Foreign Account Reporting Overview
In 2013, the U.S. Treasury has changed the reporting on foreign bank accounts. The reports must now be electronically filed on the Treasury’s Financial Crimes Enforcement Network (FinCEN) website on FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR). The Treasury no longer accepts paper-filed information reports. Our firm electronically files a significant number if these reports for many of our clients.
The filing requirements pertain to United States Persons who:
| a. have a financial interest or signature authority over a financial account located in a foreign country and |
| b. the aggregate value of the accounts are greater than $10,000 at any time during the year. |
The FinCEN Form 114 is due no later than June 30 of each year to avoid potential late filing penalties.
Additionally, you may be required to file Form 8938 if you are a Specified Individual (a U.S. citizen or a resident alien of the U.S.) and on the last day of the tax year your foreign financial assets exceed the threshold amount. For a married couple, the threshold amount is more than $100,000 on the last day of the year or more than $150,000 at any time during the year. For single persons the respective amounts are $200,000 (last day) and $300,000 (any time during).
Form 8938 is attached to your annual return and must be filed by the due date (including extensions) for that return. There are also penalties for late filing of failure to file Form 8938.