Taxpayers who have foreign accounts or interests that exceed $10,000 at any point during the year must submit a Foreign Bank Account Report (FBAR) through the Financial Crimes Enforcement Network (FinCEN) website. This notifies the U.S. Treasury Department of the accounts.
Failure to file this form can result in severe penalties from the IRS. Find out what these penalties are and how delinquent forms may be submitted.
Key Insights We Will Discuss
- Penalties the IRS may assess for not filing FBAR forms
- How to submit delinquent FBAR forms
According to the IRS, failing to submit the form can result in a maximum penalty of $12,921. Willful violations are even steeper. These can result in penalties of $129,210 or 50-percent of the amount in the account – whichever total is larger – for each violation. Each year you did not file can be treated as a separate violation.
If you are facing criminal charges for FBAR violations, the penalties can also include possible prison time.
To avoid these penalties, it is important to work with your tax attorney to file delinquent FBAR forms as soon as possible.
Procedure to Submit Delinquent FBAR Forms
According to the IRS, individuals who have not filed a required FBAR form, who are not under a civil investigation for criminal investigation by the IRS, and who have not already been contacted by the IRS about delinquent FBARs, can submit delinquent FBAR forms.
To file a delinquent FBAR form, a person must follow these steps as outlined by the IRS:
- Review the instructions
- Include a statement explaining why the taxpayer is filing his or her FBAR late
- File the delinquent FBARs on the FinCEN website
- Select a reason – as given on the electronic form – for why the FBAR is late
Contact a Tax Attorney
If you failed to submit an FBAR form for your foreign bank accounts, call Ayar Law at 800.571.7175 to receive free, no-obligation tax advice from a tax attorney.
Executive Summary:
- Failure to file FBAR forms on foreign accounts that exceed $10,000 throughout the year can result in harsh penalties from the IRS
- If you fail to submit an FBAR, it is important to file delinquent forms as soon as possible to try to reduce the penalties assessed against you
- Contact Ayar Law to get free, no-obligation legal advice at 800.571.7175
