Max value of deposit account for 8938 and FBAR

[Canadian Newbie]

I know I am probably splitting hairs here but do you have to calculate the highest balance based on intraday or can you use the day ending balance. For example I have an account that had 10,000 on 1/1/2015 and then the next day, I did a wire transfer in the morning for 5,000 but then later that day cashed a check for 7,000. My bank account shows a balance at 1/1/2015 of 10,000 and a balance of 8,000. The wire transfer is listed first and then the cashed check. I am pretty sure I cashed the check later in the day.

So, do I report the high balance as 10,000 or 15,000? To complicate it further, the wire transfer of 5,000 was on hold until the next day so it technically was not part of the value of the account!

Here is what the IRM states regarding FBAR-



[b]4.26.16.3.2.2 (11-06-2015)
Account Valuation

1. The FBAR is required for each calendar year during which the aggregate amount(s) in the foreign account(s) exceeded $10,000, valued in U.S. dollars, at any time during that calendar year. To determine the account value to report on the FBAR follow these steps:


A.Determine the maximum value in locally denominated currency. The maximum value of an account is the largest amount of currency and non-monetary assets that appear on any quarterly or more frequent account statement issued for the applicable year.


Example:

If the statement closing balance is $9,000 but at any time during the year a balance of $15,000 appears on a statement, the maximum value reportable on an FBAR is $15,000.


Note:

If periodic account statements are not issued, the maximum account asset value is the largest amount of currency and non-monetary assets in the account at any time during the year.
[/b]


Based on the above, it appears the correct way to report is to use the balance that is shown on the statement which in my case would be 10,000.

I was just curious how you folks compute it. If there are many transactions in one day it can get even more crazy since I am not sure if the sequence on the bank statements of transactions is necessarily based on the time of day...especially when it comes to cashed checks. Thanks for any help.
[i][/i]

PS- I have already filed my 8938 so I will have to amend if I am wrong. However, I don't think I will be penalized since the return was not due until 6/15/2016.

[Canadian Newbie]

[quote="Canadian Newbie"]I know I am probably splitting hairs here but do you have to calculate the highest balance based on intraday or can you use the day ending balance. For example I have an account that had 10,000 on 1/1/2015 and then the next day, I did a wire transfer in the morning for 5,000 but then later that day cashed a check for 7,000. My bank account shows a balance at 1/1/2015 of 10,000 and a balance of 8,000. The wire transfer is listed first and then the cashed check. I am pretty sure I cashed the check later in the day.

So, do I report the high balance as 10,000 or 15,000? To complicate it further, the wire transfer of 5,000 was on hold until the next day so it technically was not part of the value of the account!

Here is what the IRM states regarding FBAR-



[b]4.26.16.3.2.2 (11-06-2015)
Account Valuation

1. The FBAR is required for each calendar year during which the aggregate amount(s) in the foreign account(s) exceeded $10,000, valued in U.S. dollars, at any time during that calendar year. To determine the account value to report on the FBAR follow these steps:


A.Determine the maximum value in locally denominated currency. The maximum value of an account is the largest amount of currency and non-monetary assets that appear on any quarterly or more frequent account statement issued for the applicable year.


Example:

If the statement closing balance is $9,000 but at any time during the year a balance of $15,000 appears on a statement, the maximum value reportable on an FBAR is $15,000.


Note:

If periodic account statements are not issued, the maximum account asset value is the largest amount of currency and non-monetary assets in the account at any time during the year.
[/b]


Based on the above, it appears the correct way to report is to use the balance that is shown on the statement which in my case would be 10,000.

I was just curious how you folks compute it. If there are many transactions in one day it can get even more crazy since I am not sure if the sequence on the bank statements of transactions is necessarily based on the time of day...especially when it comes to cashed checks. Thanks for any help.
[i][/i]

PS- I have already filed my 8938 so I will have to amend if I am wrong. However, I don't think I will be penalized since the return was not due until 6/15/2016.[/quote]

Bump for any help which would be appreciated.

[nelsona]

No bumps, please.
The interest in your question is self-evident.