You have an excellent question here. The answer to it is yes; your bank in Finland has a legal right to ask for your United States Social Security Number (SSN). And, in fact, under current US law, they are required and compelled to do so . . . or they risk losing their banking privileges in the Unites States, and can be subject to legal action by the US Treasury Department. If you don't provide your SSN to the Finnish bank, they will probably have to close your account and send your deposit money back to you.
It actually doesn't matter (from a legal compliance perspective) whether you have ever moved money from a US account to or from this Finnish bank. What does matter is that you are either a US citizen or permanent resident with an interest in a "foreign financial asset" or account. The United States, both within the Internal Revenue Service (IRS) as well as the broader Treasury Department, have become much more aggressive in enforcing these foreign account reporting rules in recent years.
They've even taken the steps of forcibly "enlisting" the help of foreign banks and financial institutions in the effort to track foreign financial assets of US citizens and residents. What you are experiencing with your bank in Finland is almost certainly a small part of this larger effort. Basically, your Finnish bank has no reasonable choice but to collect your SSN (and use it to fill out their own compliance reports with the US Treasury Department) or to close your account as the alternative.
Aside from the bank's perspective on compliance, and the matter of providing your SSN (which should be as safe as giving your SSN to a domestic US bank), here's what you need to know as an individual US taxpayer.
There are actually two
separate United States disclosure forms that may be required for foreign bank account holders; each also has different
reporting rules.
One is known as IRS Form 8938, and can be
attached to the taxpayer's relevant yearly Form 1040 tax return. The other is FinCen
Form 114, which can only be filed via the internet. The following
Internal Revenue Service webpage describes them in detail, and provides
their dollar value reporting levels:
https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements
Form 8938 is included with
TurboTax. FinCen Form 114 is not included with TurboTax, as it must be
filed over the internet by using a special tax document from the US
Treasury Department. You would need to access that reporting
webpage separately, if your foreign financial assets total over the
limit(s). Note, however, that you can get to the FinCen reporting
internet site
through the above IRS link.
Thank you for asking this important question.
