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U.S. Citizens - If you have $10K+ in a foreign bank, read this

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Oz Jon

I'm sorry to learn that the US IRS is like the Australian ATO.

They put a lot of time and effort into chasing up soft targets (small players, like you and me) for a few dollars, while the big boys (some wealthy people and particularly big-business)  get away with avoiding paying their fair share of tax -  legally or otherwise! - millions of dollars less than a fair thing!

What percentage of their income was taxed at the normal (~30%?) business rate by Apple, Google,  etc, etc? .....

... Compare it with your % rates on significantly lower income!

ps. I just looked up Apple - their 30Sept income was $230B and they paid $16B in tax .

That's about 7% of their reported income (which is questionable anyway, with all their offshore financial arrangements) !

pps. I own APPL shares - If you can't beat them, join them! :D

Edited by Oz Jon
ps and pps

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Monsoon
On 2/1/2018 at 5:05 PM, Jawny said:

There are some accounts which are exempt from the reporting such as a annuity deposit to a Philippine bank branch in the USA. 

 

In such case that would make it a non-foreign bank account therefore not subject to FBAR filing. 

Edited by Monsoon

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rfm010
12 hours ago, Oz Jon said:

I'm sorry to learn that the US IRS is like the Australian ATO.

They put a lot of time and effort into chasing up soft targets (small players, like you and me) for a few dollars, while the big boys (some wealthy people and particularly big-business)  get away with avoiding paying their fair share of tax -  legally or otherwise! - millions of dollars less than a fair thing!

What percentage of their income was taxed at the normal (~30%?) business rate by Apple, Google,  etc, etc? .....

... Compare it with your % rates on significantly lower income!

The fbar isnt about taxes.  At least not directly.  It is about reporting overseas holdings.  Purportedly to aid the fight against money laundering, but of course the info could be used to investigate tax avoidance.  And as a way to bust people on whom you want to call 'shenanigans' but you cant quite prove it.  Some people in the ongoing muellar investigation, such as (as a guess) paul manafort, will likely run into fbar problems.  But for the vast majority of people, just report a good approximation of the max you had in each overseas account (individual account values may be under 10k, it is the sum total of all accounts that matters) and all is good. 

For the true kanos out there, 2 things.  First note i said good approximation.  Its in the directions.  Exact amounts arent required.  Second, you can file up to 6 months late with no explanation required.  Third, the on time deadline is now april, it used to be june.  But again, for all intents, october will do.

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lopburi3
3 hours ago, Oz Jon said:

I'm sorry to learn that the US IRS is like the Australian ATO.

They put a lot of time and effort into chasing up soft targets (small players, like you and me) for a few dollars, while the big boys (some wealthy people and particularly big-business)  get away with avoiding paying their fair share of tax -  legally or otherwise! - millions of dollars less than a fair thing

Actually this was designed, and is used to prosecute, the big boys.  It is not a tax - just a way to jail those avoiding tax by shifting money into foreign accounts in an attempt to hide it.  Yes there are penalties but they are normally reserved for real criminal cases if not done intentionally.    

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Oz Jon
16 hours ago, lopburi3 said:

Actually this was designed, and is used to prosecute, the big boys. ....... 

Right! - I understand what you and rfm are saying.

But if the real target is the big boys and big money launderers,  then they are  putting a hell of a lot of people and companies to a lot of unnecessary trouble, time, effort and expense with a $10K reporting threshold. 

$1M or at least $100K threshold would be far more appropriate (and save a lot of trees!).

ps.

In this day and age, big brother doesn't need you to tell him if you have overseas bank accounts. He probably even knows what you had for breakfast!

Edited by Oz Jon
ps

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Jawny

There is no paper reporting for most people.  It is a simple process, or at least straightforward.  I did the report for several years, but lately have managed my accounts different,y so the $10000 threshold is not met.  No report required.

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lopburi3
15 minutes ago, Oz Jon said:

Right! - I understand what you and rfm are saying.

But if the real target is the big boys and big money launderers,  then they are  putting a hell of a lot of people and companies to a lot of unnecessary trouble, time, effort and expense with a $10K reporting threshold. 

$1M or at least $100K threshold would be far more appropriate (and save a lot of trees!).

ps.

In this day and age, big brother doesn't need you to tell him if you have overseas bank accounts. He probably even knows what you had for breakfast!

It would be helpful to have the amount higher - suspect they set it at the same amount domestic US transfers require reporting (although in South Florida that was even lowered to 4k when I lived there in 1989).  As for the trees it is now an online process so they should be saved - I avoid it by spending my bank funds as fast as I deposit.  :huh:

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Jawny

Not sure if spending the money is going to preclude the reporting. If the balance(s) exceed $10000 I had the impression the report was required.  No matter if the balance was in excess for one day or one hour.

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lopburi3
2 minutes ago, Jawny said:

Not sure if spending the money is going to preclude the reporting. If the balance(s) exceed $10000 I had the impression the report was required.  No matter if the balance was in excess for one day or one hour.

Spending the money to keep it from exceeding 10k at any time is what I do - have accounts in USA for direct deposit of pension/insurance and then transfer as required.

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liquido

My friend here in Davao has had a SRRV visa for about 4 years opened up in Bohol.At the time he had to deposit $10.000 in a bank or other investment....In January this year he decided to stop it and get his money back....As of this writing he still does not have his money but its finally been approved for withdrawl..He had it with Bank Of Commerce..Im sure he was getting a minute amount of interest..Maybe he will not claim it are his words..He went through the proper hoops to get it so if you need it back it will take almost 4 months..Can You imagine how many accounts are here like that where the foreigner dies and his relatives know nothing about it...Many bankers getting rich I assume...

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Davaoeno

The problem is bigger than he might realize. About 3 years ago the Bank of Commerce ended its relationship with PRA for the SRRV program.  All SRRV members were told that we had to move our money . But then we never heard anymore, and the money just sat in our accounts collecting small interest.  When i went to renew my SRRV annual card last year it took more than 6 months to do so . Usually it only takes 2 weeks.  I contacted PRA many times in Davao and in Manila and they just ignored me.  Finally at the PRA Christmas party i ambushed the head of Davao PRA and he admitted that Manila wouldnt renew my card until i moved my money out of Bank of Commerce.  I duly filled in the form to move the money. That was in December. I still have no idea where my money is. I asked PRA in Davao last month and they said Manila hadnt moved it yet . 

There is actually more to the story .  About 3 years ago when PRA  told me    to move the money they gave me a list of banks.   So i see BDO is on the list and i go to BDO . Nope- only BDO in Makati can handle PRA deposits.

Then I see there is some Commercial bank on the list. I go to see them . They never heard of PRA, but copy all my ID and tell me they will contact Manila and get back to me. Its been 3 years and I am still waiting for them to let me know

Edited by Davaoeno

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liquido

Just to add the money was deposited in Bohol...The Bank of Commerce in Bohol has to send the paperwork here to Davao Bank Of Coomerce where he will sign then the paperwork will be sent back to Bohol when received the wire transfer to the states will happen otherwise he would have had to make a trip to Bohol....

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liquido
6 minutes ago, Davaoeno said:

The problem is bigger than he might realize. About 3 years ago the Bank of Commerce ended its relationship with PRA for the SRRV program.  All SRRV members were told that we had to move our money . But then we never heard anymore, and the money just sat in our accounts collecting small interest.  When i went to renew my SRRV annual card last year it took more than 6 months to do so . Usually it only takes 2 weeks.  I contacted PRA many times in Davao and in Manila and they just ignored me.  Finally at the PRA Christmas party i ambushed the head of Davao PRA and he admitted that Manila wouldnt renew my card until i moved my money out of Bank of Commerce.  I duly filled in the form to move the money. That was in December. I still have no idea where my money is. I asked PRA in Davao last month and they said Manila hadnt moved it yet . 

There is actually more to the story .  About 3 years ago when PRA  told me    to move the money they gave me a list of banks.   So i see BDO is on the list and i go to BDO . Nope- only BDO in Makati can handle PRA deposits.

Then I see there is some Commercial bank on the list. I go to see them . They never heard of PRA, but copy all my ID and tell me they will contact Manila and get back to me. Its been 3 years and I am still waiting for them to let me know

My friend said the lady at the SRRV office in Cebu was VERY halpfull in this matter..The person in Davao is useless he said..

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Davaoeno
15 minutes ago, liquido said:

My friend said the lady at the SRRV office in Cebu was VERY halpfull in this matter..The person in Davao is useless he said..

I can only confirm half of that statement ! 

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streak03

I just finished applying for my SRRV through the Manila office, and I used Bank of Commerce for the time deposit.

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Davaoeno
5 minutes ago, streak03 said:

I just finished applying for my SRRV through the Manila office, and I used Bank of Commerce for the time deposit.

I am surprised to hear that - especially since PRA forced me to remove my money from Bank of Commerce just this year   . When you say " time deposit" - do you mean the 10K or 20K etc you need to deposit with a PRA approved bank ?

i'm asking because i dont think there is any " time " associated with the deposit you need to keep in place.

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streak03
10 hours ago, Davaoeno said:

I am surprised to hear that - especially since PRA forced me to remove my money from Bank of Commerce just this year   . When you say " time deposit" - do you mean the 10K or 20K etc you need to deposit with a PRA approved bank ?

i'm asking because i dont think there is any " time " associated with the deposit you need to keep in place.

Yes, it was the required $1500.00 deposit that I had to send from outside the country.   They called it a time deposit.

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Davaoeno
4 hours ago, streak03 said:

Yes, it was the required $1500.00 deposit that I had to send from outside the country.   They called it a time deposit

The $1500 is just your application fee.  Once you get approved then you will be required to deposit the amount that applies to your case [ for some its 10K usd and for some  its 20K usd and for some 50K usd  ].  I was advised that my 20K could no longer be held by the Bank of Commerce because they no longer provide that service to PRA.

[ Initially I had my 20K in China Bank but they also severed their relationship with PRA and I had to move the money to another bank- and I chose Bank of Commerce.   Now I am moving it again - this time to PNB !! ]

Edited by Davaoeno

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Davaoeno

Can a mod possibly split this thread so that SRRV comments are in a new thread - possibly called SRRV Bank Deposits  [ or some such thing }

thank you 

 

I didnt realize how much the info would become about SRRV and the Bank

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streak03
9 hours ago, Davaoeno said:

The $1500 is just your application fee.  Once you get approved then you will be required to deposit the amount that applies to your case [ for some its 10K usd and for some  its 20K usd and for some 50K usd  ].  I was advised that my 20K could no longer be held by the Bank of Commerce because they no longer provide that service to PRA.

[ Initially I had my 20K in China Bank but they also severed their relationship with PRA and I had to move the money to another bank- and I chose Bank of Commerce.   Now I am moving it again - this time to PNB !! ]

Nah, 1430.00 was the initial application fee.  1500.00 was for the deposit as I'm retired military.

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Davaoeno
18 minutes ago, streak03 said:

Nah, 1430.00 was the initial application fee.  1500.00 was for the deposit as I'm retired military.

Ah one of those lucky guys! I'm jealous! Hehe

Now I really want to know what the story is re Bank of Commerce! ( well this week's story anyway!)

( the only good thing but my SRRV is that I'm grandfathered in at $10 a year )

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SkyMan
On 4/29/2018 at 11:17 PM, Jawny said:

lately have managed my accounts different,y so the $10000 threshold is not met.

That's the best plan.  If you need more than $10K just invest it in your mattress.

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