Families with ties to both the U.S. and Korea face questions that neither a typical U.S. accountant nor a Korean advisor alone tends to catch. Three come up again and again.
1. Overseas accounts must be reported
U.S. persons with foreign financial accounts exceeding certain thresholds generally must file an FBAR, and sometimes Form 8938. The penalties for missing these filings can far exceed any tax owed, even when no tax was due at all.
2. Gifts from family in Korea
Receiving a large gift from a parent in Korea may trigger a U.S. reporting requirement (Form 3520) even though the gift itself is not taxed. Many families learn this only after the fact.
3. Two estate systems, one family
Korea and the U.S. tax estates very differently. Without coordinated planning, the same assets can be exposed to both systems. A plan designed for one country alone is often only half a plan.
The most expensive mistakes in cross-border planning aren't tax mistakes. They're reporting mistakes.
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