# Form 8938



## whistlerexpat (Oct 17, 2013)

question regarding reporting bank balances. Do you report the highest balance during the year for each account as with FBARs or the balance at the end of the year? My concern is I have transferred money between accounts and looks like my total is 500,000 when really is only 250,000


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## cuerna1 (Mar 7, 2015)

My answer : the highest balance during the year. But wait - it gets worse - if you have a spouse, and the account is 'joint' - you need to both file (for the fbar). When we transfer funds we use one account on the US side and another in Mexico. When it reaches Mexico it gets reallocated - across banks. You are right - if you add it all up we are very wealthy people...


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## Bevdeforges (Nov 16, 2007)

cuerna1 said:


> My answer : the highest balance during the year. But wait - it gets worse - if you have a spouse, and the account is 'joint' - you need to both file (for the fbar). When we transfer funds we use one account on the US side and another in Mexico. When it reaches Mexico it gets reallocated - across banks. You are right - if you add it all up we are very wealthy people...


Small clarification - both spouses have to file only if both spouses are US citizens or otherwise have a US tax filing obligation (say, a green card holder). For someone married to an NRA (non resident alien), there is the option to file as "married, filing separately". Still have to report the full balance in the joint accounts, but the NRA spouse's income does not have to be reported unless the couple elects to file with the NRA spouse as a full year resident. (And that may have further implications.)
Cheers,
Bev


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## whistlerexpat (Oct 17, 2013)

Bevdeforges said:


> Small clarification - both spouses have to file only if both spouses are US citizens or otherwise have a US tax filing obligation (say, a green card holder). For someone married to an NRA (non resident alien), there is the option to file as "married, filing separately". Still have to report the full balance in the joint accounts, but the NRA spouse's income does not have to be reported unless the couple elects to file with the NRA spouse as a full year resident. (And that may have further implications.) Cheers, Bev


I guess my question is still on the form 8938 do you report the balances at the end of the tax year or the highest during the tax year as not quite clear on the 8938 instructions put out by the IRS and are they not going to question all of a sudden this large new report amount compared to last year as I moved money around?


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## BBCWatcher (Dec 28, 2012)

Highest balance.

No, they're not going to question. In the extremely unlikely event I'm wrong, have you laundered drug money? Have you funded a child pornography ring? Have you hidden money in order to evade taxes illegally? Do you finance international terrorism? If the answer to these and similar questions questions is no, then you'll have a perfectly reasonable, truthful explanation in reply to any letter the IRS or the U.S. Treasury Department sends you inquiring about your fund movements. If you lie on a financial disclosure form, especially for no good reason, then things get more "interesting."


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## DavidMcKeegan (Aug 27, 2012)

Yes it is quite common for funds that have been transferred throughout the year to be "double counted" on the FBAR forms. This is nothing the Treasury has not seen before, and you should be absolutely fine. The key part of the FBAR is the "disclosure" and not necessarily the balance. They just want to know about the existence of the account, and they don't necessarily care about the numbers reported.

Good luck!


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## whistlerexpat (Oct 17, 2013)

DavidMcKeegan said:


> Yes it is quite common for funds that have been transferred throughout the year to be "double counted" on the FBAR forms. This is nothing the Treasury has not seen before, and you should be absolutely fine. The key part of the FBAR is the "disclosure" and not necessarily the balance. They just want to know about the existence of the account, and they don't necessarily care about the numbers reported. Good luck!


Thanks very much David for clarifying. I am assuming the same goes for the form 8938. Seems crazy that reporting the same exact information twice even though to separate reporting agencies.


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## BBCWatcher (Dec 28, 2012)

Slightly crazy, but keep in mind that truthful people tell the same truth twice or even three times, especially when asked slightly different questions. As Perry Mason could have told you.


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## DavidMcKeegan (Aug 27, 2012)

Yes the same goes for Form 8938, you would report the maximum value of the specified foreign financial assets. 

Just be careful though as with the Form 8938, items other than bank accounts must also be reported (for example interest in a partnership, hedge funds, equity funds and even foreign stock in rare occasions).

Good luck!


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## whistlerexpat (Oct 17, 2013)

BBCWatcher said:


> Slightly crazy, but keep in mind that truthful people tell the same truth twice or even three times, especially when asked slightly different questions. As Perry Mason could have told you.


Thanks. Yes you are right honesty is the best as I am not trying to hide anything just wish the powers to be could make it simple and logical.


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