FBAR – Foreign Bank Accounts Require Disclosure
If you are U.S. Citizen or a Green Card holder and you have a bank account outside the United States, your foreign bank account(s) requires disclosure to the Internal Revenue Service (IRS) and the Financial Crimes Enforcement Network (FinCEN) through Form FinCEN 114 or FBAR.
Every U.S. Citizen or Green Card holder must file Form FinCEN 114, commonly known as FBAR, if they have one or more bank accounts outside the United Stated with an aggregate balance of over $10,000 U.S. dollars.
In addition, the FBAR form is required if an individual has a financial interest in or signature or other authority over the foreign bank account. Regardless of the name to which the foreign bank is registered, be it a personal or business, or family account, if you have signature authority for that foreign bank account you must report it to the IRS using the FBAR form when you file your annual tax returns.
The IRS is constantly issuing penalties to those who fail to timely file their FBAR form. Penalties may start at $10,000 USD per unreported bank account. In certain situations, penalties may be avoided if there is reasonable cause for the failure to report and the issue is corrected. If non-reporting is willful, then the penalty amount can rise to $100,000 USD or 50% of the account balance at the time of the violation – whichever is greater.
The FBAR can be difficult to calculate and report. RJS LAW and its qualified attorneys are available to assist in preparing and reporting your FBAR as well as assisting those who failed to report. If you have questions, please call for a free consultation and assessment at 619-595-1655. You may also contact us via the web at www.RJSLawFirm.com. We look forward to hearing from you.
Written by Andrea Cisneros Valdez, Esq., LL.M.