Your Mom, back in Canada, made you a cosigner on her bank accounts, “just in case...”
Or, you like to do some internet gambling, which means you transfer money to an account with an offshore casino to fund your bets...
Oh, oh! You may have to file an FBAR by June 30 or face ridiculous penalties.
FBAR is the report of Foreign Bank and Financial Accounts.
Who Must File an FBAR?
United States persons are required to file an FBAR if:
1. The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
2. The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.
United States person means United States citizens; United States residents; entities, including but not limited to, corporations, partnerships, or limited liability companies created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.
A 6/4/14 Court decision ("Homs") confirms the internet gambling account is subject to FBAR reporting.
Exceptions to the Reporting Requirement
Exceptions to the FBAR reporting requirements can be found in the FBAR instructions. There are filing exceptions for the following United States persons or foreign financial accounts:
-Certain foreign financial accounts jointly owned by spouses;
- United States persons included in a consolidated FBAR;
- Correspondent/nostro accounts;
- Foreign financial accounts owned by a governmental entity;
- Foreign financial accounts owned by an international financial institution;
- IRA owners and beneficiaries;
- Participants in and beneficiaries of tax-qualified retirement plans;
- Certain individuals with signature authority over but no financial interest in a foreign financial account;
- Trust beneficiaries; and
- Foreign financial accounts maintained on a United States military banking facility.
Look to the form’s instructions to determine eligibility for an exception and to review exception requirements. Forms and instructions can be found at irs.gov.
The FBAR is DUE June 30, and must be received (not postmarked) by then.
