I could write about tariffs in this week’s column. After all, we are in the middle of a trade war with China. Tariffs could very well result in higher prices for consumers. Tariffs could force everyone to dig deeper into their pockets or maybe even cause them to forgo a purchase. That would make sense in a financial column, but I’d rather not discuss tariffs today.
After all, there are several hot spots in the world I could talk about. They’re dominating the news. Tensions are high in both North Korea and Iran. Turmoil roams the streets in Venezuela. And, while those are political situations more than financial, they do have economic ramifications. But I won’t write about hot spots either.
I will mention a little about FATCA, the Foreign Account Tax Compliance Act. It’s too complicated to explain in detail, but it is a Federal Law. It requires all foreign financial institutions to keep tabs on U.S. citizens and report their assets to the Department of the Treasury. It also calls for those citizens to report their non-U.S. assets to the Internal Revenue Service.
The U.S. is one of only a handful of countries that taxes people based on citizenship rather than their residency. Now, I’m not passing judgment. The law is the law. But I am saddened by one of the “side effects” of FATCA.
Did you know that some 5,000 people renounce their citizenship and leave the country every year? FATCA is one of the reasons. And as the world grows smaller and Americans marry non-citizens, I suspect more will leave.
A good example happened earlier this month, when the royal family announced the birth of Prince Archie. Keep in mind his mother is a U.S. citizen, which means the new prince is too, since his mother was a U.S. resident for five years prior to his birth.
So the Duchess of Sussex, formerly known as Meghan Markle, and young Prince Archie will both have to comply with FATCA’s complex tax requirements. Although I suspect it won’t be much of a financial burden on them.
So here’s what bothers me. Remember those hot spots? If things ever get out of control, it’s our military that stands in harm’s way. I understand that Memorial Day is the same time every year, but this year the timing seems spot on.
The number of World War II and Korean veterans is dwindling. The men and women who served in Vietnam are now retirees. And those that served in Iraq and Afghanistan cover a wide age range.
And yet there are always men and women who volunteer and stand ready to serve our country. For as long as I can remember, year in and year out, our military has done their best so we can live a lifestyle that’s the envy of the world.
I like simplicity, but the world seems to be moving toward complexity. I believe every household has a friend or relative that serves or has served our nation. Many paid the ultimate price, giving their lives so that we can live in freedom.
Let us all take some time today, to reflect and give thanks to all the men and women who have bravely defended our freedom. It’s Memorial Day. Let’s remember.