# U.S citizen with UK residency



## Ravencloud (Mar 29, 2018)

Hi all, I've been lurking here in the hopes of getting my head around by tax obligations as an expat but still feel completely lost and overwhelmed.

I had no idea I needed to file tax returns since I moved here in 2005. My husband is a British citizen and I got my two children us passports as we travel to my family in the us every year.

I worked from 2007 to 2010 and have been a Stay at home mom until last Nov when I started working part time. 

I have been told by H and R block that I don't need to file a return this year (they've looked over my details) but I think I need to do the FBAR.

I don't know whether to start next year as I think I'll be above the threshold for earnings and file everything together. It seems odd to file the FBAR alone (I guess I'd have to do the past 6 years).

Which is the best way to file? Is it pretty self explanatory? I worry about making mistakes and facing penalties.

Any help you can give me will be much appreciated.

Thanks


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## Bevdeforges (Nov 16, 2007)

The FBARs are probably the easiest part of the reporting requirement - and yes, those are required, even if you don't have enough income to file. They're tedious, but not horribly difficult to file. I would recommend using the "download the file" option (you will need the free Adobe Acrobat pdf program). That way, you can save a copy of the form and (unless they change the forms next year) just make changes to your copy (i.e. dates, high balances) and upload next year.

For tax filing - if you don't need to file this year, then don't. It's not unusual for those of us overseas to simply not file for a few years (if we don't have income sufficient to report) and then start filing again when our income increases (or is subject to US taxes for whatever reason).

The FBAR is where you (theoretically) face penalties for not filing - though these aren't often imposed unless there are problems related to your income tax filings. For income taxes, "late" filing penalty is a percentage of the tax amount due, so unless you owe taxes on years not filed, the penalty is a whopping $0.
Cheers,
Bev


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## Ravencloud (Mar 29, 2018)

Thank you so much Bev. I really appreciate it. 

I've read the deadline for FBAR is April 15 but also read there is an automatic extension to Oct 15 (I've read this was only for actual tax returns but also read it applied to FBAR too, hence my confusion.)


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## Bevdeforges (Nov 16, 2007)

Basically, I guess the official deadline for FBARs is April 15th, but they've more or less announced that they won't do anything for those filed late. Not sure in practice what that means, but what's that about "not looking a gift horse in the mouth?"
Cheers,
Bev


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## Ravencloud (Mar 29, 2018)

Thanks again.

I've also just bought a house with my British husband. Are there any US tax implications regarding that?

My children are also dual UK US citizens. When will tax issues affect them? I know the FBAR thing applies to them if their accounts pass the threshold or is that just if I have signature in their accounts ?


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## Bevdeforges (Nov 16, 2007)

Buying a house with your husband doesn't really add anything to your US tax reporting requirement - until and unless you sell the place for a whopping big profit. (Well, more than the $250,000 you're currently allowed on sale of a personal residence.) 

But, your kids, as dual nationals, are definitely subject to all the same US reporting requirements as you are. If they have overseas accounts that total more than $10,000 then they need to file FBARs (or have you file for them if they're too young to file for themselves). Plus, you need to report any of their accounts that you have signature authority over on your own FBAR.

If the kids were born outside the US, they are much more able to just stay below the IRS radar if they choose. However, if they want to "take advantage of" their US citizenship (by moving to or studying in the US), it's probably best to get used to the filing obligations. They won't have to file income tax forms until their income exceeds the filing threshold for their status. But once they start earning, they have all the same obligations that you have.
Cheers,
Bev


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## Ravencloud (Mar 29, 2018)

Thank you. That's good to know.


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## Nononymous (Jul 12, 2011)

Ravencloud said:


> My children are also dual UK US citizens. When will tax issues affect them? I know the FBAR thing applies to them if their accounts pass the threshold or is that just if I have signature in their accounts ?


I would take a slightly more cautious approach with the kids. If they are UK-born, with dual UK-US citizenship, my view is they should stay as far away from any and all US entanglements as possible, unless they are very certain they plan to move to the US at some point. 

First, they should remain off the US tax radar - do not file returns or FBARs. 

Second, they should open bank accounts not connected to you in any way - go to a new bank with their UK parent and UK identification and answer "no" if asked about US citizenship. This will avoid FATCA reporting and, more importantly, protect them from any future restrictions on banking and investment services. (The UK doesn't sound too bad yet but in Switzerland it's apparently a nightmare for US citizens to do anything financial.)

If at some future date they decide to study in the US, they can easily come into compliance then. 

If you can avoid getting them US passports, that reduces further their contact with the US government, but it you enter the US as a family and one parent is on a US passport, a halfway alert official may ask about the children's citizenship.


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