Delinquent FBARs

Delinquent FBARs

The FBAR (Report of Foreign Bank and Financial Accounts) is a Form FinCEN 114. The Bank Secrecy Act details the FBAR filing requirements.

This form must be filed electronically with the Financial Crimes Enforcement Network (FinCEN), a bureau of the Treasury Department.

The FBAR is due on April 15th of the year following the calendar year being reported. You’re allowed an automatic extension to October 15th if you fail to meet the FBAR annual due date of April 15th. Also, you don’t need to request an extension to file the FBAR, as you do with your personal tax return (Form 1040).

Non-willful FBAR penalties can be up to $10,000 per violation. The penalties for a willful FBAR violation can be the greater of $100,000 or 50% of the aggregate account balance.

When Are Delinquent FBAR Penalties Waived?      

Good news! If you should have filed an FBAR but failed to do so, the federal government has amnesty programs available that allow you to file late without a penalty, chief among them, the Streamlined Filing Compliance Procedure.

What is the Streamlined Filing Compliance Procedure?

The streamlined filing compliance procedures (“streamlined procedures”) are available to taxpayers certifying that their failure to report foreign financial assets and pay all tax due in respect of those assets didn’t result from their willful conduct.

These procedures give taxpayers with delinquent FBARs  the following:

  • A streamlined way to file amended or delinquent returns;

and

  • A means for mitigating or eliminating altogether any penalties or other charges for filing amended or delinquent returns; and

Am I Eligible?

The streamlined procedures are available to both U.S. individual taxpayers living outside the United States and those residing in the U.S.

Delinquent FBARs
you can avoid FBAR penalties by filing your FBAR by April 15th. In addition, you must report any income earned from these foreign accounts. Plus, you may have other reporting obligations.

Taxpayers may be eligible if they:

  • Haven’t filed a required Report of Foreign Bank and Financial Accounts (FBAR) (FinCEN Form 114, previously Form TD F 90-22.1);
  • Aren’t under a civil examination or a criminal investigation by the IRS; and
  • Haven’t already been contacted by the IRS about the delinquent FBARs.

Tax returns submitted under the Streamlined Filing Compliance Procedure will be processed like any other return submitted to the IRS. As a result, receipt of the returns won’t be acknowledged by the IRS, and the streamlined filing process will not culminate in the signing of a closing agreement with the IRS.

Those returns submitted under the Streamlined Filing Compliance Procedure won’t be subject to IRS audit automatically; however, they may be selected for audit under the existing audit selection processes applicable to any U. S. tax return.

Again, taxpayers must certify that conduct was not willful.

Remember, you can avoid FBAR penalties by filing your FBAR by April 15th. In addition, you must report any income earned from these foreign accounts. Plus, you may have other reporting obligations.

Contact Us

The attorneys at Ely J. Rosenzveig & Associates have extensive experience successfully navigating the complex and highly nuanced rules and protocols related to the FBAR, and achieving extraordinary results for their clients, including the substantial mitigation or removal altogether of criminal sanctions and civil fines imposed upon individual U.S. taxpayers with bank accounts and other assets (e.g., brokerage, and pension accounts, life insurance policies with cash surrender values) in foreign countries who fall into foreign account or asset reporting non-compliance. 

We can help. Contact us today. Violation of the FBAR reporting and record-keeping requirements can seriously impact you and your family. Work with an experienced attorney at Ely J. Rosenzveig & Associates to ensure your peace of mind and your financial future.

Ely Rosenzveig
[email protected]

Ely J. Rosenzveig practices principally in the fields of elder law, trusts & estates, tax planning, employment law, and mediation. He has extensive experience in federal and New York State tax law, and has successfully represented a wide range of clients on FBAR & FATCA compliance issues. Ely also practices employment law, with a particular emphasis on age and disability discrimination, negotiating compensation agreements, and severance issues.

With his extensive background in the law, his experience as a congregational rabbi, and his specialized training in Mediation at Harvard Law School, Ely is also available as a professional mediator to help facilitate optimal solutions in matters ranging from family and estate disputes to multi-party commercial issues.



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