Adlerstein Law Office

FBARadvice.com

 

  WHAT IS AN FBAR?



An FBAR is the Report of Foreign Bank and Financial Accounts. 


FinCen Form 114 must be filed annually by a United States “person” which has an interest in or signature power or other authority over financial accounts in a foreign country that have an aggregate value of more than $10,000 in a calendar year. 


A United States person includes:

•  U.S. citizens

•  Lawful permanent residents of the U.S. (“green card” holders)

•  Foreign nationals who are U.S. resident aliens under the provisions of the Internal Revenue Code

•  Certain business entities

•  Certain trusts and estates


Foreign Financial accounts include:

•  Bank accounts (savings, checking, time deposits)

•  Mutual funds

•  Brokerage accounts (including options and commodities future accounts)

  1. Israeli pension accounts (e.g.,Keren Pensia, Keren Histalmut, and Bituach Menahalim)

  2. Life insurance and annuity policies with cash values

  

FBARs must be filed electronically through the BSA E-filing system of FinCen. 

FinCen is the Financial Crimes Enforcement Network, a bureau of the U.S. Department of Treasury.

BSA is the acronym for the Bank Secrecy Act of 1970, the first anti-money laundering legislation.

They are not part of the income tax return.  They cannot be filed by mail.


FBARS are due by June 30th following a calender year in which aggregate account value exceeds $10,000. The June 30th filing date cannot be extended.  FBARs can be filed late, but that may result in the assessment of penalties.


Civil and criminal penalties for non-compliance with the FBAR filing requirements are severe. Civil penalties for a non-willful violation can range up to $10,000 per violation. Civil penalties for a willful violation can range up to the greater of $100,000 or 50 percent of the amount in the account at the time of the violation. Criminal penalties for violating the FBAR requirements while also violating certain other laws can range up to a $500,000 fine or 10 years imprisonment or both. Civil and criminal penalties may be imposed together.  Civil and criminal penalties may be entirely avoided by timely entry into a voluntary compliance program or procedure.

 

FBARs

                                          Jo Anne C. Adlerstein, Esq.