On February 24, 2011, the Treasury Department published final
FBAR Regulations. These regulations became effective March 28, 2011, and apply to FBARs required to be filed with respect to foreign financial accounts maintained at any time during calendar year 2010, and for FBARs required to be filed with respect to all subsequent calendar years.
You are required to file a Report of Foreign Bank and Financial Accounts (FBAR) Form TD F 90-22.1 with IRS, each year if you have a financial interest in or signature authority over financial accounts, including bank, securities or other types of financial accounts, in a foreign country (say India), if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year.
The new annual due date for filing Reports of Foreign Bank and Financial Accounts (FBAR) for foreign financial accounts is April 15. The FBAR is not filed with a federal tax return. When the IRS grants a filing extension for a taxpayer's income tax return, it does not extend the time to file an FBAR.However, the Act mandates a maximum six-month extension of the filing deadline. To implement the statute with minimal burden to the public, 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
Those required to file an FBAR who fail to properly file a complete and correct FBAR may be subject to civil monetary penalties of up to $12,459 per violation for non-willful violations that are not due to reasonable cause. For willful violations, the inflation-adjusted penalty may be the greater of $124,588 or 50 percent of the balance in the account at the time of the violation, for each violation
Please note that effective July 1, 2013 electronic filing of FBARs is mandatory and there are now procedures to allow the filing of an FBAR by a third party (such as a paid preparer or a spouse) on behalf of the person who has the obligation to file an FBAR. We at MTG can provide assistance in electronically filing your FBAR
Who Must File an FBAR
United States persons are required to file an FBAR if:
The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported
Note
United States person includes U.S. citizens; U.S. residents; entities, including but not limited to, corporations, partnerships, or limited liability companies, created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States
Certain exceptions do apply to the FBAR reporting requirement, please contact us to find out more