samiam1066

I had an inheritance over £50,000. I transferred £45,000 to USA. Do I need to file FBAR as my money in UK is now under $10,000. Or do I have to file because at one point int he year I had more than ¢10,000?

Jerseygirl

If you had a total amount...in one or more accounts...of over $10K at anytime in the tax year it must be reported.

samiam1066

Thank you.

penguinsix

As mentioned, if it was over $10,000 at any point during the year, you have to file. I would also note that if the total amount of ALL your overseas accounts is > $10,000 USD at any point in the year, then you will have to report ALL accounts. I wanted to mention this because you have one account with about $7,500 USD in it so if you happen to have a few other small ones you might find yourself in an FBAR situation.

Account #1 - £5,000 ($7,500USD)
Account #2 - £1,500 ($2,200 USD)
Account #3 - £500 ($750 USD)
Account #4 - £1 ($1.50)

You must report ALL accounts on your FBAR, even the one with £1.

Also note that the $-£ rate can shift you up into reporting should the pound strengthen over the next year or two (as it did in the mid-2000s).

samiam1066

Thank you.

Neillc37

It's worse. You can not actually have $10k in money and still have to file. Just moving $5k between two accounts in a year will cause a need to file.
Also in a inheritance situation you can have a financial interest in accounts not owned by you while the executor sorts out the estate. We reported my wife's late mother accounts on our FBAR for the year she died.

celticgrid

Not quite correct.

The official wording is:

Therefore moving $5k between accounts does not affect the aggregate value at that time.

However, when you complete the FBAR you need to put the maximum value, during the year, of each account, so on the form you may actually include that $5k twice, but such a transfer does not affect the initial assessment as to whether you need to complete the FBAR.

MidAtlantic

There are two different questions that tend to get confused:
1. Do I need to file? Only if the aggregate value of the foreign financial accounts exceed $10,000 at any time during the calendar year.
2. If I do need to file, what do I report? determine the maximum value of each account (in the currency of that account) during the calendar year being reported; convert those maximum values to USD using the Treasury's Financial Management Service rate; report those values for each account.

lansbury

I'm not sure that is correct. I have understood the requirement to be on accounts over which you have signature authority. If the executor is the only one who can control the money in the account it isn't yours until they give it to you.

Including open accounts with a nil total if other accounts take you over the $10k limit. Fell foul of that one myself.

Neillc37

Signatory authority or a financial interest in. I ran it by my tax attorney. I had to include them.

Neillc37

Unfortunately that not the official word. The IRS successfully defeated a CPA in tax court arguing that what the IRS says on it's web site and forms is not legally binding (IRA rollover timing, once a year stuff). Only the tax code itself has any weight. To understand if you have to file the FBAR you have to go to title 31. I have seen legal types weight in in the past that transfer amounts are counted twice. There might have been a change in 2014 though that changed this.

celticgrid

So although you earlier state this definitively, you are now unsure?

I've seen legal types weigh in with all sorts of rubbish - it is what they do for living, after all.

You may be right. Some citation would help. Luckily I am unaffected by any lack of clarity in this area.

durham_lad

If in doubt then file the FBAR report. It takes very little time and doesn't even cost the price of a stamp these days.

lansbury

Actually the situation doesn't arise as the money cannot be in 2 accounts at the same time. Therefore the aggregate amount stays the same.

celticgrid

I would agree with that. That's my position.

No-one in their right mind would posit otherwise, but I do however acknowledge that Neillc37 is talking about the IRS and lawyers, so "in their right mind" is not so cut and dried