As I have a moment in what are becoming very busy days, I want to key in on this, now that the old blog is dusted off for a series of posts.
Yesterday, I focused on this post of Ben’s on January 24, which I read last week: “What happens if US citizens don’t file their IRS tax return?”
In what I found to be standard fashion nowadays, Ben couches his coaching with his disclaimers:
“This blog post is for entertainment purposes only” ( !!! ) “I am not a tax professional, nor a lawyer, nor an IRS employee.” “I don’t know you.” (Such reassuring words from such a helpful guy.) “I am not even American!” (That’s right. It’s not your business!) Then, he goes, BUTTTTTTTT “I often talk to Americans about personal finance” (because I’ve been spending the last ten years promoting myself about it in Japan) ANNNNND:
As I say, click here for more:
It turns out to help these minions, Ben turned to the Google Search engine. But none of them could themselves. And he was not satisfied with what was out there. What a favor to you! You don’t have to do the search on this newfangled thing.
So he next points you to: Reddit. The authoritative source for answers, when you’re coaching.
As he calls it, the “excellent” (his word) JapanFinance subreddit, gave him a bunch of answers. And then “someone” told him about the USExpatTaxes subreddit. You, in the community, could not have found these anonymous posters yourselves, and gotten that same imprimatur of credibility.
After that, Ben, the UK citizen who is so concerned about US tax issues, makes a list of what look like very non-entertaining, legal ramifications of not filing. Then, he cuts and pastes from some other source a likelihood of what your odds are of facing penalties. Notice, this is not Ben’s own voice. He is quoting someone else, and all you get are links to Anonymous Persons on Reddit, from all I have seen.
Then, he pitches the online prep community’s criminal conspiracy du jour: the filing under IRS Streamlined Filing Compliance, which is an amnesty of sorts for the non-willful non-filer. Using that procedure, you swear/affirm on Form 14653 that you are NOT willful. So the IRS has lately been getting these stacks of Form 14653’s from people who knew they were supposed to file, but stopped. And then, when the COVID stimulus money showed up, well, hey ho, I should file! And online internet services/mills like MyQuickieExpatReturnsWithSoftwareJustForYou dot com pitch the Form 14653 as the ticket to just filing three back years (and six of the FBAR), and grabbing that COVID cash.
If you attest to non-willful, and you were in fact willful, the Department of Justice has you for perjury. Talk about a missing PFIC form? When the IRS finally clears out all the ERC (employee retention credit) tax credit fraud cases, which ones do you think the Department of Justice will showcase next? Maybe tens of thousands of people who started filing for the COVID cash but stretched the truth a little about why they hadn’t been heard from in a while?
And it’s like, as the hundreds or thousands of these Form 14653’s pour into Washington, no one stateside is going to say, “hey, why can’t we locally also say ‘we didn’t know!!!!!’ and get around all these penalties we get when we kiss off the Treasury and make They the Other People cover for our taxes.”
It’s like none of these online firms have heard about something nicknamed Quiet Disclosure, where you just start doing what you were supposed to do. If the impact on Treasury is zero (probably because you’ve paid plenty to Japan already), why would you ever risk falling for the marketing scheme of “Streamlined”? That’s all it is. They say, “we can get you square for much less than what the competition would charge you, for the low-low price of . . . ” and then the price is what you would get charged for if you do your returns with Quiet Disclosure, and without the potential follow-up perjury questionnaire from DoJ.
Here’s what Ben’s actual problem was: it’s that there’s not quite 20,000 UKers in Japan, but there’s over 60,000 Americans, not including the “hidden Christians” or the Americans on the Down Low. (These are Japanese who were born in America, but don’t file. So, Americans. Maybe 24,000 of those on top of the 60,000.)
After years and years and years of this guy, and basically being “man behind the curtain” for some of his early stuff, I am so tired of him saying things that aren’t really true. I am tired of his saying things that are just not accurate, and then the invitations to “fix the internet”. Then, when I make the offer, it has to be done in a way that just promotes whatever the hell it is he’s doing.
On a very elucidating thread from American/Japanese/(American again?) Debito Arudou in 2017, https://www.debito.org/?p=14704 <—-here, you can get a sample of how the “We aRe sO LoST!” about retirement spiel in the J-expat community really was about how a large number of people were just dodging Nenkin (like 20% of the Japanese).
Here’s the Ben Self-Promo:
I get the invitation to “write for readers in Japan” after I post to say I was writing about the issue of the 10-year-qualification four years before it happened. If the guy can find and link to anonymous people on Reddit now, he had a problem linking to someone discussing Nenkin, in English, before he started what was apparently designed to be a consulting business all along. And lately, a tax advisory business as well. (The Japan Finance subreddit has four categories of topics, three of what are empty. The only one getting posts involves do-it-yourself US taxes, or complaints about the US tax system. It’s a misnamed subreddit to hide the fact of what’s going on there. Started, curiously, in 2018.)
Are people “so lost” about retirement in Japan? Without good English materials in the era of 5G translation?
I don’t buy it.
I think the problem is that people didn’t do what they were supposed to all along, and now if they’re lifers here, they found out that they will be sucking wind because they weren’t paying what they needed to, and putting aside what they needed to.
So I suppose there’s an attraction to a site that is going to pass around all the “tips and tricks” to save money and do Kakeibo with your budget.
But then to lament that there is no one to give them free professional guidance on what are not exactly easy issues, and to gap-fill this with “content” from anonymous posters somewhere else on the internet doesn’t seem very much of a resource or community service to me at all.
Kokumin Nenkin in English: https://www.nenkin.go.jp/service/pamphlet/kaigai/kokunenseido.files/2English.pdf
National Pension Fund’s iDeCo, in English: https://www.ideco-koushiki.jp/english/
(By the way, iDeCo is short for: Individual Defined Contribution. English words. It’s basically a USA concept that the Japan government adopted. It’s a 401(k) account.)
For those with the browser translator, the National Pension Fund’s annuity product: https://www.zenkoku-kikin.or.jp/
I imagine, in time, there will be an official English site for that one, too. Again, there’s plenty about it out there compared to twenty years ago.
It doesn’t take a lot of surfing before anyone can be an “expert” at the Japanese pension system. There is a basic, subsistance pension the Kokumin Nenkin that costs you JPY 16,520 a month and will produce (April 2024’s number) 141.7 yen for each month you pay.
That’s the Tier One.
The Tier Two is either iDeCo or the Kokumin Nenkin Kikin, nicknamed “Plus Nenkin”.
When you have employer coverage, you are having both Tier One AND Two taken out of your pay as Kosei Nenkin. Alternatively to that, there are other named systems for teachers or government workers.
It’s the same principle as most countries, that these are contributory systems. If you don’t contribute, you don’t get.
The basic problem in Japan is that people don’t contribute.
Not that there’s not enough internet chatter about what happens if you don’t declare US taxes . . .
Hoofin 