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FBAR Must Be Filed Electronically Through FinCEN’s BSA E-Filing System, Not With The Federal Tax Return



FBAR must be filed electronically through FinCEN’s BSA E-Filing System. The FBAR is not filed with a federal tax return.

Public Law 114-41 mandates a maximum six-month extension of the filing deadline. To implement the statute with minimal burden to the public and FinCEN, FinCEN will grant filers failing to meet the FBAR annual due date of April 15 an automatic extension to October 15 each year. Accordingly, specific requests for this extension are not required.

Thus, before the FBAR extended due date of October 15, file streamlined FBARs for each of the most recent 6 years for which the FBAR due date has passed (i.e., is delinquent, and of course timely file the current year FBAR too).

Taxpayers who have not filed a required FBAR and are not under a civil examination or a criminal investigation by the IRS, and have not already been contacted by the IRS about a delinquent FBAR, should file any delinquent FBARs and include a statement explaining why the filing is late. Select a reason for filing late on the cover page of the electronic form or enter a customized explanation using the ‘Other’ option.

When filing as part of the streamlined program you’d separately disclose for the past six years your financial accounts held outside the USA via the online FBAR filing and ticking the “streamlined” box in your online submission. See http://www.ustaxservices.ca/single-post/2017/03/13/FBAR-Fincen-114—the-easy-guideline for FBAR requirements.

IRS says it will not impose a penalty for the failure to file the delinquent FBARs if income from the foreign financial accounts reported on the delinquent FBARs is properly reported and taxes are paid on one’s U.S. tax return, and one has not previously been contacted regarding an income tax examination or a request for delinquent returns for the years for which the delinquent FBARs are submitted.

Those required to file an FBAR who fail to properly file a complete and correct FBAR may be subject to civil monetary penalties.  The IRS may assess an inflation-adjusted civil penalty not to exceed $12,459 per violation for non-willful violations that are not due to reasonable cause. For willful violations, the inflation-adjusted penalty may be the greater of $124,588 or 50 percent of the balance in the account at the time of the violation, for each violation.

Have a question? Contact Daniel Gray.

Your comments are always welcome!

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Daniel Gray

2 thoughts on “FBAR Must Be Filed Electronically Through FinCEN’s BSA E-Filing System, Not With The Federal Tax Return

  1. Avatar Andy says:

    Yes, everybody knows all that. But a serious question came up recently: Who if anybody has responsibility for filing an FBAR — or indeed a tax return and form 8938 for a decedent with no personal representative and no estate, all the cash having gone directly for funeral and burial expenses. The answer seems to be that since the FBAR doesn’t require a real signature anybody can file it. And in real life the IRS really doesn’t care who signs a tax return when there is no probate and no heir and no refund.

    I am reminded when, back in the day, I knew a New York City slumlord who made his janitor the president of real estate C corporations. He’s long dead, so I can safely link to a case that illustrates the point: https://www.leagle.com/decision/196688353misc2d8301641

  2. Avatar Nononymous says:

    US non-residents, particularly those with dual citizenship, are generally protected from any IRS attempts to collect penalties in their countries of residence (the exceptions being US-only citizens resident in Canada or Denmark). So in most cases US persons abroad who wish to remain non-compliant with tax and FBAR requirements can do so without fear that the IRS can successfully collect the penalties it might decide to assess. Dual citizens and particularly accidental US citizens are often best served by ignoring their reporting obligations and remaining outside the US tax system.

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