Category Archives: FBAR Fundraiser

#FEARBar (“Foreign Email Account Report”) update – All indications lead to reporting

The above tweet references a post written four years ago in June of 2013. The post predicted that at some point the United States would require disclosure (in addition to FATCA (Form 8938) and FBAR (FinCen 114) and other forms) of the email accounts used by Americans abroad.


That post concluded with my prediction:

The purpose of FBAR and FATCA is to …

Provide the U.S. with information that is outside of its jurisdiction. In other words, the U.S. has no legal right to the information. Therefore, by threatening “life altering” penalties, the U.S. forces its citizens to provide this information to the U.S. government.

If the contents of bank accounts is important, then the contents of an email account would be even more valuable.

You heard it here first:

The next information return that the U.S. will require is the:

Foreign Email Account Report” – FEARBar for short!

Congress will (like FATCA) unknowingly pass the general legislation (slipped in as part of a Hiring Act) and authorize the IRS to specify the contents of the return. What an Orwellian World!

FEARBar coming to an information return near you!

Continue reading

Snapshot in time: Eyewitness account of evolution of Schedule B and the #FBAR Form TDF 90-22.1 from 1981 to 1986

The above tweet references a fascinating discussion about Mr. #FBAR in the early years prior to the “The FBAR Fundraiser“.

Interestingly for the years 2003 to 2008 (if memory serves), IRS Publication 54 did NOT reference the FBAR requirement.

OAP says
October 11, 2016 at 4:23 pm

@heidi, @pacifica777

Now you’ve peaked my curiosity, and I’ve done a sad thing. My first filing from abroad was in 1981 and I’m sure I filed an FBAR, so I’ve dug out all the old records.

1981

A. Schedule B – It contains Part III and the question about financial accounts in a foreign country.
(I believe the instructions for Sch. B referenced FBAR.)

B. FBAR, top instructions – “This form blah, blah blah. You are not required to file a report if the aggregate value of the accounts did not exceed $1,000.”
(That’s not a typing error, it says $1,000.)

C. FBAR Line 9 – “ If you had a financial interest in one or more….accounts which are required to be reported, and the total maximum value of the accounts exceeded $10,000 during the year,….”
(Note total maximum value of the accounts, not maximum aggregate value of the accounts, and $10,000 figure.)

D. Instructions on back of FBAR – Unfortunately, for 1981 I only have the top copy and not the back.

1982
A. Schedule B – It contains Part III and the question about financial accounts in a foreign country.

B. FBAR, top instructions – Same as 1981

C. FBAR Line 9 – Same as 1981

D. Instructions on back of FBAR – Unfortunately, top copy only..

1983

A. Schedule B – It contains Part III and the question about financial accounts in a foreign country.
(For 1983, includes directions to FBAR instructions and now asks for which countries the accounts are located in.)

B. FBAR, top instructions – “This form blah, blah blah. You are not required to file a report if the aggregate value of the accounts did not exceed $5,000.”
(That’s not a typing error, it says $5,000.)

C. FBAR Line 9 – Same as 1981.

D. Instructions on back of FBAR, Who must file – Each United States Person who has financial interest in or signature authority or other authority over bank, …..or other financial accounts in a foreign country which exceeds $5,000 in aggregate value at any time during the calendar year, must report that relationship each calendar year by filing TD F 90.22.1….”
(Note $5,000 figure.)

1984

A. Schedule B – Same as 1983

B. FBAR, top instructions – “This form blah, blah blah. You are not required to file a report if the aggregate value of the accounts did not exceed $5,000.”
(That’s not a typing error, it says $5,000.)

C. FBAR Line 9 – “ If you had a financial interest in one or more….accounts which are required to be reported, and the total maximum value of the accounts exceeded $10,000 during the year,….”
(Note total maximum value of the accounts, not maximum aggregate value of the accounts.)

D. Instructions on back of FBAR, Who must file – Same as 1983. ($5,000)

1985

A. Schedule B – Same as 1983.

B. FBAR, top instructions – “This form blah, blah blah. You are not required to file a report if the aggregate value of the accounts did not exceed $5,000.”
(That’s not a typing error, it says $5,000.)

C. FBAR Line 9 – Same as 1981.

D. Instructions on back of FBAR, Who must file – Unfortunately, only top copy.

1986

A. Schedule B – Same as 1983.

B. FBAR, top instructions – “This form blah, blah blah. You are not required to file a report if the aggregate value of the accounts did not exceed $10,000.”
(It now says $10,000.)

C. FBAR Line 9 – Same as 1981.

D. Instructions on back of FBAR, Who must file – Unfortunately, I only have the top copy.

From my limited files confusion reigns. For 1983, as for 1981, (C) FBAR Line 9 mentions “total maximum value of accounts exceeded $10,000″, but the instructions on the back of the FBAR states “which exceeds $5,000 in aggregate value at any time during the calendar year”. The (B) Top instructions don’t mention $10,000 until 1986.

I’m now off to find a life.

What are the benefits of U.S. citizenship that justify extra-territorial taxation?

For those the US deems legally incompetent to understand the concept of citizenship, and thus too incompetent to understand renunciation/relinquishment of it, there are no ‘psychological’ or other intangible benefits:

The US prevents them from EVER renouncing or relinquishing for life if the underlying condition is chronic and permanent (ex. mental, psychological, intellectual or physical states which cause substantial lack of understanding sufficient to be considered legally ‘competent’ – ex. brain injury, developmental delays). And prevents minors from doing the same for years until age of majority (rarely earlier unless the minor can prove their understanding to stringent consular judgement) – on the basis of being not mature enough to appreciate the consequences.

Adult parents and legal guardians are prevented by US law from relinquishing/renouncing their children or ward’s US citizenship status on their behalf.

So, why is it that US extraterritorial citizenship-based taxation does not then exclude those deemed legally incompetent (by US laws) of the burdens of taxation predicated on the very status (citizenship) which it also FORCES them to retain (many for life) – because it states that they are incompetent to understand the status, and to form a decision to retain or renounce it?

The FBAR online instructions state that children (deemed ‘US taxable persons’) should complete and submit THEIR OWN FBAR themselves – an absurd and offensive instruction to impose on a minor whom US law states is legally incompetent/immature. It is completely unacceptable that the US should instruct children that their local legal birthday and education savings accounts are reportable (and PENALIZABLE) to an agency called “FINANCIAL CRIMES ENFORCEMENT NETWORK” merely because they are outside the US, and have either a US parent, or a US birthplace. This would apply to those adults deemed incompetent as well.

The FBAR treats ourselves and our children and wards as criminals.

Where is the presumption of innocence before guilt?

And how can the US government and US law maintain the fiction that minors and those deemed legally incompetent due to immaturity or physical/psychological/mental/intellectual conditions are incompetent to understand the ‘benefits’ of US citizenship, yet are competent enough to be mandated to file their own FBARs, and to be US taxpayers?

The US taxes and penalizes the education and disability savings and grants of our children and dependents outside the US – despite giving tax preferred or deferred status to the US equivalent accounts.

The US deprives our children and dependents who are deemed to be US citizen-taxpayers ‘abroad’ of the benefits it extends to ALL US residents (whether citizens or not).

There are no psychological benefits or other similar intangible benefits for those who the US deems legally incompetent to understand US citizenship.

Whereas there are substantial burdens and costs and potentially bankrupting penalties the US imposes on even minors and the legally incompetent – as well as their parents and legal guardians – who may themselves NOT BE US citizens or ‘US taxable persons’.

Obviously, everyday there are many people born around the globe – outside the US – who may have had one or more US citizen parent, and who have NO other US connection or relationship, who will never set foot in the US, are citizens of the non-US country where they were born, and who may never know that the US considers them ‘US taxable citizens’.

That does not even cover the situation faced by those who happen to have been born in the US to non-US parents who are there on a short or temporary basis – to students, visitors, etc. Or, who were sent across the Canada-US border to a US hospital on an emergency basis. Their parents are NOT US citizens and did NOT seek US status for their children. In those cases, the US forces citizenship twinned with lifelong US taxable status on them.
January 2015

@JoeBwan writes about the shocking story of the #FBAR Fundraiser

 

The above tweet references an excellent series of posts written by CPA Joe Kristan about Commissioner Shulman’s tenure as IRS Commissioner and the FBAR Fundraiser. This collection of posts are among the best ever written about FBAR, OVDI and the like. Most of these were written during the “OVDI Terrorism” years of 2009 – 2012. While I’m at at it, here is some of my commentary during this period:

The taxpayer, the IRS and the “professionals” – where to go from here

(This includes links to another four posts on this topic.)

Taxpayer Advocate vs. The IRS – It’s a question of trust

(And when the IRS reintroduced the Offshore Voluntary Disclosure Program)

IRS reopens the Offshore Voluntary Disclosure Program and promises new procedures for U.S. citizens living outside the United States

It is a truly incredible story.It is an example of such incredible abuse of Americans abroad and U.S. Green Card Holders that it is deserving of a book of its own.

I have followed this story from the beginning and written a number of posts about Mr. FBAR and “The FBAR Fundraiser”.  It’s even possible that the IRS may have contributed to the failure of Americans abroad to file the FBAR.

The site of American Citizens Abroad has substantial information on the problems of FBAR and Americans abroad.

Please note that Mr. FBAR must now be filed online and only online. Mr. FBAR even has a new name. He’s called: FinCen 114.

Frankly, I don’t know how any government could do this to its citizens or lawful permanent residents.  What is wrong with these people?