No FBAR wallet reporting example in the entire world


#1

There is not one (1) example of how to fill in a FBAR entry for one’s personal cryptocurrency wallet in the entire world.

[2018/1/29 update Because maybe it’s not needed!]

I challenge you the reader to show me how to properly enter it.

Account number: wallet address(s)?
Financial Institution: Me?
Address of Financial Institution: My address?
Etc.

Yes I am in a foreign country right now so so must be my wallet.


#2

Yep, FUBAR! :slight_smile:


#3

Personally, this year, I am going to use a CPA that knows about cryptos to fill all this properly as their are still a few unanswered questions BUT if I was to fill this myself I would just enter ‘Financial Institution as ‘Cryptocurrency hardware wallet’’ and enter the total dollar amount and ignore the financial address and account number.
The important part that the IRS wants to know is how much money is in the account and where it’s being held, imo.

Also, I believe that if you had more than $10,000 (combined) on exchanges at any time during the year that would need to be reported too.


#4

I happen to know a CPA in ATL who has “quite a few” FBAR clients. I’ll see if I can get some guidance on that and post it to the group.


#5

In advance of reporting back on the results I’ve received from my ATL CPA contact, I have cited this firm in the tax talk I’m giving to the Atlanta TAB group on January 27.

Read through this referenced article.

There are some hints to the answers but it does not give away the entire answer for the reason that they have to make money somehow!!


#6

Ah no wonder none of those lawyers publish the full answer!

P.S., I am a U.S. Citizen, but me and my paper wallet are not in the U.S.
As we know FBAR is very strict and one little mistake (a missing final
digit of a wallet address?) might lead to tens of thousands of dollars
in fines and lengthy trips back to the U.S to settle litigation.
Also to be more forthcoming on FBAR wouldn’t it be better to give them
the public key to the wallet so they can find all the wallet addresses
etc.?

Yes though not Winklevoss class, my assets are still trigger the need to file a FBAR.


#7

@Hades, thanks but one does not just cross one’s fingers and hope for the best when filling out such forms lest one end up on the airplane back and forth to the US to settle lengthy court battles for one missing cut and paste digit, who knows?


#8

I mean, the important part is that you report the correct amount and where it’s located (can’t hurt to enter your public wallet addresses either).
If you are afraid of making a mistake, you should consider hiring a CPA to do it for you (I know I will this year).


#9

OK but users might be in the hills of Nepal with no CPAs around and bad Wi-Fi.

As we observe on


the FBAR address requirements are very picky even about zip codes

Nine-digit ZIP Codes cannot end with four zeroes or four nines. ZIPCodes and foreign postal codes must be entered without formatting or special characters such asspaces or hyphens. For example, the ZIP Code 12354-6120 would be entered as 123546120. Theforeign postal code HKW 702 would be entered HKW702.

But one still would rather not have to hire a CPA just to properly enter
a zip code or a bitcoin address…


#10

@Peter_Rehm better ask your CPA friends for their 2016 filing year FBAR successes. Any 2017 filing year FBARs haven’t had a chance to get rejected by the agency yet or not, so we don’t know if they were valid.


#11

Strictly speaking, it says

Foreign Financial Account. A foreign financial account is a financial account located outside of the United States.

Well all readers here’s coins are located on worldwide blockchains, which certainly are located outside the United States (but also in the United States.)…


#12

As we see, even SSN should not be entered with dashes,

Identifying numbers: Enter all identifying numbers as a single text string without formatting or special characters such as hyphens or periods. An identifying number in the format NNN-NN-NNNN would be entered as NNNNNNNNN.

I don’t want to make any mistakes. I do not want to end up like
http://www.ledmp.com/vs/crypto-trader-heads-to-fed-prison-randall-lord-interview


#13

Guys, if you can bear to sit through it – Youtube has LOTS OF FBAR videos for regular fiduciary types of accounts. Just do a search for “FBAR”

There is even one where the presenter prepares his personal FBAR and he gives lots of practical advice on how each field is formatted.

The problem is that no one has presented a video on whether a FBAR has to be prepared if you have loaded all of your crypto onto a hardware wallet and have kept it off of any exchange for the entire year/ over a year.

OF COURSE you have to prepare a FBAR if your accumulated value is over $10,000 and you have all of your crypto saved at any kind of exchange where you have granted them the fiduciary duty to protect your assets.


#14

Thanks for the pointer.

Not one CPA I know of had any idea in early 2017 (tax filing season for the year 2016) that crypto would have to be disclosed on an FBAR.


#15

As to use of your public key on the FBAR when disclosing your paper wallet balance – Agreed. That makes sense.

Small mistakes, if adequately disclosed and described, can probably be resolved more amicably than you might think. Still it’s troubling that the IRS can potentially be so miffed by inadvertent errors.


#16

Thanks but I have now decided I'll give the Government my wallet addresses, not public key .


#17

What about funds on btc-e? Totally anonymous exchange, now defunct, albeit converted to Wex.nz, none of the trade history or balance information was preserved. How would you fill one out for that?


#18

My Policy Statement: I won’t comment or provide tax or any other type of guidance on btc-e or any other cryptocurrency that has had, continues to have or may in the future have issues with the US or other countries legal systems.


#19

Our attention now turns to “maybe there is some crypto tax tracker website out there that helps us fill in a FBAR?”

Although https://cointracking.info/documentation.php says

Our tool is designed to adapt to the laws, financial statements and forms of different countries, such as Capital Gains, FBAR, Form 8949, the German tax declaration under the Income Tax Act, and many more.

Alas, though on their site one finds a produce Form 8949 button, but no produce FBAR button, besides that site doesn’t apparently keep track of wallet addresses etc. high levels of detail needed for FBAR.


#20

What’s the difference between a wallet address and the public key? Aren’t they the same?