Former US citizen - how can she get citizenship again? Please help

This all boils down to whether she explicitly renounced her US citizenship (to a US government official) or had it explicitly revoked, vs. assuming her US citizenship was lost as a result of taking Canadian citizenship.

If there was explicit revocation or renunciation, her citizenship is gone and she would have to go through the usual N-400 process to get it again. But if it was just an assumed thing, she most likely still is a US citizen and should be able to obtain a US passport.
 
If it was an explicit renunciation, she will have a very, very tough time regaining her citizenship.

G. IRREVOCABILITY OF RENUNCIATION

Finally, those contemplating a renunciation of U.S. citizenship should understand that the act is irrevocable, except as provided in section 351 of the INA (8 U.S.C. 1483), and cannot be canceled or set aside absent successful administrative or judicial appeal. (Section 351(b) of the INA provides that an applicant who renounced his or her U.S. citizenship before the age of eighteen can have that citizenship reinstated if he or she makes that desire known to the Department of State within six months after attaining the age of eighteen. See also Title 22, Code of Federal Regulations, section 50.20).

Renunciation is the most unequivocal way in which a person can manifest an intention to relinquish U.S. citizenship. Please consider the effects of renouncing U.S. citizenship, described above, before taking this serious and irrevocable action.

http://travel.state.gov/law/citizenship/citizenship_776.html
 
It will be almost impossible to undo the renunciation.

But I don't see anything that bars a former citizen from applying to obtain citizenship just like any other noncitizen.
 
Correct - if she has renounced her citizenship or lost it as a direct consequence of obtaining Canadian citizenship pre-1986, then that cannot be regained. She would have to apply for citizenship by filing for it. It appears that she is no longer a US citizen by the mere fact that she had to be sponsored by her parents for a GC and that she has a GC. So I would say that she needs to file an N-400. Unfortunately the US does not have an application for resumption of citizenship - once it has been renounced - like Canada.
 
It appears that she is no longer a US citizen by the mere fact that she had to be sponsored by her parents for a GC and that she has a GC.
It's not clear that she had to be sponsored by her parents for a GC. It could be that she and her parents mistakenly assumed she needed a GC, and INS didn't recognize the mistake. Just like there are some people who mistakenly apply for citizenship via N-400 even though they already became citizens via their parents, and USCIS didn't catch it. Or both she and INS were operating under the old laws where loss of citizenship was assumed if you naturalized in another country, and now that those laws have been ruled unconstitutional maybe she still has her original citizenship or it can be reinstated by the courts.
 
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I asked my friend, and she says she never renounced her US citizenship, she was told by Canadian immigration that she if she becomes Canadian citizen she cannot be American citizen anymore.
She is going to apply for US passport with written explanation how she never had any intention to renounce her US citizenship, as dms1 suggested, and only had to get GC according to pre-1986 laws.
Another advice I got on another forum - she can write to Dept of State and explain that she had to get GC before the laws changed, and without intention to renounce her US citizenship (http://travel.state.gov/law/citizenship/citizenship_778.html), but it would probably take longer time.
She asked me to thank all posters who shared their opinions and advice.
 
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