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Foreign Bank Account Reporting (FBAR)—FinCEN Form 114



John Dundon

Financial Crimes Enforcement Network (FinCEN) is a bureau of the Treasury Department. Authorized under the Bank Secrecy Act, foreign bank account reporting, commonly referred to as “FBAR”, is electronically reported to the IRS via FinCen Form 114, separate and distinct from filing a U.S. income tax return.

U.S. taxpayers with financial interest or signatory authority over foreign financial accounts, whether it is in banks, investment brokerage accounts, mutual funds, pension plans, or other financial accounts with aggregate balances over $10,000 on any day during the calendar year, must electronically file FinCEN Form 114 (FBAR) using the BSA E-Filing Systems Website.

Special Note regarding FBAR: Beginning for reporting year 2016, the FBAR due date will be April 15th, 2017, but extensions will be allowed.

Many taxpayers are confused while trying to understand the nuanced difference between an FBAR filing (FinCEN Form 114) and Foreign Financial Asset Reporting (FATCA Form 8938). For those folks I draw your attention to the following link worth reading: Form 8938 and FBAR Requirements Comparison FinCEN Form 114 and Form 8938.

For example, foreign stock or securities NOT held in a financial account AND foreign partnership interests need to be reported to the IRS via IRS Form 8938, but are not reported to the U.S. Treasury via FinCEN Form 114 (or otherwise).

The penalties are also different as well. You absolutely must check the requirements and relevant reporting thresholds of each form and determine if you should file Form 8938 or FinCEN Form 114 (or both).

I am enrolled with the United States Treasury Department to practice before the IRS, governed by rules stipulated in United States Treasury Circular 230. As a Federally Authorized Tax Practitioner and a tax appeals specialist my Enrolled Agent License #85353 is issued by the United States Treasury. With this license I work for U.S. taxpayers everywhere to resolve tax matters and de-escalate stress about taxes or tax disputes for individuals and corporations with federal and state issues.

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