# Power of Attorney & FBAR/FATCA



## yido101

Hi all, 

i am hoping somebody can offer me some advice or insight regarding FATCA and FBAR reporting rules. 

I am a green card holder in the US (uk originally), and until now just had some fairly small bank accounts in the uk in my own name. 

However, my parents have recently granted me and my brother (in the uk), as well as each other as 'power of attorney' for both their financial affairs and health decisions, should the time come where they are unable to make sound decisions for themselves. My parents are 70, and 68 so hopefully a little yet until then!

However, I'm unsure how this effects my reporting requirements, and what i would need to do. This just started this year, so I would have to report for the 2018 year rather than a previous year so I am trying to get ahead of the game as it were. 

Is anyone able to tell me what i need to do or what information i need to have/report? It's early stages, so currently all i have received is letters stating that the power of attorney has been registered. I'm not in the loop at the moment as to what assets and accounts my parents have. Their house obviously is the main one, and no doubt there's bank accounts, savings, pensions, etc. 

Would i have to report this next year? or simply in the event that my parents health deteriorates and thus having to 'activate' the power of attorney status? Or is my name instantly linked to their accounts, assets, etc?

I also in reading around, read that "power of attorney being given to somebody with a US address" is a 'US person indicia'. Does that mean my parents banks, etc will now be passing on information about me and my involvement in those accounts to the IRS or treasury? 

Im sure more questions will occur to me, all seems very confusing at the moment and just trying to get a leg up on what i should be preparing for.


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## Moulard

Depending on the powers granted, I would expect that for the purposes of FBAR you have signatory authority over the account, and thus it would be reportable.



> Signature authority is the authority of an individual (alone or in conjunction with another individual) to control the disposition of assets held in a foreign financial account by direct communication (whether in writing or otherwise) to the bank or other financial institution that maintains the financial account.


Again, depending on the powers granted, I expect that you have no interest in the account, so while it would be considered a custodial account, I am not sure that it would be reportable on form 8938.


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## yido101

thanks for the response. I'm getting the sense that I would likely need to file 'something'. Although the parts i'm specifically unsure on:

1. right now i dont actually technically HAVE the authority to do something with their accounts/assets, more that if/when the time comes, that it would be me/my brother/other parent that could trigger that. I'm not sure if that makes a difference in the eyes of the IRS, etc? For their purposes this counts as signatory authority now? or only when that time comes that we 'action' it? 

2. If i do indeed need to file, what information would i need to find out? I'm not sure what they have to be honest. Im sure there could be more than 1 bank account, savings accounts, pensions, as well as their house, but i am purely guessing. What specifics would need to be included if i was filing?

3. anywhere recommended that i can read up on this? My google searches havent brought up a lot about that specific circumstance of taking on power of attorney of overseas relatives.


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## Bevdeforges

Ultimately it would depend on what powers of attorney you actually have. If you have signatory authority over the account (i.e. you can make transactions on your own signature without any further administrative registration or activation or whatever), then it's actually a sort of joint account. If, on the other hand, there is some stipulation that you can only authorize transactions in the interest of your parents, then it could conceivably be reported as an account in which you have "signatory authority but no financial interest." (I.e. you don't have access to the account for your own purposes or indulgences <g>)

But the FBAR only requires you to report financial accounts - bank accounts, investment accounts and the like. The house, the mortgage, etc. don't go onto the FBAR and shouldn't need to be reported at all on your US tax returns.
Cheers,
Bev


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## Nononymous

This is a situation where, potentially, you might want to let your brother in the UK be the only one with power of attorney on financial matters. 

In my situation (sibling and parents in Canada, myself the only US-Canadian dual) I've proposed that my sister deal with all financial matters and I with all health affairs. She is the executor of their will, not I, for just this reason. I am completely non-compliant with US tax obligations so it probably doesn't matter, but it's an easy precaution to take.

Also I would imagine that you would have no FBAR reporting obligation until such time as you actually took on power of attorney. If right now it's just an agreement, or paperwork to be signed in the event of your parents becoming incapacitated, then I doubt there's any reason to report the accounts before that occurs.


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## JustLurking

yido101 said:


> ... right now i dont actually technically HAVE the authority to do something with their accounts/assets, more that if/when the time comes, that it would be me/my brother/other parent that could trigger that.


There are articles here and here that vaguely cover so-called 'springing' powers of attorney.

The answer to your question -- as is so often the case when US tax law tries yet again to run roughshod over another country's tax law -- appears to be: Nobody knows, including the IRS.


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