Don’t Forget to File Your FBARs – Due June 30th
Foreign financial accounts include the following:
- Bank account
- Brokerage account
- Mutual fund
- Trust
- Any other type of foreign financial account
Generally, United States persons are required to file an FBAR if:
- The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
- The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.
United States person includes U.S. citizens; U.S. residents; entities, including but not limited to, corporations, partnerships, or limited liability companies, created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.
A person required to file an FBAR who fails to properly file a complete and correct FBAR may be subject to a civil penalty not to exceed $10,000 per violation for non-willful violations that are not due to reasonable cause. For willful violations, the penalty may be the greater of $100,000 or 50% of the balance in the account at the time of the violation – for each violation.
Taxpayers who wish to prepare and file their own FBAR’s are able to do so through FinCEN’s BSA E-Filing System at the following link:
https://bsaefiling.fincen.treas.gov/main.html
**it should be noted that there are NO extensions for filing FBARs**
Taxpayers may also have to file Form 8938, Statement of Specified Foreign Financial Assets which is filed with an income tax return. Foreign financial assets could include foreign accounts reported on an FBAR and this form may be required to be filed in addition to the FBAR. These easy to follow comparison charts provided by the IRS lays out some frequently asked questions and is very helpful in determining various filing requirements for each form.
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Nicole DeRosa, CPA, MAcc T: (732) 828-1614 [email protected]
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To ensure compliance with U.S. Treasury rules, unless expressly stated otherwise, any U.S. tax advice contained in this communication is not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.
