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Buyer Community> Trade Intelligence> news> Notice: FBAR Filing Deadline for U.S. Persons Rapidly Approaching
Source: DSA DSA

Notice: FBAR Filing Deadline for U.S. Persons Rapidly Approaching

Published: 24 Oct 2013 00:14:59 PST

U.S. persons are required by law to report foreign bank accounts to the IRS by Saturday, June 30, or face severe civil or criminal penalties!

By Chet Scheltema

Jun. 21 – According to the U.S. Bank Secrecy Act, if the aggregate amount in a U.S. person’s foreign accounts exceeds US$10,000 at any time during the calendar year, then a Foreign Bank and Financial Accounts Report (FBAR) must be filed with the IRS by the following June 30 (no extensions available). It is important to note that since June 30, 2012 falls on a Saturday, the due date for this year’s FBAR filing is effectively pushed up to Friday, June 29.

The FBAR form (Treasury Department Form TD F 90-22.1.) can be found online at IRS.gov and fincen.gov. Note that the new IRS Form 8938, Statement of Specified Foreign Financial Assets, which is filed along with one’s tax returns, does not replace or affect the obligation to file the FBAR.

Timing is essential, as the FBAR must reach the IRS’ U.S. location by Saturday, June 30! Filers may not avail themselves of the “mail-box rule” to gain an extra day or two (the FBAR is not like a tax filing), so U.S.persons abroad are advised to act expeditiously.

Certain individuals may be able to file electronically using the BSA E-Filing System, although it is obviously important to determine early enough whether electronic filing is available.

FBAR penalties are severe! The civil penalty for each non-willful violation could reach US$10,000 per violation. Willful violations could carry a penalty of the greater of US$100,000 or 50 percent of the amount in the account(s) in question for each time a violation occurs. Because the FBAR is directed at criminal activities – including tax evasion, money laundering, and terrorism – criminal fines and punishment are a reality. Monetary punishments could reach or exceed US$250,000 and imprisonment is also a possibility.

U.S. persons responsible for filing an FBAR include:

  • U.S. citizens having a financial interest in foreign accounts
  • U.S. residents and entities having a financial interest in foreign accounts
  • Individuals with signature authority over the foreign accounts of these U.S. persons

Please note that individuals with authority over the accounts of foreign-invested enterprises in China may need to file an FBAR, even though they have no personal interest in the accounts.

Foreign accounts are those located outside U.S. territories or possessions and include at least the following:

  • Bank accounts
  • Brokerage accounts
  • Mutual funds
  • Trusts
  • Annuities
  • Insurance policies

To determine whether the US$10,000 reporting threshold has been reached, the total amount in all such accounts must be aggregated for each day of the calendar year using the official U.S. Treasury currency conversion rate in effect on December 31.

For specific and detailed reporting requirements, consult a qualified accounting or legal professional, or call the IRS at 313-234-6146 (for international calls) or send an email to FBARquesitons@irs.gov.

If calling from within the United States, the FBAR hotline is 1-800-800-2877.

The completed FBAR report (Treasury Department Form TD F 90-22.1) should be sent to the appropriate IRS address below.

File by mailing the FBAR to:

United States Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621

For express deliveries, address the FBAR to:

IRS Enterprise Computing Center
ATTN: CTR Operations Mailroom, 4th Floor
985 Michigan Avenue
Detroit, MI 48226
(303)-234-1062

Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam as well as liaison offices in Italy and the United States.

U.S. expats who require additional assistance or clarification regarding FBAR filing procedures may contact Chet Scheltema of Dezan Shira & Associates at chet.scheltema@dezshira.com. For further details or to contact the firm please visit www.dezshira.com or download the company brochure.

This article was first published on China Briefing.

Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam as well as liaison offices in Italy and the United States.

For further details or to contact the firm, please email info@dezshira.com, visit www.dezshira.com.

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