Keeping a South African or other foreign account after moving to the United States can create more than one reporting obligation. FBAR and Form 8938 are separate regimes with different filing destinations, thresholds and asset definitions.
The FBAR threshold is aggregate
A U.S. person generally files an FBAR when the aggregate value of foreign financial accounts in which the person has a financial interest or signature authority exceeds $10,000 at any time during the calendar year. The accounts are considered together, not one by one.
Form 8938 is part of the tax return
Specified individuals and certain entities file Form 8938 when the total value of specified foreign financial assets exceeds the threshold for their filing status and living situation. Thresholds are generally higher than the FBAR threshold, but the assets covered are not identical.
One filing does not replace the other
The same account may appear on both forms, and reporting an asset elsewhere on a tax return does not automatically eliminate every information-return obligation. Foreign companies, trusts and funds can also require separate forms.
Build the record set
- Maximum value of each foreign account during the calendar year
- Account number and financial institution details
- Ownership and signature-authority information
- Currency conversion method and exchange rate
- Statements for foreign investments, companies and trusts
- The exact U.S. tax-residency starting date
Cross-border decisions need to be sequenced before U.S. tax residency changes the picture. America Financial Readiness™ helps you identify the right questions, documents and specialist input before you act through Emigrate2USA.
International information returns can carry significant penalties. Obtain individualized U.S. tax advice before filing or correcting an omission.
