WHAT IF OTHER NATIONS ACTED LIKE THE U.S.
Tiffany MacKenzie, the daughter of two Americans living in living in the Boston area was married to Thomas Carlson. Tiffany had been born in Japan while her parents were there for a short time. She has not returned since she was three months old.
Thomas was born in the U.S. but because his father is Swedish he is considered a Swedish citizen. His mother is German so he is considered a German citizen. Because of that he is taxed on his full income in all three countries.
The young couple were married last month and went to open a joint bank account. The officer looked at their application and said to Tiffany, "I'm sorry you cannot have an account because you were born in Japan."
They looked confused. "But she is American."
The officer continued. "We have to report all Japanese citizens to the Japanese tax authorities. If we don't we will pay heavy fines and will not be able to operate in Japan. It is too expensive for us to risk having a foreigner or even an American born in another country as a client."
The couple looked at each other. "I suppose we could put everything in Tom's name," Tiffany said.
The bank officer, who knew Tom's parents said. "We can't open an account for him either. He is considered German and Swedish and we have to report all Swedish and German accounts to the Swedish and German tax authorities or face high penalties from their governments."
The couple left. They were having dinner with Tom's parents that night and they told them what happened.
"The bank is closing our accounts too," Tom's dad Sven said. "I have 30 days to pay off my mortgage. I've called every bank around but no one will do business with me."
"But you are an American," Tom said. "For over 20 years."
The four of them looked at each other an visualized their future with no access to any banking services.
Of course Japan, Sweden and Germany do not expect U.S. Banks to spend billions to report accounts of their citizens to them like the U.S. does. They have not bullied the U.S. into changing their laws either nor have they threatened the U.S. to report.
Sadly the 8.7 million American expats are in danger of having their financial futures destroyed by the U.S. FATCA.