Contents
- 1 FBAR Filing Requirements
- 2 Who Has to File the FBAR?
- 3 FBAR Filing Under 25 Accounts
- 4 More than 25 Accounts & FBAR Filing
- 5 Unsure of the Account Maximum Balance?
- 6 Can’t Recall an Account Number
- 7 Account Closed in the Current Year?
- 8 Prior Year Closed Account
- 9 No-Income Earning Account?
- 10 Electronic Filing
- 11 Missed the FBAR Reporting Due Date?
- 12 Our FBAR Lawyers Represent Clients Worldwide
FBAR Filing Requirements
FBAR Filing Requirements
FBAR Filing Requirements: The FBAR is the Foreign Bank and Financial Account form FinCEN Form 114. The Form is required to be filed for any individual who is a U.S. Person, and meets the threshold requirements for filing. The FBAR Requirements for Filing kick-in when a U.S. Person has foreign accounts, and the annual aggregate total of the accounts combined, exceeds more than $10,000 on any day of the year. It is not a $10,000 per account requirement, but rather the total aggregate value of all accounts. Even “zero balance accounts” and “dormant or inactive accounts” have to be included. In recent years, the IRS has taken a very aggressive approach toward foreign account and asset compliance. The failure to timely report the form may result in FBAR penalties — but these may be avoided, reduced or eliminated through FBAR Amnesty/voluntary disclosure.
Who Has to File the FBAR?
The FBAR is required by all U.S. Persons.
This is not limited to individuals, and may also include:
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Corporations
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Partnerships
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Other Entities
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Trusts
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Estates
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FBAR Filing Under 25 Accounts
When a person has under 25 ownership/co-ownership over foreign accounts the account information is listed directly on the FBAR.
More than 25 Accounts & FBAR Filing
When a person has ownership of more than 25 accounts, they should prepare a detailed table with their account information so they can access it if they were audited.
Unsure of the Account Maximum Balance?
If a Filer is unsure of the maximum balance, they still complete the account information. They can mark off “maximum balance unknown” or if the filer is pretty sure they have a close enough value, they may be able to estimate the balance.
Can’t Recall an Account Number
If a person cannot recall the account number, they should still do their best to report the institution and value amount.
Account Closed in the Current Year?
If the account was closed in the current year, it is still reported on the FBAR for the current year. For example, if a filer closed an account in 2022, then at some point during 2020 the account was “still open,” so it is included one more time on the FBAR.
Prior Year Closed Account
The FBAR filer does not have to continue reporting closed accounts after the final year of closing. BUT, a “zero account” is still reported, because it is open — despite the account having a zero balance.
No-Income Earning Account?
Whether or not the account earns interest has no impact on reporting. Therefore, if a person has a non-interest bearing account, it is still reported on the FBAR.
Electronic Filing
All FBARs (current or past) must be reported electronically.
Missed the FBAR Reporting Due Date?
When a person misses the FBAR deadline for reporting, then the FBAR is considered delinquent. A taxpayer cannot just go back and file a late FBAR. Rather, they are required to submit to one of the Voluntary Disclosure/Tax Amnesty Programs. Otherwise, it may be considered a quiet disclosure, which may result in significant fines and penalties including tax fraud, willfulness penalties, and an IRS special agent investigation.
Our FBAR Lawyers Represent Clients Worldwide
Our FBAR Lawyer team specializes exclusively in international tax, and specifically IRS offshore disclosure.
Contact our firm today for assistance with getting compliant.