Over the past 15 years, the IRS has dramatically increased the obligations of US persons to report their assets overseas. Businesses and individuals that maintain foreign bank accounts must annually disclose these accounts to the Treasury Department’s Financial Crimes Enforcement Division (“FinCEN”). This report is called the Foreign Bank Account Report or “FBAR” and is filed on FinCEN Form 114. Additionally, anyone who acts as a signer on a foreign bank account (for an employer or family member, for instance) must also file an FBAR.
FBAR reporting is no joke. Failure to comply with FBAR requirements can lead to civil penalties of up to 50% of the balances in your account for the unreported years or possibly even criminal charges.
You may also be required to file Form 8938 to declare foreign assets and income on your annual tax return. The threshold for filing Form 8938 is higher than the FBAR, but the list of included assets is more expansive.
We assist many clients in meeting their foreign asset compliance obligations. We work with small business and individual taxpayers to comply with offshore bank account reporting guidelines. Additionally, if you find that you have not been compliant with these requirements in past years, we help you file under available compliance programs to rectify the issues and mitigate penalties.
Contact our firm today to discuss your Offshore Disclosure issues and how we can assist you.