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    newtotax's Avatar
    newtotax Posts: 6, Reputation: 1
    New Member
    		  
    #1

    Feb 6, 2009, 08:38 PM
    Foreign Bank Interest
    Hi,

    I have a friend who recently migrated to the United States in the middle of year 2008. I told him about this forum and he asked me to find out if any of you has the answer to his problem.

    Prior to moving to United States, he had a few bank accounts in his home country and he paid tax then. Now that he is a U.S person for tax purpose, does he have to pay tax for the bank interest he received before he came to the US? If so, where does he report this on his tax return?

    Thank you!
    MukatA's Avatar
    MukatA Posts: 7,110, Reputation: 176
    Tax Expert
    		  
    #2

    Feb 7, 2009, 04:46 AM

    Since you know that the person is U.S. person, what is the residence starting date?
    newtotax's Avatar
    newtotax Posts: 6, Reputation: 1
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    #3

    Feb 8, 2009, 05:51 PM

    He came to the US on April 10th, 2008. Would the date make a difference?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Feb 18, 2009, 03:39 PM
    Because, unless he is married, he will file as a dual-status alien, and will NOT have to pay taxes on the interest earned before his arrival.

    Any interest earned AFTER his arrival IS subject to U.S. taxes. He can claim the Foreign Tax Credit (Form 1116) for the portion of the taxes that applies to the post-28 April 2008 interest.
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