Chief Counsel (Repatriation Tax)
Leni.c.perkins@irscounsel.treas.gov

Democrats Abroad
Taxation Task Force
RepatRemedy@democratsabroad.org

U.S. Congress

House Ways & Means Committee

Barbara Angus
Chief Tax Counsel, Ways & Means Committee
Barbara.angus@mail.house.gov

Aaron Junge
Tax Counsel, International Matters, House Ways & Means Committee
aaron.junge@mail.house.gov

Kara Getz
Tax Policy, Leading Democrat Richard Neal, House Ways & Means Committee
Kara.getz@mail.house.gov

Senate Finance Committee

Mark Prater
Chief Tax Counsel - Republicans, Senate Finance Commitee
Mark_Prater@finance.senate.gov

Tiffany Smith
Chief Counsel- Democrats, Senate Finance Committee
Tiffany_smith@finance.senate.gov

We also encourage calling your representatives in Congress, whether they be a Democrat or Republican. On this page you’ll find contact information for your Senator or Representative, along with useful tips for making effective calls to Congress.

 Demand a remedy for the Repatriation and GILTI Taxes!

Please contact us at any time with questions: taxationtf@democratsabroad.org

Democratically yours,

Steve Nardi
Chair, Democrats Abroad Canada


Bus Trip from Ontario to March for Our Lives~March 23rd-25th

Students can ride for free. Minors need to be accompanied by an adult. 

Ride with us by bus to Washington, DC. Let President Trump know on Saturday, March 24th that we stand with the brave kids and families of Parkland, FL. Show your support for gun control now and vow that #NeverAgain shall students die for the lack of common sense in gun legislation.

Register now for the DA Canada Delegation Charter Bus. Round-trip ticket is $150 CAD. We have places for 56 persons. Ten places are reserved for US citizen high school students to ride free. Bus pick-ups in Toronto, Burlington and Fort Erie.

The bus leaves Toronto for a 8:00-9:00 pm pick-up. We are also scheduling stops in Burlington and Fort Erie. Thereafter, we will travel overnight in a Coach Canada deluxe charter bus to Washington, DC, rolling up to Pennsylvania Ave on Saturday, March 24th. After attending the rally and march, we will leave DC Saturday night and travel overnight back to Ontario, Canada. The round-trip cost is $150 CAD on a first come first service basis.

"At the Democratic National Committee Meeting last week, a resolution was passed to support The March for Our Lives. Ken Sherman, DNC member in attendance, was so moved by the energy in the room, he notified us from the floor of the meeting that he will sponsor the first 10 US citizen high school students to join us! We are most grateful for his generosity and so looking forward to having these special guests and families on the bus."

Please sign up today! If you have one high school child you'd like to bring and have considered for sponsorship, we plan to provide one free ride per family, up to 10 families! Adult students can travel alone. Please email neveragain@democratsabroad.ca with any questions. 


+

Take the Pledge-Never Again

Never Again is the rally cry from the kids and families of Parkland Florida as they organize the March for Their Lives in DC March 24 2018

Never Again is the pledge I make.

Never again, will I let the memories of school shootings fade from my mind once the news cycle decides it not news anymore.
Never Again, will I forget the images of children dead inside of America's learning institutions.
Never again, will I be complacent on gun control.
Never Again, will I forget that these children depend on Us Adults to do something.
Forever and again, will I use my clout to vote "them" out.

Add your name to this pledge by sending an email to neveragain@democratsabroad.ca. putting your First and Last Name (or First Name and last initial if you prefer) and City in the subject line.

Julie Buchanan-Brampton, ON

Lissette Wright-Ottawa, ON

Danielle Stampley-Toronto, ON

Gena Brumitt-London, ON

 

Steve Nardi-Mississauga, ON

Ramona Rhoades - Cocoli, Panama Oeste, Panama

Rajib Sengupta - Kolkata, India 

Heidi Burch - Victoria, BC

Louie Bardelang - Columbus, Ohio

Jim Mercereau - Mardrid, Spain

Jacqueline Swartz - Toronto, ON

+

Join us in a call with Earl Fowlkes, Chair of the LGBT Caucus of the DNC Feb. 28th 2:00pm EST

Please join us in a call with Earl Fowlkes, Chair of the LGBT Caucus of the Democratic National Committee, as he speaks about the various issues facing the LGBTQIA community under the current Administration, and about how the Democratic Party is addressing those issues and mobilizing the community to get out the vote in 2018. The call begins at 2pm DC time on February 28, 2018. Please RSVP below to join!

About our speaker: 

Philadelphia native Earl Fowlkes has for a long time been an activist for LGBTQIA rights and marriage equality. He is a founder and CEO of the Center for Black Equity, an international LGBT advocacy organization, a member of the Gertrude Stein Democratic Club, D.C.’s largest LGBT political organization, chair of the D.C. Commission on Human Rights, and since 2013, the chair of the LGBT Caucus in the DNC.

Please RSVP HERE to join and learn more!

Note: this is an online event, so you will need an internet connection in order to attend.


US Pop-Up Consulate in Prince Rupert, BC

The US Consulate in Vancouver will be coming to Prince Rupert to host a "Pop-Up Consulate" for U.S. Citizens.

When: Friday, March 23rd

Where: Jim Ciccone Civic Centre, Training Room 

Address: 1000 McBride Street  MAP

Time: 12:30 pm - 4:00 pm

Facebook:  https://www.facebook.com/events/155720081755716/

For appointments, please call: 1-604-685-4311 x340

Consulate staff will be accepting passport applications, passport renewals, applications for "Consular Report of Birth Abroad" and providing notary services. An appointment is required and there are fees for these services.

To make an appointment, please call American Citizen Services at: 1-604-685-4311 x340

If you have any questions about the US Pop-Consulate, please email the US Consulate in Vancouver at: VancouverACS@state.gov

 


Views from Canada ~ Apocalypse then: Looking back at the Vietnam War after half a century

                                                                                                                                                                                                                                                       by: Virginia Smith

Many members of Democrats Abroad Canada arrived in Canada during the Vietnam War era, from the late 1960s to the early 1970s. A number of them, including Ken Sherman, were involved in efforts to stop the conflict.

Ken Sherman is the chair of DA Canada’s Hamilton – Burlington chapter and a member of the Democratic National Committee. He has also served as the global chair of Democrats Abroad and the chair of Democrats Abroad Canada.

Ken first became involved in anti-war efforts as a member of Clergy Concerned About Vietnam. He was a founder of the Draft Counselling Centre in Buffalo, New York, and was jailed at least seven times for his resistance activities. He was landed in Canada in 1996 and became a dual citizen soon after.

Ken started spending time in Canada in the early 1970s when his wife, a French national, started living in Ontario. At that time, he helped many Americans to find a place in Canada. After President Jimmy Carter’s amnesty for draft resisters was enacted, Ken drove a friend back to the U.S. The border crossing was publicized on national television as the first return home of an American after the amnesty.

DA Canada recently asked Ken to share some of his reflections about that tumultuous era.

● Tell us about a couple of the ways the Vietnam War changed your life.

The war made me a political activist. I and others began using the electoral system to raise issues to end the Vietnam War and redirect its resources to the urban infrastructure. I ran as a peace candidate for Buffalo City Council in 1969. I worked to support peace candidates in the 1968, 1972, and 1976 Federal elections. In the end, it was Congress that ended the war by not funding it.

The war also made me aware of the role of globalization. My wife to be was a French citizen who moved to Canada. She was looking for progressive politics that matched her views for world peace. We worked out an interpersonal relationship across borders and cultures to raise three children. I think about 90% of the Americans who came to Canada did so for similar reasons of love.

The movement of so many Americans at that time into Canada also changed the Canadian cultural environment and Canadian society.

How did the war affect your commitment to your responsibilities as an American?

The global context of the Vietnam War woke me up to the situation in the Americas. I learned of the realities of U.S. imperialism in Central America / Nicaragua, for instance, and later in Afghanistan. I did coffee picking in Nicaragua in 1984 as part of a peace delegation. I realized then that the U.S. economic engine must have a war to feed its military machine.

Before he left office, President Carter warned that the battles of the future would be focused on the petroleum economy. I organized an energy coop in 1976 as energy conservation was becoming the new political framework. I supervised a staff of ten insulating inner city homes.

At the time of the first Iraq war in 1990, there was a movement to boycott the use of gasoline. I joined a peace demonstration to oppose the invasion. After, I turned to riding my bicycle where I could. My bicycle slipped on ice when returning from church one Sunday, and I broke my hip. I had to have three pins put into my hip. They remind me of the futility of that war.

What has been the ongoing impact of the Vietnam War on U.S. political life?

The war taught me the key role that grassroots political organizing has on social change. Those who have come through the anti-war experience make up much of the progressive base of the Democratic Party today. They form a bloc that has been mobilized by the progressive wing of the party in response to the wars in Afghanistan and Iraq.

There is now a permanent anti-war movement. The church-based and other political groups that came together in a movement continue to be funded and have support.

This movement is much more diverse now though. Such was noticeable recently in the assembly at the Washington Women’s March the day after the inauguration of President Trump. Everyone’s cause was on display at this march with great joy. The march was so full of love and respect. The movement to end the Vietnam War was composed largely of liberals and the college left.

I was so proud to be a Canadian and an American at the Women’s March.

Are there similarities between the activism of the 1960s and today’s activism?

It is still true that social change comes through grassroots and political organizing. There is no social change without grassroots organizing.

Is U.S. society as polarized now as it was then?

Yes, the country is as polarized now as it was in the 1960s. The war was wound down when the most people realized that there was no redemption in continued fighting and no victory to be won. Right now, Middle America is propping up Donald Trump. Political activism is again needed to mobilize the grassroots citizenry.

What action is needed right now?

The progressive sector of the Democratic Party needs to focus on getting out the vote for the 2018 mid-term elections. We need to turn back the Republican Party from any more gains accomplished by gerrymandering districts in advance of the next U.S. census.


+

Webinar: Investment Tips & Traps for Americans Living in Canada

Democrats Abroad Canada extends an invitation to join us for the next webinar in our information series

INVESTMENT TIPS & TRAPS FOR
AMERICANS LIVING IN CANADA

THURSDAY, NOV. 8, 2017

9:00PM AST / 8:00PM EST / 5:00PM PST

Presented by

BDO Canada LLP
and
Perreira Hurly Wealth Advisory of Raymond James Ltd

This webinar will provide insight on investment management, retirement planning and cross border tax considerations for Americans living in Canada. We will outline various investment and retirement accounts available on both sides of the border and will also provide insight on the regulatory issues and alternatives available. We will address the Canadian and U.S. tax implications of these investment accounts & retirement plans and provide some tax planning strategies to help minimize the tax burden.

This is a free online webinar and advance registration is required.

WHEN
Thursday, Nov. 8th
9:00pm AST/8:00pm EST/5:00pm PST

CLICK HERE TO RESERVE SPACE


Note that webinars are presented on the WebEx platform. To avoid frustrations, you need to be aware that:

· WebEx will not function on Mac OS X 10.6 which would affect this and any earlier version of the OS. You should be okay on any newer version than 10.6.

· WebEx does not function properly with Microsoft Edge


Leading this session from BDO Canada LLP is Romana Fabicka, Senior Manager, U.S. Personal Tax and Manisha Deora, Manager, U.S. Personal Tax. And from Perreira Hurly Wealth Advisory are Elizabeth Hurly, and Bernardine Perreira, Financial Advisors.

BDO Canada is a leading provider of professional services to clients of all sizes in virtually all business sectors.

Perreira Hurly Wealth Advisory of Raymond James Ltd., is a broadly-resourced, boutique-style financial services company serving select clients in Canada and the U.S.

If you wish to attend this webinar you must complete the registration form to receive the access instructions. If you're unable to attend but wish to receive the audio recording and presentation slides afterwards, be sure to register.

CLICK HERE TO RESERVE

We hope you’ll join us for this very informative session!

Democratically yours,

Steve Nardi
Chair, Democrats Abroad Canada


Webinar: Operating a Corporation as a U.S. Citizen in Canada Oct. 22nd

Democrats Abroad Canada is pleased to offer the following webinar

Operating a Corporation
as a U.S. Citizen in Canada

Sunday, October 22, 2017
4:00pm ADT / 3:00pm EDT / 12:00pm PDT

US citizens living in Canada are subject to two tax systems: Canada and the United States. In the eyes of the US tax system, all activities conducted outside of the United States are “foreign” and therefore subject some of the most complex and expensive provisions of the US tax code. This is especially true of those who run a business through a corporation. The US tax rules that apply to those who own Canadian corporations are the same as the rules that apply to large multinationals such as Apple and Walmart.

This webinar will address the US tax consequences to US citizens in Canada who:

· Are incorporated professionals (doctor, dentist, lawyer, consultant etc.);

· Run a business

· Use a corporation to invest in stock or securities

· Use a corporation or a family trust to split income with a spouse or kids;

A survey of some common Canadian corporate tax planning techniques and whether they work in the United States will also be addressed.

When
Sunday, October 22, 2017
4:00PM ADT / 3:00PM EDT/ 12:00PM PDT
Duration: 90 minutes

CLICK HERE TO RESERVE SPACE


These is an online webinar and advance registration is required. Democrats Abroad Canada is entirely run by volunteers and we request a $10 donation to cover the costs of the webinar plus our nationwide Get Out The Vote efforts.

Note that webinars are presented on the WebEx platform. To avoid frustrations you need to be aware that:

· WebEx will not function on Mac OS X 10.6 as of July 14, 2015 which would affect this and any earlier version of the OS.

· WebEx does not function properly with Microsoft Edge


Leading the session is Max Reed with SKL Tax. SKL Tax is a law and accounting firm that has been serving US citizens in Canada for over 40 years. SKL's team of accountants and lawyers provides a range of cross-border tax services including yearly tax compliance, general tax planning, estate planning and administration, FATCA compliance, and tax services for owner-managers. To read more about the presenter please click here.

If you wish to attend this webinar you must complete the registration form to receive the access instructions.

                                                                                                                     CLICK HERE TO RESERVE 


2 Webinars ~ Estate Planning for US Citizens in Canada & Canada Immigration Options for US Citizens

Democrats Abroad Canada is pleased to announce two webinars, one on a topic which has proven to be in great demand from members, and the other presenting a new topic

Estate Planning for U.S. Citizens Living in Canada

Sunday, September 17, 2017
3:00-4:30 PM Eastern
12:00-1:30 PM Pacific
Presented by SKL Tax

And

Going North – Canadian Immigration Options for US Citizens

Monday, September 18, 2017
8:00-9:30 PM Eastern
5:00-6:30 PM Pacific
Presented by BDO Canada LLP

Estate Planning for U.S. Citizens Living in Canada
Sunday, September 17, 2017
3:00-4:30 PM Eastern
12:00-1:30 PM Pacific

This webinar, presented by Max Reed of SKL Tax, outlines the basics of estate planning for US citizens who live in Canada. Topics include:

• What is estate planning and why it matters
• The estate planning basics
• The basics of US estate tax
• Canadian income tax at death
• Selling your principal residence
• Tax consequences of inheriting money from US parents
• Other cross-border trips and traps

Max Reed is a cross-border tax lawyer at SKL Tax where he specializes in tax and estate planning for dual citizens and helping people evaluate their citizenship options. Prior to joining SKL tax he practiced US tax law at White & Case LLP in New York and before that clerked at the Canadian Federal Court of Appeal where he specialized in Canadian tax. Max is the co-author (with Dick Pound) of A Tax Guide for US Citizens in Canada - a plain language guidebook that helps US Citizens in Canada understand their tax obligations, a number of technical articles on US tax for Canadians, and a series of newspaper columns on the same topic. You can learn more about Max at http://www.skltax.com/max-reed.

Space is limited!

Previous webinars on this topic have been filled
to capacity so we recommend registering early.

                                                     CLICK HERE to register for Estate Planning Sept. 17th

About SKL Tax

SKL Tax is a law and accounting firm that has been serving US citizens in Canada for over 40 years. SKL's team of accountants and lawyers provides a range of cross-border tax services including yearly tax compliance, general tax planning, renunciation of US citizenship, estate planning and administration, FATCA compliance, and tax services for owner-managers


Going North – Canadian Immigration Options for US Citizens
Monday, September 18, 2017
8:00-9:30 PM Eastern
5:00-6:30 PM Pacific

Leading this session from BDO Canada LLP is Doreen Buksner, Senior Manager, BDO Immigration Services and Tracie Jennett, Manager, BDO U.S. Personal Tax.

Are you or your family members interested in moving to Canada for a work assignment or a course of study? Are you currently residing in Canada and want to stay, or move here permanently?

This webinar will cover the most frequently used strategies for U.S. citizens relocating to Canada on a temporary or permanent basis.

You will benefit from this webinar if you are a foreign worker currently in Canada or seeking employment in Canada; foreign student currently enrolled in post-secondary education programs in Canada; working age professional looking to relocate permanently; family members looking to reunite in Canada, or a Canadian permanent resident seeking citizenship.

We will cover the following:

- Work and Study Permits

- Permanent Residence for Skilled Workers

- Family Sponsorship

- Citizenship

- Cross-border considerations

- Basic tax requirements for temporary or permanent residents

                              CLICK HERE to register for Going North – Immigration Options Sept. 18th

About BDO Canada

BDO is a leading provider of professional services to clients of all sizes in virtually all business sectors. BDO’s Immigration Services group provides a wide range of corporate and individual immigration services. They can assist with a variety of Canadian inbound and outbound matters, including business visas, work and study permits, and permanent residence applications. BDO’s U.S. Tax Practice helps businesses and individuals throughout Canada minimize their U.S. tax burden and identify new tax benefits. BDO professionals on both sides of the border provide personalized service through a single point of contact.

Democrats Abroad Canada suggests a donation of $10 to cover costs associated with presenting the webinars and raise funds for our 2017-18 Get Out The Vote campaign efforts.

Democratically Yours,

Steve Nardi
Chair, Democrats Abroad Canada


Appointments to DemsAbroad Canada Board

Congratulations to the following individuals on their recent appointments to the DemsAbroad Canada Board:

Marnelle Dragila – Recording Secretary
Jamey Shick – Director of Volunteers
Bodil Geyer – GOTV Coordinator
Tim Kelley – Communications Officer

Each of them brings skills, energy and a drive to make a difference in 2018 and we’re pleased to have them join us.

The board extends its gratitude to Roseanna Sharpe for her contributions as Recording Secretary. We wish her well in her endeavours and look forward to her continued support.

Democratically yours,
Steve Nardi
Chair, Democrats Abroad Canada