FBAR Deadline Extended to October 31October 20, 2020
Financial Crimes Enforcement Network (FinCen) posted a notice on October 16th 2020 clarifying once and for all that 2019 calendar year FBARs will be considered timely filed if received by October 31, 2020.
Important information for U.S. persons with FBAR filing requirements: The 2019 FBAR will be considered timely filed if received by October 31, 2020. Here’s what you should know.
What is the FBAR?
The Report of Foreign Bank and Financial Accounts, commonly called the FBAR, is filed on FinCen Form 114. It is an annual report in which U.S. persons (a citizen, resident, corporation, partnership, limited liability company, trust and estate) report financial interest and/or signature authority on financial accounts located outside the United States if the accounts’ highest balance during the year, when translated to U.S. dollars and then aggregated, exceed a $10,000 threshold.
In an already difficult tax filing season the Financial Crimes Enforcement Network FinCen created some additional drama just before the October 15 extended filing deadline last week.
Here’s what transpired:
On October 14th, FinCen posted a notice on their website that generically stated that the FBAR filing deadline had been moved to December 31, 2020. However, the notice was in error, and FinCen later clarified that the extended deadline was only intended for filers affected by natural disasters (October 6, 2020 notice)
On October 15th, within 24 hours of posting the October 14th notice, FinCen detected the mistake and removed the notice. They explained that the deadline for filers unaffected by natural disasters was still October 15th 2020. For those who missed the clarification, for example, filers living abroad who had gone to sleep by the time the update was issued, the needle on the panic meter moved significantly to the right. (Readers of a certain age may relate to the vision of Lucy holding the football for Charlie Brown and pulling the football away as he went to kick it; this is how many people felt on October 16th.)
On October 16th, 2020 FinCen posted another notice, stating “filers who file their 2019 calendar year FBAR by October 31, 2020 will be deemed to have timely filed.” They apologized for the incorrect message and the confusion that resulted. Those preparers and filers who had hurriedly submitted their FBARs on October 16th exhaled and the needle on the panic meter moved significantly left.
In a typical year, the FBAR due date is already a bit confusing. The report is due on April 15th of the current tax year for the prior tax year. For example, the 2019 FBAR is due April 15th, 2020. However, filers are given an automatic extension, meaning no action is required by the filer, to extend the FBAR until October 15th.
If you were unaware of the FBAR filing requirement for 2019, or any prior year, KLR’s International Tax Services are here to help. We can assist with current year compliance or fixing potential omissions in prior years. We’re experienced with the variety of programs that help taxpayers get caught up on any foreign informational filings that may have been overlooked.