ACA News Update - January-February 2010

CONTENTS

ACA research paper on tax trends in major industrialized countries

Jane Bruno on “the international tax gap”

Roger Adams on “moving back to America”

Exchange rates for 2009 tax returns

Voting – remember annual registration!

American Legion supports overseas vets who lost APO/FPO to embassy addresses

Strict enforcement of the Electronic System for Travel Authorization (ESTA)

ACA auction – donations are a win-win proposition

Country Contact activities

Upcoming events

Contact us: let me count the ways!

While you're surfing …

Wonder Where Your Money Goes? Comparison of Tax Trends between US and OECD Countries

Based on data from the most recent annual report on taxation in member states of the Organization for Economic Co-operation and Development (OECD), ACA’s newly-issued research paper reveals how US unique insistence on citizenship-based taxation laws harms overseas Americans. The paper, “A comparison of tax trends (1962-2006) between the United States and eight major countries where overseas Americans reside” concentrates on the OECD countries hosting an estimated 40 percent of overseas US citizens (Australia, Canada, France, Germany, Japan, Mexico, Switzerland and the United Kingdom), but the arguments are of more general application.

Since 1965, total taxation as a percentage of the gross national product has risen faster in foreign countries than in the United States.  In addition, tax structures outside the US have shifted from income tax towards social security and general consumption taxes, which are not deductible from income when filing US income taxes. The devaluation of the dollar in recent years artificially inflates the taxable income of Americans residing abroad. The manner of calculating US capital gains often leads to fictitious “gains” in dollars, which are then taxed on transactions which may de facto have been money-losers for the individual investor.

Thanks to ACA Directors Jackie Bugnion, Peter Bordui and Peter Carson for their work on this paper, which is available in full text, summary form and as a PowerPoint presentation.

The International Tax Gap And Its Impact On You

Jane Bruno, in her latest article, “Beware of the International Tax Gap and How It Could Impact YOU!!” points out that the IRS is concentrating increased effort on reducing the difference between the tax that overseas American taxpayers should pay and the amount that is paid voluntarily and on time. The IRS defines this as: “the sum of non-compliance with the tax law”.

She encourages taxpayers not to hide their heads in the sand, but to comply with tax filing, to keep good records of deductions, and to reply (politely) when queried by the IRS.  She encourages readers to note the “International Tax Gap Series” on the IRS website, intended to educate overseas taxpayers.

Jane Bruno has prepared tax returns for Americans living overseas for the past 20 years. See other articles by her on the ACA website – on the Links page.

Moving Expenses Deduction for Moving Back to the US?

Roger B. Adams, a regular contributor to ACA’s web pages, points out in “Moving Back to America” that if one returns to the US after retirement from living and/or working abroad, or subsequent to the death of a spouse who was working abroad, moving expenses may be deductible from your total income (whether work income or passive income) if you meet the requirements set out in IRS Publication 521.

Hence, he cautions, check out the publication prior to moving, and keep careful and accurate records of all money spent on the move.

Exchange Rates for use on 2009 Tax Returns

Historical exchange rates for 2009 and previous years are available at Oanda.com. This site is also recommended by the IRS for use in preparing tax returns.

Thanks again to Roger B. Adams for this item.

New Voting Law Requires Annual Registration

Recently enacted revisions to the Uniformed and Overseas Absentee Voting Act (UOCAVA), which applies to all Americans voting from abroad in federal elections, require a fresh registration to vote each year in which you want to vote. Fortunately, thanks to the Overseas Vote Foundation, the Federal Voting Assistance Program and other groups encouraging registration online, it costs but a few minutes of your time.

This tightening measure is expected to bring considerable cost savings to states, who have had major problems with mailings to absentee voters who have changed addresses without notifying them.

The text of UOCAVA with recent changes entered in red can be found on the FVAP website.

American Legion Supports Vets Re‑Lost Mail Privileges at Embassies/Consulates

The Director, National Security and Foreign Relations, of The American Legion, has assured close to five thousand American veterans living abroad who lost their APO and FPO addresses at US embassies and consulates at the end of 2009 that “The American Legion has written letters to both the Department of Defense and Department of State urging that mail privileges through the US Embassies concerned be restored.” He also suggested that a Resolution be submitted to the National Headquarters of the American Legion to be considered for adoption at the Spring National Executive Committee Meeting.

Only a small portion of veterans living abroad are affected by the State Department’s inability to assume costs of forwarding to military retirees with mail service via embassies and consulates. Other veterans, fortunate enough to have APO or FPO addresses at military installations – and Defense Department personnel officially assigned to embassies and consulates – will not be affected.

Gilbert Wells, military retiree and ACA Country Contact in Portugal, is serving as ACA focal point on this issue. He reports that in some instances – Madrid, Rome, Italy and Portugal, for example – a local military base has given affected veterans a military PO box.

ESTA Pre-Travel Clearance Mandatory for VWP Nationals

Effective January 20, 2010, the US Department of Homeland Security has transitioned to enforced compliance of the Electronic System for Travel Authorization (ESTA) requirement for travelers from Visa Waiver Program (VWP) countries. VWP travelers who have not obtained approval through ESTA should expect to be denied boarding on any air carrier bound for the United States.

Travelers holding passports from countries participating in the Visa Waiver Program (see below) are encouraged to apply for travel authorization 72 hours prior to entering the United States by air or sea. Responses are generally sent minutes later, but may in some instances take up to 72 hours. Once complete, the authorization is generally valid for two years and allows multiple visits without the need to reapply.

Countries in the Visa Waiver Program include: Andorra, Australia, Austria, Belgium, Brunei, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Iceland, Ireland, Italy, Japan, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Monaco, The Netherlands, New Zealand, Norway, Portugal, San Marino, Singapore, Slovakia, Slovenia, South Korea, Spain, Sweden, Switzerland, United Kingdom.

For more information go to the Customs and Border Protection website.

ACA Auction: Note the Date, Contribute, Attend

American Citizens Abroad’s annual fundraising auction will be held on 19 March 2010 at the Ramada Park Hotel in Geneva. Mark your calendars, and join us for a fun evening where you can meet other Americans and bid for a once-in-a-lifetime combination of items and services.

And NOW is the time to offer something to be auctioned off. Early donors are noted on the hard copy invitation sent to hundreds of people in Switzerland and nearby France. Donations are featured on the home page of the ACA website, with donor-designated photo/logo and/or link, and mentioned in hard copy posters distributed throughout the area. A great way to advertise your business, yes – but also just a great way to show that you support ACA! Travel, hotel stays and restaurants are traditional big-ticket items, but also popular are stays in homes/vacation homes, home-cooked meals, unique and/or hand-crafted items. Use your imagination! Contact the ACA office by email or phone at
+41 22 340 0233.

This is YOUR chance to help support the work of scores of volunteers worldwide who contribute thousands of hours of unpaid labor to help all Americans abroad.

ACA Country Contacts’ Corner

American Citizens Abroad is proud of its network of 50+ representatives on six continents, active in their countries of residence on behalf of ACA, and increasingly active on the global front, as well.

·         ACA warmly welcomes on board Country Contacts in Stockholm, Sweden and in Bern, Switzerland.

·         ACA co-founder and member of the Executive Committee, Andy Sundberg, was able to meet in Cairo late last year with ACA Country Contact for Egypt, Nagwa El-Mallakh. They found common acquaintances and shared tales of the difficulties they experienced in obtaining US citizenship for their born-abroad children.

·         About the same time, Vice Executive Director Ron Banks met with Country Contact Vince Truong in Dubai, United Arab Emirates, where they discussed ways to build awareness and membership for ACA in Dubai.

Upcoming Events in 2010

17-19 March: Overseas Vote Foundation Summit 2010, Munich, Germany.

Click the logo to register.

19 March: ACA Annual Super Fundraising Auction, Ramada Park Hotel, Geneva.
Donations of auctionable goods and services welcomed!

19-23 April is Overseas Americans Week ACA will participate in Washington, DC.

Will we be seeing you there?

By Any Means, Contact ACA!

Your input is important to us.
Let ACA know what you feel strongly about, how you can help, what you feel we can do better, by whichever means is best for you:

E-mail – ACA Website –  Facebook: ACA group – XING – Twitter – or on the ACA Headquarters, Canada or Czech Republic websites.

while you’re surfing …

Think that you are reasonably well-versed on major topics in American news?

The Pew Research Center for the People and the Press conducts periodic quizzes of the general public. The results of the most recent quiz (October 2009) reveal that the average respondent knew fewer than half the answers to the 12 questions. Give it a try yourself, before viewing how others did: Pew Quiz.

The Pew Research Center conducts numerous surveys on a variety of topics; their site is worth checking out in detail.

Thanks to reader Sterling Giannotti for this tip.

Articles from this edition can be read on the ACA Website

JOIN US!

If you would like to become part of the dynamic volunteer team that powers ACA, there is a constant need for additional staff – especially if you can work from your home. Needed are:

research assistants, database managers, event planners and coordinators,
tax specialists, and lawyers.

Interested parties may contact ACA's Geneva office:

American Citizens Abroad

5 rue Liotard

CH-1202 Geneva, Switzerland

Phone and fax: +41 22 340 0233

Or send us an E-mail

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PLEASE DO NOT RESPOND TO THIS EMAIL.   All inquiries should be sent to:  info.aca@gmail.com

American Citizens Abroad (ACA)
The Voice of Americans Overseas
5 Rue Liotard
1202 Geneva, Switzerland
+41.22.340.02.33
info.aca@gmail.com
www.americansabroad.org

American Citizens Abroad (ACA), the voice of Americans overseas, is a non-profit, non-partisan, all-volunteer organization that represents the interests of Americans living and working outside the U.S. to the Executive Branch of the U.S. Government, the U.S. Congress and the U.S. Federal Judiciary to insure that Americans overseas are treated with equality and fairness.  ACA keeps Americans overseas informed and supports their role as informal representatives of the United States.  To learn more about ACA please visit our website, www.americansabroad.org

Disclaimer: While ACA and its board members make every effort to be
accurate in the information they transmit, such information is not to
be considered a substitute for specific and qualified professional
advice