# Yet another FBAR question



## hanksteelbottom (Mar 13, 2014)

Hello,
This is my first post and I'm sorry if this has been answered somewhere else...

Background: I'm a US citizen and have lived in Norway for about 15 years. I have a wife and 2 kids and consider this to be my home, i.e., I can't imagine ever moving back to the States under any circumstances...but that's another thread 

Anyway, I received a gift from my mom (non-taxable) which pushed one of my accounts up over the infamous $10,000 limit. Happy happy, Joy joy 

So, yes, I have to file FBAR for the first time and wonder about a couple of things:

Question 1) The money was deposited in Account #1 and withing a few days transfered to Account #2...If I report both accounts with having that amount, doesn't it make it look like I had twice the money I actually do? Or is that not really important?

Question 2) I also have a couple of savings accounts for my kids...do I have to list those as well even though they had NOTHING to do with the money from my mom, i.e., never touched any of that money?


Thanks in advance! Believe me, I've tried to decipher the officail instructions and have ended up losing sleep, stress, headaches, etc....I just want to get this over with and file as correctly as possible.

thanks again!


----------



## Bevdeforges (Nov 16, 2007)

hanksteelbottom said:


> Question 1) The money was deposited in Account #1 and withing a few days transfered to Account #2...If I report both accounts with having that amount, doesn't it make it look like I had twice the money I actually do? Or is that not really important?


Yes, you have to report all your non-US bank accounts, with the high balance for the year. They actually don't do much with the balance figures you give them and they are well aware that you may have transferred the same money from one account to another. 



> Question 2) I also have a couple of savings accounts for my kids...do I have to list those as well even though they had NOTHING to do with the money from my mom, i.e., never touched any of that money?


If you are a joint holder or have signature authority over the accounts, then yes, you have to report them. The rule is $10,000 cumulative balance across all your foreign accounts, not in just one account - so if you have 11 accounts, each with $1000, then you have to report them all.

But the FBAR is simply an information report. They don't do much of anything with the information (unless, I suppose, they have some reason to suspect something is "funny" with your income tax returns). 
Cheers,
Bev


----------



## BBCWatcher (Dec 28, 2012)

hanksteelbottom said:


> Question 1) The money was deposited in Account #1 and withing a few days transfered to Account #2...If I report both accounts with having that amount, doesn't it make it look like I had twice the money I actually do? Or is that not really important?


It doesn't look like _anything_ except that you have two (or more) accounts with particular peak values during the reporting year.

Is the government asking you for complete bank statements? The total peak value across all accounts at any one moment in time? No. Don't you think the government knows that 2 plus 2 does not necessarily equal 4 in this type of report? Give them some credit, OK?

I love all this second guessing.  The truth is the U.S. Treasury Department will put your report in a file drawer (metaphorical) and never look at it. Unless you or a family member decide to finance a terrorist group. Then they might be curious. But your truthful report will then probably be very boring indeed.

Said another way, just tell the truth and forget about it. The untruthful or missing report is *far* more interesting to the government.

If you are financing a terrorist group, talk to your lawyer first. And stop financing that terrorist group, please.



> Question 2) I also have a couple of savings accounts for my kids...do I have to list those as well even though they had NOTHING to do with the money from my mom, i.e., never touched any of that money?


The instructions are quite clear on this. Do you have signature authority over those accounts? Yes, you report them. No, you don't.

If either or both of your kids are U.S. citizens, and if either/both of them have a requirement to file, you help them file their own reports.


----------



## hanksteelbottom (Mar 13, 2014)

I appreciate the quick responses! Since I just found out about FBAR (I naively assumed the US Govt. would keep me informed of what I needed to do tax-wise...oh, silly me...) I've been feverishly reading everything I can about it, and here is how the instructions looked to me for the first few days:

"vague rule... PENALTY JAIL PENALTY JAIL...unclear rule.....PENALTY JAIL PENALTY JAIL...incomprehensible tax-speak...PENALTY JAIL PENALTY JAIL PENALTY PENALTY JAIL JAIL"

so I hope everyone can understand my trepidation and overly cautious asking of (what seems now to be) silly questions 

Good to read in other threads that I'm not alone on this...


----------



## BBCWatcher (Dec 28, 2012)

hanksteelbottom said:


> Since I just found out about FBAR (I naively assumed the US Govt. would keep me informed of what I needed to do tax-wise...oh, silly me...)


Actually they thought of that. Take a flip through your U.S. passport some rainy day to find the fine print. 

It's actually pretty good fine print because it tells you rather concisely what your responsibilities are. So kudos (seriously) to the bureaucrat(s) who authored that particular paragraph or two.


----------



## maz57 (Apr 17, 2012)

If it's all such a big deal (from the US government's point of view) it would have made much more sense to put it in bold red letters in the front of the passport so people won't miss it. 

They say they want compliance but then hide the relevant information way in the back in microscopic print. The natural tendency of normal people is to ignore fine print. How many folks actually read those EULAs on their computers? Right, they don't; they just click "I agree" and get on with their life. So in effect, fine print exists to create a means to later come back and ambush innocent people. 

No one sits down to read their passport, regardless of the weather. Plus if you don't happen to have a US passport there's not even fine print to read.


----------



## hanksteelbottom (Mar 13, 2014)

maz57 said:


> No one sits down to read their passport, regardless of the weather. Plus if you don't happen to have a US passport there's not even fine print to read.


I certainly didn't...

I also naively thought that since I registered at the Embassy as an American living abroad (or whatever) that they (US Gov) would send out a newsletter or something along the lines of 

"Hi American Citizens, don't forget that FBAR time is coming up! Be sure to check the IRS site for more information"...

I mean, how hard could that have been. Alas, my fault, yadda yadda....working on gathering up missing information as we speak


----------



## SuzieF (Feb 3, 2014)

hanksteelbottom said:


> I certainly didn't...
> 
> I also naively thought that since I registered at the Embassy as an American living abroad (or whatever) that they (US Gov) would send out a newsletter or something along the lines of
> 
> ...


Too easy.. And it would be nice if there was a little sign tacked unto the building at the border crossing.. " hey US "persons" did ya know you still had to to IRS and Fbar even tho ya don't live here anymore?" When :flypig: flys


----------



## Bevdeforges (Nov 16, 2007)

hanksteelbottom said:


> I certainly didn't...
> 
> I also naively thought that since I registered at the Embassy as an American living abroad (or whatever) that they (US Gov) would send out a newsletter or something along the lines of
> 
> ...


Nah - too many of us living abroad stop registering at the Embassy once we're "dug in" here overseas. Plus, you have to remember that the IRS has pretty limited resources when it comes to tracking us "caviar swilling expats" - there's a bit more potential information with this FATCA stuff, but reading over a couple of the Bilateral Agreements that kick in this year, there are still plenty of exemptions from the reporting requirements.

Way back when (when I was in Business School) they taught us that the IRS really does rely on voluntary compliance to a huge extent (for domestic as well as for international taxpayers). OK, in this age of computerization they certainly can run W-2's and 1099's against their data base of filings, but they literally have NO way to control foreign wages and benefits that you may (or may not) report - unless they have some reason to suspect something and can get the participation of your local government officials.
Cheers,
Bev


----------



## BBCWatcher (Dec 28, 2012)

maz57 said:


> No one sits down to read their passport, regardless of the weather.


Obviously I did. Those quotes from famous people are pretty interesting, too.

"Ignorance of the law isn't a defense" in most countries (including the U.S.), so that passport-published notice isn't even required. But there it is. Anyway, I was merely responding to the "nobody ever told me" remark. Well, nobody has to tell you, but, actually, as it happens, the U.S. State Department did and does every 5 or 10 years in those little blue books. And, if somebody were writing a "What Americans Living Overseas Must Know" guide, it's actually pretty good! Hats off to them.


----------



## DavidMcKeegan (Aug 27, 2012)

Just one more thing to add... I wouldn't be worried in the slightest about penalties or jail time for getting your FBAR's on track. From the sounds of your situation, it appears that this is the first year you have to worry about FBAR, and as long as you are filed by June 30th, then you are perfectly fine and on time (they couldn't assess fines if they wanted to).

I have seen people who have never filed an FBAR, and who had hundreds of thousands on their accounts, and did not receive a penalty. You will be fine!


----------



## maz57 (Apr 17, 2012)

BBCWatcher said:


> "Ignorance of the law isn't a defense" in most countries (including the U.S.), so that passport-published notice isn't even required. But there it is. Anyway, I was merely responding to the "nobody ever told me" remark. Well, nobody has to tell you, but, actually, as it happens, the U.S. State Department did and does every 5 or 10 years in those little blue books. And, if somebody were writing a "What Americans Living Overseas Must Know" guide, it's actually pretty good! Hats off to them.


You are factually correct on all points, BBC. However, I never read my passport, possibly because I never wanted one in the first place but was forced to get it after they tightened up things after 911. So for thirty years after I moved to Canada I had no US passport, and therefore had nothing to read re: tax obligations. 

I'll stand by my point that if they figured the message was so critically important they shouldn't have put it in the back in fine print. Perhaps they decided against putting it up front in big red letters due to "artistic considerations", LOL. Also, I read somewhere that the CBT notice was not included in passports until relatively recently. There's probably a Wiki on the history of US passports somewhere.

But we've drifted a long way from FBARs.


----------

