is FBAR for offshore Gold storage accounts?

[serge_oc]

What is FBAR:

"
Report on Foreign Bank and Financial Accounts


If you have a financial interest in any foreign bank accounts, or if you had signature or other authority, but no financial interest in any foreign bank accounts, you may need to file an additional form with the government.

If the total of all your foreign bank and financial accounts exceeds $10,000 at any time during the year, you must complete a Report on Foreign Bank and Financial Accounts, Form TD F 90-22.1.

This form is due on June 30th of each succeeding year and there is no provision for extension regardless of whether or not you filed an extension."

The penalties for not reporting FBAR involve seizing 50% of assets in questions (amongst other things). So even if there is no tax involved (but you don't report what you should have), it seems IRS can ask foreign governments to declare you a criminal and send a check in the value of 50% of your holdings, even if you have paid all your taxes (just for not reporting)!!

In the US, does FBAR reporting apply to purely gold storage programs, such as Bullion Vault or Perth Mint Certificate Program?

I am asking this here, because IRS is vague on this, and after asking 4 CPAs I get different answers (don't know, maybe, no and yes)??

I can imagine GoldMoney being reportable, as it looks like a financial account. However, aforementioned (BV and PMCP) do not appear to be financial accounts, but rather storage programs. You can't use them to pay anything, you can just store gold and eventually liquidate.

Any Itulip user from the US having an opinion on this (or experience)?

This seems important to me, as it can be used to appropriate (steal) massive amount of wealth from US citizens who have foreign accounts, even from those who pay taxes religiously. Just on the account of 'not reporting'..... Good way to narrow the deficit...

[Guest]

Re: is FBAR for offshore Gold storage accounts?

Serge - the answer is "yes" on all counts. I filed this past year for both conventional accts. and bullion accounts. Perth Mint, Goldmoney, Bullion Vault and reg. bank accts. This is most decidedly NOT something to get cute about. One or two people may hesitate for a year or two figuring they can "change their minds later" and they can get into a really bad bind merely from procrastination.

That's unless you are a Senator who's just been picked for US government office of course - in that case you have some "leeway" to file late. :rolleyes:

What is FBAR:

"
Report on Foreign Bank and Financial Accounts


If you have a financial interest in any foreign bank accounts, or if you had signature or other authority, but no financial interest in any foreign bank accounts, you may need to file an additional form with the government.

If the total of all your foreign bank and financial accounts exceeds $10,000 at any time during the year, you must complete a Report on Foreign Bank and Financial Accounts, Form TD F 90-22.1.

This form is due on June 30th of each succeeding year and there is no provision for extension regardless of whether or not you filed an extension."

The penalties for not reporting FBAR involve seizing 50% of assets in questions (amongst other things). So even if there is no tax involved (but you don't report what you should have), it seems IRS can ask foreign governments to declare you a criminal and send a check in the value of 50% of your holdings, even if you have paid all your taxes (just for not reporting)!!

In the US, does FBAR reporting apply to purely gold storage programs, such as Bullion Vault or Perth Mint Certificate Program?

I am asking this here, because IRS is vague on this, and after asking 4 CPAs I get different answers (don't know, maybe, no and yes)??

I can imagine GoldMoney being reportable, as it looks like a financial account. However, aforementioned (BV and PMCP) do not appear to be financial accounts, but rather storage programs. You can't use them to pay anything, you can just store gold and eventually liquidate.

Any Itulip user from the US having an opinion on this (or experience)?

This seems important to me, as it can be used to appropriate (steal) massive amount of wealth from US citizens who have foreign accounts, even from those who pay taxes religiously. Just on the account of 'not reporting'..... Good way to narrow the deficit...

[raja]

Re: is FBAR for offshore Gold storage accounts?

Serge - the answer is "yes" on all counts. I filed this past year for both conventional accts. and bullion accounts. Perth Mint, Goldmoney, Bullion Vault and reg. bank accts. This is most decidedly NOT something to get cute about. One or two people may hesitate for a year or two figuring they can "change their minds later" and they can get into a really bad bind merely from procrastination.

That's unless you are a Senator who's just been picked for US government office of course - in that case you have some "leeway" to file late. :rolleyes:

Would this apply to CEF and GTU????

[serge_oc]

Re: is FBAR for offshore Gold storage accounts?

Lukester, thanks for the reply, I just recently learned about this and got the 'deer in the headlight' feeling about myself, as this is something I totally didn't know about but seems to have consequences and then some.

The FAQ on irs site is here:

http://www.irs.gov/businesses/small/...148845,00.html

Raja, Look under 'What is financial account' for more info. If that doesn't help you, maybe someone else would know...

[Guest]

Re: is FBAR for offshore Gold storage accounts?

I would do it for everything Raja. If I were in your situation, with a nice farm, some ducks and chickens and a cow, a solar equipped home and a wonderful retirement, I'd make my peace with this a lot more easily than I have while still mired in life as a working stiff. Just do it for everything and bite the bullet. Your farm and happy retirement is the most wonderful consolation.

[tastymannatees]

Re: is FBAR for offshore Gold storage accounts?

I bought my GTU and CEF off of the AMEX so would it be counted as US securities.

The gold storage vaults are well... simply storage vaults to my thinking. Gold is a commodity like steel or lead. If I had some lead in in storage in a warehouse in Mexico would not meet the reporting requirement. Some googling seems to support that view.

Of course I would report any loss or gain on a sale to the IRS. I'll do some more checking but seems a stretch

[Guest]

Re: is FBAR for offshore Gold storage accounts?

The gold storage vaults are well... simply storage vaults to my thinking. Gold is a commodity like steel or lead. If I had some lead in in storage in a warehouse in Mexico would not meet the reporting requirement.

Nice try tastymannatees. But no cigar. The gold is overwhelmingly likely to be considered "munny" just like a foreign checking acct.

[tastymannatees]

Re: is FBAR for offshore Gold storage accounts?

And if I sell it to an electronics manufacturer for making components? or a jewelery company in India? It's taxed as a "collectible" which defines it by the government as a non financial instrument. Does not seem to meet the means test in the who must file section. IMO

GTU and CEF are financial Instruments and are taxed as so as per my accountant and I own that in the US.

Not to say that next week they might change the definition but for now I log onto Bloomberg and get my quotes in the commodities next to oil and pork bellies. Applying the "walks like a duck" template is a better fit.

The gold is overwhelmingly likely to be considered "munny" just like a foreign checking acct.

"likely" in the future in not what is required today. Some laws you can make retroactive. I do not think this is one of them.

It's kinda like the IRS audit to me where your accountant tells you not to give any info that's not asked for otherwise you give them permission to dig into other aspects of your finances.

Why give them a right they do not have? If they change the definition I will comply..I am not hiding anything besides my US broker where I have my Perth account probably has filed all relevant info on customers accounts with the government anyway.

[Guest]

Re: is FBAR for offshore Gold storage accounts?

Tastymannatees -

Whose side do you think I'm on - yours, or theirs?

[tastymannatees]

Re: is FBAR for offshore Gold storage accounts?

LOL -one truly never knows...as they say only the paranoid survive

[tastymannatees]

Re: is FBAR for offshore Gold storage accounts?

Accountant Just sent me form 8938 with the comment- This is in addition to the other form that we do in June, and requests a lot of the same information. But this one needs to be attached to your income tax return, and there is a $10,000 penalty for failure to file it.

I would guess that some might miss this thinking they were OK with only the June filing but failing to file this and you are on record with the June filing kind of sets you up for an automatic $10,000 fine......

[LazyBoy]

Re: is FBAR for offshore Gold storage accounts?

Accountant Just sent me form 8938 with the comment- This is in addition to the other form that we do in June, and requests a lot of the same information. But this one needs to be attached to your income tax return, and there is a $10,000 penalty for failure to file it.

I would guess that some might miss this thinking they were OK with only the June filing but failing to file this and you are on record with the June filing kind of sets you up for an automatic $10,000 fine......

Crap. I did. I filed FBAR for my goldmoney.com account last June and missed this in TurboTax.
Anyone know how to amend my TurboTax e-filing?

[LazyBoy]

Re: is FBAR for offshore Gold storage accounts?

Regarding need-to-file: http://www.irs.gov/businesses/articl...255986,00.html

Financial (deposit and custodial) accounts held at foreign financial institutions

What qualifies as a "financial institution"?

[tastymannatees]

Re: is FBAR for offshore Gold storage accounts?

Regarding need-to-file: http://www.irs.gov/businesses/articl...255986,00.html

What qualifies as a "financial institution"?

I would be cautious with the IRS, it is my own personal opinion that they loosely define terms on purpose to allow themselves latitude or flexibility when they want to collect.

Page 4 of the 8938 instruction form seems broadly to cover everything involving a foreign asset -storing lead in a warehouse in Bolivia or a painting with an art dealer in Paris.

I believe what has to satisfied is the ability to be able to easily trace all foreign assets, for example I report my PM holdings in Perth but My CEF and GTU stock (Candian companies) was bought on a US exchange and held in US brokerage accounts and the IRS will know when I buy or sell them because the info is reported to them.

These days I would use an accountant as I think there are more mine fields coming in regulation and auditing and a thousand or two spent on a good accountant is good insurance against penalties and interest & potential audits

[sadsack]

Re: is FBAR for offshore Gold storage accounts?

Page 4 of the 8938 instruction form seems broadly to cover everything involving a foreign asset -storing lead in a warehouse in Bolivia or a painting with an art dealer in Paris.

On the other hand, the IRS seems to be saying something different here: http://www.irs.gov/businesses/articl...255986,00.html

The pertinent info is in red below.

Comparison of Form 8938 and FBAR Requirements
The new Form 8938 filing requirement does not replace or otherwise affect a taxpayer’s obligation to file Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts). Individuals must file each form for which they meet the relevant reporting threshold. Specified individuals, which include U.S citizens, resident aliens, and certain non-resident aliens that have an interest in specified foreign financial assets and meet the reporting threshold U.S. persons, which include U.S. citizens, resident aliens, trusts, estates, and domestic entities that have an interest in foreign financial accounts and meet the reporting threshold No Yes, resident aliens of U.S territories and U.S. territory entities are subject to FBAR reporting $50,000 on the last day of the tax year or $75,000 at any time during the tax year (higher threshold amounts apply to married individuals filing jointly and individuals living abroad) $10,000 at any time during the calendar year If any income, gains, losses, deductions, credits, gross proceeds, or distributions from holding or disposing of the account or asset are or would be required to be reported, included, or otherwise reflected on your income tax return Financial interest: you are the owner of record or holder of legal title; the owner of record or holder of legal title is your agent or representative; you have a sufficient interest in the entity that is the owner of record or holder of legal title. Signature authority: you have authority to control the disposition of the assets in the account by direct communication with the financial institution maintaining the account. See instructions for further details. Maximum value of specified foreign financial assets, which include financial accounts with foreign financial institutions and certain other foreign non-account investment assets Maximum value of financial accounts maintained by a financial institution physically located in a foreign country Fair market value in U.S. dollars in accord with the Form 8938 instructions for each account and asset reported Convert to U.S. dollars using the end of the taxable year exchange rate and report in U.S. dollars. Use periodic account statements to determine the maximum value in the currency of the account. Convert to U.S. dollars using the end of the calendar year exchange rate and report in U.S. dollars. By due date, including extension, if any, for income tax return Received by June 30 (no extensions of time granted) File with income tax return pursuant to instructions for filing the return Mail to: Department of the Treasury Post Office Box 32621 Detroit, MI 48232-0621 For express mail to: IRS Enterprise Computing Center ATTN: CTR Operations Mailroom, 4th Floor 985 Michigan Avenue Detroit, MI 48226 Certain individuals may file electronically at BSA E-Filing System Up to $10,000 for failure to disclose and an additional $10,000 for each 30 days of non-filing after IRS notice of a failure to disclose, for a potential maximum penalty of $60,000; criminal penalties may also apply If non-willful, up to $10,000; if willful, up to the greater of $100,000 or 50 percent of account balances; criminal penalties may also apply Yes Yes No Yes No No No, unless you otherwise have an interest in the account as described above Yes, subject to exceptions The account itself is subject to reporting, but the contents of the account do not have to be separately reported The account itself is subject to reporting, but the contents of the account do not have to be separately reported Yes No Yes No No Yes, if sufficient ownership or beneficial interest (i.e., a greater than 50 percent interest) in the entity. See instructions for further detail. Yes Yes No No Yes, as to both foreign accounts and foreign non-account investment assets Yes, as to foreign accounts Yes Yes Yes No No No No, but the foreign entity itself is a specified foreign financial asset and its maximum value includes the value of the real estate No No No No No No No No No

Then again, the IRS can't be held responsible for giving wrong/bad information . . .