Author Topic: Is the new bordeless bank account great to pay the IRS (and receive refunds)?  (Read 344 times)

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Offline jfkimberly

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I have no idea if it will work for the IRS - what do others think? https://www.moneysavingexpert.com/news/banking/2018/04/new-debit-card-gives-you-banks-accounts-in-four-countries---but-is-it-any-good-?_ga=2.151184953.1667166545.1524988728-8275782.1506771304

It gives the customer an ACA or whatever the US calls its bank routing number, and an account number.  Isn't that all you need for the IRS.  This sounds like it should be sufficient.
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Online durhamlad

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It gives the customer an ACA or whatever the US calls its bank routing number, and an account number.  Isn't that all you need for the IRS.  This sounds like it should be sufficient.

I agree, it sounds like a great solution.
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Offline Nan D.

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Pardon the paranoia, but are the funds insured?

Offline jfkimberly

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Pardon the paranoia, but are the funds insured?

It's not insured under the FSCS, but they are governed by the FCA with the money is held by either Wells Fargo or Barclay's, so even if Transferwise collapses, as long as those institutions don't also go belly-up, your money will be fine.
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Offline Nan D.

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Coolies!  ;D

Offline theOAP

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..... but they are governed by the FCA with the money is held by either Wells Fargo or Barclay's, ....
So,....playing the troll on this,

If the funds are held by Barclays, does this mean the highest yearly balance for the UK Transferwise account should be declared on an FBAR and 8938?

Offline jfkimberly

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So,....playing the troll on this,

If the funds are held by Barclays, does this mean the highest yearly balance for the UK Transferwise account should be declared on an FBAR and 8938?

I would assume so, if your aggregate holdings total more than $10k at any point in the year.
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Offline Anchor

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Are the funds at Barclays in my name or Transferwise? If they are in the name of Transferwise does that give me any protection in the event of Transferwise failing?

If they are in the name of Transferwise, I still have a financial interest in the Barclays account so presumably should still report on FBAR and 8938, but I have no information whatsoever about the account.

It is frustrating that Transferwise do not appear to address any of these issue.

Online durhamlad

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So,....playing the troll on this,

If the funds are held by Barclays, does this mean the highest yearly balance for the UK Transferwise account should be declared on an FBAR and 8938?

I would think so, but given the advantages this account gives those that have need of it then adding an extra account onto your list of accounts for FBAR or FATCA reporting is a small inconvenience I would think.
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Offline theOAP

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I would think so, but given the advantages this account gives those that have need of it then adding an extra account onto your list of accounts for FBAR or FATCA reporting is a small inconvenience I would think.
I agree the advantages may be worth the price, especially for those of us with no US bank account, US credit card, or anyone in the States to write a check for us.

I have no idea whether it's reportable or not. Transferwise could be treated as a pass thru entity. If it is reportable, there may be a few folks unaware that they now have an FBAR or 8938 responsibility, especially on the BE site since it is being 'talked up' a lot there. For them, transferring any amount over $50,000 ($100,000) would count for 8938.

Online durhamlad

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I agree the advantages may be worth the price, especially for those of us with no US bank account, US credit card, or anyone in the States to write a check for us.

I have no idea whether it's reportable or not. Transferwise could be treated as a pass thru entity. If it is reportable, there may be a few folks unaware that they now have an FBAR or 8938 responsibility, especially on the BE site since it is being 'talked up' a lot there. For them, transferring any amount over $50,000 ($100,000) would count for 8938.

The fact that the borderless account has a debit card option surely means the account holder has signature authority and it is not a pass through account, and holds a balance controled by the owner. I personally wouldn’t risk not reporting it in my FBAR or FATCA forms.
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Offline theOAP

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The fact that the borderless account has a debit card option .....
Didn't know about the debit card. If the debit card is directly on the Transferwise account, that does make the reporting situation interesting.

Online durhamlad

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Didn't know about the debit card. If the debit card is directly on the Transferwise account, that does make the reporting situation interesting.

This website has a drop down debit card option

https://transferwise.com/gb/borderless/

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Offline theOAP

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I've now had the opportunity to look further on the link durhamlad gave.

I've hesitated on this because I remember when TransferWise was first launched as a normal money exchange company. At that time, much was made of the fact they were US based. The page of their story did confirm this, but that is missing now.

https://transferwise.com/about

Now, it is obvious they are governed by English law. See 5.1, 5.2, 29.5, and 29.6:

https://transferwise.com/terms-of-use#/section-29

Report maximum balance per year (in conjunction with all other foreign accounts) on FBAR and 8938 if required.

Guya's original question, will the IRS interact with TransferWise, is still unanswered.