K Treasury Account

[Guest Astrrro]

Kasikorn offers a K Treasury account which seems similar to American tax free municipal money market account or perhaps more like a tax free municipal mutual fund. Though not guaranteed the return appears similar to a time deposit (2.75% for 4 months, 2.8% for 8 months, 2.85% for 15 months) however it's not subject to the 15% Thai tax so the after tax yield *should* be somewhat higher.

 

Anyone else consider opening a similar account with a Thai bank?

 

I would assume that it would be highly unlikely that the IRS would discover the existence of this type of account?

[Gaybutton]

I would assume that it would be highly unlikely that the IRS would discover the existence of this type of account?

 

Would you really want to chance that and risk the possibility of facing tax evasion charges? That doesn't sound like a very good idea to me.

[Guest jtrack33]

For those of you, like me who don't care what the IRS does or doesn't know, I opened a Bangkok Bank Thanatavee Fixed Income Fund. Ok it's only 2%, but it's personal tax-free in Thailand and can be bought and sold in big or small bits on-line via Bangkok Bank internet banking. The advantage to me is that it is a fund available to people without work permits(which all of the 3% accounts seem to require) and can be kept for as long or as short as you like. The interest is compiled/added constantly.

Instead of keeping Bht800,000 in an "almost-zero" interest account for 3 months to satisfy immigration for annual visa extension, you can have it earning some interest and just transfer to your atm account via the web as and when needed. The transfers (buy or sell) take 24 hours between the fund and your atm account with no need to visit or call a bank.

The 3% rates banded about by the main banks, in addition to being unavailable for those without work permits, also have to be held untouched for 4 months at least....therefore assuming you needed that money to live on in the meantime, you would only want to invest about 2/3 in the fund and have to keep 1/3 to live on in an atm account earning almost nothing. That brings you down to about 2% overall. The advantage of the Thanatavee fund is that you are issued an updatable passbook to satisfy the immigration.

[Guest Astrrro]

Seems as if the K Treasury account is similar to Thanatavee.

 

I now have three K Bank passbooks, one for the 4 month CD at 2.75% (I don't have a work permit but do have retirement visa), a K Treasury passbook, and my regular passbook.

 

Is it only the regular passbook that will satisfy immigration?

 

Re the IRS, no sense not reporting small amounts of money, especially since there is a paper trail but they would have to search pretty hard since I "assume" this info is not reported to them.

[mahjongguy]

Every US citizen who has more than $10,000 in an overseas account must file a TD F 90-22.1 before June 30th of the following year. There are impressive penalties for non-compliance.

 

Mailing in the form by no means assures that the IRS will be checking to see if you report earned interest. Only the submission of a 1099 by the bank would trigger such, and that of course doesn't happen.

 

Still, if you earn a few hundred dollars from the bank, why not include it on your 1040? It's hardly going to move you into a punishingly high tax bracket, and well worth the peace of mind.

[Guest Astrrro]

Thanks for the heads up re TD F 90-22.1. Had never heard of it.

 

I agree about reporting interest; I have things arranged so that I'm in a very low tax bracket anyway and the small amount of extra tax buys peace of mind.

[Guest richsilver]

If you're an American, why not open an online account with, say ING (http://home.ingdirect.com/products/products.asp)? They are currently paying 3%, it's FDIC insured up to $100,000 and you can transfer funds online to your Bangkok Bank account here in Thailand for free (Bangkok Bank charges about 300 baht). Transfers take 3 or 4 days, but are really quite simple. To open an account you need only a US address (use you friend's) and a US drivers license.

 

Other banks offer similar deals. E-Trade, for example (https://us.etrade.com/e/t/banking), is currently paying 3.15%. You can also transfer funds online to Bangkok Bank, but it's a bit of trouble to set up.

[Guest Astrrro]

Thanks for the heads up Rich!

 

I have an ING (and EmmigrantDirect and HSBCDirect) account but didn't check it out.

My local bank charged me a 25 buck fee and Jamie Dimon got his grubby hands on 18 bucks more as an intermediary bank.

 

Will check it out in the future.

 

 

 

[2lz2p]

For those that may be interested in the US IRS foreign bank reporting requirements, go to IRS link

 

The reporting is required if at any time there was more than $10,000 US in the foreign bank account during the calendar year -- the report is separate from your US tax return and must be made by June 30, of the following year.

 

Richsilver put me on to the benefits of an INGDirect savings account a few years ago and later to the benefits of also opening a checking account in order to transfer funds from my primary US bank to Bangkok Bank at a lower cost (my primary bank was charging me $40 for wire transfers to my Bangkok Bank account). Now I transfer funds to INGDirect from my primary account (no fee) and send myself an "electronic check" (uses Bangkok Bank New York Federal Reserve routing number and my Bangkok Bank Pattaya branch account number) - it takes about 3 days for it to be deposited here in Thailand. If over $2,000 US, Bangkok Bank New York branch charges $10 and Bangkok Bank Thailand charges a 1/4 percent conversion fee. The fees are lower for smaller amounts. INGDirect does not charge a fee for sending electronic checks.

 

[Guest Astrrro]

I just Skyped ING (800 numbers free with Skype).

 

I'm quite confused but maybe you can help me get unconfused.

 

Am I correct that I'll need an Electric Orange account in addition to my regular ING account?

 

Am I correct that the reason this can be done is because Bangkok Bank has a New York office and routing number? So I probably could not do this with my Kasikorn account?

 

Does the Bangkok Bank charge the 0.25% fee on all transfers or is that a special add on due to the unusual nature of the ING transfer?

 

So for a 10K transfer Bangkok Bank would charge 35 bucks and ING nothing?

 

Thanks!

 

[2lz2p]

My answers to your questions are based on my understanding of the process:

 

Am I correct that I'll need an Electric Orange account in addition to my regular ING account?

 

Yes - the Electric Orange is the checking account -- easy to open if you already have an account. They will also send an ATM/debit card to your USA address (a note on that later). With the Electric Orange account, you can set up any Electronic Check payee with an account in a bank within the the US banking system.

 

INGDirect does not charge fees for the Electric Orange account and they pay interest on it. The account comes with $1,000 overdraft protection - if you use any of the overdraft amount, they do not charge a fee - only interest while the funds are outstanding. I have never availed myself of it because if I need funds sent right away, I simply transfer any additional amount I need from my savings to the checking account (usually immediate, but I have had to wait a few minutes sometimes for Electric Orange to record it as available in my checking account).

 

 

Am I correct that the reason this can be done is because Bangkok Bank has a New York office and routing number? So I probably could not do this with my Kasikorn account?

 

Again, yes. Bangkok Bank's New York branch is a US Federally chartered bank per their web site and, thus, has a routing number within the Federal Reserve system. Without that number, INGDirect will not send an Electronic check. As to the Kasikorn account, I can't answer. If they have USA branch with a Federal Reserve routing number, you could send an electronic check -- however, whether their USA branch is set up to transfer it on to a Thailand based account, I don't know.

 

 

Does the Bangkok Bank charge the 0.25% fee on all transfers or is that a special add on due to the unusual nature of the ING transfer?

 

The .25% is a regular charge -- after revisiting their site, it notes that the minimum charge is 200 Baht and the maximum is 500 Baht.

 

 

So for a 10K transfer Bangkok Bank would charge 35 bucks and ING nothing?

 

If you sent 10k US Dollars, the fee would apparently be $10 US by the NY Branch and another 500 Baht by Bangkok Bank here in Thailand -- or about $25 maximum.

 

 

Regarding the Electric Orange ATM card, if you plan to use it in Thailand, you need to call INGDirect customer service and let them know -- otherwise, it might work once, but they will put a security hold on the card and you can't use it again until you contact them (I'm speaking from experience).

 

 

I am using INGDirect Electric Orange account as it was the simplest to set up and the least expensive way of using Bangkok Bank's NY branch -- But, Bangkok Bank NY will accept funds from other banks as well as direct deposits of pension checks, social security checks, etc. (myself, I prefer to keep my pension and other funds in the US and transfer only what I need).

 

Bangkok Bank information is available on their web site (I hope that this link works): Bangkok Bank NY Branch website

 

[Guest Astrrro]

I might suggest that based on the detailed info you've provided your screen name is quite the misnomer. Thanks!

 

I wonder if I could drop off a check in their New York office? Just curious because the ING transfer seems easy enough.

 

I suppose any US bank that has free electronic bill pay could be used instead of ING. But again, think I'll use ING cause I know it works and I already have their basic account.