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Thread: two taxes questions... (about foreign bank accounts)

  1. #1
    made_of_sequins
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    Default two taxes questions... (about foreign bank accounts)

    ...not sure if anyone knows the answer to this, but i thought i could ask.

    This is the first time I'm doing taxes in the US (since it's the first year I worked in the US). I'm from Belgium, and I've got some money in a savings account there.

    Do I have to claim this to the IRS for taxes? Must I pay taxes on money that a) I recieved in Belgium and b) is stored in a bank there? (I'm actually a dual citizen of the US and Belgium, if that makes a difference.)

    Also, what if I transfer some of this money to a US bank? I am to use some of it to pay for school here...but would I get in trouble with the IRS for depositing what seems to be an un-explained sudden amount of money? I know I am honest, but how can I prove this and protect myself from any trouble?

    This frustrates me because I'm afraid that no matter what I do, something bad will happen. Because I hear of all the stories about the IRS looking at people with foreign bank accounts with mistrust, as if they simply must be scam artists or terrorists.

    I know you will probably say "hire a professional to answer you!" and I will next year...but with irony, I have NO money right now. This year was much more difficult money-wise than I had any idea.

    If anyone can give me any helpful links or information at all, I will love you forever.

  2. #2
    Banned Melonie's Avatar
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    Default Re: two taxes questions...

    I don't have all of the answers in this situation, but can relate what I learned from the 'school of hard knocks' in regard to a Swiss Bank account that I used to have.

    Yes the IRS requires that American citizens residing in the USA report foreign income sources, and pay taxes on that income to the US federal and state tax agencies.

    Yes, the US state dep't requires that an American citizen residing in the USA report the existance of 'offshore' bank accounts.

    Yes, a large international transfer of funds between, say, a Belgian bank and a Pennsylvania bank, is going to be detected by Homeland Security and automatically reported to the IRS. I would imagine that as long as the existance of the Belgian bank account has been previously reported to the US state dep't, and the interest earnings from the Belgian bank account have been declared on US federal and PA state tax returns, that everything would be explainable.

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