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ephemerald · Jul 5, 2012, 06:19 AM

Hello everyone. This is my first post.

I'm American, living in Asia. In June, when cleaning out a drawer, I found two old foreign bank account passbooks that I'd misplaced and then totally forgotten about 18 years ago. I went to the banks and learned that the accounts still exist with tiny balances (about $4 and $20) and have been dormant and receiving no interest since 1995.

I'd already filed a 2011 FBAR at that point, so I amended it (should have waited 120 days, but didn't know that).

I suppose I should now also amend fbars for 2006-10. I thought I'd explain in a cover letter that I misplaced the passbooks and then forgot about them because they had such insignificant balances; that they have received no interest since going dormant in '95; and that I think my reason for not reporting the accounts constitutes reasonable cause and want to request that penalties be waivered.

1. Does this seem a reasonable approach? Any pitfalls I'm missing?

2. Is it best to attach a cover letter to each amended fbar, or bundle the five together and attach one explanation?

3. Since there's been no income on the accounts since 1995 (thus no tax relevance in recent times), am I likely to face penalties?

I'm feeling very insecure about how to approach this. FBARs spook me.

Thanks for listening!

ephemerald

smoothy · Jul 5, 2012, 12:51 PM

Originally Posted by ephemerald

Hello everyone. This is my first post.

I'm American, living in Asia. In June, when cleaning out a drawer, I found two old foreign bank account passbooks that I'd misplaced and then totally forgotten about 18 years ago. I went to the banks and learned that the accounts still exist with tiny balances (about $4 and $20) and have been dormant and receiving no interest since 1995.

I'd already filed a 2011 FBAR at that point, so I amended it (should have waited 120 days, but didn't know that).

I suppose I should now also amend fbars for 2006-10. I thought I'd explain in a cover letter that I misplaced the passbooks and then forgot about them because they had such insignificant balances; that they have received no interest since going dormant in '95; and that I think my reason for not reporting the accounts constitutes reasonable cause and want to request that penalties be waivered.

1. Does this seem a reasonable approach? Any pitfalls I'm missing?

2. Is it best to attach a cover letter to each amended fbar, or bundle the five together and attach one explanation?

3. Since there's been no income on the accounts since 1995 (thus no tax relevance in recent times), am I likely to face penalties?

I'm feeling very insecure about how to approach this. FBARs spook me.

Thanks for listening!

ephemerald

Are you sure those accounts are even active... most accounts have fees what will eat such small account up in short time and a zero balance account will usually be closed by the bank.

ephemerald · Jul 5, 2012, 05:36 PM

Originally Posted by smoothy

Are you sure those accounts are even active...most accounts have fees what will eat such small account up in short time and a zero balance account will usually be closed by the bank.

Yes. Unfortunately, in this country accounts remain open forever unless you close them. I went to the bank yesterday and closed the accounts. There were no service fees, so the balances remained exactly what they were when the accounts went dormant 17 and 18 years ago.

smoothy · Jul 5, 2012, 05:37 PM

Originally Posted by ephemerald

Yes. Unfortunately, in this country accounts remain open forever unless you close them. I went to the bank yesterday and closed the accounts. There were no service fees, so the balances remained exactly what they were when the accounts went dormant 17 and 18 years ago.

I had to ask... because I thought those all went by the wayside decades ago. They did here in the USA.