Another FBAR/tax thread (sorry!)
Hi all,
After reading all the posts on tax and FBAR, I am now more :confused: than before. I have been quite successful doing our tax return but I would like to clarify which additional forms I need to submit. The following is our UK situation: We still have 4 pensions. These are not contributed to, and we don't receive anything from them. 2 are worth more than £10K and we can see their values rise and fall with the tides. The other 2 we don't know much about except that they are worth more than the 2 we do know about. We have a stocks and shares ISA holding some funds, which also rises and falls with the tides. No money added to it and no income from this and sadly no real increase in value either. We also have 2 properties which we rent. We don't have a bank account in the proper sense in as much as it is a One account. Our "savings" offset the amount we owe and we have a facility of money we could draw upon should the need arise. I have included our income from the property on the tax return, so I'm not concerned there. But am I correct in thinking I need submit an FBAR form for our pensions? Do we include the facility on any forms? If so, which forms? I believe I need to include the ISA somewhere. Again, which forms? Do I include the houses on any forms? FWIW, we haven't told any UK institutions that we left, as until we have a GC in our grubby little mits, we might still have to go back. And we did file a UK tax return for last year. Many thanks for your responses. And apologies if this has been answered before. I just couldn't figure it out. CWT |
Re: Another FBAR/tax thread (sorry!)
I'm not sure about this so I'm having my CPA look into it further - his first response was no as it has no monetry value yet but I'll post his response when he clarifies it for me further.
|
Re: Another FBAR/tax thread (sorry!)
Originally Posted by 100weight
(Post 9961556)
Hi all,
After reading all the posts on tax and FBAR, I am now more :confused: than before. I have been quite successful doing our tax return but I would like to clarify which additional forms I need to submit. The following is our UK situation: We still have 4 pensions. These are not contributed to, and we don't receive anything from them. 2 are worth more than £10K and we can see their values rise and fall with the tides. The other 2 we don't know much about except that they are worth more than the 2 we do know about. We have a stocks and shares ISA holding some funds, which also rises and falls with the tides. No money added to it and no income from this and sadly no real increase in value either. We also have 2 properties which we rent. We don't have a bank account in the proper sense in as much as it is a One account. Our "savings" offset the amount we owe and we have a facility of money we could draw upon should the need arise. I have included our income from the property on the tax return, so I'm not concerned there. But am I correct in thinking I need submit an FBAR form for our pensions? Do we include the facility on any forms? If so, which forms? I believe I need to include the ISA somewhere. Again, which forms? Do I include the houses on any forms? FWIW, we haven't told any UK institutions that we left, as until we have a GC in our grubby little mits, we might still have to go back. And we did file a UK tax return for last year. Many thanks for your responses. And apologies if this has been answered before. I just couldn't figure it out. CWT If you have a total of $10K+ in overseas accounts...including pensions etc it must be submitted on FBAR. As far as the IRS is concerned all overseas accounts, pensions etc must be declared. |
Re: Another FBAR/tax thread (sorry!)
Originally Posted by Jerseygirl
(Post 9961896)
As I understand it from our accountant....
If you have a total of $10K+ in overseas accounts...including pensions etc it must be submitted on FBAR. As far as the IRS is concerned all overseas accounts, pensions etc must be declared. |
Re: Another FBAR/tax thread (sorry!)
Originally Posted by Bink
(Post 9961972)
And yet they tell you not to report paper losses/gains only real losses/gains. It doesn't make sense to me that pensions would be the sole exception to that.
Lots of confusion in this thread as to what's reportable on an FBAR to what's reportable on the new Form 8938 that is submitted with one's tax return. There are multiple existing threads on this. |
Re: Another FBAR/tax thread (sorry!)
You have a few issues here:
Firstly - your house - remember you can depreciate the purchase price and any other improvements, this helped me massively reduce tax liability on my rental house - all my costs, income etc are on the Schedule E. UK Stocks and Shares ISA - Oh dear - I have one of these, and it seems that dealing with them is very complicated - I have lots and lots of Form 8621's filled in and any increases are taxed as regular income. FBAR - I didn't put my pension on the TD F 90-22.1 last year - I'm still unsure whether I should have done (it is listed on the 8398 form this year). If this is your first year with an ISA and a House, I would highly recommend you get someone to do the paperwork - I have done, and while there were some errors I picked up on, it has proved very useful. Crispin |
Re: Another FBAR/tax thread (sorry!)
Originally Posted by Giantaxe
(Post 9962105)
They're not. The Form 8938 reporting requirement potentially extends to all (depending on how you wish to interpret this) kinds of foreign financial accounts, regardless of whether they generated income in the year of reporting.
Lots of confusion in this thread as to what's reportable on an FBAR to what's reportable on the new Form 8938 that is submitted with one's tax return. There are multiple existing threads on this. It's a ridiculous reporting requirement for something that isn't generating income. It should be taxed when it's withdrawn as income and it shouldn't need to be reported until it has a physical value, not just a paper value. |
Re: Another FBAR/tax thread (sorry!)
Originally Posted by 100weight
(Post 9961556)
I have been quite successful doing our tax return but I would like to clarify which additional forms I need to submit. The following is our UK situation:
We still have 4 pensions. These are not contributed to, and we don't receive anything from them. 2 are worth more than £10K and we can see their values rise and fall with the tides. The other 2 we don't know much about except that they are worth more than the 2 we do know about. SIPPs etc probably do need to be on FBAR. If you have accounts and with unit trusts etc in them they definitely need to go on FBAR. FATCA, Just include everything. We have a stocks and shares ISA holding some funds, which also rises and falls with the tides. No money added to it and no income from this and sadly no real increase in value either. For your UK pensions you may also need to file 3520, 3250-A and 8621 depending on whether they are qualifying pensions under the treaty and you can make a tax treaty claim to exclude any gains from US taxation. If you don't make the treaty claim on 8833 then foreign trust and PFIC filing will be necessary. We also have 2 properties which we rent. We don't have a bank account in the proper sense in as much as it is a One account. Our "savings" offset the amount we owe and we have a facility of money we could draw upon should the need arise. I have included our income from the property on the tax return, so I'm not concerned there. But am I correct in thinking I need submit an FBAR form for our pensions? Do we include the facility on any forms? If so, which forms? I believe I need to include the ISA somewhere. Again, which forms? Do I include the houses on any forms? FWIW, we haven't told any UK institutions that we left, as until we have a GC in our grubby little mits, we might still have to go back. And we did file a UK tax return for last year. You are in a very complicated situation and probably need the help of a professional to get this sorted out particularly doing the "mark to market" calculations for the PFIC filing. This covers the main issues for pensions. http://www.expattaxandlaw.com/Foreign_Pensions_FAQ.html |
Re: Another FBAR/tax thread (sorry!)
Originally Posted by Bink
(Post 9962142)
Massive confusion and the IRS doesn't exactly help out, just fine you if you get it wrong. FBAR is intended for accounts you have signatory authority over - There's no signatory authority on a pension. There's also no easy way to state what a pension is worth and how to report that to the IRS. Do you take the peak value for the year or do you examine the exchange rate fluctuations and work out the highest USD amount?
It's a ridiculous reporting requirement for something that isn't generating income. It should be taxed when it's withdrawn as income and it shouldn't need to be reported until it has a physical value, not just a paper value. |
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