FBAR

Welcome to the happy group.

The 8938 instructions are vague, but most play it safe and report.

For the amount (married filing joint, resident abroad):
"Married taxpayers filing a joint income tax return. If you are married and you and your spouse file a joint income tax return, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the tax year." [bold mine]

Further along, the following is stated:
"Reporting Maximum Value
You must report the maximum value during the tax year of each specified foreign financial asset reported on Form 8938." [bold mine]

https://www.irs.gov/pub/irs-pdf/i8938.pdf

What they really want are the account locations and numbers. The value is of less importance unless it is high (subjective). You've volunteered information for valuing future inheritance tax claims, etc.

(IMHO)   The Manafort/Gates indictment listed 6 counts of FBAR violations (out of a total of 12 counts) and one additional of tax fraud. The additional mentioned Schedule B (Part III questions), but said nothing about 8939.

FBAR (part of Title 31) violations can carry both a criminal penalty and varying monetary penalties. Form 8938 (Title 26) carries a $10,000 penalty for failure to file. One can only guess the IRS has a selection to pick from and will use those violations which give them the best case in court.

My understanding is that your first quotation is the means to determine whether or not you are required to report.

In the event that you do have to report then your second quotation is what you actually report.

My understanding is that your first quotation is the means to determine whether or not you are required to report.

I agree.

In the event that you do have to report then your second quotation is what you actually report.

I again agree.

There are no instructions for determining what is the total value of specified foreign assets. In the first quote, what does it mean regards $600,000 valued at any time?

For "Valuing specified foreign financial assets. The value of a specified foreign financial asset for purposes of determining the total value of specified foreign financial assets in which you have an interest during the tax year or on the last day of the tax year is the asset's fair market value." That's the only definition including the words total value.

Not to be difficult (you know where this is going  ), but if the $400,000 is the total value of your specified foreign financial assets (plural) on 31 Dec., and one makes an instantaneous transfer at their building society on 31 Dec from an existing account containing $260,000 to a new account in the same institution of $250,000 (leaving the first account with $10,000), what is the "total value of assets on Dec. 31"? It could be $260,000 (total value of asset at 23:59:59 in this building society), or the value of asset(s) A of $260,000 plus the value of asset(s) B of $250,000.

Logic says it's the former and I'll happily go with add them all up at 23:59:59 on 31 Dec. and if it's over $400,000, report (or $600,000 for any 1 day(? as is 31 Dec.), 1 hour, 1 second, it doesn't say, during the year), but that interpretation is not specifically defined by the instructions.

Sorry, but the instructions are not clear and this isn't the only occurrence of unclear instructions on 8938. It's up to the user to determine the interpretations they feel they can justify.

Sorry, but the instructions are not clear and this isn't the only occurrence of unclear instructions on 8938. It's up to the user to determine the interpretations they feel they can justify.

I agree entirely with you. The definitions are a complete mess.

I was merely taking a broad brush approach to the two sections you referenced above.

I agree entirely with you. The definitions are a complete mess.

I was merely taking a broad brush approach to the two sections you referenced above.

 

I remember the discussions on line 8b (type of issuer) of the "Other Foreign Asset" section on deferred compensation assets (pensions) where the choices include everything but "pension". I still don't know the correct answer for my situation, or who the issuer is. I know whose name is on the monthly transfer into the bank, but they are not the people who hold and control the funds. Does it matter The funds are traceable (FCA registered and HMRC reporting) and they're not in a tax haven.

If you are must file a FBAR if you are a US citizen and the aggregate total of all foreign accounts exceeds $10,000 at any time. In other words, if you ever have $10,000 or more in an account outside the US, you are suppose to report it. 

You report the highest amount in each account for the calendar year.  So if you transfer $11,000 between two accounts, you would report $11,000 for each even though one account may have $0 while the other has $11,000. 

The forms are now submitted electronically.

Second paragraph is correct but the first is wrong. The steps are

• Find the annual maximum amount in each non-US account
• Add up these maximums

If this sum is $10,000 or more you must file. For example, if you have $5000 in one account and move it to another, you must file even though you never had more than $5000 in total.

Second paragraph is correct but the first is wrong. The steps are

• Find the annual maximum amount in each non-US account
• Add up these maximums

If this sum is $10,000 or more you must file. For example, if you have $5000 in one account and move it to another, you must file even though you never had more than $5000 in total.

Crazy arithmetic but I agree that is how it works.

Second paragraph is correct but the first is wrong. The steps are

• Find the annual maximum amount in each non-US account
• Add up these maximums

If this sum is $10,000 or more you must file. For example, if you have $5000 in one account and move it to another, you must file even though you never had more than $5000 in total.

I only have one UK bank account, so if I always keep my balance under 10k I would not have to report it.  Right?

I only have one UK bank account, so if I always keep my balance under 10k I would not have to report it.  Right?

Right.

Right.

Thank you! I can do that.

Thank you! I can do that.

You won’t know the exact exchange rate to use until after the fact so stay well below. The IRS publish the rate to be used (as of December 31 of the year in question) in January the following year. For 2017 that rate is £1 = $0.74.

https://www.fiscal.treasury.gov/fsreports/rpt/treasRptRateExch/itin-12-31-17.pdf

https://www.fiscal.treasury.gov/fsreports/rpt/treasRptRateExch/historicalRates.htm

I only have one UK bank account, so if I always keep my balance under 10k I would not have to report it.  Right?

No pension plan?

https://m.lw.com/thoughtLeadership/lw-top-10-foreign-bank-account-reporting-mistakes-FBAR

https://www.greenbacktaxservices.com/faq/foreign-bank-account-reporting/

No pension plan?

https://m.lw.com/thoughtLeadership/lw-top-10-foreign-bank-account-reporting-mistakes-FBAR

https://www.greenbacktaxservices.com/faq/foreign-bank-account-reporting/

No pension, I have 401k but can't withdraw yet.  I need to figure out how to continue growing retirement  funds now that I am no longer an employee and can't continue 401k contributions.

No pension, I have 401k but can't withdraw yet.  I need to figure out how to continue growing retirement  funds now that I am no longer an employee and can't continue 401k contributions.

Sorry, I meant a current UK pension plan. If you are not enrolled in one, then you have no concerns, at least, as far as the FBAR goes!

Defined contribution UK pension plans for example will go on an FBAR if someone is enrolled in one. See reply #14:
http://talk.uk-yankee.com/index.php?topic=87606.msg1140577#msg1140577