Foreign Financial Account holders: You have until April 15^th (with an automatic October 15^th extension) to submit your 2023 Foreign Bank Accounts Report (FBAR) to the Department of Treasury.

Who is required to file the FBAR?

U.S. citizens, green card holders, and U.S. tax residents are required to file the FBAR if:

• They have financial interest in or signature authority over at least one financial account located outside the United States;
• They have financial foreign accounts with an aggregate value which exceeds $10,000 at any time during the calendar year. For example, if you have Bank account A with a value of $4,000 and Bank account B with a value of $7,000 you triggered the filing threshold.
• It is possible to not have an income tax return filing requirement but still have to file the FBAR.

Who is exempt from filing?

You are not required to file if you reported all of your foreign financial accounts on a consolidated FBAR or you and your spouse are joint owners of your FFAs.

How do you file?

Most foreign financial account holders opt to file the FBAR through the Financial Crimes Enforcement Network (FinCEN) BSA E-Filing System. If you wish to paper file, you must request an exemption from e-filing through FinCEN’s resource center. FinCEN will send you the paper FBAR if they approve your request.

Need someone to file on your behalf? You must authorize the person to do so through FinCEN Report 114a, Record of Authorization to E File FBARs.

What to do if you need an extension:

You do not need to specifically file for or request an extension FinCEN grants filers failing to meet the April 15^th due date with an automatic extension to October 15^th this year.

What are the penalties for failing to file?

If you fail to file, remember that you are subject to either a civil penalty of up to $10,000 for each negligent violation (non-willful violation), or a civil penalty of up to $100,000 or 50% of the balance of the account at the time of the purposeful violation (willful violation). Criminal penalties can arise as well for willful violations.

Recordkeeping requirements

Be sure to keep records of:

• Name on the foreign financial account
• Name and address of foreign bank
• Account number
• Type of account
• Maximum value during the year in functional currency

It’s recommended to retain these records for five years from the FBAR deadline.

Check out our 2024 Tax Deadline Calendars for Businesses and Individuals for more key deadlines.

Questions? Contact any member of our International Tax Services Practice.