Tax Reporting on Foreign Assets

[CowBoE 429]

My fiancee has chunk of money in cash savings and in retirement insurance (kind of like IRA / Social Security in US).

This IRS page says you need to report

"taxpayers with foreign accounts whose aggregate value exceeded $10,000 at any time during 2012 must file Treasury Department"

http://www.irs.gov/uac/Newsroom/IRS-Reminds-Those-with-Foreign-Assets-of-U.S.-Tax-Obligations

This page says, any type of Social Security program run by the foreign government need not be reported.

http://www.irs.gov/Businesses/TypesofForeignAssetsandWhetherTheyareReportableonForm-8938

But on this IRS page, it says if it's below $50K, no reporting is necessary.

"If the total value is at or below $50,000 at the end of the tax year, there is no reporting requirement for the year, unless the total value was more than $75,000 at any time during the tax year"

http://www.irs.gov/Businesses/Corporations/FATCA-Information-for-Individuals

Anyone with experience on should or should not be reported to IRS?

Edited September 8, 2014 by DualityOneness

[RandyW 149]

From your link - BOTH reporting requirements apply. There are two different forms.

Alert: The reporting requirement for Form 8938 is separate from the reporting requirement for the FinCEN Form 114, Report of Foreign Bank and Financial Accounts (“FBAR”) (formerly TD F 90-22.1). An individual may have to file both forms and separate penalties may apply for failure to file each form. See the Comparison of filing requirements for further information.

See the Comparison of filing requirements for further information.

As of 2014 (effective in Jan., 2015), Chinese banks are expected to cooperate with the IRS

Beijing to back United States over new FATCA law against tax evasion

[Darnell 8,478]

ain't reportable till the first tax year she's in the USA as a permanent resident, IIRC.

[RandyW 149]

ain't reportable till the first tax year she's in the USA as a permanent resident, IIRC.

NOT TRUE - reportable as of the first year she falls under the U.S. tax umbrella. This would happen when (if) you use the Married, filing jointly filing status.

from the i8938 instructions

You are a specified individual if you are one of the following.

• A U.S. citizen.
• A resident alien of the United States for any part of the tax year (but see Reporting Period, later).
• A nonresident alien who makes an election to be treated as a resident alien for purposes of filing a joint income tax return.
• A nonresident alien who is a bona fide resident of American Samoa or Puerto Rico. See Pub. 570, Tax Guide for Individuals With Income From U.S. Possessions, for a definition of bona fide resident.

Requirements for the FinCen Form 113 Report of Foreign Bank and Financial Accounts (FBAR) are separate.

Who Must File an FBAR

United States persons are required to file an FBAR if:

1. the United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
2. the aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year reported.

United States person includes U.S. citizens; U.S. residents; entities, including but not limited to, corporations, partnerships, or limited liability companies, created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.

[Darnell 8,478]

Randy - they ain't married yet.

Sorry, my calendar actually matches yours, but for different reasons/labels.

[RandyW 149]

Randy - they ain't married yet.

Sorry, my calendar actually matches yours, but for different reasons/labels.

Then they can't file married, filing jointly - she is NOT under the IRS' thumb until they do.

They (or anyone else) can make their own determination of which reports they need to file. Not to be argumentative - I'm only concerned with AWARENESS.

Sorry, but telling people they don't need to file the reports until they are permanent residents is a step AWAY from that goal.

[CowBoE 429]

Then they can't file married, filing jointly - she is NOT under the IRS' thumb until they do.

They (or anyone else) can make their own determination of which reports they need to file. Not to be argumentative - I'm only concerned with AWARENESS.

Sorry, but telling people they don't need to file the reports until they are permanent residents is a step AWAY from that goal.

She's due to POE tomorrow (Sept 12), and we will do civil marriage within weeks of her arrival,

so we will be married in 2014, and will file as "Married filing jointly".

So I understand about the cash savings need to be reported,

but China employment rule mandates various social insurances such as

1) Pension

2) Medical

3) Unemployment

4) Housing Fund

5) Work-related Injury

6) Maternity

http://www.china-briefing.com/news/2014/02/24/social-insurance-compliance-in-china.html

According to this link, looks like any Social Security type accounts do NOT need to be reported.

http://www.irs.gov/Businesses/Comparison-of-Form-8938-and-FBAR-Requirements

BTW, do you know what the regulations are to withdraw them?

Edited September 11, 2014 by DualityOneness

[RandyW 149]

She's due to POE tomorrow (Sept 12), and we will do civil marriage within weeks of her arrival,

so we will be married in 2014, and will file as "Married filing jointly".

So I understand about the cash savings need to be reported,

but China employment rule mandates various social insurances such as

1) Pension

2) Medical

3) Unemployment

4) Housing Fund

5) Work-related Injury

6) Maternity

http://www.china-briefing.com/news/2014/02/24/social-insurance-compliance-in-china.html

According to this link, looks like any Social Security type accounts do NOT need to be reported.

http://www.irs.gov/Businesses/Comparison-of-Form-8938-and-FBAR-Requirements

BTW, do you know what the regulations are to withdraw them?

Sorry, but I'm not familiar with any of those accounts. If you and/or your wife have financial accounts in China above the $10,000 or $50,000 thresholds, it's in your own best interests to familiarize yourself with the FBAR and 8938 requirements and determine for yourself whether to file one or both forms.

If she has had any Foreign Earned Income this year, you may wish to also take a look at the Foreign Earned Income Exclusion, Form 2555 and the Foreign Earned Income worksheet in the 1040 instructions. The 'Foreign Earned Income Exlcusion' does NOT allow you to actually EXCLUDE the foreign earned income - it will be treated as a tax credit, beginning at a 10% rate (read the forms and instructions).

Edited September 12, 2014 by RandyW