FBAR and buying a house

[Gator]

2 hours ago, davewe said:

 I assume it's to track potential illegal financial activities abroad.

That and to assess if any income tax is owed on it or any interest income earned on the account(s). As well as to track any income earned outside of the US that is not reported to the IRS. 

FBAR = Foreign Bank and Financial Accounts.  But I like Dave’s definition better as it best describes the IRS and it overly complicated rules. 

[sonjack2847]

2 hours ago, Dave Hounddriver said:

Fecked Beyond All Recognition

 

That`s what I  knew it as.

[OnMyWay]

1 hour ago, Gator said:

That and to assess if any income tax is owed on it or any interest income earned on the account(s). As well as to track any income earned outside of the US that is not reported to the IRS. 

FBAR = Foreign Bank and Financial Accounts.  But I like Dave’s definition better as it best describes the IRS and it overly complicated rules. 

FBAR reporting was around before the FATCA laws were created, but FBAR probably didn't accomplish much then.  What FATCA added was the foreign bank reporting back to the U.S.

So, for example, if BPI reports to the IRS that you had $30,000 max in your accounts in 2018, and earned $300 interest on it, your FBAR report should reflect the $30,000 and your tax return should show the $300.  In this scenario, if you DON'T file an FBAR, there is a potential fine and not reporting the $300 on your tax return might trigger an audit.  I'm not sure how detailed they are if the amounts are small, but there is a section on the IRS form 1040 that asks if you filed FBAR.

My interest earned at BPI as been $200-300 the past few years and I reported it to the IRS.  The PH tax that BPI withholds can be credited as a foreign tax credit.

BTW, the due date for filing FBAR is the same as taxes, April 15th, 2019, tomorrow!

Edited April 14, 2019 by OnMyWay
Typo, added the DON'T!