In today’s interconnected global economy, it is not uncommon for individuals or businesses to maintain foreign financial interests such as bank accounts and other overseas assets. However, you may be required by US laws to report these interests through the Foreign Bank Account Report (FBAR) when filing taxes.
Who needs to file FBAR?
- Any United States person that has a financial interest in at least one financial account outside the United States.
- AND the total value of all foreign financial accounts exceeds $10,000.
“United States person” also includes any business entities, such as corporations, Limited Partnerships, and LLCs formed in the United States that have foreign financial accounts. It also entails any resident in the United states, whether a citizen of the US or resident alien.
Some Exceptions to FBAR
- Owner or beneficiary of an IRA
- Account with a US Military banking facility
- Certain joint accounts by spouses
FinCEN provides a detailed list here.
Filing FBAR
Individuals that need to file FBAR must answer the FBAR related questions on Schedule B of the individual 1040 form. FBAR itself can be E-filed for individuals and businesses. The due date to file FBAR is April 15th, just like with the individual tax filing due date.
FBAR is one of many things an individual or business should be aware of when filing taxes. Businesses especially may need the additional info due to their specific circumstances. Having a knowledgeable support team like us at MiklosCPA to anticipate those needs and other future requirements can save a business time and money from incorrectly rushed tax filings. We are a California-based tax and accounting firm that supports businesses with their tax and accounting needs through a “virtual office” service. This allows businesses to charge ahead with what’s most important, growing the business. If you would like to learn more about us, please contact us.