Delinquent FBAR | Ultimate Things You Need To Know
What Is The FBAR?
The Report of Foreign Bank and Financial Accounts (FBAR) form is a Treasury information document, separate from your annual IRS income tax return, that details your activity with any foreign financial institutions (FFI). The Bank Secrecy Act (BSA) of 1970 requires the reporting of any involvement you have with foreign banks, brokerage houses, mutual funds, or other FFI if you are a U.S. resident or citizen of the United States or a person (which can include a corporation, trust or partnership) in, and doing business in, the United States. Your involvement includes either signatory authority (through, for example, a business role) or a personal financial interest. Disclosure of foreign financial activities to tax authorities is becoming increasingly important because of the increase in information sharing between countries around the world. See our Tax Samaritan articles about international data exchange and Foreign Financial Asset Reporting on Form 8938.
In late 2013, the Financial Crimes Enforcement Network (FinCEN) introduced the FinCEN Form 114 (previously known as Form TD F 90-22.1) online through the BSA E-filing System (see our Tax Samaritan Takeways).
Who Should File An FBAR?
You have an FBAR filing requirement every year if:
- you are a U.S. person
- you have one or more financial account(s) in a foreign country (a Foreign Financial Institution)
- you have either financial interest in the account or signature or other authority over the foreign financial account
- the aggregate amounts in the financial accounts are valued in U.S. dollars that exceed $10,000 at any time during the year
Some of the most common methods to file a delinquent FBAR include the Offshore Voluntary Disclosure Program (OVDP) and Streamlined Filing Compliance procedures.
Got A Delinquent FBAR?
Our goal at Tax Samaritan is to provide the best counsel, advocacy and personal service for our clients especially when they have delinquent FBARs. We are not only tax preparation and representation experts, but strive to become valued business partners. Tax Samaritan is committed to understanding our client’s unique needs; every tax situation is different and requires a personal approach in providing realistic and effective solutions. We detail options available to you for filing a delinquent FBAR in our FBAR Late Filing article.
Here are summarized steps you need to follow when filing a delinquent FBAR:
- Either seek a practiced tax professional or review all the IRS instructions. We have listed many of these sources below.
- Write a Letter of Explanation detailing why your FBAR is late. This explanation, attached to each separate form for a specific tax year, should detail a reasonable cause for the failure to file and explicitly state that the delinquent filing was in no way related to tax evasion. This explanation is a very serious part of your submission. We recommend seeking professional guidance in engaging in any communications with the IRS.
- Using the electronic transmittal form, indicate your reason for late filing on the cover sheet. The BSA website provides BSA instructions in PDF format for filing the FBAR electronically. Alternatively, contact FinCEN’s Help line at 1-800-949-2732 or, if calling from outside the US) 1-703-905-3975 for assistance in paper submission of forms.
Click the button below to request a Tax Preparation Quote today to get started with resolving your Delinquent FBAR.
Tax Samaritan Takeaways
IRS FBAR Submission Procedures
IRS Delinquent International Information Return Submission Procedures
BSA (Bank Secrecy Act) E-Filing System
IRS 2012 Offshore Voluntary Disclosure Program
IRS Streamlined Filing Compliance Procedures
Tax Samaritan is a team of Enrolled Agents with over 25 years of experience focusing on US tax preparation and representation. We maintain this tax blog where all articles are written by Enrolled Agents. Our main objective is to educate US taxpayers on their tax responsibilities and the selection of a tax professional. Our articles are also designed to help taxpayers looking to self prepare, providing specific tips and pitfalls to avoid with delinquent FBAR filing.
When looking for a tax professional, choose carefully. We recommend that you hire a credentialed tax professional such as Tax Samaritan that is an Enrolled Agent (America’s Tax Experts) and experienced with the filing of delinquent FBAR and tax returns. If you are a US taxpayer overseas, we further recommend that you seek a professional who is experienced in expat tax preparation, like Tax Samaritan (most tax professionals have limited to no experience with the unique tax issues of expat taxpayers).
Randall Brody is an enrolled agent, licensed by the US Department of the Treasury to represent taxpayers before the IRS for audits, collections and appeals. To attain the enrolled agent designation, candidates must demonstrate expertise in taxation, fulfill continuing education credits and adhere to a stringent code of ethics.
Every effort has been taken to provide the most accurate and honest analysis of delinquent FBAR filing. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.
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