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Guys,
I think I have a situation:
1: In my previous year tax returns I did not report interest in my NRE accounts
2: I didn't file FBAR for 3 years, when I was actually supposed to.
If anyone has been in the similar situation and has any thoughts.
If you got professional help, can you give the reference?
Any help is really appreciated.
Here's what I have found so far: FBAR and Interest earned in NRE Accounts
Update: I decided to go with attorney's advice.
Interesting read if you are planning to move back to India after getting citizenship: https://renounceuscitizenship.wordpr...tizens-abroad/
I have not had this situation. I only started an NRE account last year so this year it will be a part of my returns (filed an extension in April) and I filed the FBAR for it in June.
If you transferred the funds from the US it is easily traceable, and you are potentially a candidate for an audit (don't mean to scare you). If that's the case, go ahead and file the FBAR for the previous years and the voluntary disclosure too. If you didn't transfer it from the U.S., and if it's with an Indian bank, I don't see how the IRS could track it down.
To be safe, of course, the best option is to consult with a tax attorney and do what he recommends.
Thanks Pedro.
I am getting professional help. Actually I wanted to share the link in my last post and that's what brought this thread up.
FATCA is a way how IRS will track it down: http://wp.me/p1OvGl-zB
Though it is not sure which and all Indian banks will comply. I think the major ones like ICICI, SBI , HDFC, Citi, etc. will.
My understanding is that that reporting is required ONLY IF you have 10K USD or more outside of US.
Yes, that's correct for FBAR. And it doesn't matter if the balance of USD 10K(combined of all foreign accounts) was for entire year or for one hour.
Quote:
Originally Posted by qesehmk
Sorry to post in the old thread. I have similar issues. My wife has some domestic bank account in india since 2009. We were not aware that we need to report the interest from that account to the IRS while filing tax. Now we are worried. Could anyone offer any suggestion on how about going on to fix this? Any help is very much appreciated.
Thanks
If balance of account didn't cross 10K USD in a given yr then you don't have to declare it. You have to fill out FBAR/FATCA forms, if balance crossed even for few mins.Quote:
Originally Posted by radhyn
As for interest, IRS will only know abt interest income if 1099-INT form was generated and sent to you as well as to IRS. Anyway if interest is under $10 for a yr then reporting is not needed.
Whatever taxes you have paid in India on that account for given year will be included in calculation while filing US taxes. Talk to CPA for proper handling/calculation of taxes.
If its a dormant account with minimal activity, my recommendation is to wrap it up as its not worth the hassle to go thru all this.
Thanks the the information. We have been filing FBAR and also declaring the account in schedule B while filing 1040.
We were just not aware that the taxes need to be paid here on the interest. Since the taxes were deducted at the source in india, we thought that would be enough.
Do you think we should amend the taxes going back to 2009?
Its your personal call. If you like your taxes squeaky clean then yes amend taxes.Quote:
Originally Posted by radhyn
Many folks push envelope when it comes to taxes and try to reduce their liability. Again its upto you whats your tax strategy is. IRS can initiate audit only till 6 yrs back but once audit starts they can go back as far as they want. Soure - https://www.irs.gov/businesses/small...udits#far-back
As this is Immigration forum I will make one more statement - USCIS will not decide your GC application based on taxes. They would just like to know whether you are in good standing with IRS or not. Proper taxes paid or not will be decided by IRS. If IRS is not currently giving you grief, you are good from USCIS perspective.