Retirement Account in Peru

[gsolari]

Hi,

I have a retirement account  (AFP), that I opened in Peru back in 1998. I only made a one time deposit of less than $200 and never funded it again. I just checked as I was preparing my tax return for 2025, and the balance is around $300 with a gain of approximately $20 for the year. Do I need to report that? I was thinking about closing that account that is more of a hassle than a it is a benefit.

[Opus 17]

Technically, if you are being credited with interest annually (a few dollars a year), that should be reported each year that the interest is paid.  Then, when withdrawing the funds and closing the account, no tax would be owed because you are just withdrawing your own money.

Since you have not reported the interest, what I would do is withdraw the funds in 2026, and you would then report the interest amount (the amount of gain over the years, not the whole amount of the account) as bank interest.  You won't get a 1099-INT since it's a foreign bank, so there is a box you can check for "I did not get a 1099-INT for this interest."  If you kept the account, you should probably report all the interest to date in one lump sum, then keep track and add the yearly interest to your tax return each year.