B488

My wife and I have been US resident for a few years and always kept up with our personal FBARs and foreign interest reporting on tax returns.

Problem: when our son was born in the US in 2017, his Grandpa setup a child saver account with a bank in the UK. It only had a few hundred quid in it then. Grandpa is a named account holder but my son is also named. And you guessed it, I just learned that Grandpa topped up the account 2018 to a level which significantly exceeds the FBAR threshold. He never mentioning it to me, and I don't even have direct access to the statements as my name isn't on the account, and Grandpa had given his own address as that of my son when he opened the account. The account seems only loosely attached to my son, Grandpa is free to remove money at any time, and my son is clearly unable to because he is two years old. What to do now? a) Do we even need to file the FBAR and b) will the few months of lateness be an issue?

Cook_County

Use the delinquent FBAR procedure for your son if needed. Just make sure Grandpa doesn't invest in any PFICs for your son...

livinginnyc

As Cook_county said - the delinquent FBAR procedure should work, be sure to explain the delinquency and back story for context; they will want to see interest rates on the account and should file and send a confirmation 2 days after it's filed.

mv72

Just a question about the FBAR am I right in saying that you would file it if you have a foreign financial account during the year that exceeded $10k or when all foreign accounts added exceeded $10k then you would complete the FBAR?

Also when completing the fbar do you only list your foreign bank & foreign pensions accounts and do not include your US bank and US work pension accounts?

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MidAtlantic

Yes it only relates to foreign accounts.

The methodology is:
- determine the maximum sum in local currency for each account for the year
- convert those sums to USD using the exchange rate for December 31 here: https://www.fiscal.treasury.gov/repo...e/current.html
If that USD total is $10k or over you need to report.

This can produce some weird results eg if you only have $6k but move it from one account to another, the total is $12k and you have to report, even though you have only ever had $6k.

mv72

Interesting so only list foreign accounts when doing the form you don't additionally include US bank accounts etc?

MidAtlantic

Yes only foreign accounts.
Yes all accounts that you have had for that calendar year, even if you had one for just one day!

mv72

No worries, thank you