The FBAR (Report of Foreign Bank and Financial Accounts): Everything You Need to Know
What is the Report of Foreign Bank and Financial Accounts (FBAR)?

Congress enacted the statutory basis for the requirement to report foreign bank and financial accounts in 1970 as part of the “Currency and Foreign Transactions Reporting Act of 1970,” which came to be known as the “Bank Secrecy Act” or “BSA.” These anti-money laundering and currency reporting provisions, as amended, were codified at 31 USC 5311 – 5332, excluding section 5315.

The Secretary of the Treasury subsequently delegated the authority to administer civil compliance with Title II of the BSA to the Director of FinCEN.  IRS Criminal Investigation (CI), however, maintains authority to enforce the criminal provisions of the BSA.

While FinCEN retains rule-making authority with respect to FBAR reporting, FinCEN redelegated civil FBAR enforcement authority to the IRS.

The FBAR regulations require that a United States person, including a citizen, resident, corporation, partnership, limited liability company, trust and estate, file an FBAR to report:

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On September 30, 2013, FinCEN posted on their internet site, a notice announcing FinCEN Form 114, Report of Foreign Bank and Financial Accounts (the current FBAR form). FinCEN Form 114 supersedes TD F 90-22.1 (the FBAR form that was used in prior years) and is only available online through the BSA E-Filing System website.

On July 29, 2013, FinCEN posted a notice on their internet site that introduced a new form to filers who submit FBARs jointly with spouses or who wish to have a third party preparer file their FBARs on their behalf. The new FinCEN Form 114a, Record of Authorization to Electronically File FBARs, is not submitted with the filing but, instead, is maintained with the FBAR records by the filer and the account owner, and made available to FinCEN or IRS on request. Read More

British Virgin Islands agrees to US FATCA Blog PostThe leader of the British Virgin Islands says the Caribbean territory has started talks with the United States Treasury to comply with a law designed to counter offshore tax evasion.

The tiny islands are one of the world’s top offshore trust jurisdictions and the incorporated registry for hundreds of thousands of companies. Premier Orlando Smith said August 20, 2013 that the territory is negotiating an intergovernmental agreement with the United States to comply with the US Foreign Account Tax Compliance Act (FATCA).

Smith says the islands are “not being forced or coerced” into finalizing a pact under the United States law that will take effect next year.

Smith said the islands’ crucial financial services industry has been consulted and agrees with the move.

“We are of the very considered opinion that this course is the best one to adopt for the BVI,” Smith said at a press briefing on the main island of Tortola.

The Cayman Islands announced last week that it had reached agreement with the US to provide information on accounts held by US citizens under the same law.

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