Posted: 9/11/2012 4:30:16 AM EDT
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I have a few questions about banking overseas
Im looking at Iceland as a possible foreign account. Their interest rates on a savings account are 3.30 percent compounded monthly... not tied down by the prime rate like we are here. The bank has an excellent website in English and most of the inhabitants speak English as a second language. I could also locate the main branch since I have been to Iceland and am familiar with part of the country. It would be as a side savings account and we would maintain active US accounts for typical bills and so forth. My quesiton: Who has done international banking? Does it hedge against the USD since it would be converted to Krona or is there something I am missing? ( the krona is at an all time low BTW) What type of forms do I have to fill out on the US side of things? Thoughts? |
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Crossed this bridge whilst living in England. I didn't consider converting to Pounds and back to Dollars a type of protection against issues with the Dollar, as the UKP has issues as well.
As mentioned in another post, I had to mention on my US tax return having a UK account. No biggie. By the way - I did make money on the exchange rate - but that could have easily gone the other way and wiped out any interest gained. Iceland is a welfare state (hugely so), and will want a piece of any interest you gain, won't they? Ray |
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Does it hedge against the USD since it would be converted to Krona or is there something I am missing? ( the krona is at an all time low BTW) What type of forms do I have to fill out on the US side of things? Yes it is a hedge against the USD since it is held in the native currency. If you have more than 10,000 at any time during the year you must file a Form TD F 90-22.1 to report the foreign holdings. Quoted:
You will have to report the foreign account each year when you do your taxes. Better to buy property overseas as you don't have to report it. You do have to report foreign property ownership. Tax form 8938 |
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Does it hedge against the USD since it would be converted to Krona or is there something I am missing? ( the krona is at an all time low BTW) What type of forms do I have to fill out on the US side of things? Yes it is a hedge against the USD since it is held in the native currency. If you have more than 10,000 at any time during the year you must file a Form TD F 90-22.1 to report the foreign holdings. Quoted:
You will have to report the foreign account each year when you do your taxes. Better to buy property overseas as you don't have to report it. You do have to report foreign property ownership. Tax form 8938 I didn't know that. Thanks! |
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You do have to report foreign property ownership. Tax form 8938 ??? This is not for owning land or property. If you receive some sort of distribution or income from a property, estate or trust then you have to report it. If its just a house and some land that your not renting then its not required. Or am I reading this wrong? It would impact me if I have been reading it wrong. |
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You do have to report foreign property ownership. Tax form 8938 ??? This is not for owning land or property. If you receive some sort of distribution or income from a property, estate or trust then you have to report it. If its just a house and some land that your not renting then its not required. This is what I had been told. |
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I could be mistaken, but I think a whole lot of Brits lost their asses banking in Iceland a few years ago. http://www.bbc.co.uk/news/business-18072195 http://edition.cnn.com/2011/BUSINESS/04/10/uk.iceland.banks/index.html http://topics.nytimes.com/top/news/international/countriesandterritories/iceland/index.html |
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Indeed they did, but with iceland now "reset" in their banking sector because of those issues... I feel like it would be fairly safe place for my cash.
They basically had a run on the Internet based banking system by UK residents and simply couldn't cover those accounts. Lots of butthurt in the UK about it. Who wouldn't be upset? They are expected to be in a state where their economy can once again grow. Seeing as how the banking crisis caused a major loss of Krona value the banks are under the very watchful eyes of the Icelanders. Time to profit fellas. |
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Quoted:
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You do have to report foreign property ownership. Tax form 8938 ??? This is not for owning land or property. If you receive some sort of distribution or income from a property, estate or trust then you have to report it. If its just a house and some land that your not renting then its not required. Or am I reading this wrong? It would impact me if I have been reading it wrong. For a long time foreign property was not required to be disclosed. Now, any property, including land and or a house if not used for business (rental) is considered held for investment. Foreign investments do need to be reported on Form 8938. |
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The instructions for the 8938 are clear: Foreign financial assets. Mentioned specifically are financial accounts at an foreign institution and investments not held in an account, to include stocks, securities, financial instruments, or contracts. Nowhere mentioned is land or a house.
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You do have to report foreign property ownership. Tax form 8938 ??? This is not for owning land or property. If you receive some sort of distribution or income from a property, estate or trust then you have to report it. If its just a house and some land that your not renting then its not required. Or am I reading this wrong? It would impact me if I have been reading it wrong. For a long time foreign property was not required to be disclosed. Now, any property, including land and or a house if not used for business (rental) is considered held for investment. Foreign investments do need to be reported on Form 8938. |
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Why not just use bitcoin? It would do all the things you desire without big fees or paperwork. You can even spend it anywhere in the world.
Whenever I travel I make arrangements to sell some in country for local currency. Easier and cheaper than at the money exchangers. |