Is FBAR Required in my case?

This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.

Moderator: Mark T Serbinski CA CPA

Post Reply
cosurshe
Posts: 13
Joined: Sat Mar 16, 2019 12:15 pm

Is FBAR Required in my case?

Post by cosurshe » Wed Mar 27, 2019 5:08 pm

I was a resident (for tax purposes) of USA until June 2018. After which I moved to Canada. I'm now filing taxes in USA s a Dual Status filer, 1040 and 1040NR + Closer Connection to a Foreign Country (using H&R Block). They say that I should be filing FBAR even if I did not hold any foreign accounts prior to my leaving USA. Is that correct?

I did have more than 10,000 USD at some point between Jan 1 2018 to June 15th 2018. I transferred all my funds after I leave USA to my Canadian bank account, practically emptying out my US bank accounts.

nelsona
Posts: 15980
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Is FBAR Required in my case?

Post by nelsona » Thu Mar 28, 2019 10:04 am

Closer connection filing doesn't apply in your case, but that is HRB for you.
Any particular reason you are not filing full year 1040 to get better tax rate?
There is little guidance on FBAR filing for part-year residents, if you choose to file that way, but there is no harm in taking the 10 minutes to file FBAR, if only to protect yourself.

But seriously, I would be filinga regular 1040 for 2018. We've discussed this here many times.

And HRB sucks at cross-border items.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

cosurshe
Posts: 13
Joined: Sat Mar 16, 2019 12:15 pm

Re: Is FBAR Required in my case?

Post by cosurshe » Thu Mar 28, 2019 1:00 pm

Hey nelson,

Thanks for taking the time to reply. While I’m tempted to do that, I moved to Canada and started my own business which has had some income since I started it. To start the business I declared myself as a resident of Canada (which I am, A PR). Not sure how claiming to be a resident of USA is going to impact my business.

cosurshe
Posts: 13
Joined: Sat Mar 16, 2019 12:15 pm

Re: Is FBAR Required in my case?

Post by cosurshe » Thu Mar 28, 2019 1:05 pm

Also, I'm not sure how to file Canadian taxes if I claim to be resident of USA. I'm posting my

We (myself and my spouse) were resident aliens (for tax purposes) until June 2018 on a F1 visa. We left USA and moved to Canada in June 2018 (less than 183 days in 2018), established a home in Canada. We aren't citizens of either USA or Canada and do not have dependents.

Here is what my income looked like

US Employer Income (while residing in USA) : x-a

US Employer Income (while residing in Canada): x-b

Contract work as a consultant (while residing in Canada, but for a US client): y-a

My incorporated business : y-b

Canadian Employer income (while residing in Canada, from a Canadian company): z


Here is why my spouses income looked like:

US Employer Income (while residing in USA) : m-a

US Employer Income (while residing in Canada): m-b

Canadian Employer income (while residing in Canada, from a Canadian company): n

With all of this, I didn't find enough resources online to figure out how to properly file taxes int he two countries.

cosurshe
Posts: 13
Joined: Sat Mar 16, 2019 12:15 pm

Re: Is FBAR Required in my case?

Post by cosurshe » Thu Mar 28, 2019 1:08 pm

nelsona wrote:
> Closer connection filing doesn't apply in your case, but that is HRB for
> you.
> Any particular reason you are not filing full year 1040 to get better tax
> rate?
> There is little guidance on FBAR filing for part-year residents, if you
> choose to file that way, but there is no harm in taking the 10 minutes to
> file FBAR, if only to protect yourself.
>
> But seriously, I would be filinga regular 1040 for 2018. We've discussed
> this here many times.
>
> And HRB sucks at cross-border items.

Curious - why doesn't closer connection apply? We left USA prior to 183 days of 2018.

nelsona
Posts: 15980
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Is FBAR Required in my case?

Post by nelsona » Thu Mar 28, 2019 1:55 pm

Closer connection applies to ones who never resided in US, and are trying to prove this. Look at the form. It says which foreign country was your tax home on jan 1 2018. Your was US.
As I said, HRB knows little about cross-border taxes. They are the ones you should question about 8840.

Anyone leaving US merely declares that they are leaving and either files a dual-status return (and the explanation goes on the 1040NR), or a full-year return. maybe in 2019 you file 8840, if you have no reason to file a 1040NR, but not in year of departure.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

cosurshe
Posts: 13
Joined: Sat Mar 16, 2019 12:15 pm

Re: Is FBAR Required in my case?

Post by cosurshe » Thu Mar 28, 2019 2:11 pm

nelsona wrote:
> Closer connection applies to ones who never resided in US, and are trying
> to prove this. Look at the form. It says which foreign country was your tax
> home on jan 1 2018. Your was US.
> As I said, HRB knows little about cross-border taxes. They are the ones you
> should question about 8840.
>
> Anyone leaving US merely declares that they are leaving and either files a
> dual-status return (and the explanation goes on the 1040NR), or a full-year
> return. maybe in 2019 you file 8840, if you have no reason to file a
> 1040NR, but not in year of departure.

Ah! I’ll talk to them. Thanks!

Post Reply