U.s. Citizens - Foreign Bank Account Reporting Due June 30Th!

[OnMyWay]

I posted this last year and thought I would bring it up again.  Fun Fun Fun!   :1 (103):

 

http://www.philippines-expats.com/topic/16402-us-citizens-with-foreign-bank-accts-irs-deadline-june-30th/

 

If you have 1 or more foreign bank accounts and the TOTAL of all of their HIGHEST BALANCEs during the year exceeds $10,000, you have to file the FBAR.  E.G.:

 

Account 1 highest 2013 balance:  $3000.00

Account 2 highest 2013 balance:  $4000.00

Account 3 highest 2013 balance:  $3500.00

 

Total                                           $10500.00  You must file

 

Due date is June 30th, 2013, for 2013 reporting.

 

Links:

 

Filing site:  http://bsaefiling.fincen.treas.gov/NoRegFBARFiler.html

 

Instructions:  http://www.fincen.gov/forms/files/FBAR%20Line%20Item%20Filing%20Instructions.pdf

 

Exchange rates to be used for non-dollar accounts:  http://www.fms.treas.gov/intn-12-31-2013.pdf

 

The link in the instructions to the exchange rates is broken so I had to find the correct one.

 

I had to file this year and it took me a while to plod through it.  If I have some time I will try to post some tips.

[earthdome]

If you have 1 or more foreign bank accounts and the TOTAL of all of their HIGHEST BALANCEs during the year exceeds $10,000, you have to file the FBAR.  E.G.:

 

I thought it was only if at any instant in time you had $10,000 or more USD equivalent in banks or other investments.

[MikeB]

"Who Must File an FBAR.

A United States person that has a financial interest in or signature authority over foreign financial accounts must file an FBAR if the aggregate value of the foreign financial accounts exceeds $10,000 at any time during the calendar year."

If you had $9999 in 1 acct in Jan, withdrew half in Feb leaving say $5000, then opened another acct with $2000 in March giving you a total of $7000 you do not have to file because you did not exceed $10k at any one time. That's the way I read it.

http://www.fincen.gov/forms/files/FBAR%20Line%20Item%20Filing%20Instructions.pdf

[OnMyWay]

"Who Must File an FBAR.

A United States person that has a financial interest in or signature authority over foreign financial accounts must file an FBAR if the aggregate value of the foreign financial accounts exceeds $10,000 at any time during the calendar year."

If you had $9999 in 1 acct in Jan, withdrew half in Feb leaving say $5000, then opened another acct with $2000 in March giving you a total of $7000 you do not have to file because you did not exceed $10k at any one time. That's the way I read it.

http://www.fincen.gov/forms/files/FBAR%20Line%20Item%20Filing%20Instructions.pdf

 

As usual with the government, they have confusing information.  That is the way I read that too, but look at these sections of the instructions.  According to this, it is the aggregate of the maximum value of each account, so the maximum value date would be different for the different accounts.

 

Record Keeping Requirements. Persons required to file an FBAR must retain records that contain the name in which each account is maintained, the number or other designation of the account, the name and address of the foreign financial institution that maintains the account, the type of account, and the maximum account value of each account during the reporting

period. The records must be retained for a period of 5 years from June 30th of the year following

the calendar year reported and must be available for inspection as provided by law. Retaining a copy of the filed FBAR can help to satisfy the record keeping requirements.

 

Monetary amounts: When recording the maximum value of accounts, record all amounts as U.S. Dollar amounts rounded up to the next whole dollar. The amount $15,265.25 would be recorded as $15,266. The maximum value of the account can be determined using the following steps.

 

NOTE: After determining the value of the account, as described below, if the value results in a

negative (minus) value, enter zero (0) in item 15, “Maximum account value.”

 

Step 1. Determine the maximum value of each account (in the currency of that account) during the calendar year being reported. The maximum value of an account is a reasonable approximation of the greatest value of currency or nonmonetary assets in the account during the calendar year. Periodic account statements may be relied on to determine the maximum value of the account, provided that the statements fairly reflect the maximum account value during the calendar year. For Item 15, if the filer had a financial interest in more than one account, each account must be valued separately. For an account denominated in U.S. Dollars, the maximum value of the account is the largest U.S. Dollar value of the account during the report year.

 

Step 2. In the case of non-United States currency, convert the maximum account value for each account into United States dollars. Convert foreign currency by using the Treasury's Financial Management Service rate (select Exchange Rates under Reference & Guidance at www.fms.treas.gov) for the last day of the calendar year. If no Treasury Financial Management Service rate is available, use another verifiable exchange rate and provide the source of that rate. In valuing currency of a country that uses multiple exchange rates, use the rate that would

apply if the currency in the account were converted into United States dollars on the last day of

the calendar year.

 

If the maximum account value of a single account or aggregate of the maximum account values of multiple accounts exceeds $10,000, an FBAR must be filed. An FBAR is not required to be filed if the person did not have $10,000 of maximum value or aggregate maximum value in foreign financial accounts at any time during the calendar year.

[MikeB]

I found many sources (below is one) that say they are going to use bank-issued statements to determine on what date the funds were present. If the bank doesn't issue "periodic" (paper?) statements (don't think mine do) then they will use any individual date they can find. That's my reading of it. It's like these rules were written 30+ years ago, before online banking. I might go with what Mike S suggested and put the foreign accounts in the wife's name. She's going to get it eventually anyway. 

"The account value is the largest amount of currency and/or monetary instruments that appear on any quarterly or more frequently issued account statement for the applicable year.  If a bank does not issue a periodic account statement, the maximum account value is the largest amount of currency and/or monetary instruments in the account at any time during the year.  If the account value exceeds $10,000 on any account statement at any time during the calendar year, the taxpayer must file FBAR."

http://www.taxationlawfirms.com/resources/tax/irs-and-tax-audits/reporting-foreign-accounts.htm

[OnMyWay]

There certainly will be a lot of confusion.  BPI issues quarterly statements with balance after each transaction, and I had them archived, so I was able to use them.  If you go online, BPI only has 3 quarters available.   :1 (103):