nun

I tend to agree with you philosophically for "accidental americans" who get caught in laws that they never even knew existed. They get caught in a very unjust situation.

But for US born citizens there's no excuse or reason not to file, it's your responsibility. It may suck, but it's US law. Just hoping they won't find you is not a good option.

Ignorance of tax law is not an excuse, especially FBAR......there are rulings on that. With FATCA coming in you could lie on UK financial forms about your citizenship to avoid being reported to the IRS, but now you've committed a crime in the UK and the US.

Squirrel

Well I do tell DH to file his taxes but I can't make him lol. He does say every year he is going to do it but then never gets round to it (he's like that about everything!)

He doesn't have any pension atm but supposing he did take up a company pension. How would he know exactly how much was in his personal pension fund? These things don't tend to really be like that. For example I have a pension through work and get annual statements, but the statements just tell me how much my pension will be if I carry on paying until retirement, they don't say how much exactly my fund is at that given time.

nun

Pensions are an area of debate, but if DH had a company defined benefit pension where he didn't have signature authority over any accounts it's probably not FBAR reportable, but personal pensions where you invest in funds would be reportable, for those there's an account balance. Getting the appropriate documentation is often the most difficult thing in complying with US tax requirements.

The UK/US tax treaty would allow him to defer taxes on contributions to UK pensions, or he could use the FEIE if the total compensation doesn't go above the limits, or he could declare those contributions (his and his employers) on his US tax return and pay the tax using excess foreign tax credits, if he has any, for UK taxes paid.

robin1234

I do worry about FBAR even though I have submitted it every year. For instance, what if they received it, but lost it and never filed it, and they come back years later and say they never received my 2009 return?

Also - my wife and I have TfL Oyster Cards. The highest balance on them during 2011 was probably £25. Should we have listed them on the FBAR?

theOAP

+1
I haven't heard of anyone calling the telephone number where you confirm their filing, so don't know if that works or not.

Who knows? I've seen two reputable advisors say 'yes' (I believe you commented to one earlier today [make that yesterday, time zone problems], but I could be wrong). The other was LIZ at BritishAmericanTax, if my memory serves me. I've seen others who said 'no'.

It fits the definition of a 'prepaid credit card', so I would list it anyway. I've not heard of any penalties for filing 'on the safe side'.

Are those black helicopters circling the library?

robin1234

They are, but I have my tinfoil hat on just to be on the safe side.

theOAP

I must find one of those.

robin1234

This works..

theOAP

Thanks for the link. I'm now desperately searching the house for old Canadian coins.

Bob

yes, the fines are massive compared to any potential taxes due, and in this particular case, there wouldn't be any taxes owed, so for the sake of piece of mind and to prevent any future hassles, seems silly not to, especially when the US Embassy has a very helpful IRS office.

lansbury

I've wondered that. Our CPA does ours when he does our tax return. What happens if he forgets to post it etc. Is there a time limit in which they can come back, like tax return errors?

lansbury

Thanks long time since I opened a UK bank account (1984) and it is still my UK account, in those days there were no such questions.

nun

I plan to retire to the UK and my strategy as a dual UK/US citizen will be to only have a UK current account and keep that below $10k, so no FBAR or FATCA filling. Also I'm going to get as much of my savings as possible into ROTH retirement accounts with a low cost US mutual fund company. This has the following advantages; far lower fees than with UK based investments; no IRS issues with non-US investments and no UK offshore funds problems either as they are in a retirement fund, finally ROTH gains and distributions are tax free in the US and the UK.

Bluegrass Lass

For clarification, a) you have to declare an account if the balance is more than $10k at any time during the year, or b) the account balance is over $10k at the end of the year?

We have a current account in the UK, but it only has about $900 in it at the moment. However, at one point this year it had about £6k or £7k. The balance went that high because we transferred over money from the US.

theOAP

For FBAR, it's any 1 day during the tax year. The funds may have been in the account for only an hour, but it still counts as one day. For FATCA (Form 8938), it's an either/or situation, as there are two balance requirements: one during the year and one for 31 Dec. (if you use the standard tax year). For FBAR, there is only one amount ($10,000). For Form 8938, the requirements are based on your filing status, your residence, the amount during the year, or the amount at the end of the year. It can vary from $50,000 to $600,000.

Check your statements carefully since your amounts are critical to filing. If we guess an exchange rate of 0.625 (1.60) for 2011, £6,000 would equal $9,600. So no FBAR required. If it's £7,000, the amount would equal $11,200 and would require an FBAR. Don't forget to take into consideration any additional financial accounts that must be considered for FBAR as adding them will increase your amounts subject to FBAR reporting.