# FBAR and Swedish pension plans



## Sweden1 (11 mo ago)

Hello everyone,

I am wondering if there is anyone out there who can answer my questions about Swedish pension plans and if they need to be reported on the FBAR. According to the information on:
Report of Foreign Bank and Financial Accounts (FBAR) | Internal Revenue Service

…”you don’t need to report foreign financial accounts that are: Held in a retirement plan of which you’re a participant or beneficiary…”

So I assumed that the public (mandatory) Swedish pension system is nothing that needed to be reported on the FBAR. But now I’m second-guessing that (due to fear-mongering tax attorney homepages that insinuate that the Swedish pension plan _might_ have to be reported).

There are three parts to the system: a national public pension from the state, an occupation pension from employers, and private savings. I have no private pension savings at all. (My personal regular bank savings are such that I have to file an FBAR.) I can’t opt out of the national or occupation pensions, I can’t place more money in them than the government/employer takes automatically, and I can’t access the money until I retire.

I called the FBAR hotline and they said that if you are “made to” be a part of a foreign pension plan, then you don’t have to report it, but that there might be exceptions (at this point I couldn’t remember the details of the pension plans in Sweden so I couldn’t ask any follow-up questions regarding exceptions to the rule). I will call them again but I am so worried now that I feel sick to my stomach.

In the national public pension, you are allowed to direct where you’d like the money placed through fund selection or just leave it up to the state. You can be active in choosing lower-risk or higher risk funds or just be passive. But still, you have no access to the money at all.

In the occupational pension from employers, you can choose from a few companies that place the money in different funds, and also choose if you want traditional or higher risk placements. Can’t touch the money until retirement.

One tax lawyer online implies that the Swedish national public pension does not have to be reported but that the occupational pension does. US Taxation of Swedish Pension Plans: FBAR & FATCA

_Generally, while Pillar 1 (national) is not considered FBAR reportable — since it is equivalent to U.S. Social Security and not technically an account — the same cannot be said for other pillars. Pillar 2 (employer) or Pillar 3 (Private) are reported on the FBAR since they are segregated accounts for each person who contributes, and the accounts have a separate identifier and value based on the contribution amounts._

I have tried to find out what “segregated accounts” means but I don’t understand. I have no access to this money so I don’t understand why Pillar 1 would be any different to Pillar 2. They have hypothetical values at this point and all seem to be separate and identified to me based on how much I’ve contributed during my work life. I understand that they need to be reported as income when that day comes, but otherwise how can this be of any interest to the Treasury Dept? It is impossible to “hide” funds in these plans since I don’t decide on how much is taken from my salary.

My question must be relevant to thousands and thousands of people: Americans living in Sweden and Swedes living in America. I don’t understand why there is just not a clear and simple explanation about this on, for example, the US Embassy’s homepage in Sweden or something similar. The embassy does not help out at all on tax issues. And I can’t afford to pay an international tax expert.

Thanks for any helpful input you might have.


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## Sweden1 (11 mo ago)

Edit: It is obvious that I haven't given my pension plans much attention in general, and I just realized that I actually place* NO money in these funds*. Duh. Money is placed in them by the government and my employer according to how much I've earned. So what I wrote above about money being taken from my salary is incorrect. Well, if anything positive is to come of this anxiety I'm feeling at least I'm looking at my pension plans in detail for the first time in years.


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## Sweden1 (11 mo ago)

Edit 2: Well, I just talked to the nice person at the FBAR helpline and explained the Swedish system and she said that if the government or the employer sets it up then you not NOT have to report it. She was so kind to me (I was on the verge of tears with worry - the thought of $10,000 fines for each inadvertently missed reported account freaks me out). The tax lawyers online are so tricky in their ways of writing information to trigger the most anxiety possible and it makes me so angry! Every person I've ever spoken with from the FBAR helpline (I called several years ago regarding another question) and the IRS have always been SO kind to me and helpful and understanding.


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## Bevdeforges (Nov 16, 2007)

Glad to hear you got good advice from the helpline. The one thing to remember is that what they tell you on the helpline isn't "binding" on the IRS or whatever department is handling FBAR stuff these days. But, unless you're talking zillions of dollars that might actually make a difference in how much tax you pay, being able to say that you consulted the helpline and this is what they said will generally work to prove that you're not doing anything "willful" in terms of evasion. 

Tax lawyers and tax accountants are basically trying to save their own butts (and drum up a little "easy" business for themselves) so have to be super cautious about what they say and how they say it.


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## Nivie (Apr 22, 2021)

I cant answer your question but I am in similar position. I used to over think it but now just report all my pensions as my view it is better to over report and avoid any future complications and potential penalties. It takes a few minutes more and no need to think about it again for another year.


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## Lotsofquestions (Mar 22, 2017)

Actually, when listing up your foreign bank accounts, retirement plans, and so on, there's more than just the FBAR to watch out for. Depending on how much you have, you might also have to file IRS Form 8938 (Statement of Specified Foreign Financial Assets), and that special form is part of your actual tax return each year. 

For instance, it seems that if you contribute to a registered pension plan (RPP) in Canada, you don't have to report that type of account on the FBAR. *However, you DO have to report it on Form 8938* if the total of your account balances exceeds a certain threshold*. * 

Right now I'm trying to get to the bottom of this -- What exactly needs to be reported on the FBAR, and what exactly needs to be reported on Form 8938? The rules for the two aren't the same and they aren't crystal clear:

Comparison of Form 8938 and FBAR Requirements | Internal Revenue Service


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## Post-American (8 mo ago)

Sweden1 said:


> Edit 2: Well, I just talked to the nice person at the FBAR helpline and explained the Swedish system and she said that if the government or the employer sets it up then you not NOT have to report it. She was so kind to me (I was on the verge of tears with worry - the thought of $10,000 fines for each inadvertently missed reported account freaks me out). The tax lawyers online are so tricky in their ways of writing information to trigger the most anxiety possible and it makes me so angry! Every person I've ever spoken with from the FBAR helpline (I called several years ago regarding another question) and the IRS have always been SO kind to me and helpful and understanding.


Hi, I've been going nuts trying to find a definitive answer for this as well and this is the first time I feel someone has addressed the specifics of my situation. I had to create an account just to say thank you.


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