It is FBAR season folks. And FBARs are due on… June 30th, 2015, so please contact us if yours are not yet filed.
FBAR penalties, which can be substantial (greater of $100,000 or 50% of largest balance for each year unfiled), have a six-year statute of limitations for assessment which runs from the June 30th filing date.
But, what if you haven’t filed FBARs, and only recently learned about the rule?
There may be an answer. And it may be simpler than you would think. You may simply have to file the delinquent FBAR forms and call it a day. There is even a place on the form that asks why they weren’t filed, and you can select – “I forgot” – from the dropdown menu as the reason. No further questions asked.
What? No Offshore Voluntary Disclosure Program (OVDP)? No Streamlined Filing Compliance Procedure (SFCP)? All I have to do is file my FBARs. No lions? No tigers? No bears?
That’s right Dorothy. Click your heels three times. You may be home free after all (even if you are currently stressing about FBARs from a rooftop villa in the Cayman islands).
If you meet certain criteria, you may have an easy way back into the IRS’s good graces, without going through the expensive and time consuming process of fitting yourself under one of the IRS’s amnesty programs.
On June 18, 2014, the IRS published their “Delinquent FBAR Submission Procedures” which offers a way to rectify the problem if you meet a few key criteria:
- You have not filed an FBAR (for the past few years);
- You are not under civil audit or criminal investigation by IRS;
- You have not earned any reportable U.S. income on the foreign accounts; and
- The IRS hasn’t contacted you yet.
A lot of taxpayers subject to the FBAR filing requirement meet these criteria. If your accounts don’t generate any interest or other income, you are in luck. If you reported the income on your tax returns already, but just didn’t file an FBAR, you are in luck. If your account was closed more than six-years ago, or your return was filed more than three-years ago and reported any income earned, the assessment period has closed, and you are in luck.
There are a myriad of scenarios that one can imagine that would make condition #3 apply and which would allow you to avoid having to enter into one of the more formal amnesty procedures.
If you are a taxpayer with foreign accounts and you want to determine if Delinquent FBAR filing applies to you, give us a call today at 201-529-8024 , and we will be happy to fix your delinquent FBAR problem.
Post a comment
Post a Comment to "Lions, Tigers and Delinquent FBARs… Oh, My! - Fazzio Law Offices"To reply to this message, enter your reply in the box labeled "Message", hit "Post Message."