Just a reminder that your IRS FBAR reporting is due along with your tax return on April 18th this year. The Foreign Bank Account Reports (referred to as FBAR) have previously been due later in the year, but 2017 marks a permanent change going forward. US taxpayers, including foreign nationals living or working in the United States, are required to complete an FBAR for all tax years when one specific requirements are triggered:
A US taxpayer has a financial or “beneficial interest” in or signatory authority over a foreign bank or financial account or accounts, and
The accumulated balance of all qualifying offshore accounts exceeds $10,000 at any point (even for a day) at any point during a calendar year
This obviously applies to the calendar year of 2016 for this year’s returns, but also applies to any point since 2008. If the US taxpayer has not reported the existence of all foreign accounts once the threshold has been met the IRS may apply substantial penalties and interest to all foreign accounts that are presently or previously unreported, and even many which were included in past returns. Penalties include 50% of the highest accumulated balance, or $100,000 per unreported account – whichever is higher. In addition, failure to comply with IRS reporting requirements exposes US taxpayers to criminal tax evasion charges carrying significant risk of a prison sentence.
The requirement to come into compliance with IRS FBAR reporting requirements has been significantly impacted by recent developments in the international financial community wherein literally tens of thousands of offshore banks, financial houses, investment companies and foreign sovereign tax authorities are providing electronic data directly to the IRS. If you need help coming into compliance knowing that IRS FBAR reporting is due within the next week, or you have questions about the Offshore Voluntary Disclosure Program (OVDP), streamlined disclosure program and other options for coming into compliance we invite you to contact the experienced tax attorneys at Allen Barron for a free consultation at 866-631-3470. Ask about the protections of the attorney-client privilege that are not available through your normal tax preparer, CPA or financial adviser.
