FBAR - FOREIGN BANK ACCOUNT REPORTING (Form 90-22.1)
If you own or have authority over a foreign financial account, including a bank account, brokerage account, mutual fund, unit trust, or other types of financial accounts, then you may be required to report the account yearly to the Internal Revenue Service. Under the Bank Secrecy Act, each United States person must file a Report of Foreign Bank and Financial Accounts (FBAR), if
- The person has a financial interest in, or signature authority (or other authority that is comparable to signature authority) over one or more accounts in a foreign country, and
- The aggregate value of all foreign financial accounts exceeds $10,000 at any time during the calendar year.
A United States person is not prohibited from owning foreign accounts. The FBAR is required because foreign financial institutions may not be subject to the same reporting requirements as domestic financial institutions. The FBAR is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent United States law. Investigators use FBARs to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad.
Reporting and Filing Information
A person who holds a foreign account may have a reporting obligation even though the account produces no taxable income. Checking the appropriate block on Form 1040 Schedule B, and filing Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts, satisfies the account holder’s reporting obligation.
Shortcut to Form 90-22.1 (FBAR): Form 90-22.1 (FBAR)
A foreign account holder must mail the Form TD F 90-22.1 on or before June 30 of the following year to:
U.S. Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621
Please Note:
- The FBAR is not to be filed with the filer’s Federal income tax return.
- The granting, by IRS, of an extension to file Federal income tax returns does not extend the due date for filing an FBAR.There is no extension available for filing the FBAR.
- A FBAR can not be E-filed (submitted electronically).
- Account holders who do not comply with the FBAR reporting requirements may be subject to civil penalties, criminal penalties, or both.
