Living in US with bank accounts in UK
May 29th 2012, 12:08 am
#16
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Re: Living in US with bank accounts in UK
To clarify it's the total balance of all overseas accounts at anyone time during the year. Therefore if the total balance of all accounts goes over $10K for one day...then they must be reported.
May 29th 2012, 12:50 am
#17
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Re: Living in US with bank accounts in UK
It's not clear if you should file an FBAR if your foreign accounts were above $10k before you become US resident. So it's safest to file if they were above $10k at any time during the tax year.
http://us.kpmg.com/microsite/taxnews...9/Jun/FBAR.pdf
http://us.kpmg.com/microsite/taxnews...9/Jun/FBAR.pdf
The relief provided by IRS Announcement 2009-51 still leaves unclear the definition of the term “resident of the United States.” Because the FBAR rules are promulgated under Title 31 of the United States Code, and not under the Internal Revenue Code, the definition of U.S. resident in IRC section 7701(b) is inapplicable; that provision applies only “for purposes of this title” (i.e., Title 26).
Some guidance on this issue, however, is provided by the Internal Revenue Manual (“IRM”), which states that an individual can establish nonresidency for FBAR purposes by showing that he or she (1) does not hold a green card, (2) does not meet the substantial presence test of section 7701(b)(3), or (3) has not made a first-year residency election under section 7701(b)(4).15
However, this guidance in the IRM does not clarify whether individuals are required to file the FBAR if they are (1) part-year residents (whether inbound or outbound), (2) individuals who have made an election under section 6013(g) or (h) to be treated as residents for U.S. income tax purposes, or (3) individuals who invoke the residency tie-breaker provision of a treaty.
Some guidance on this issue, however, is provided by the Internal Revenue Manual (“IRM”), which states that an individual can establish nonresidency for FBAR purposes by showing that he or she (1) does not hold a green card, (2) does not meet the substantial presence test of section 7701(b)(3), or (3) has not made a first-year residency election under section 7701(b)(4).15
However, this guidance in the IRM does not clarify whether individuals are required to file the FBAR if they are (1) part-year residents (whether inbound or outbound), (2) individuals who have made an election under section 6013(g) or (h) to be treated as residents for U.S. income tax purposes, or (3) individuals who invoke the residency tie-breaker provision of a treaty.
May 31st 2012, 11:49 pm
#18
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Re: Living in US with bank accounts in UK
Form TD F 90-22 if over $10K AND Form 8938 if funds held in foreign account exceeded $100K in any one day of the calendar year.
Then you need to report the name, address, sort-code and account number of each foreign account. e.g.. you have 5 accounts but one of them had more than $100K in it. Then you need to declare the info on ALL accounts.
This is purely for "information collection purposes" blah blah blah, it does not incur any tax liability (unless you are a perm resident then your tax status will/might differ), but if you don't declare, then from what I read, they can fine you 50% of that highest amount even if you don't have it.
Welcome to the land of the free! Also the deadline is 30th June!
Then you need to report the name, address, sort-code and account number of each foreign account. e.g.. you have 5 accounts but one of them had more than $100K in it. Then you need to declare the info on ALL accounts.
This is purely for "information collection purposes" blah blah blah, it does not incur any tax liability (unless you are a perm resident then your tax status will/might differ), but if you don't declare, then from what I read, they can fine you 50% of that highest amount even if you don't have it.
Welcome to the land of the free! Also the deadline is 30th June!
Jun 1st 2012, 12:50 am
#19
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Re: Living in US with bank accounts in UK
Be careful, the FATCA limit varies depending on whether you're single or married, US or overseas resident and even depends on the time of year. The limit if you're single and US resident is $50k on the last day of the tax year and $75k the rest of the year.
Jul 5th 2012, 1:02 am
#20
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Re: Living in US with bank accounts in UK
So if you have a foreign account with, say, $1000 in it but no interest, obviously no FBAR needs to be filed (interest is irrelevant for the FBAR anyway). Does this need to be on Schedule B of the 1040? Or is that only if it earns income? Schedule B is only something you would even encounter if you earn more than $1500 in interest or dividends, but the foreign account reporting requirement in part 3 simply states that if you had signature authority (i.e. an account in your name) then it needs to go on the form, regardless of income.
Any thoughts anyone?
Any thoughts anyone?
Jul 5th 2012, 1:10 am
#21
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Re: Living in US with bank accounts in UK
Schedule B is only something you would even encounter if you earn more than $1500 in interest or dividends, but the foreign account reporting requirement in part 3 simply states that if you had signature authority (i.e. an account in your name) then it needs to go on the form, regardless of income.
To be honest, I don't know the answer - I always have to file Schedule B anyway so I just check "yes" for question 7a (which is the one that asks about signature authority over foreign accounts) and "no" for question 7b (which asks whether you are required to file Form TD F 90.22-1)
Last edited by md95065; Jul 5th 2012 at 1:14 am.
Jul 5th 2012, 1:49 am
#22
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Re: Living in US with bank accounts in UK
Indeed, yes, think schedule B is needed for next year's return as my financial situation may be different. New account will probably accrue small amounts of interest (I suspect single dollars, if that), so I will probably need schedule B to report the income. Is it needed if I don't gain any interest? Looking at Part 3, it just asks do you have an account, and do you need to file the FBAR (TD 90.22-1). It's fairly bare bones (yes or no) and doesn't ask for any account information or even which country the account is in (only need to specify that if you need to the FBAR). When you complete that, are you prompted for additional info (like account numbers, account start dates etc)?
Jul 5th 2012, 1:57 am
#23
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Re: Living in US with bank accounts in UK
As far as Schedule B goes all that I do is check the two boxes - yes I have a foreign account and no, I am not required to file anything ...
Jul 5th 2012, 5:40 am
#24
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Re: Living in US with bank accounts in UK
Keep at least one account open and active in the UK, you may want to use it down the line, remember too to use your UK debit card so that they do not cancel it due to in activity.
Jul 5th 2012, 6:02 am
#25
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Re: Living in US with bank accounts in UK
Pension plans, funds, stocks etc is where things get more complicated but even that's doable. Now when you have a bank that only keeps online statements for six months and you notice that too late things get interesting...
Jul 5th 2012, 1:56 pm
#26
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Re: Living in US with bank accounts in UK
So as an addendum, make sure you have a savings account open too before you depart the UK.
Jul 5th 2012, 5:20 pm
#28
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Re: Living in US with bank accounts in UK
Open a UK bank account for your child(ren).
Of course, everyone's situation is different but my children have dual citizenship and may, some day, wish to return to the UK, or simply visit, or go to university, or...
A simple online transaction putting a few quid into their accounts from mine each month keeps everything active.
Jul 5th 2012, 5:27 pm
#29
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Re: Living in US with bank accounts in UK
It's not clear if you should file an FBAR if your foreign accounts were above $10k before you become US resident. So it's safest to file if they were above $10k at any time during the tax year.
http://us.kpmg.com/microsite/taxnews...9/Jun/FBAR.pdf
http://us.kpmg.com/microsite/taxnews...9/Jun/FBAR.pdf
Jul 6th 2012, 2:25 pm
#30
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Re: Living in US with bank accounts in UK
You need to include the interest from those accounts on your Schedule B and 1040. If there's no interest you don't have to put them on the 1040 at all.
The FBAR is actually not a tax form. It's an informational form you send to the Treasury.....not the IRS. You must file FBARs if the value of your foreign accounts is over $10k...the FBAR has nothing to do with earnings!
The FBAR is actually not a tax form. It's an informational form you send to the Treasury.....not the IRS. You must file FBARs if the value of your foreign accounts is over $10k...the FBAR has nothing to do with earnings!
Hi,
maybe you can clarify something. This may apply to me this year. I thought accounts outside the US had to be mentioned on Part 3 of Schedule B regardless of whether they earned interest or not?