# TransferWise, PayPal and FBAR



## Ogier P.

The aggregate value of my foreign financial accounts exceeded $10,000 during the calendar year 2021.
One of those accounts (TransferWise) was opened in a foreign country and I have both a foreign and a USD "balance". As far as I'm aware, the USD balance only has a US address associated with it. The form doesn't allow me to select the USA - should I simply exclude this USD balance on the form?

Also, there seems to be a lot confusion online about PayPal accounts that have been opened overseas - if it's strictly a personal account (I don't receive payments) does it need to be included?
I've read elsewhere on this forum that no one really pays attention to FBARs but still, I'd really like to know 🤓

Any advice you can provide will be appreciated 🙂


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## Nivie

You may not get a definitive answer. I include my Paypal account. Not sure if I need to but it does not take any longer to add my paypal to FBAR as it does to typing this reply. No confusion, no risk and no need to think about it anymore until next tax year.


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## Ogier P.

Nivie said:


> You may not get a definitive answer. I include my Paypal account. Not sure if I need to but it does not take any longer to add my paypal to FBAR as it does to typing this reply. No confusion, no risk and no need to think about it anymore until next tax year.


Thanks Nivie,
RE: PayPal, if your situation is like mine and never receive payments, what do you put as max balance, $0? I know it doesn't take long to fill out and there's no harm in any case, but I don't understand why we can't get a definitive answer. I am a geek I suppose


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## Moulard

If Paypal is not holding funds for you then it is not a financial account. For example if you are using paypay simply as a payment gateway entering credit card or other details as the source of the funds.
If you do use it to hold funds that you draw down on for payment to other parties then it is a financial account.

If you have gotten this far, and they do hold your funds then the next question to ask is it a foreign financial account or not.
The answer to that will depend on the actual organisation your account is with. Paypal is not one company.. it is many companies 
Simplest way may be to check a statement, account balance, or other factor that may include a business address on it. If its not a US address it is foreign.

Same principles will apply for Transferwize


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## saffron_gin

Ogier P. said:


> The aggregate value of my foreign financial accounts exceeded $10,000 during the calendar year 2021.
> One of those accounts (TransferWise) was opened in a foreign country and I have both a foreign and a USD "balance". As far as I'm aware, the USD balance only has a US address associated with it. The form doesn't allow me to select the USA - should I simply exclude this USD balance on the form?
> 
> Also, there seems to be a lot confusion online about PayPal accounts that have been opened overseas - if it's strictly a personal account (I don't receive payments) does it need to be included?
> I've read elsewhere on this forum that no one really pays attention to FBARs but still, I'd really like to know 🤓
> 
> Any advice you can provide will be appreciated 🙂



Oh this is interesting...My wise account still has my US address associated with it (hadn't managed to change it as yet), and briefly my Euro balance went over 10k...and was thinking that I would need to have to file FBAR....but from what you say, maybe not? 

I am in France on a visitor LSV and likely won't have to file taxes at all in the US as my 'income' per se for the past year would have been a minuscule amount from a US savings account...

Could you/someone clarify for me....thanks.


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## Bevdeforges

saffron_gin said:


> and briefly my Euro balance went over 10k...and was thinking that I would need to have to file FBAR


Technically, yes, you should report it - using the bank address listed for your Euro balance that Wise provides (I think last time I looked, it was in Belgium). But what matters isn't the address that Wise (i.e. the bank) has on file for you, but rather where you actually reside. However, the chances are remote that the IRS would follow up on this, even assuming that Wise will report the balance to the IRS. However, it's not a matter of one account going over the $10,000 point - if the accumulated total of all your foreign based accounts exceeds $10,000 then you are supposed to report ALL your foreign accounts.



saffron_gin said:


> I am in France on a visitor LSV and likely won't have to file taxes at all in the US as my 'income' per se for the past year would have been a minuscule amount from a US savings account...


Depends on your US tax filing status. If you file as "single" then your filing threshold is $12.550 (i.e. you really don't have to file if your total worldwide income doesn't exceed this amount). But if you file as "married, filing separately" you're supposed to file if your worldwide income exceeds $5 for the year. (No digits missing in that one, it's really only five dollars.)


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## saffron_gin

Bevdeforges said:


> Technically, yes, you should report it - using the bank address listed for your Euro balance that Wise provides (I think last time I looked, it was in Belgium). But what matters isn't the address that Wise (i.e. the bank) has on file for you, but rather where you actually reside. However, the chances are remote that the IRS would follow up on this, even assuming that Wise will report the balance to the IRS. However, it's not a matter of one account going over the $10,000 point - if the accumulated total of all your foreign based accounts exceeds $10,000 then you are supposed to report ALL your foreign accounts.
> 
> 
> Depends on your US tax filing status. If you file as "single" then your filing threshold is $12.550 (i.e. you really don't have to file if your total worldwide income doesn't exceed this amount). But if you file as "married, filing separately" you're supposed to file if your worldwide income exceeds $5 for the year. (No digits missing in that one, it's really only five dollars.)



Thanks Bev...that is crystal clear...about FBAR...and it ought to be filed if the worldwide total exceeds 10k USD and then I should report all my overseas account, irrespective of whether I have to file taxes or not, yet?


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## saffron_gin

saffron_gin said:


> Thanks Bev...that is crystal clear...about FBAR...and it ought to be filed if the worldwide total exceeds 10k USD and then I should report all my overseas account, irrespective of whether I have to file taxes or not, yet?


*yes?


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## Moulard

saffron_gin said:


> My wise account still has my US address associated with it


From the perspective of your reporting requirements. Your address does not matter.. what determines whether or not it is a foreign financial account is the tax residency of that institution. That is why I suggested checking their address.

As for their reporting requirements that is different. They will also have reporting requirements under whatever IGA may be in place to their local tax authority, who then report it to the IRS. 

Practically speaking however, what you report and what they report will never align... so don't loose too much sleep over it.




saffron_gin said:


> Thanks Bev...that is crystal clear...about FBAR...and it ought to be filed if the worldwide total exceeds 10k USD and then I should report all my overseas account, irrespective of whether I have to file taxes or not, yet?


That is right, FBAR is completely separate to Income tax even though they can include the same information.

FBAR is Title 31 Income tax is Title 26 

Although the IRS now deals with some of the Administrivia related to the FBAR because, truth to tell, FinCen are not interested in ordinary accounts.


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## Bevdeforges

saffron_gin said:


> Thanks Bev...that is crystal clear...about FBAR...and it ought to be filed if the worldwide total exceeds 10k USD and then I should report all my overseas account, irrespective of whether I have to file taxes or not, yet?


Yes. FBAR is a separate filing from your income taxes.


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## Nivie

Ogier P. said:


> Thanks Nivie,
> RE: PayPal, if your situation is like mine and never receive payments, what do you put as max balance, $0? I know it doesn't take long to fill out and there's no harm in any case, but I don't understand why we can't get a definitive answer. I am a geek I suppose


Hi. I put my one time maximum balance that was held in Paypal however short of time, could have been just a few hours.


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## Ogier P.

Thanks for the information everyone 🥳.

Question 1 - I have 2 TransferWise "balances":
a) USD balance = $10,000 (balance apparently held in a US bank)
b) YYX balance = $5000 (foreign balance converted to USD)
Because my foreign financial accounts exceeded $10,000 for calendar year 2021 I will complete an FBAR. I have other bank accounts too, but they _are _foreign so easy to work out. But what should the maximum balance for TransferWise be $5000 or $15,000? 
If the form allowed a US address to be input I'd just include the USD balance to make life easy but it doesn't allow this. What would you do?

Question 2 - PayPal
My PayPal account is _only _used to make payments. It _is _a foreign account.
Assuming that I _must_ include this account in my FBAR what would the maximum balance be? Would it be $0 (because I don't receive payments or hold a balance) or would it be the highest _purchase _amount I've used PayPal for during the year?
🤓
Thanks for all the help!


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## Bevdeforges

For the Wise accounts, you can find the address and account number information for each of your currency balances in the section for the details of your borderless account. For a US FBAR, you only need to report the YYX balance account information and balances. If your country of residence has any requirements for reporting foreign financial accounts, you would include the account for your Wise US$ holdings.

Can't help you on the PayPal account - though I suspect you'd have to have a balance of some sort in order for it to be reportable. I had a PayPal account a LONG time ago but haven't used it in years now. But to the extent that you are just making payments through the account and not collecting or accumulating a balance, I would consider it to be like a foreign credit card rather than like a bank account.


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## Ogier P.

Bevdeforges said:


> For the Wise accounts, you can find the address and account number information for each of your currency balances in the section for the details of your borderless account. For a US FBAR, you only need to report the YYX balance account information and balances. If your country of residence has any requirements for reporting foreign financial accounts, you would include the account for your Wise US$ holdings.
> 
> Can't help you on the PayPal account - though I suspect you'd have to have a balance of some sort in order for it to be reportable. I had a PayPal account a LONG time ago but haven't used it in years now. But to the extent that you are just making payments through the account and not collecting or accumulating a balance, I would consider it to be like a foreign credit card rather than like a bank account.


Merci beaucoup Bevdeforges🦉!


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