Quote:
Originally Posted by synthia
What I was trying to say was that if the OP left the money in the original accounts and didnīt take anything out, there would be no real income to report, as the OP wouldnīt have received any money. Iīm assuming that interest in a retirement account that is protected would also be sheltered from US tax. And it would have to be a huge amount of interest for it to make much of a difference. If the account were kept largely in stock (shares to you guys), and nothing was bought or sold, there wouldnīt be any tax no matter what the status of the account.
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Technically, all interest from foreign bank accounts is supposed to be reported to the IRS by US citizens or green card holders. As you say, though, small amounts accruing to an account aren't going to be noticed (or "material") for the IRS to go after.
Just be careful, because there is another requirement that all US taxpayers are supposed to report all foreign accounts (bank account or stock holdings) to the Treasury Dept. each year if the combined total of the accounts exceeds $10,000. I don't know how carefully the IRS compares tax returns to the annual overseas account reports, but it can happen. And, as you mentioned, the exact nature of the fund can have alot to do with it, too. I know France has a similar requirement (i.e. to report overseas bank accounts and life insurance policies), however I have declared my US retirement funds to be a form of "life insurance" which is exempt from taxation here in France until the funds are withdrawn.
Cheers,
Bev