Reporting Inherited Foreign Bank Accounts
Reporting Inherited Foreign Bank Accounts: When a U.S. person receives foreign accounts, assets, investments and/or income from a deceased person, the reporting can become very complicated. There are various tax and reporting requirements that the beneficiary of the foreign accounts will have to report. If the beneficiary is also an administrator of the estate (common with children beneficiaries), they may have also to ensure the decedent’s final tax return is filed timely — and the prior returns were also filed correctly. That may lead to the beneficiary having to submit to FBAR Amnesty for prior year non-compliance of the decedent or risk penalties.
We will summarize the IRS rules for Reporting Inherited Foreign Bank Accounts.
FBAR & Reporting Inherited Accounts
When a person inherits foreign accounts, they may have a foreign account reporting requirement on the FBAR.
Reporting on the FBAR would begin when the person either inherited the accounts, or if they have any signature authority or prior joint ownership (even if the money was not technically their money in the account).
The latter is very common is countries when a beneficiary is placed on an account for “future inheritance” purposes.
FATCA Form 8938 & Inherited Account Reporting
In addition to the FBAR, the person who inherited the account may also have a FATCA Form 8938 reporting requirement as well.
The FBAR is not mutually exclusive from the FBAR, and an account holder may have both an FBAR and FATCA Form 8938 reporting requirement.
Additional Reporting of Inherited Foreign Accounts
The IRS has developed many different international information reporting forms. Depending on the type and value of the foreign accounts, other reporting forms may include:
- Form 3520 (Foreign Gift)
- Form 8621 (Passive Foreign Investment Company)
- Form 926 (Transfer of Property Overseas)
- Form 5471 (Foreign Corporation)
- Form 8865 (Foreign Partnership)
Our FBAR Lawyers Represent Clients Worldwide
Our FBAR Lawyer team specializes exclusively in international tax, and specifically IRS offshore disclosure.
We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe. Our attorneys have worked with thousands of clients on offshore disclosure matters, including FATCA & FBAR.
Each case is led by a Board-Certified Tax Law Specialist with 20 years of experience, and the entire matter (tax and legal) is handled by our team, in-house.
*Please beware of copycat tax and law firms misleading the public about their credentials and experience.
Less than 1% of Tax Attorneys Nationwide Are Certified Specialists
Sean M. Golding is one of less than 350 Attorneys (out of more than 200,000 practicing California Attorneys) to earn the Certified Tax Law Specialist credential. The credential is awarded to less than 1% of Attorneys.
Recent Case Highlights
- We represented a client in an 8-figure disclosure that spanned 7 countries.
- We represented a high-net-worth client to facilitate a complex expatriation with offshore disclosure.
- We represented an overseas family with bringing multiple businesses & personal investments into U.S. tax and offshore compliance.
- We took over a case from a small firm that unsuccessfully submitted multiple clients to IRS Offshore Disclosure.
- We successfully completed several recent disclosures for clients with assets ranging from $50,000 – $7,000,000+.
How to Hire Experienced Offshore Counsel?
Generally, experienced attorneys in this field will have the following credentials/experience:
- 20-years experience as a practicing attorney
- Extensive litigation, high-stakes audit and trial experience
- Board Certified Tax Law Specialist credential
- Master’s of Tax Law (LL.M.)
- Dually Licensed as an EA (Enrolled Agent) or CPA
Interested in Learning More about Golding & Golding?
No matter where in the world you reside, our international tax team can get you IRS offshore compliant.
Golding & Golding specializes in FBAR and FATCA. Contact our firm today for assistance with getting compliant.