Mineola, NY - This is a reminder that U.S. persons who have bank and other financial accounts in a foreign country that exceeded $10,000 in the aggregate at any point during the 2011 tax year are required to report those accounts to the U.S. Department of Treasury by June 30, 2012.
U.S. persons are required to file a Report of Foreign Bank and Financial Accounts (FBAR), Form TD F 90-22.1, each year if they have a financial interest in or signature authority or other authority over any financial accounts, including bank, securities or other types of financial accounts, in a foreign country, if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year.
A United States person is not prohibited from owning foreign accounts but civil and criminal penalties may apply for failures to properly file FBARs when required. Failure to file an FBAR can result in penalties up to $10,000 per year for each non-willful violation, and the greater of $100,000 or 50 percent of the balance of the foreign account for willful violations.
The 2011 FBAR form must be received by the Treasury Department on or before June 30, 2012 at: U.S. Department of the Treasury, P.O. Box 32621, Detroit, MI 48232-0621. The FBAR is not an income tax return and should not be mailed with any income tax returns. Additionally, unlike with federal income tax returns, an extension of time to file an FBAR is not available.
If you have not previously complied with the requirement to file the FBAR you should speak with an attorney to discuss your reporting requirements and the opportunity to report previously undisclosed foreign accounts and entities without criminal penalties and with substantially reduced civil penalties under the existing IRS Offshore Voluntary Disclosure Program.
Please contact one of the attorneys in the Tax Law Group at Meltzer, Lippe, Goldstein & Breitstone, LLP for more information regarding FBAR filing requirements.
Due to the general nature of its contents this newsletter is not, and should not be regarded as, legal advice.