If you have a financial interest in or signature authority over a foreign financial
account exceeding certain thresholds, the Bank Secrecy Act may require you to report
the account yearly to the IRS by filing a Financial Crimes Enforcement Network
(FinCEN) Form 114 ("Report of Foreign Bank and Financial Accounts (FBAR)").
Specifically, for 2014, Form 114 is required to be filed if during the year:
- You had a financial interest in or signature authority over at least one foreign
financial account (which can be anything from a securities, brokerage, mutual
fund, savings, demand, checking, deposit, or time deposit account to commodity
futures or options, and a whole life insurance or a cash value annuity policy);
- The aggregate value of all such foreign financial accounts exceeded $10,000 at
any time during 2014.
The FBAR is filed on a separate return basis (that is, joint filings are not allowed).
However, a spouse who has only a financial interest in a joint account that is
reported on the other spouse's FBAR does not have to file a separate FBAR.
The 2014 Form 114 must be filed by June 30, 2015, and cannot be extended. Furthermore,
it must be filed electronically through
The penalty for failing to file Form 114 is substantial - up to $10,000 per violation
(or the greater of $100,000 or 50% of the balance in an account if the failure is
willful). Please give us a call if you have any questions or would like us to prepare
and file Form 114 for you.
This publication is distributed with the understanding that the author, publisher and
distributor are not rendering legal, accounting or other professional advice or
opinions on specific facts or matters, and, accordingly, assume no liability
whatsoever in connection with its use. The information contained in this newsletter
was not intended or written to be used and cannot be used for the purpose of (1)
avoiding tax-related penalties prescribed by the Internal Revenue Code or (2)
promoting or marketing any tax-related matter addressed herein. © 2015