FBAR – Reporting Foreign Financial Accounts Dear Client, FBAR is a regulation requiring U.S. persons to report if they have interest in foreign financials accounts. The reports must be filed by June 30th, 2013 (no extensions) and failure to report may bring large amounts of penalties and fees. I am sending this e-mail to all Shatz-Tax Inc. Clients and posting this on our Facebook page. This is a synopsis of a much larger regulation it does not entail the full scope of the regulation and you cannot rely on this e-mail as advice or as an excuse to why you did not report a foreign account(s). If you are not sure please contact me via e-mail and I will get back with you to discuss the matter. Please LIKE us on Facebook, from time to time I find tax related articles and topics that I would like to share with you, and Facebook is a great way to do that. Or click here to read this on Facebook https://facebook/ShatzTaxInc What is FBAR – If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, with an aggregate value of more than $10,000 you are required to report it to the IRS we call that report an FBAR report. Who is affected –1) U.S. citizens residing anywhere in the around the world. 2) Residents of the U.S. including green card holders, work visa (such as H1-B) and even those who reside in the country illegally. What are the penalties for failing to report an account(s) – A penalty of up to $10,000 per account unless there is a reasonable cause for the failure to report the account. Willful failure to report may bring a penalty of the greater of $100,000 or up to 50% of the value of the account. What is a Foreign Account – This includes, but not limited to securities, brokerage, savings, checking, CDs, commodity futures, options or other types of accounts maintained with a foreign financial institute located outside the U.S. For example monies deposited in a Bank of China branch located in the U.S. does not need to report. But if the money is deposited in a branch of the same bank outside the U.S. that account does need to be reported. How to calculate the $10,000 value – Find the point at which the account had the highest value. That will become the maximum value of the account. If you have more than one account find that value for each account. Each account may have its maximum value at a different time of the year. Add all these maximum account values together, if that number is higher than $10,000 than need to be reported. A couple who jointly owns an account – can file 1 form together. What does control means – This is usually the holder of record on the account, but it can also be the owner of a corporation with a foreign account, a U.S. person with signatory rights over an foreign account (that includes officers), and more.
Posted on: Thu, 06 Jun 2013 21:22:48 +0000