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Do I have to file the FBAR even though I didn't earn any interest on a foreign account that I had more than $10,000 in 2016?

I recently (2017) purchased property outside the US, however, on December 29, 2016 I open a bank account in the same city where I purchased the property and deposited more than 10,000 dollars for the down payment and closing costs.  Because the transaction was so late in the year I didn’t earn any interest income for 2016.  Do I still need to file the FBAR?
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GeoffreyG
New Member

Do I have to file the FBAR even though I didn't earn any interest on a foreign account that I had more than $10,000 in 2016?

This is a good question, and I did some research on it for you.  The answer is that, in order to be compliant with FATCA, FBAR, FinCEN 114, IRS Form 8938, and IRS reporting requirements in general, a taxpayer has to report their foreign financial accounts (presuming they meet the filing threshold requirement), anytime that “the annual aggregate total of foreign accounts meets or exceeds the threshold requirements at any time during the year.”  This quote is directly from the US Treasury Department instructions.

Thus, even a foreign account opened just days before the end of the calendar year does not escape the reporting requirements, as long as its value exceed the filing threshold at any time during the year.  The following Internal Revenue Service webpage describes the filing requirements for Form 8938 and FinCen Form 114 in some further detail, and provides their dollar value reporting (threshold) levels:

https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements

 

Thank you for asking this important question.

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1 Reply
GeoffreyG
New Member

Do I have to file the FBAR even though I didn't earn any interest on a foreign account that I had more than $10,000 in 2016?

This is a good question, and I did some research on it for you.  The answer is that, in order to be compliant with FATCA, FBAR, FinCEN 114, IRS Form 8938, and IRS reporting requirements in general, a taxpayer has to report their foreign financial accounts (presuming they meet the filing threshold requirement), anytime that “the annual aggregate total of foreign accounts meets or exceeds the threshold requirements at any time during the year.”  This quote is directly from the US Treasury Department instructions.

Thus, even a foreign account opened just days before the end of the calendar year does not escape the reporting requirements, as long as its value exceed the filing threshold at any time during the year.  The following Internal Revenue Service webpage describes the filing requirements for Form 8938 and FinCen Form 114 in some further detail, and provides their dollar value reporting (threshold) levels:

https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements

 

Thank you for asking this important question.
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