FBAR filing joint account with parent outside of US

[yoru1119]

Hi,

I saw a lot of people asking about join account with spouse, but my situation is a bit different, it’s a joint account in a foreign country with my mother who is not a U.S. person and live outside U.S. her whole life.

I have a small amount of saving in that account before I move to US, but everything else are hers (including her income and investment gains that has nothing to do with me). I do not have foreign income or investment in the joint account. I only occasionally help my mom manage the account, like if I saw she have a credit card bill overdue, or like an accidental overdraft and I’d help her move money from savings to current account. 

Do I still file FBAR? But seems unfair if over 90% of the asset is not mine? Would IRS want to tax me on this joint account if I file FBAR? 
Is there anything I should do to avoid this? 

[SusanY1]

Since you can sign on the account, you do need to report it on your Foreign Bank Account Report (FBAR/FinCEN 114) if the highest daily value of the account is $10,000 or more during the tax year. 

There is no way to really avoid it if have control of the assets, even though they may not fully belong to you. 

There is no tax due with the filing of the FBAR report.  It is an information report only.  

However, if the account pays interest you need to report your share of interest income (if any) on your tax return. 

[yoru1119]

Thanks for the reply! Should I report this under part III joint account, or part IV filer has signature authority but no financial interest in the account?

Do you know if I also need to file Form 8938? But the account does not generate foreign income for me (my mom use the account to receive income, not me)

[DaveF1006]

It depends. If you have a joint financial interest in the account (e.g., you co-own it), you would report it under Part III. However, if you only have signature authority over the account but no financial interest (e.g., you can access or manage the account but don't benefit financially), you would report it under Part IV.

You may need to file Form 8938 even if the account doesn't generate foreign income for you. The requirement to file depends on the value of the foreign financial assets and your filing status. For example, if you're a single-filer living in the U.S., you must file Form 8938 if the total value of your specified foreign financial assets exceeds $50,000 on the last day of the tax year or $75,000 at any time during the year. Since the account is used by your mom to receive income and not you, it might not count as your financial asset unless you have a financial interest in it and retain all rights to it as an account holder.