US tax delinquency: do I need to file?

spock · Post by **spock** » Thu Nov 24, 2011 9:43 pm

Born in Canada, one US parent. If I got my passport and social security in the beginning of 2009, but my gross income for 2009 and 2010 was under $5000 (so I didn't need to file a US tax return). So, do I need to file US tax returns for the years before I had formally applied for citizenship? Secondly, I've never filed an FBAR, because I didn't think I ever had to file a US tax return until now. How many years back do I need to file FBARs for? 6? or just 2009 and 2010?

Thanks for any help.

nelsona · Post by **nelsona** » Thu Nov 24, 2011 9:47 pm

You have always been a US citizen, and thus you shoukld file 3 years back, regardless of when you got a passport. you did not apply for citizenship, you applied for a passport.

If you are required to file FBAR (access to fianacial accounts that in total had >10K in assets at any time), then you should back file these alone for past 3 years.
Same if you ahd an RRSP for form 8891.

spock · Post by **spock** » Thu Nov 24, 2011 9:53 pm

So back three years for returns means only the years that I had more than the minimum amount of income required to file, i.e., only 2008, is that correct? Or do I need to file 2009 and 2010 even if my income was below the filing requirements?

thanks again nelson for the prompt reply

nelsona · Post by **nelsona** » Thu Nov 24, 2011 10:11 pm

I'm of the opinion, that if you need to check any box 'yes' on the bottom of schedule B, you should be filing 1040 for that year, regradless of how little your income is.

that means if you have ANY foreign interest income, or if you have RRSP.

spock · Post by **spock** » Thu Nov 24, 2011 10:17 pm

I didn't have any interest income in 2009 and 2010 - and my RRSP value in those years was only $6 because i withdrew money under the life long learning plan (basically set up the rrsp at the end of the year in 2008 and withdrew the money almost immediately in 2009 for my tuition... would i still need to file a return for 2009 and 2010 if the rrsp amount was so negligible?

nelsona · Post by **nelsona** » Fri Nov 25, 2011 1:23 am

Why not. Get into the practice.

spock · Post by **spock** » Fri Nov 25, 2011 1:26 am

main reason is accounting fees...'practice' doesn't justify hiring someone to do 3 yrs of returns if they're not all necessary...

nelsona · Post by **nelsona** » Fri Nov 25, 2011 9:53 am

Why would you hire an accountant to do a $5000 1040?

If you reeally can't do it, have one return done (the 2008 one, for example), then just follow as a template.

nelsona · Post by **nelsona** » Fri Nov 25, 2011 9:57 am

Besides, in 2009 you made a substantial withdrawl from your RRSP, this needs to be reported. The penalty for not reporting it (8891) would be based on its highest value that year, and if you don't elect to defer taxation, it is considered income.

tsanaha · Post by **tsanaha** » Fri Nov 25, 2011 10:12 am

it is practice of your obligation. so if you have done one year, you can do the following years easily.

the first year is very important as it is your template, all the error/mistake will be replicated

nanic · Post by **nanic** » Fri Nov 25, 2011 10:42 am

Go to the TurboTax website (the US site). You can download previous years tax software for free. The software will walk you through the process.

spock · Post by **spock** » Fri Nov 25, 2011 5:12 pm

Thanks for the feedback. regarding the turbotax site, do I need a tax id number from the irs to efile?

nelsona · Post by **nelsona** » Fri Nov 25, 2011 5:24 pm

You would not be able to e-file for the current year (not past years), until you file your first paper return. that would be the case even if you lived in US and you had your SSN.

You need to apply for SSN firdt even before you renounce; I think once you realize the work involved just to be able to renounce, you won't think filing every year to keep citizenship will be a big deal.

spock · Post by **spock** » Fri Nov 25, 2011 7:36 pm

I have an sun and have no interest in renouncing. I am unclear whether or not I am eligible to efile for 2008, 2009 and 2010.

nelsona · Post by **nelsona** » Fri Nov 25, 2011 9:10 pm

Sorry, getting this thread mixed with other.

You are not eligible to e-file until you paper file the previous years. and. like caada, you can only e-file current year during a specific period, which has likely lapsed.

So, the earliest you will be able to e-file is proabaly the 2012 tax year.