# Security deposit on FBAR



## Alltimegreat1

I paid a security deposit to my German landlord, who then opened a savings account with that money in his own name. It bears minimal interest. Do I need to report this on my FBAR, and if so, what section of the FBAR?


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## BBCWatcher

No. You do not have signature authority over that account (I presume). You cannot visit his bank and receive that money. He alone controls that account.


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## Alltimegreat1

That's right, I don't have signature authority. Good to know I won't need to amend my FBAR.


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## Alltimegreat1

BBCWatcher said:


> No. You do not have signature authority over that account (I presume). You cannot visit his bank and receive that money. He alone controls that account.


I just read this PDF file from http://www.lw.com/ called "Top 10 Foreign Bank Account Reporting (FBAR) Mistakes." This law firm claims that signature authority over an account is not necessary for it to be FBAR-reportable. If a US person has a financial interest or is the beneficial owner of an account, then it must be reported.

...The obligation to file an FBAR extends well beyond signatories and legal accountholders and includes any US person who has a “financial interest” in a foreign financial account. The term “financial interest” is broadly defined in the regulations and generally includes a US person who is a beneficial owner of the assets in the account, even though he or she may not be identified as the legal accountholder in the records of the financial institution or able to communicate directly with the financial institution. Thus, a US person is required to file an FBAR if the owner of record or holder of legal title of the account is acting on the person’s behalf as an agent, nominee, attorney or in “some other capacity.” For example, if a brother who resides overseas agrees to hold US$15,000 of a sister’s money in his foreign bank account, the sister has a reportable “financial interest” in the foreign financial account and is required to file an FBAR even though she is not a signatory to, or legal title holder of, the account...


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## iota2014

Sympathies, Alltimegreat1.

I hate to mention this but does that mean your landlord also has to start filing FBARs?


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## Alltimegreat1

My landlord is German so he won't need to. It seems like I might have to report his acvount though on my FBAR (according to that legal firm at least).


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## Bevdeforges

If you read too far into any of the US tax or other legislation you'll drive yourself crazy. (And the various law firms looking to dredge up business by scaring the [email protected] out of Americans overseas will act as chauffeur.)

Apply some level of common sense to all this. Generally, in the case where a landlord is holding a deposit in escrow, the renter has no idea of the account number and has no effective control over the account. I'd say leave it off the FBAR. If you read the instructions, you'll see that you are supposed to report your employer's bank accounts if you have signature authority over them - but in that case they claim you have no "financial interest." (But you only have to report the name of your employer, not the details about the account.)

Makes little or no sense, but as always, you make a "good faith effort" and let them ask for details if they have any problems with what you have or haven't reported.
Cheers,
Bev


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## BBCWatcher

You don't have a financial interest in that account, and you are not its beneficial owner. You aren't even guaranteed to get your deposit back, e.g. if you damage the property or fail to pay your rent.

It's not reportable, and it's not even a close call. You can report it if you wish, but you are not required to.


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