Effective for the 2016 reporting year, due to law changes implemented under the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, the foreign bank account report (FBAR) filing due date is now April 15th, with an available extension of six months to coincide with due dates of individual income tax returns. This is a change from 2015 and previous reporting years which required all FBAR filings be filed by June 30th, with no available extension.
Currently, a FBAR filing (Form FinCEN 114) is required for any U.S. person who has a financial interest in or signature authority over a foreign financial account and the aggregate value of the foreign financial account(s) exceeds $10,000 at any time during the calendar year.
As we enter a new year, please note a few of these reminders as you consider your foreign bank account report obligations:
In March of 2016, FinCEN issued proposed rules which modify the final regulations enacted in February of 2011 regarding foreign bank account reports. If the proposed regulations are finalized they will eliminate much of the duplicative reporting for individuals who only have signature authority over a foreign financial account which is already reported on a FBAR filing. As the regulations have not been finalized, in December 2016, FinCEN issued FinCEN Notice 2016-1 which expands on previously issued notices that provided extensions and extends the reporting due date for these individuals until April 15, 2018. While this is favorable, the proposed regulations also include a change for filers with 25 or more foreign financial reports. Previously, these filers were able to file abbreviated reports without all of the detailed account information for each account. Under the proposed regulations, this abbreviated reporting would no longer be permissible.
While FBAR filings can be relatively painless, penalties for non-compliance and underreporting are steep and can be punitive. If you have any questions regarding your specific filing obligations, please reach out to Mary McVicar, firstname.lastname@example.org or Tim Schlotterer, email@example.com for assistance.