What is the FBAR?
What is the FBAR? The FBAR is the Foreign Bank and Financial Account Form. It is also referred to as FinCEN Form 114. FinCEN is the Financial Crimes Enforcement Network. The form is not actually a tax form — which is where the complexity comes in. Rather, the FBAR is a Title 31 form. Title 31 refers to AML or Anti-Money Laundering. The form is used to report the maximum balance of your offshore and foreign bank and investment accounts. It also requires the reporting of assets such as foreign life insurance, pension accounts, and investment accounts (whether or not they generate income or were opened before the the filer became a “U.S. Person“)
The FinCEN Form 114 is not the most complicated international information reporting form. But, what makes the form so dangerous are the penalties associated with the form. There are IRS civil penalties, which can be willful or non-willful and criminal penalties — the former which may include criminal FBAR enforcement (although it is relatively rare).
When it comes to international tax and reporting compliance, the FinCEN Form 114 is one of he most important forms to get right.
Late or Untimely Filed Foreign Account Reporting
If you report your foreign accounts timely, and the Form is accurate — you are one of the lucky ones. But, if you are out compliance because you did not file report the foreign account timely, you may need tax and legal assistance. That is because the FinCEN Form 114 is usually just one of several International Information Returns you may have to file.
Other common foreign reporting forms, include:
- FATCA Form 8938
- Form 3520
- Form 3520-A
- Form 5471
- Form 8621
- Form 8865
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Our International Tax Lawyer team specializes exclusively in international tax, and specifically IRS offshore disclosure and Foreign Accounts Compliance.
Contact our firm today for assistance with getting compliant.