US Citizen Residing Abroad With Non-Resident Alien Spouse

joint bank accounts in Forms 8938 and TD F 90221. This is correct for a specified individual living outside the US filing a separate tax return.

My question is how the interest is reported -- all of it, half of it, or it is considered to be paid to the first-named person on the account? I assume you are asking how to report the income on your separate 1040 income tax return. I will assume that you are a resident of a foreign country (Israel from your prior posts using a .il domain) and no longer are a resident of any US state. As such, one "generally" must look to local law to determine how income from jointly owned assets is split. However, it is quite possible that local law provides a different answer then your actual usage of the funds and who exercises beneficial ownership. From the IRS point of view, actual handling of the money and beneficial ownership will trump local law.

So... what it comes down to is this... find out what Israeli tax law is on who declares the passive income from financial deposits when a married couple file individual returns rather than a joint assessment. Assuming that the answer comports with how you both actually treat the accounts and the income from those accounts, then you have the answer for the US 1040.

Yes, if you are a co-owner of the account, or your wife files an MFJ tax return then you must report the accounts as long as there is enough money in them. I think for TDF the amount is 10k, and for 8938 it is

If the accounts are all in your wife's name and you file MFS, and she does not file a US tax return or files only 1040-NR, then I don't think anything needs to be reported.

To report interest I normally just convert the total interest received during the year in the foreign currency to the average exchange rate. You can be exact and convert the interest on the day it was received using the exchange rate on that day, but with interest, dividends, stocks, etc this gets too complicated.