Every United States citizen or lawful permanent resident is required to file a Report of Foreign Bank and Financial Account (or FBAR) statement each year if the citizen/resident meets specific criteria. Under current requirements, a citizen or resident must report any financial interest or signature authority for any financial account with a balance that exceeds $10,000 in aggregate (e.g. all accounts combined total more than $10,000). Any U.S. entity must file FBAR reports,
A basic FBAR report is filed online via FINCen Form 114 with the Bank Secrecy Act branch of the Department of Treasury. The form itself is relatively simple, but the consequence for failure to file is rather strict. The FBAR is a calendar year report and must be filed on or before June 30 of the year following the calendar year being reported. The FBAR is not filed with a federal tax return. When the IRS grants a filing extension for a taxpayer’s income tax return, it does not extend the time to file an FBAR. There is no provision for requesting an extension of time to file an FBAR.
If you are a U.S. citizen or permanent resident, and have aggregate offshore accounts that total more than $50,000 (or $75,000 at any point in a given calendar year), you are also required to file a separate report with the Internal Revenue Service. You must file Form 8938 with the IRS along with your annual tax return to remain in compliance.
If you have failed to file FBARs or Form 8938 in past tax years, you might consider discussing your situation with our office to determine whether you should enter the Offshore Voluntary Disclosure Program to permanently take care of your offshore accounts in the eyes of the IRS.