The IRS is reminding taxpayers with overseas bank accounts of the June 30 deadline for filing the FinCEN Form 114, Report of Foreign Bank and Financial Accounts. U.S. taxpayers holding foreign accounts with assets exceeding $10,000 at any time during 2014 are required to file FBAR Form 114.
These filings are sent directly to Financial Crimes Enforcement Network (FinCEN), a bureau of the Treasury Department, through its website.
“The vast majority of taxpayers pay their fair share. The FBAR and FATCA filing requirements make it tougher for that relatively small number of taxpayers trying to hide assets and income offshore,” said IRS Commissioner John Koskinen. “Taxpayers are encouraged to review the rules and disclose their offshore assets.”
Some exceptions to the FBAR filing requirements apply to:
• Certain foreign financial accounts jointly owned by spouses
• U.S. persons included in a consolidated FBAR
• Correspondent/Nostro accounts
• Foreign financial accounts owned by a government entity
• Foreign financial accounts owned by an international financial institution
• Owners and beneficiaries of the U.S. IRAs
• Participants in and beneficiaries of tax-qualified retirement plans
• Certain individuals with signature authority over, but not financial interest, in a foreign financial account
• Trust beneficiaries (but only if a U.S. person reports the account on an FBAR filed on behalf of the trust)
• Foreign financial accounts maintained on a U.S. military banking facility
Failing to file FBAR on time can cost you $10,000 for each violation. If you are willfully withholding information from FinCEN, the penalties are much greater and could amount to $100,000 or 50 percent of the assets in each account for each year the accounts went unreported.
If you’re due for FBAR filings, the Maddox, Thomson team is here to help. Give us a call at 713.783.4242 or send us an email at [email protected]