Foreign Financial Accounts
If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, exceeding certain thresholds, the Bank Secrecy Act may require you to report the account yearly to the Department of Treasury by electronically filing a Financial Crimes Enforcement Network (FinCEN) 114, Report of Foreign Bank and Financial Accounts (FBAR). Additional forms may be required to report foreign financial accounts and transactions therein.
The FBAR form is used by U.S. persons to report a financial interest in, or signature or other authority over, one or more non-U.S. financial accounts that have at least $10,000 in the aggregate at any time during the year. E-filing of the FBAR is required and paper filing is generally not be accepted beginning July 1, 2013, including for late filed reporting for prior years. Amounts shown on FinCEN Form 114 must continue to be coordinated with reporting on the Individual Income Tax Return (Form 1040 for most persons).
FinCEN, sponsored by the U.S. Treasury Department, allows a third party to prepare and electronically file this form. E-filers, individuals and third party preparers, are required to register with the Bank Secrecy Act (BSA) E-filing System. Form 114a “Record of Authorization to Electronically File FBARs” is required to be filled-out and signed by persons who have an obligation to file a Report of Foreign Bank and Financial Accounts if they designate a third party to electronically submit their information. The Form 114a is also used to approve which spouse will sign the report if they are filing a joint FBAR. For more information, please call our office at (281) 360 – 2800 for assistance. Our firm is registered with the BSA E-filing System.
Due Date for FBARs
The annual due date for filing Reports of Foreign Bank and Financial Accounts (FBAR) for foreign financial accounts is now April 15. This date change was mandated by the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, Public Law 114-41 (the “Act”). Specifically, section 2006(b)(11) of the Act changes the FBAR due date to April 15 to coincide with the federal income tax filing season.
The Act also mandates a maximum six-month extension of the filing deadline. To implement the statute with minimal burden to the public and FinCEN, FinCEN will grant filers failing to meet the FBAR annual due date of April 15 an automatic extension to October 15 each year. Accordingly, specific requests for this extension are not required.