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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16559
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Ive the following situation: - I m a US resident, married

This answer was rated:

I've the following situation:
- I m a US resident, married filing jointly.
- My mom and dad are NOT a US citizen, nor a US resident.
- My parents are planning to open an JOINT bank account (100% their money) - interest bearing deposit account - in Singapore using both their names + me. If they die, all the money will be belong to me.

Questions:
- What tax that I need to pay? Tax on the interest? How much - since there are 3 names in the account and 2 are not US persons?
- What tax form(s) do I need to file?

Megan C :

Hello! I am a CPA here to assist you with your tax questions. My goal is to provide you with excellent service today.

Megan C :

How are you today?

Megan C :

Since your name is XXXXX XXXXX account, 1/3 of it is presumed to be yours and you would pay tax on 1/3 of the interest earned.

Megan C :

You do this on form 1040 schedule B

Megan C :

That's the only tax that's due.

Megan C :

However, if the value of the account is over $10,000 you will have to file form TDF 90-22.1

Megan C :

When they pass away, there is no tax on the funds that you receive.

Megan C :

But, if they pass and the value of the funds you receive is over $100,000 you will need to file form 3520.

Megan C :

Do you have any more questions about this matter?

Megan C :

If you have no further questions, Please rate my response as "excellent" so that I may receive credit for assisting you roday

Megan C :

today

Megan C :

Also, as to the interest earned on the account, it could be a more complex tax question. The owner of the income is determined by local law. If local law pins your parents as the sole owners of the account, then you have no income to report from that account.

Megan C :

You can read more about how interest is allocated to accounts, here: http://www.woodllp.com/Publications/Articles/pdf/Who_Pays_Tax_On_Joint_Bank_Accounts.pdf

Megan C and other Tax Specialists are ready to help you

Thank you for your positive rating. Please come back and visit me for any of your tax, finance, or social security needs. It was a pleasure working with you today.