Wednesday, June 17, 2015

The dreaded FBARs


Now there are only a few people in the world that will understand what I am talking about (the rest of the USA citizens who have to file a list of their foreign bank accounts), but perhaps the rest of the world should be aware as if the USA can do it, what's to stop the other countries from decided to do the same?
For your edification: FBAR = Foreign Bank Account Report

Disclaimer: I like my IRS enrolled agent who is not only efficient, but also actually nice so the following is no reflection upon S!

First one gathers the materials, makes the excel tables, pdfs (new vocabulary) the various pieces of tax “proofs” for mortgages, bank statements, charitable deductions, salary statement, W-9s, and all the other assorted junk that one apparently needs to survive in this world; secondly one forwards all this (the past couple of years by e-mail, which means color coding bits and pieces to make sure that all of it was actually transferred to one’s tax agent); then one awaits his or her input, requests for additional information or further “proofs”;
Thirdly one proceeds to go through every single bank account, life insurance policy or other investment to make sure that one has declared the highest amount in the 365 days of the year, cause if you make a mistake you will not only be fined $10’000.00 but will pay a penalty that can easily take the whole account (now in theory you don’t have to do this for anything under $10’000 but if it was that one year and not the next year, you’d better declare it anyway unless you can prove that you closed that account – cause who knows but what that might not be a “criminal” offense) and transfer those results to your IRS enrolled agent so that he or she can establish your FBARs.

Then the nightmare starts:
…” Please review the form to ensure that all your foreign accounts (including pension and life insurance) in which you have either financial interest or signature authority (or both) have been reported.  Please contact us if there are any accounts that should be indicated on this form which are not listed. 
- Please save the attached file on your computer.
- Please open the pdf form from your computer, then click first on the ‘Sign the Form’ button.
- Please then click on the ‘Save’ button to save the form to your computer. 
- After the form has been saved you should click on the ‘Ready to File’ button which will redirect you to the BSA efiling website. 
- Once at the BSA efiling website you will need to enter your name and email address before browsing to the location where you saved the form on your computer.  Once you have clicked on the button to submit the form you will automatically receive a confirmation of the submission;  this confirmation will also be sent to you via email.  For further assistance with this process please visit the following website - http://bsaefiling.fincen.treas.gov.  …”


Now you know that you have provided your tax agent with all the information, in my case nothing (but the amounts – lower, much lower due to expenses renovating etc.) has changed, still you have a ball in the bottom of your stomach, you live in fear of missing something – be it even one penny – because if you do, the IRS isn’t going to believe you, or if by some totally unforeseeable miracle they do, you are still going to be paying a fine and a penalty and risk finding yourself on the black list the next time you visit your brother or sister in the USA, yet you still panic; you still feel like a criminal.

Nor will I go into the other potential negative: as this FBAR report must be filed on-line with all of not only your personal details, i.e. name, address, etc. but also with your social security number and all the numbers of said reported accounts of personal identity theft is a very real possibility.

Well, the hard part is done in that I have read and digested what I need to do – on with the FBAR filing – then I’ll only need to file my actual tax declaration – two different spots – sending it registered with a request for notification of receipt or I will find myself accused of not having turned it in at all: ask my older son who one year was told that he hadn’t filed although I had paid the tax and the IRS had cashed the check. Turned out they had simply created another him by spelling his last name wrong: they swore that it couldn’t happen as there would be a duplicate for his Social Security number, but it took six months to find the one person capable of actually finding the second and totally invented name!
And then Americans think that we expats should be grateful for the privilege of being American – or course we are all cheats as there is something inherently wrong about someone falling in love and leaving the country of their birth, or about someone working overseas for an American company. The land of the free and the brave is no longer free and those of us living abroad are no longer brave: we cower under the burden of trying to comply with rules and laws that don’t exist anywhere else in the world, i.e. citizen-based taxation. OK not entirely true, Eritrea also imposes their citizens – some comparison.

from https://www.pinterest.com/source/malenadugroup.blogspot.in/