Foreign Bank and Financial Accounts - FBAR

Foreign Bank Account Reporting (FBAR) is a critical requirement for US local and expats with financial accounts held outside the United States. FBAR is governed by the US Department of Treasury and must be filed annually by individuals who meet the reporting threshold. The threshold for reporting is when the aggregate value of all foreign financial accounts exceeded $10,000 at any point during the calendar year.

To comply with FBAR, US local and expats must electronically file FinCEN Form 114 through the Financial Crimes Enforcement Network (FinCEN) website. The form collects essential information about the foreign accounts, such as bank names, account numbers, and maximum values during the reporting year.

Who Must File an FBAR?

The IRS states that "A U.S. person, including a citizen, resident, corporation, partnership, limited liability company, trust and estate, must file an FBAR to report:

1) a financial interest in or signature or other authority over at least one financial account located outside the United States if

2) the aggregate value of those foreign financial accounts exceeded $10,000 at any time during the calendar year reported."

US local and expats should be well-informed about FBAR requirements and deadlines to avoid potential penalties for non-compliance. Always consult with a qualified tax professional to ensure accurate reporting and to stay up-to-date with any changes in FBAR regulations that may not be reflected here.

Sources:

IRS: Report of Foreign Bank and Financial Accounts (FBAR)

Department of Treasury: Individuals Filing the Report of Foreign Bank & Financial Accounts (FBAR)