For married filing jointly with foreign accounts, consider the following example with two bank accounts A and B:
May 1st:
Account A balance = $50,000
Account B balance = $10,000
May 2nd:
$60,000 was transferred to Account A (from an external source) leading to:
Account A = $110,000
Account B = $10,000
May 3rd:
$60,000 was transferred from Account A to Account B leading to:
Account A = $50,000
Account B = $70,000
How is the aggregate calculated for Form 8938's reporting threshold?
a) Aggregating the maximum value of all accounts crosses the threshold but a lot of it is counting the same money twice i.e. Account A max of $110,000 + Account B max of $70,000 gives $180,000 (meeting the $150,000 threshold).
b) Or is the aggregate calculated based on a single day?
For example, on May 2nd Account A balance of $110,000 and Account B balance of $10,000 = $120,000. Similarly on May 3rd too the calculation comes to $50,000 + $70,000 = $120,000.
For purposes of the 8938 (as well as FBAR/FinCEN 114) money often is counted twice. The threshold is met when the year-end balance or any single-day balance exceeds the amount for the residency and filing status.
In addition to these amounts triggering the requirement to file, the highest balance for each account, separately, needs to be reported - even if it represents the same funds being moved around. The IRS is aware that many taxpayers move money through the year (from checking to higher interest savings, for example) and understands that this is not a representation of total assets or net worth.