# Form 8938 question



## BearDown (Sep 20, 2014)

Say a single person has 2 foreign accounts with $100,000 each at the beginning of the tax year. Halfway through the tax year, he transfers the full balance of one account to another account and closes the originating account. This means at the end of year he still has 2 "active" accounts with a combined balance of $100,000.

For FBAR purposes, I know he would need to report 3 accounts showing $100,000 in each of them. However, on his 8938, would he report 2 accounts or 3 accounts? I've read the instructions but couldn't figure out the correct approach.

Thanks in advance!


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## Bevdeforges (Nov 16, 2007)

> Halfway through the tax year, he transfers the full balance of one account to another account and closes the originating account. This means at the end of year he still has 2 "active" accounts with a combined balance of $100,000.


From what you've described, you'd have one account with a max balance of $100,000 to report (i.e. the closed one) and another (where you'd combined the funds from the two accounts with $100,000 each) with a max balance for the year of $200,000.

Or maybe I'm misreading - and you closed one account and opened a new one - in which case, you'd have three accounts to report - each with a max balance for the year of $300,000. 

You are supposed to report all accounts you held at any time during the year - and each account is reported at the maximum balance it held during the year.
Cheers,
Bev


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