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IRS now hitting up Canadiens who owe taxes

Help! I’m on the IRS hit list

 
MARGARET WENTE

Tuesday's Globe and Mail

Published Tuesday, Sep. 20, 2011 2:00AM EDT

Last updated Tuesday, Sep. 20, 2011 9:35AM EDT

 

 

 

When my friend Brian told me the American tax police were after him, I thought he must be nuts. Brian is a worrier. He gets a little paranoid sometimes. “We haven’t filed a U.S. tax return in 20 years,” he said. “Now our accountant says we have to – or else.”

Brian and his wife are from the States. He took out Canadian citizenship years ago. They’ve lived and worked in Canada for decades. They have no U.S. income or assets. They are 100-per-cent tax compliant – in Canada.

“Forget about it,” I advised. “What could they possibly do to you?”

We’re about to find out.

I’m on the IRS hit list, too. I came here at 13, and I’ve been a citizen since 1979. I don’t have a U.S. passport or any U.S. earnings. But the IRS wants to confiscate a large chunk of my retirement savings. Many of my friends are in the same fix. They send me e-mails saying things like, “Have you filled out the FBAR [Report of Foreign Bank and Financial Accounts] yet?” The amnesty deadline has come and gone, and we still have no idea what to do.

“It’s not the back taxes that will kill you,” Brian told me. “It’s the penalties.” It turns out the IRS can fine you for every unreported bank account, mutual fund and RRSP – at a rate of $10,000 per offence per year. It can also confiscate as much as 25 per cent of the maximum amount you’ve held in each account. This is so absurd it can’t possibly be true. But it is.

The Americans have an unusual view of citizenship. Once an American, always an American, even if you left the U.S. the day you were born. The U.S. is the only country that requires its citizens to file a tax return and report their worldwide income, no matter where they live and what other citizenship they hold. Nobody can explain why the IRS has suddenly decided to enforce this law, which is aimed at money-launderers with offshore bank accounts. I guess the Americans need the money.

Naturally, my friends and I are outraged. It’s confiscatory and extraterritorial. It’s taxation without representation. It’s also a clear violation of privacy laws. (By 2014, Canadian financial institutions will be required to disclose your name if you were born in the U.S.) So why comply? Because if you don’t, they can refuse to let you into the U.S.

You can understand why I’m curled up in the fetal position. “I’m not going to do it,” I told my husband. “You have to do it, “ he said. “If you don’t, someone will rat you out and you’ll never be able to visit your sister again.”

He had a point. So I called our accountant. “Do I have to do it?” I wailed. “I can’t advise you,” he said. He told me that I might be able to get off the hook for only a few thousand dollars. “Can they come after me for more?” I asked. “Yes,” he said. “Nobody knows what they’ll do.”

One person who’s off the hook is my brother. He was 11 when we moved to Canada. At 17, he got a draft notice. So he renounced his citizenship (after a long lecture from a consular official). I suppose I could renounce, too – but they won’t let you do that until you’ve filed your back tax returns.

As many as a million U.S.-born residents of Canada are caught in this Kafkaesque nightmare. Finance Minister Jim Flaherty has written an indignant letter to leading U.S. newspapers. All of us are getting wildly conflicting professional advice. At first, Brian and his wife, who are by no means wealthy, decided to come clean. But when they were told they’d be on the hook for $250,000, they changed their minds.

“Don’t write about this,” my husband warned me. “You’ll just make yourself a target.”

Entry #5,511

Cousins attract attention with claim they are human magnets

Serbian cousins attract serious attention with claim they are human magnets

Lukas I. Alpert
DAILY NEWS STAFF WRITER

Monday, September 19th 2011, 10:49 AM

Luka Lucic shows off his rare skill.
 
Luka Lucic shows off his rare skill.
 
A pair of Serbian cousins have been attracting serious attention with the claim that they are human magnets.

Wherever David Petrovic, 4, and his cousin Luka Lukic, 6, go, metal objects stick to them, their families claim.

David's mother said she first noticed the trait "about a month ago," when he came walking out of the kitchen with forks and spoons sticking to his chest.

"I asked him to fetch me a spoon so I could feed his little brother, and he yelled back: 'Mom, it sticks!'" Sanja Petrovic told The Associated Press.

When she called her sister, she said she discovered David's cousin was capable of the same thing.

"Other kids in the family can't do this, just the two of them," she said.

The phenomenon is rare and unexplained, but similar cases have been reported in Serbia and nearby Bosnia and Croatia.

"As far as I know, there is no medical or scientific explanation," said radiologist Mihajlo Dodic.

Luka Lukic, 6, is an attractive boy. (Marko Drobnjakovic/A)

But other experts remain skeptical.

"I doubt very much that someone is magnetic," said Patrick Regan, a physics professor in England. "Humans are made of the wrong material to be magnetic."

"It would be pretty unsafe to have metal objects sticking to you against the force of gravity," he said. "You couldn't switch something like that off - unless it's fake."

Luka's father, Slavisa Lukic, said doctors have told them the boys are otherwise healthy.

"Nobody can tell us why this is happening," he said.

David's mom said the magnetic attraction appears to wane when the boys sleep but switches back on when they are awake and moving around.

The family says they were alarmed at first but have gotten used to the unusual phenomenon and all the attention surrounding it.

"It was a shock at first, but now we just try to keep the knives away from them," Petrovic says.

Entry #5,502
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