Copyright 2013 by John T. Reed
If you had more than $10,000 in foreign accounts in 2012, you must get Treasury From TD F 90-22.1 to an IRS office in Detroit by 6/30/2013, not with your tax return. However, Turbotax insists on filling this out in conjunction with your tax return once you check the “yes” boxes in line 7a of Schedule B—which you MUST do if you have such accounts.
Line 7b of Schedule B asks the name of the “foreign country” where “the account” is located. That assumes only one—an IRS screw-up, not Turbotax. In our case, the correct answer is Australia, Canada, and New Zealand, which would fit on line7-b. However, when my wife tried to enter those three countries, Turbotax entered “See stmt.” That is false. You are not supposed to file TD F 90-22.1 with the tax return. We do not plan to. So Turbotax is referring the IRS to a non-existent statement.
Accordingly, I urge you to use Turbotax to create your tax return, but not file it electronically. Instead, hand write the names of the countries into line 7b and mail it in.
Furthermore, Turbotax fills Form TD F 90-22.1 out incorrectly—a form where mistakes can cost you a $10,000 fine! In our case, we own the foreign accounts jointly, so we are not supposed to use the second sheet, which is for married filing separately. Turbotax uses it and keep saying you have an error for not filling it out. Morons!
Also, the top of each page after the first asks for the year, taxpayer ID number of the “filer” (me) and last name of the filer and page numbers in the format of ___ of ___. Turbotax leaves all but the page numbers blank and screws up the page numbers by including the “separately” page in direct violation of explicit IRS instructions. You are not allowed to leave the year and “filer” info blank and you have to label the first jointly page as #2 not the blank and therefore omitted “separately” page.
Turbotax asks how many joint owners on line 24 and my wife correctly answered 1. I am the “filer.” She is the only “joint owner.” But then when asked for the name, SS# and address of the “joint owner,” Turbotax automatically typed in MY info instead of my wife’s, three times per page! Also, when you are married, the IRS instructions says to write “(spouse)” after the last name of the joint owner. Turbotax will not let you fill in those lines and negligently violates all these explicit IRS instructions on a form where errors can cost $10,000. Thanks a lot, Intuit.
In other words, the Form TD F 90-22.1 automatically created by Turbotax is a pile of errors caused by poor computer programming and the Intuit programmers simply either not bothering to read, or willfully disregarding, explicit IRS instructions. So use Turbotax to create your normal Form 1040 income tax return, override “See stmt” on line 7b of Schedule B manually if you have more than one foreign country account, remove all the Form TD F 90-22.1s created by Turbotax from your tax return and burn them before they somehow get you into trouble. File your tax return by snail mail. Then separately file your Form TD F 90-22.1 which you either fill out by hand or using the IRS web page where you can file it on line.
Last year, I actually used Adobe Indesign and simply created the answers to all the blanks and lined them up so I could print the correct answers neatly onto the correct locations on the blank IRS Form TD F 90-22.1 then mailed it in.
Turbotax is worth than worthless with regard to Form TD F 90-22.1. I fills it out incorrectly in violation of the explicit IRS instructions for filling out the form.
Finally, although the form has a block for “filer” signature, if you file jointly, both the “filer” and the “joint owner” are supposed to sign in the “filer” signature box. I’m not making this up, folks. Read the IRS instructions for the form (which start on page 6 of this pdf) if you doubt.
Form TD F 90-22.1 is also known as the Report of Foreign Bank and Financial Accounts (FBAR). You are required to file it under the Bank Secrecy Act, not the Internal Revenue Code, although the IRS Form 1040 asks about it.
John T. Reed