Inspiring Women Winter 2017
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((IRS + FATCA) x FBAR) = Acronym Anxiety<br />
Homework, soccer practice, guitar lessons, doctors’ appointments, dentist<br />
appointments – moms have a lot to stay on top of. Oh, and don’t forget to<br />
add your kid’s FBAR to the list. I know, it’s a pain, and I’m sorry – please don’t<br />
kill the messenger.<br />
A recent inquiry from a mom, whose minor US citizen child was being kicked<br />
out of his foreign bank for not being able to prove his FBAR compliance,<br />
made me realize that many moms don’t know that their US citizen children,<br />
even if underage, might need to file an FBAR.<br />
As I’m sure most of you know, US persons – citizens, green-card holders, and residents – are<br />
required to file a Report of Foreign Bank and Financial Accounts (FBAR) if the aggregate value of<br />
the foreign accounts they sign on or have a financial interest in is USD $10,000 or more.<br />
Before we dive in, here’s a brief FBAR refresher. (1) You must report foreign bank and “financial<br />
accounts” (e.g. brokerage, escrow, pension, and life insurance accounts) if their aggregate<br />
value is $10,000 or more; (2) the $10,000 filing threshold is not per account, it’s all accounts<br />
added together; (3) if you sign on an account, include it, even if it’s someone else’s account;<br />
and (4) if the account contains your money – like an escrow account – include it.<br />
Most people with an FBAR filing requirement diligently file it every year because they know if they<br />
don’t, the penalties can be harsh. The problem is, parents often don’t realize that the FBAR is an<br />
equal opportunity nuisance – minors are not exempted from having to file it.<br />
Assume that you opened a savings account for your 2-year-old, who is a US citizen, and the<br />
balance of the account is over $10,000. Guess what? Your child needs to file an FBAR. And, as<br />
your child’s legal guardian, it’s your responsibility to file it on their behalf. Additionally, if you are a<br />
signer on the account, which you likely would be in the case of a 2-year old, you need to include<br />
the account on your FBAR as well.<br />
It has been a pleasure writing for all of you this year, and I look forward to continuing to do so<br />
next year. If there is a topic you would like for a future article, please feel free to email me at<br />
info@esquiregroup.com.<br />
Jimmy Sexton, LL.M., is an expert in the field of international taxation, with an<br />
emphasis on expat issues. He has presented to American expats at groups that<br />
include American women’s clubs throughout Europe and is a sought-after expert<br />
for several news organizations, including CNN and the Washington Post. He is the<br />
President of Esquire Group, an international tax preparation firm and Premier<br />
Sponsor of <strong>Inspiring</strong> <strong>Women</strong> Magazine.