I have a brother in Guatemala (Guatemalan Citizen) who is about to close a bond sale in swiss. The Paymaster will open an account for him and all the other people involved in this transaction. If the bussines closes as expected my brother wil be traveling to swisswithin the next couple of weeks. To insured the well being of my family, he will be opening a personal account under my name (United State Citizen) in swiss. I would like to bring the part of the money he is giving me to United State. what is the most secure action permited by US law, Please advise
State/Country relating to question: United States
requesting this advise.
Hello and thank you for using Just AnswerThis information is based on your being a US citizen or resident alien.
You can have the amount transferred to your US bank that is legal and you do not have a tax event by doing so. You may need to report the gift from your brother if it is over a certain amount.
If your brother gifts you more than $100,000 you wil need to report the gift on form 3520. You do not pay tax on the gift but you must report because your brother is not a US person.
Generally, a foreign gift is money or other property received by a U.S. person from a foreign person that the recipient treats as a gift or bequest and excludes from gross income. A “foreign person” is a nonresident alien individual or foreign corporation, partnership or estate.
Where to File Form 3520Mail Form 3520 to the following address:Internal Revenue Service CenterP.O. Box 409101Ogden, Utah 84409
Now, about that account he wants to open for you. If at anytime it has $10,000 in it you would need to file Form 90-22.1
This is known as the FBAR.
The FBAR is required because foreign financial institutions may not be subject to the same reporting requirements as domestic financial institutions. The FBAR is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent United States law. Investigators use FBARs to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad.
Taxpayers with specified foreign financial assets that exceed certain thresholds must report those assets to the IRS on Form 8938, Statement of Specified Foreign Financial Assets. The new Form 8938 filing requirement does not replace or otherwise affect a taxpayers requirement to file FBAR. So depending on the amount in that account you may need the 90-22.1 and the 8938
I know this is all alot but you would not want to take the advice of those that would say the IRS would never know. More and more countries are working together to close the loop holes of individuals and report.
Did you have another question before you cick ACCEPT
if we are talking about 5 million up, does my brother have to pay any taxes to united states for giving me the mone?, can my brother open an account for himself in this country and how much taxes he has to pay?
No he is not a US person so he would have no tax responsibility to the US.
If he opens an account here he would still not have to pay as long as he is not a US person
A bank account and any interest earned on that account is not taxable in the US to a Nonresident alien
could you recomend a Tax attorney before doing any transaction?
I wish I could but we are not allowed to advise on any one company or person for endorsements.
I would look to others you know personally and ask who they use
Your bank can handle the transfer and will know how to do it so it is smoothly accomplished
how do you think we should report this trasaction to IRS.?
You will need all the forms I mentioned
The 3520 to report the gift
The 90-22.1 and the 8938 most certainly
Those forms report the gift
my understanting was for a gift over 13,000.00 dollar we have to pay taxes is that true?
When you ook for a tax specialist make sure you request they have international experience
No, that is when you, a US person gives money to someone else
If you gave more than $13000 in one year to any one person you would need to report the amount over $13000
no tax until you hit your lifetime limit $5mil
He is not a US person
should I hire a tax attorney?
As long as you report the gift you will be covered
He is a Guatemala citizen
I don't think you need an attorney
\But a tax professional to assist with the forms
how could I contact you if I have more question
I think that about covers it but you can always come back even after you click ACCEPT. You have a very generous brother
Thanks a lot, you were very helpful.
sure I do!
15years with H & R Block. Divisional leader, Instructor