Here are some of the common questions that our clients have asked recently…
Do I need to file FBAR (Foreign Bank Account Reporting)?
If you have more than $10,000 USD aggregate total of monies and investments outside the US at any point during the year. This number includes all assets inside of accounts outside the US including your personal bank accounts, retirement accounts, investment accounts, RRSPs, RESPs, TFSA, RDSPs, RPPs, ISA’s, Superannuation funds, prepaid credit cards, cash value of life insurance policies, and many other similar assets.
US Citizens, Green Card Holders and Foreign Expats who have met the substantial presence test but file as US nonresidents under the tax in the United States are subject to the FBAR rules. Individuals who have not properly terminated US permanent resident status, but have allowed their green cards to expire instead, are also subject to these rules.
Let an AET Expat Tax Specialist help you determine whether you fall under the FBAR rules.
Is it true I can’t mail FBAR forms?
Yes, Foreign Bank Account Reports may only be submitted electronically through the BSA/FinCen website (Bank Secrecy Act/Financial Crimes Enforcement Network). The only exceptions to this are for persons who call BSA and can prove that they do not have access to the internet to be able to file online. Not owning a computer is not an acceptable reason to get an exception to the e-file requirement.
AET is an approved Institutional e-filer for BSA and can assist you with the new FBAR forms.
I am a US citizen living outside the United States. My income is less than the income levels to be required to file a US income tax return, do I have to file anyways since I live outside the US?
You may be required to file, even if you have no income. This is not because you live outside the US – ownership or dealings with certain types of accounts and businesses could trigger an automatic requirement to file.
Some of the most common assets that cause an annual US filing requirements outside of the level of your income are (list is not all inclusive):
- Non US retirement accounts
- Savings & investment type accounts that are tax deferred in your country of residence
- Dividend from or the sale of a non-US mutual fund
- Ownership of 10% or more of a non-US corporation or partnership
- Inheritances & gifts from Non- US persons
- RESPs (registered education savings plans)
- RDSPs (registered disability savings plans)
An AET Expat Tax specialist can help determine your filing requirements today.
I had a US green card which expired years ago, do I still need to file a US return?
Yes, an expired green card just means that your proof of US permanent residency has expired, not that you no longer have the status. To properly terminate green card status, Form I-407 must be submitted to US Immigration.
I’m in a same sex partnership, I heard the United States will now let me file jointly with my partner, is that true?
Yes and no, or better stated- it depends. Yes the U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled in August 2013 that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. Any same-sex marriage legally entered into in one of the 50 states, the District of Columbia, a U.S. territory or a foreign country will be covered by the ruling. However, the ruling does not apply to registered domestic partnerships, civil unions or similar formal relationships recognized under state law.
Individuals who were in same-sex marriages may, but are not required to, file original or amended returns choosing to be treated as married for federal tax purposes for one or more prior tax years still open under the statute of limitations.
An AET Expat Tax Specialist can help determine your filing requirements today.