Recent news stories regarding the leaked (or stolen) “Panama Papers” highlight the problems faced by some of the world’s “one percenters” in connection with off-shore accounts, apparently used in many cases to hide assets or avoid taxes in their home countries. These stories should serve as an important reminder to more common folk regarding the need to file the annual FinCEN Report 114, the Report of Foreign Bank and Financial Accounts (FBAR).
All “U.S. persons” (including individuals, trusts and entities) with ownership interests in, or signature authority over, “foreign accounts” (not just bank accounts) aggregating more than $10,000 at any time during the prior calendar year must file the annual FBAR report or risk serious penalties. The FBARs are now filed on-line using the BSA (Bank Secrecy Act) E-Filing System. The reports are due each year by June 30.
While filing the simple report does not necessarily require the assistance of a lawyer or tax professional, there are many issues involving foreign accounts, or the need to correct prior or missed filings, that may require professional help.
For more information, call Tom Hammerschmidt in our Ann Arbor, Mich. office at 734-623-1602, or another member of the Dickinson Wright tax group.