FATCA or FBAR filing thresholds

[reikiman]

Trying to clarify my understanding of filing requirements regarding a foreign bank account.

I had read via one of the Taxes for Expats books you find on Amazon a strong warning to always notify (FBAR etc) the US Govt when you have a foreign bank account. There is of course an overriding need to locate tax evaders etc.

But the other day reading the IRS web pages on this, I see discussion of filing thresholds. For FATCA there are several ways to categorize the thresholds - but for example one of the thresholds was an account value of $50,000. For FBAR there is also a threshold, of a minimum of $10000 account value.

So... that means, if I understood right, that below those thresholds one is not required to make a FATCA or FBAR filing?

 

[Just Blue]

I will tag @Taxing Matters for you. He is a site vetted Tax Attorney.

 

[Taxing Matters]

Trying to clarify my understanding of filing requirements regarding a foreign bank account.

I had read via one of the Taxes for Expats books you find on Amazon a strong warning to always notify (FBAR etc) the US Govt when you have a foreign bank account. There is of course an overriding need to locate tax evaders etc.

But the other day reading the IRS web pages on this, I see discussion of filing thresholds. For FATCA there are several ways to categorize the thresholds - but for example one of the thresholds was an account value of $50,000. For FBAR there is also a threshold, of a minimum of $10000 account value.

So... that means, if I understood right, that below those thresholds one is not required to make a FATCA or FBAR filing?

There are several disclosures that may be required for a U.S. citizen/resident who has assets outside the United States. Regardless of amount, you do need to complete the foreign account disclosure on your Form 1040, Schedule B. The requirements for the Form 8938 and FBAR filing requirements only apply above certain levels. Note the levels are determined by aggregating the value of all reportable assets together. So if you have 3 accounts that total $50,000 you'd have the reporting requirement for Form 8938 even though none of the accounts alone met that threshold. The IRS has a handy chart that compares the 8938 and FBAR requirements that is useful to help you sort out when each form needs to be filed.

 

[LdiJ]

There are several disclosures that may be required for a U.S. citizen/resident who has assets outside the United States. Regardless of amount, you do need to complete the foreign account disclosure on your Form 1040, Schedule B. The requirements for the Form 8938 and FBAR filing requirements only apply above certain levels. Note the levels are determined by aggregating the value of all reportable assets together. So if you have 3 accounts that total $50,000 you'd have the reporting requirement for Form 8938 even though none of the accounts alone met that threshold. The IRS has a handy chart that compares the 8938 and FBAR requirements that is useful to help you sort out when each form needs to be filed.

I agree, but it's safe to say that if someone has only bank account/financial assets abroad and those assets are less than 10k, that their only reporting requirement is to identify the income from those assets on Schedule B and to take credit for any foreign income tax paid on Form 1116.

 

[reikiman]

I see - Schedule B is for interest and dividends. But it has a section on foreign trusts. Thank you

 

[Taxing Matters]

I see - Schedule B is for interest and dividends. But it has a section on foreign trusts. Thank you

It is a section that asks questions about both foreign accounts and trusts. So if you have a foreign bank account, brokerage account, or other foreign financial asset you'd complete that part of Schedule B.