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Old 02.03.2012, 14:24
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New form 8938: how to report 2nd pillar / 3a pillar accounts??

Hello again,

Trying to figure out how to report my Swiss 2nd and 3a pillar accounts on this new form 8938... did anyone already fill that form? What I think makes sense:

Report as "Other Foreign Assets", line 8b tick "corporation", 8c = "Foreign Person". Does that sound reasonable?

This new form really is a pain...
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Old 02.03.2012, 15:27
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

Form 8938 is for US tax returns. I would suggest you make this clear in your post.
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Old 02.03.2012, 16:18
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

Sorry, of course for the US taxation. Can't seem to edit my post
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Old 03.03.2012, 11:52
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

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Trying to figure out how to report my Swiss 2nd and 3a pillar accounts on this new form 8938... did anyone already fill that form? What I think makes sense: Report as "Other Foreign Assets", line 8b tick "corporation", 8c = "Foreign Person". Does that sound reasonable?
I would check Part II, 8b(4): Trust (US law views a pension arrangement as a trust, i.e. funds are held for your benefit by a 3rd party).

Also, please note the reporting threshold is quite high for a non-resident like yourself:
You are filing a return other than a joint return and the total value of your specified foreign assets is more than $200,000 on the last day of the tax year or more than $300,000 at any time during the year; or
You are filing a joint return and the value of your specified foreign asset is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the year.
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Old 03.03.2012, 17:56
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

Also here, thanks a lot for your answer.

Unfortunately, I have to file the form since my husband is Swiss and does not file a US return (his greencard will only become active in May). So I can't use the threshold for joint filers :-(

One more thing: what about the tickbox re PFIC - could companies offering Swiss Vested Benefits accounts and pillar 3a accounts be considered PFICs? Sorry if this question is silly, but my financial knowledge really is limited... :-)
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Old 03.03.2012, 18:09
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

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One more thing: what about the tickbox re PFIC - could companies offering Swiss Vested Benefits accounts and pillar 3a accounts be considered PFICs? Sorry if this question is silly, but my financial knowledge really is limited... :-)
If you recognize the term PFIC, you're in the top 10% for financial sophistication. Two replies: (a) In theory, any non-US corporation could be a PFIC; the determination depends on the source of the company's income. (b) However, who cares? (That is not a rhetorical question.) Being the beneficiary of a pension does not make you a shareholder, and the PFIC determination only matters to shareholders (owners). Again, from the US point of view a pension or similar structure is effectively a trust arrangement, i.e. money is held by someone for your benefit, subject to certain rules on when you may take the money.
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Old 05.03.2012, 12:23
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

Just had a discussion over lunch with a friend, and he mentioned that reporting foreign pension plans as trust might get you more attention than necessary from the IRS, since an interest in a trust per se could mean something different from an IRS perspective than what a Swiss pension plan really is. This is just confusing (did I mention this before? )

Also, a second topic we were discussing: are shares of a Swiss company held in a swiss bank's securities account to be reported in part I as "Deposit Account", or in Part II, line 7 as "stock of a foreign entity"???
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Old 30.06.2012, 16:49
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

Hi-
Interesting question - if the account is held by your employer then you do not have "Signatory authority". If on the other hand you have ceased employment and the account has been transferred to your choice of bank - then you have "Signatory authority" and it requires 8938 reporting.

The key is to remember that the pension fund contributions in CH are considered nothing more than regular bank account contributions. There is NO PENSION in CH for USA guys. NONE - no 3rd no 2nd. Nothing qualifies as a pension according to IRS rules

Therefore, do not contribute 3rd or 2nd pillar accounts under any circumstances - you end up paying US taxes on any contributions so there is no savings and you only end up locking up you money.

So no 8938 for Employer help accounts but 8938 reporting for any bank accounts....

Does this help?
Regards,
Eric
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Old 30.06.2012, 18:37
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Re: New form 8938: how to report 2nd pillar / 3a pillar accounts??

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Therefore, do not contribute 3rd or 2nd pillar accounts under any circumstances - you end up paying US taxes on any contributions so there is no savings and you only end up locking up you money.
When you say contribute above, do you really mean report to the IRS?

Edited to add, ok, I saw your response in another thread. Because some contributions to 2nd pillar are compulsory.
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