Many of our avid CLIENT ALERT readers have established overseas structures that require the filing of the Foreign Bank and Financial Accounts form, otherwise known as the FBAR. The FBAR would be required if you or your trust is the owner of (or has signature or other authority over) a foreign bank, securities, or other financial account. Moreover, additional reporting may be required as an attachment to your tax return on Form 8938 and, separately, on Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (“FBAR”), and you may have to check the box on Schedule B Part III, line 7 of your Form 1040 to report the account.
Effective July 1, 2013, those required to file the FBAR must do so electronically. According to the website of the Financial Crimes Enforcement Network of the Department of Treasury (FinCEN), failure to do so may impose civil monetary penalties for noncompliance with their regulations, including $500 for each negligent currency transaction or suspicious activity reporting violation.
Please contact your tax preparer to ensure compliance. Continue reading