Nice new FBAR exemption

The IRS was kind enough to amend FBAR with a new exemption for owners of foreign corporations.

Modified Reporting for United States Persons Residing and Employed Outside of the United States. A United States person who (1) resides outside of the United States, (2) is an officer or employee of an employer who is physically located outside of the United States, and (3) has signature authority over a foreign financial account that is owned or maintained by the individual's employer should only complete Part I and Part IV, Items 34-43 of the FBAR. Part IV, Items 34-43 should only be completed one time with information about the individual's employer.

So if you own a foreign corporation, use it for business or trade, and live abroad, the accounts owned by the company are not reportable via FBAR.

However, it will be reportable via the new form 8938 if you treat your company as a disregard entity for tax purpose.

Failing again at constructive feedback

I often pick up food from a nearby restaurant when I don’t have time for a full two hour lunch break. The other day, the soup I had picked up tasted a bit off, so the next day I commented to them that the soup yesterday hadn’t been so good.

“Then why did you come back? Normally people who don’t like our food just go somewhere else.”

Generalitat Bonds at a discount

Soon you will get a phone call from your friendly bank representative flogging the latest issue of bonds from the Generalitat of Catalunya. What patriotic Catalans they must be to spend so much time and effort helping out our struggling government.

Well, not so much.

What is missing from the picture is the juicy commission that the bankers get from convincing overly patriotic and perhaps not so financially astute citizens when they sell the bonds at retail. Exactly what the commissions are is not clearly disclosed.

However, if you want to buy an equivalent bond for a much better price (ie higher interest), have your bank open up a renta-fija account for you and you can buy the bonds yourself.

Boerse Frankfurt has a nice bond search engine that you can use to see what’s going on with Generalitat debt:

Name	ISIN	Last price	Maturing on
GEN. CATALUNYA 09/14 MTN	CH0105004060	16.84%	1/10/2014
GEN. CATALUNYA 10/16 MTN	CH0110411532	15.74%	24/03/2016
GEN. CATALUNYA 11-13	ES00000950L4	12.01%	4/4/2013
GEN. CATALUNYA 02-12	ES0000095770	11.19%	30/09/2012
GEN. CATALUNYA 06/16	ES0000095895	10.20%	15/11/2016
GEN. CATALUNYA 04-14	ES0000095838	9.13%	16/07/2014
GEN. CATALUNYA 05-15	ES0000095861	7.90%	15/09/2015
GEN. CATALUNYA 10/15 MTN	XS0499156080	6.59%	7/4/2015

The first two bonds are kind of interesting… they were issued in 2009 in Swiss Francs. You have to wonder what kind of stupidity was involved there. The ones with an ES prefix are regular Spanish law bonds and the XS one trades in Luxemburg.