HB Reader wrote:
I don't know about a garden variety safe deposit box in a bank immediately across the border. I really doubt that you would ever get in trouble for not reporting it, but I can't say for sure. I guess that isn't much help.
I am going to continue to strongly argue my position for 2 reasons:
1. For those of us within a day’s drive of Canada, I think that bullion held in a Canadian bank safe deposit box is about as pure and convenient a method as one can find for achieving international diversification of hard assets. It is increasingly difficult/impossible to buy and store gold in a Swiss vault (or the like), as might have been done in the day of HB, and everything else has additional counterparty risk and much higher expense (such as allocated gold at Perth Mint).
2. Although Craig has made a good point that reporting is low risk, if there is no need to do so, it is superfluous, IMO. You are simply filing forms to the government for no good reason. Would you tell Uncle Sam that you had gold in your community bank SDB if there were no reason to do so?
As it turns out, this was indeed a nebulous issue until this year:
1. On 3/26/12, with the publication/revision of “Comparison of Form 8938 and FBAR Requirements”? (
http://www.irs.gov/businesses/article/0 ... 6,00.html/), the IRS clearly indicates that bullion (along with real estate, foreign currency, and personal property such as collectables) are not reportable under FBAR or form 8930 as long as they are “held directly.”?
Note: Private vaulting facilities, mint certificates, and companies that buy and store bullion through an account are all reportable, since they are NOT held directly.
2. In 6/7/12, the IRS further confirmed the non-reportability of directly owned bullion held offshore with the publication/revision of “Basic Questions and Answers on Form 8938”? (
http://www.irs.gov/businesses/corporati ... 61,00.html). Note: 8938 is for specified foreign
assets while FBAR is specifically for
accounts maintained by a financial institution in a foreign country.
In this publication, question 20 reads as follows:
“I directly hold precious metals for investment, such as gold, in a foreign country. Do I need to report these assets on Form 8938?”?
“No. Directly held precious metals, such as gold, are not specified foreign financial assets. Note, however, that gold certificates issued by a foreign person may be a specified foreign financial asset that you would have to report on Form 8938, if the total value of all your specified foreign financial assets is greater than the reporting threshold that applies to you.”?
Question 22 deals with foreign safe deposit boxes:
“I have a safe deposit box at a foreign financial institution. Is the safe deposit box itself considered to a financial account?”?
“No, a safe deposit box is not a financial account.”?
Hope this helps.