Check out some similar questions!

deepali2310 · Jul 22, 2011, 09:47 AM

Hello, I am NRI in the US. I have a salaried account in India with HDFC bank and I work as a contractor in US and get USD allowances in US Bank. I fill my India taxes and US taxes separately. I have recently submitted application to convert my HDFC account to a NRO account. The W2 I get in US consists of my INR salary converted in US + USD allowances. If the INR balance in HDFC bank equates to a value of USD 10,000, is that liable for FBAR reporting? Also, the interest that I earn in the HDFC bank, is that supposed to be declared on the US tax returns? Likewise I have a ICICI bank account as well. Please assist.

Nadel · Jul 22, 2011, 10:05 AM

If you were a resident (filed anything other than a form 1040NR) for tax purposes in the US, then you need to declare all income in India (salary, interest income etc.). You can take a credit for all Indian taxes on US return.

And if the total of all your accounts in India exceed $10K anytime during the year, then you need to file an FBAR and report ALL Indian accounts.

deepali2310 · Jul 22, 2011, 10:33 AM

The W2 I get in US includes my INR salary in USD. So I am good there. The interest portion, is there a upper limit that we need to report only if the interest exceeds a certain amount ?

Also, is it that FBAR is only for those accounts that have a an associated US bank ? Or the rule applies to any bank in general ?

AtlantaTaxExpert · Jul 22, 2011, 11:24 AM

Generally, the reporting threshold for bank interest is $10 USD. So, if your Indian accounts earned MORE than $10 in interest, you need to report it on your U.S. tax return.

deepali2310 · Jul 22, 2011, 03:09 PM

My account was 10,000 USD in Jan 2010.I reported this income on my US Tax returns, but didn't know that a FBAR also has to be filed. Likewise, for this year too, I did not have any idea until recently. What's the best way to address this situation. Can I file the first FBAR next year?

AtlantaTaxExpert · Jul 23, 2011, 06:12 AM

Do NOT wait on the FBAR for 2010. You will be late, but better late and a LOT late. More than likely, the IRS will accept the FBAR without comment.

JudyKayTee · Jul 25, 2011, 06:03 AM

Please read the amhd rules - no advertising, no telephone numbers.

Nadel · Jul 25, 2011, 07:03 AM

Deepali, the FBAR has to be filed for ALL foreign financial accounts. That means ALL foreign bank accounts, irrespective of whether they have an associated US account. It also includes stock/shares accounts, mutual fund accounts, Indian retirement accounts, life insurance policies with cash value etc.

I disagree with ATE on one point. In the US. You will not get a 1099-INT for interest < 10$, but you are still supposed to report it on your tax return. With foreign accounts, you cannot be too careful, so its better to report all income, even $1 (although its not worth amending a return just for that).

deepali2310 · Aug 1, 2011, 10:15 AM

I am ready to file my FBAR online via BSA e-filing on the Fincen site. I have a Question -- I have one account in India that exceeds 10K and one that has only 4K. Do I need to report both or only the one that exceeded 10K?

AtlantaTaxExpert · Aug 1, 2011, 12:17 PM

You need to report BOTH accounts, plus any OTHER Indian-based account that had ANY money in it in 2010.

deepali2310 · Aug 1, 2011, 03:11 PM

Hello, I read the definition below on the FBAR reporting form. Based on this definition, ONLY if the Indian bank account is associated to a United States bank, then it falls under FBAR category. If true, then all banks like HDFC, ICICI , Indian Overseas Bank DO NOT fall under this, as they are Indian banks with no branches in the US.Please assist.

Foreign Financial Account. A foreign financial account is a financial
Account located outside of the United States. For example, an account
Maintained with a branch of a United States bank that is physically
Located outside of the United States is a foreign financial account. An
Account maintained with a branch of a foreign bank that is physically
Located in the United States is not a foreign financial account.

AtlantaTaxExpert · Aug 2, 2011, 06:32 AM

Deepali2310:

You are only presenting part of the picture by extracting only a small part of the FBAR regulation. If you read the FBAR regulation in toto, it becomes clear that any and all financial accounts located outside of the U.S. that are owned by U.S. citizens or U.S. residents ARE subject to FBAR reporting.

taxesforaliens · Aug 2, 2011, 08:28 AM

I don't agree. US banks are not required to issue a 1099 INT in interest less than $10, but if the sum of all income is above the threshold for having to file, any amount needs to be reported. The only exemption would be if you use rounding to the $ when anything below $0.50 would round to Zero