# streamline or just filing Fbar for last year



## Kiku

Hello. I am a dual citizen (French/American) working in the US. I did not know about FBar until last November.

I have foreign accounts in France that I nevert report on my taxes:
LivretA: tax free in France but I now found out it is in the US
PEL: tax free in France and told in France 
that the interest was only reported and paid when I close the account.
What about the US. Was I supposed to report the interest for each year?
How do I call this account when filing FBar? Housing Saving Account?
The other accounts were portfolio that did not do well and checking accounts.
The total assets are about 125000 E.
The accountant who did my tax and Fbar for 2017 told me to leave it as this and did not mention Domestic Streamline. I found out through internet research.
I already paid another accountant 500 dollars retainer, His total fee will be $3700, I do not trust him entirely. For example, he did not tell me clearly what penalties and interest I would have to pay on due back taxes. I know the FBar penalty will amount to about $7000.
I would very much appreciate if I could get some feedback on my questions as I am at loss and have been worried sick for several months.
Thank you


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## Bevdeforges

Be careful - very very careful. There seem to be a raft of "tax advisors" out there who whip up business by scaring people into doing back filings they may not need to do.

Technically speaking, the US does not recognize any tax-free or tax deferred accounts offered outside the US. OTOH, if you check with your bank in France, there is a list of accounts that they don't report to the IRS - basically the Livret A and other standard tax-free and tax-deferred accounts. So it's up to you and your assessment of your risk as to whether or not you bother reporting them.

But the options for reporting any account on an FBAR form are basically "bank" or "investment" - and it's more or less up to you how you report them.

If it's only your FBARs you haven't filed, I wouldn't worry about "streamlined" or any other such special program. Especially if your total assets are only $125,000. It may sound like lots of money to us "normal people" but generally speaking they won't really bother you if you make a good faith declaration and leave it at that. 

You are at a slightly greater risk level given that you are in the US and so have US assets (that would be available for the IRS to seize, should they decide to investigate). But in practice, they usually only audit cases where the potential return is "worth their while" in terms of potential back taxes.

It's entirely possible to simply start filing FBARs for your 2018 returns and leave it at that.


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## Kiku

Thank you Bevdeforges. I totally agree with your statement re acountants. I went for a consultation and ended up with an FBar reporting and a tax return indicating my interest on foreign assets. So this is done for 2017 as well as the forma reporting my interests on the tax returns which I had never reported previously. Mistake?
Now that this has been done, I am wondering about streamline because obviously, I am now aware of F Bar requirements and wonder if this makes me "willful" if I get a tax audit since I reported a 3000E foreign account that was never reported before.
I truly appreciate your prompt reply to my first post.


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## Bevdeforges

From what anyone can tell, the FBAR filings are basically just kept for reference should something "questionable" turn up on your tax returns. And frankly a 3000€ account is peanuts for the IRS. Nothing to say that you didn't just set up that account in the year you did report.

One other factor to consider is whether or not your bank in France has asked you for a W-9 (i.e. to confirm that you are a US citizen and thus subject to US taxation). They may or may not be reporting your French bank accounts to the IRS even. (There are a number of exemptions and exceptions in the agreement that spells out what they are supposed to be reporting.)

You need to consider your "risk profile" but just be advised that IRS agents have a "goal" of returning a certain average amount per return on those they audit. Your chances of being audited drop tremendously unless the potential in back taxes meets their audit threshold, which I think we can assume is in the range of several thousands of dollars. (And that's just the back taxes - not any penalties.)


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## Kiku

Thank you so much. I let things go for a while. Now I am again totally confused by cpa and lawyers.
My 2017 FBar was filed. 3 options given by the cpas. 
1. Just file 2016,15,14,13,12. I thought streamline was always the last 6 years.
2. File from 2011 to 2016 but the firm does not give importance to the explanation of non willfulness and I was told it should include when the account was first opened, where the funds came from, etc...or it could be considered willful.
3. Forget Streamline and just do Delinguent FBar and amended tax return. Seems weird since I did not report my foreign accounts on tax returns.
The taxes I owe for the last 3 years are about $175 each year. I believe there is no penalty when Streamlining, just interest. Is this correct.
Right now, I am really fearful and unable to think clearly. Hope you can give me feedback on these questions. 
I came to the point of not trusting anyone.


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## Kiku

*specification*

I read again the thread and want to specify that the $3000 was the interest not the account whose amount were indicated in another post.


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## Kiku

Another issue.
I have been filing married filing jointly. My husband has an account in Japan and did not report it or file FBar. His bank cannot send information because they have him as a Japanese resident but he did a couple of transfers to his US Bank. I think if I start filing separately now it waves a red flag, especially since his US income is only social security. I am anxious about the risk this represents for me.


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## Bevdeforges

If you're filing jointly with your husband, you need to discuss with him how to handle the foreign accounts - whether you want to go back and file amended returns for the prior years or just handle things going forward.

When you file jointly, you both have responsibility for the entire filing, so you need to be "on the same page" as they say. The domestic version of the streamlined compliance filing does have a penalty fee attached. (You'll have to consult the IRS website for the details on that.) But whatever you do, do it jointly.


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## Kiku

Thank you.
Do you have advice about the other questions re different cpa advice?


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## Bevdeforges

Kiku said:


> Thank you.
> Do you have advice about the other questions re different cpa advice?


If you look through the forum here, you'll see I'm not a big fan of paying to file your US taxes. (Then again, I'm an accountant by trade and prefer to handle my finances myself.)

Paid tax preparers tend to be overly cautious when filing for others. (With good reason, as it's their reputations on the line.) Plus, a lot can depend on your overall financial situation, total amount of reportable income and any number of other factors. You may want to contact an Enrolled Agent - someone registered with the IRS to prepare tax returns. https://www.naea.org/find-ea-0


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## Kiku

Dear Bevdeforges,

Thank you very much for your wise advice. 
You are absolutely right about doing your own taxes. I have been ill advised and now I am in a big mess. I do not believe you hold a miracle solution but this situation made me so ill, I need to communicate and get a knowledgeable and untainted feedback.

So, I am married filing jointly (mistake!). When I found out about Fbar the accountant advised me just to start disclosing. Did not say anything to my husbandl This was for 2017. I was then advised to do streamline and spent months collecting the info. I did not realize at the time that for 8938 (or so) had to be signed jointly. So for 2017, only my French accounts were reported. I did the same for 2018 (reporting only my accounts on the return). 
For a variety of reason my husband who is Japanese and has accounts as Japanese resident, even though he is a US permanent resident, is not able to disclose at this time and may be at the end of the year but only wish to disclose one bank account. He does not have a lot of money overseas and has much less to lose than me but I do not want to put him in trouble.

A lawyer I talked to recently told me I would or could be judged willful because now I was aware of my duty to report since 2017. This would wipe me out totally as my assets were my retirement money.
a 
A woman CPA was eager to do a joint streamline disclosing just my asset . I was told this was even more risky.

I realize this is a messy situation and I am very sorry to bother you with it. However, I would appreciate any kind of feedback, especially on "willful" - I believe they take either 1/2 of your asset or 100,000 per year. This would be 4 yearsl

Thank you so much for reading this.

The problem is the streamline has to be joint since we filed jointly in the past.


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## Bevdeforges

OK - you've been filing jointly with your Japanese husband. Are you both living in the US? (If he's resident in Japan, it might make sense for you to file separately - or to start filing separately next time around.)

If he wants to continue to file jointly, you're going to have to come to some sort of agreement about how you want to treat the foreign accounts. And that depends quite a bit on how much you have in those accounts, and how much income they generate each year.

But if you decided to start filing separately, you can do that - just as long as you remember that, if you each file separately, then you do have to both handle certain items the same - namely standard deduction or itemizing. It shouldn't result in any particular "doubts" about your filings. There are many reasons that couples decide to file separately.

Other than that, I don't really know what to tell you. The chances of them "finding" your foreign bank accounts are actually pretty slim - and those huge penalties you read about aren't applied unless there are big problems with the tax returns. It really does depend on the amounts involved - and that's the kind of information you really don't want to be disclosing on an open forum like this.


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## shony

Posts on the forum can not hurt anybody as long as they do not have any personal information like address or name, etc.


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## Abello

Hello Kiku,
Any update on the streamlined process? I am also thinking to go that route...


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