jmood

A friend told me today that there was a new US law that required all US residents to declare bank accounts and property owned outside of the US. And that there had been a time (Sept?) by which this could have been done without penalty.

Any idea what the tax implications of owning a UK property are, assuming you don't have "income" from it and are NOT filing taxes with the HMR?

I am worried.
My friend also said that anything deemed "unlawful" would be treated differently (by extradition) if the perpetrator is a non US citizen.

ian-mstm

I don't think it's a "new US law" since I've been making such declarations for over 10 years now. You need to declare the existence of such accounts if the total of all accounts is over $10,000.


I suggest you find a new friend.

Ian

jmood

Yes, maybe.

Re. your other comment. What if it is property? And it has a mortgage. What are the requirements to declare in that case?

ian-mstm

I'm not 100% sure... but I believe it's nothing more than a reporting requirement. You don't have a US tax burden on an existing UK property until such time as you sell the property. The reporting requirement for property is separate from your reporting requirement for bank accounts and such.

I'm sure someone will be along in short order if I'm off base on this.

Ian

parkzy

On a similar note, I moved to Long Island, NY last month, Since then my house sale has finally gone through and funds >10k are in our UK bank account.
We are not going to be buying a place here until we can get a mortgage approved so the deposit money will stay there.
Obviously will declare this money next tax return but what are the implications of leaving it in the UK?
Is it worth moving it over into our US bank account for any reason as the exchange rate is pretty decent right now ?
Any comments would be appreciated ? Thanks..
Ryan.

IPM

I think you maybe referring to the FBAR requirement. All non-US account holdings greater than $10k in equivalent at any poiint in time during preceeding calendar year need to be dislcosed. Knowing quite a few good US attorneys, I would advise against non-compliance..

FBAR does not deal with property - or it didn't the last time I filed it.!
Non-US property income would need to be disclosed in the normal way in Federal income tax filings.

nun

The new law is FATCA. It's contents are not decided on yet, but it might duplicate a lot of FBAR but with a $50k threshold and off course further penalties for non compliance. Other rumors are that it might also include real property and require foreign banks and financial firms to identify their US citizen customers and forward details of their accounts to the US Treasury. This will be expensive for the banks to do and may contradict privacy laws in the EU so some European banks are already refusing to take US citizen customers.

jmood

US citizen vs. LPR : Treated same or different?

nun

Just reading a draft FATCA form and it looks like there will be higher thresholds if you live outside USA

http://www.irs.gov/pub/irs-dft/i8938--dft.pdf
http://www.irs.gov/businesses/corpor...236667,00.html