What to Do if You Didn’t File an FBAR By April 15, 2021News, Offshore Account Update
Posted in on April 16, 2021
When the Internal Revenue Service (IRS) extended the federal income tax filing deadline to May 17 for 2021, this extension did not apply to the obligation to file a Report of Foreign Bank and Financial Accounts (FBAR) with the Financial Crimes Enforcement Network (FinCEN). So, if you did not file your FBAR by April 15, what do you need to do? Virginia international tax attorney Kevin E. Thorn, Managing Partner of Thorn Law Group, explains:
File Your FBAR No Later Than October 15
U.S. taxpayers who fail to file their FBARs by April 15 get an automatic extension until October 15. As a result, your FBAR isn’t delinquent—yet. However, it is still generally best to file sooner rather than later, as you do not want to inadvertently miss the automatic extension deadline.
Make Sure You are Otherwise Up to Date on Your FBAR Filings
When preparing your 2021 FBAR, it is a good idea to make sure that you are otherwise up to date on your FBAR filings. Did you file an FBAR in 2020 (if you had qualifying offshore accounts)? Did you disclose all of your offshore accounts on your 2020 FBAR? Did you meet your FBAR filing obligations in all prior years?
If the IRS decides to audit your offshore bank account disclosures, it can go back several years. As a result, if you have made mistakes in the past, it will be important to correct them proactively.
Determine if You Also Need to File Under FATCA
When assessing your FBAR filing obligations, it is also important to assess your filing obligations under the Foreign Account Tax Compliance Act (FATCA). Under FATCA, U.S. taxpayers must disclose foreign financial assets (including, but not limited to, foreign bank accounts) that exceed the statutory threshold. If you are subject to FATCA, then you must make an additional annual filing with the IRS. If you have omitted this filing for any tax year, you will need to remedy this deficiency as well.
Consider Your Options for Voluntary Disclosure (If Necessary)
How do you correct FBAR or FATCA filing deficiencies? If you are not currently facing an IRS audit or under investigation by IRS Criminal Investigations (IRS CI), you have two primary options.
Questions? Contact Virginia International Tax Attorney Kevin E. Thorn, Managing Partner of Thorn Law Group
Do you have questions about FBAR or FATCA compliance? If so, Virginia international tax attorney Kevin E. Thorn, Managing Partner of Thorn Law Group, can help. To request a confidential initial consultation, call 703-752-3752, email firstname.lastname@example.org or tell us how we can reach you online today.Share This Post