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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
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Experience:  10 years experience
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Situation is joint account in usa. Mother has us citizenship

Customer Question

Hello. Situation is joint account in usa. Mother has us citizenship and primary holder of account daughter non resident alien with french citizenship. Interest above 10 dollar a year. What are the reporting obligations to irs of the bank ? Are they required to send form 1046 to the irs ? Or just form 1099 to us citizen primary holder...concern with french tax implications. Thanks for your answer
Submitted: 1 month ago.
Category: Tax
Customer: replied 1 month ago.
The joint account involve a us citizen as primary owner and non resident alien as secondary. The account was opened in the usa.
Expert:  emc011075 replied 1 month ago.

Hi. My name is ***** ***** I will be happy to help you.

Yes, the interest will be reported as income to ALL account holders. Which means, both 1046 and 1099 will be issued.

Expert:  emc011075 replied 1 month ago.

Any questions?

Customer: replied 1 month ago.
Althouth there is a statement in saying that if at least one account holder is us citizen it should be considered as a us account what does it mean then ?
Expert:  emc011075 replied 1 month ago.

Where are you reading it?

Customer: replied 1 month ago.
I am looking for it
Customer: replied 1 month ago.
If you own the income or account jointly with one or more other persons, the income or account will be treated by the withholding agent as owned by a foreign person that is a beneficial owner of a payment only if Forms W-8BEN or W-8BEN-E are provided by all of the owners. If the withholding agent or financial institution receives a Form W-9 from any of the joint owners, however, the payment must be treated as made to a U.S. person and the account treated as a U.S. account.
Customer: replied 1 month ago.
Customer: replied 1 month ago.
that is what i found on irs
Expert:  emc011075 replied 1 month ago.

It only that the account is treated as owned by US person and is not subject to back up withholding.

Customer: replied 1 month ago.
you mean no witholding but still reporting ?
This is the answer of christophe b esq
he joint owner whose SSN was listed on the 1099 has to report all the income of his tax return. He must then deduct the shares of the other joint owners and make a note on the tax return. The note lists the other joint owners, their respective shares and their Social Security numbers and states that they will be reporting their share of the income on their tax returns. The recipient of the 1099 needs to send a copy to all joint owners, along with a breakdown of the income for each owner. So no, you should not receive a 1042 if you are not the primary holder of the account. The primary holder whose SS# ***** is listed on the 1099 will receive that and a 1042 should not be sent.i am just trying to understand since it is not my money but my mother added me in case she became seek and not able to withdraw money . i dont want to get in trouble because of this
Expert:  emc011075 replied 1 month ago.

I cannot comment what somebody else told you.

Customer: replied 1 month ago.
ok i understand so what shall i do now to protect myself since those funds are not mine ?
Expert:  emc011075 replied 1 month ago.

If you are listed as account owner (primary or secondary) and have a free access to those funds, the funds are treated as belonged to both of you. You have to remove your name from the account.