Reporting Joint Overseas Accounts with Foreigners on FBAR
The US Government requires US Persons with overseas accounts and investments to report this information on the annual FBAR when the threshold filing requirements are met. And, with the globalization of the US economy, it is very common for US Persons to have foreign accounts. Whether it is because the US person previously resided in a foreign country; has relatives in a foreign country, or has otherwise invested in a foreign country (personal or business) — foreign account reporting has become a much more common requirement for taxpayers worldwide — with an emphasis on the FBAR and Form 8938 (FATCA). One common question our International Tax Lawyers receive often involves whether or not reporting is required when a US person has a joint account with a Non-Resident Alien. In other words, is a Foreign Bank and Financial Account Reporting Form (aka FinCEN Form 114) or FATCA Form 8938 required to be filed by a US person who has a joint overseas account(s) with a non-resident?
Joint Overseas Accounts with Foreigners are Included on FBAR
When a foreign account is owned jointly by a US person and a Non-Resident Alien, the account is still required to be reported for FBAR and Form 8938 purposes. The concept is that the United States wants to know about US persons who have foreign bank and financial accounts. The mere fact that the US person may have joint ownership with a non-resident alien does not negate the requirement of the US person to report the account on the annual FinCEN form 114 or Form 8938. *The extent of information provided to the IRS and FinCEN identifying a nonresident alien on the FBAR is an important consideration. Any US person who is concerned about disclosing nonresident alien information on the FBAR should consult with an experienced Board-Certified Tax Law Specialist before making any proactive representation to the Internal Revenue Service.
Overseas Account FBAR/FATCA Amnesty Program Summary
The FBAR/FATCA Amnesty Programs are programs developed by the Internal Revenue Service to assist Taxpayers who are already out of compliance for non-reporting. Some of the more common programs include:
Begin Filing FBAR/Form 8938 in the Current Year?
No, unless the current year is the first year you had an FBAR/FATCA Reporting requirement. Otherwise, if you had a prior year reporting requirement, but only begin to start filing in the current year (Filing Forward) it is illegal. In the world of offshore disclosure, this is referred to as a Quiet Disclosure. The IRS has warned taxpayers that if they get caught in an FBAR/FATCA Quiet Disclosure situation, it may lead to willful penalties and even a criminal investigation by the IRS Special Agents.
International Tax Lawyers Golding & Golding Represent Clients Worldwide
Our FBAR Lawyer team specializes exclusively in international tax, and specifically IRS offshore disclosure. Contact our firm today for assistance.