Missouri Resident Assistance With Foreign Account Reporting
If you have an account with a financial institution outside of the United States, you need assistance with Foreign Account Reporting as there are certain tax reporting requirements you must follow, namely filing a Foreign Bank Account Report (FBAR) or FinCEN Form 114 with the Department of Treasury. The purpose of the FBAR is to help the IRS keep track of the international flow of money in and out of the U.S. as part of an effort to uncover and deter crimes such as embezzlement, money laundering, drug smuggling, and international terrorism.
At Krus Law Firm, LLC, we advise and represent clients in the U.S. and abroad in complex tax matters related to foreign accounts and FBAR. If you have concealed your offshore account dealings from the IRS, it’s vitally important to give us a call at (314) 276-4834 right away. Our team of tax attorneys and CPA’s can protect your rights and fight to minimize or prevent any penalties and tax liabilities you may face, especially criminal prosecution.
Foreign Account Reporting: Who is Required to File FBAR?
If you meet all of the threshold requirements below, you would be legally obligated to file an FBAR
- you are a “U.S. person” which is defined as an American citizen or legal permanent resident. Also includes entities created in the U.S. including corporations, partnerships and limited liability companies, as well as trusts and estates.
- you have a foreign account which could include:
- bank accounts, savings accounts, time deposits
- Mutual funds
- Insurance policies
- Commodities or Options accounts
- Brokerage and Securities Accounts
- you have a financial interest in or signature authority over one or more accounts in a foreign country
- having a financial interest means you are the owner of record or have legal title; this applies even if the account is maintained by others for your benefit or maintained by you for the benefit of others, including non-U.S. citizens.
- having signature authority means you have the ability to disburse money or other property from the account through the use of your signature.
the aggregate maximum value of your foreign financial accounts exceeds $10,000 at any time during the calendar year
Foreign Account Reporting: Filing Deadline
The deadline to file an FBAR is June 30 of each year. There are NO extensions! In addition to filing an FBAR, you must also report any income from foreign assets on your tax return.
Consequences of Non-Compliance with FBAR
Failure to properly disclose your offshore holdings can result in serious civil and criminal penalties. The severity of your punishment depends on whether you failed to file an FBAR due to negligence or willfully and deliberately evaded compliance.
- Non-willful violation: up to $10,000 fine for each year the FBAR was not filed.
- Willful failure to file
- up to $100,000 fine or
- pay penalty greater than 50% of the total balances in your accounts at the time of violation
- criminal penalties can include a fine of up to $250,000 or imprisonment of up to five years, or both.
Although these penalties are harsh, the IRS has created initiatives like the Offshore Voluntary Disclosure Program to help those willing to come forward about their accounts before they discover them through their own investigations. As a reward for making a proactive attempt to get compliant, the IRS can provide protection from criminal prosecution and civil penalties. Contact The Krus Law Firm today for experienced guidance.