With increased attention from the IRS in the areas of foreign operations and investments/holdings, it is important to review your situation to determine whether you will need to comply with the FBAR disclosure requirements. The report is due at the end of June and it must be received, not postmarked, by the end of the month. Although the reporting is technically a disclosure, the penalties for failure to do so can be severe and in some cases the penalties can be in excess of the actual amount invested or held in the foreign account! Typically, a FBAR filing requirement is needed if either of the following is applicable:
1. Ownership of a foreign bank account, or
2. Control over or signing authority for a foreign bank account
Please note, these disclosure requirements apply at the entity and individual level. One bank account owned by an entity can result in multiple filings since the entity owns the account, but there may be a number of individuals employed by the entity that have control over or signing authority for the same account. Controllers, cash management personnel and CFO’s are likely to have the requisite control or signing authority to meet the filing threshold. Individual accounts held jointly or accounts held by pass-through entities also present the potential for disclosure.
In addition the information above, you can click here to learn more about some of the technical details that might be applicable or helpful to your situation.
To learn more about our tax planning and preparation services, call us at 440-449-6800.
Powered by Compendium Blogware