Delinquent FBARs and Unreported Small Income Amount

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Delinquent FBARs and Unreported Small Income Amount


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Old 13th March 2020, 05:27 PM
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Default Delinquent FBARs and Unreported Small Income Amount

Hello all,

I have been reading through the forum and really appreciate all of the insight. I just learned that the FBAR is a thing in mid to late February.

I am looking for some help with my situation. I moved to the US in 2016 on an R-1 Visa and had a Canadian TFSA in Mutual Funds worth $30,000 Canadian Dollars. I also had an RRSP (retirement savings) of about $16,000 Canadian that I mostly had forgotten about until recently. I believe the only year I reported having a foreign bank account was 2016 because using Turbo Tax it implied that if the account was not owned at the end of the year it did not need to be reported, so I did not say I had one in 2017.The mutual fund grew to $35,500 by end of 2016 but only gave out $185 of income. This income was never reported. I sold the mutual fund in November 2017 right after I got married to an American. That year married filing jointly our total income was only $44k.

I have spoken with two tax professionals including one that is local that has a few Canadian clients and one that specializes in cross-boarder banking with Canada and the US. The local guy told me to just file FBARs going forward and not worry about the income from 2016. The cross-boarder guy told me to file FBARs for 2016, 2017, 2018 and 2019 but not to worry about the income either. They both said to not worry about the capital gains because I would not owe the IRS due to the long-term capital gains tax being 0% in our tax bracket.

My initial thought is that I should file the delinquent FBARs but I am likely going to have the local guy help me with taxes. I plan to file the FBARs myself though.

My question is:

1) Should I file the delinquent FBARs or just going forward?
2) Should I amend my 2016 return to include that $185? (I believe my income that year was something like $23k filing single in a state with no income tax)
3) If I should amend, should I do so prior to filing the delinquent FBARs?

I just want to make sure I am doing what is right and protects us going forward.

Thank you in advance for the help!

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