FBAR (Report of Foreign Bank and Financial Accounts) is a regulatory requirement that impacts businesses and individuals who have international assets. A business, a home, or just an income and asset stream can mean you must meet FBAR requirements.
Accountants who get FBAR
We provide comprehensive assistance for the US Treasury’s FBAR (Foreign Bank and Financial Accounts) program to individuals and businesses. As you may know, the US Treasury Department and IRS are cracking down on the disclosure requirements for offshore accounts and foreign assets, even to the extent of applying criminal penalties. If you may be subject to this requirement, we can help!
Every year, under the law known as the Bank Secrecy Act, you must report certain foreign financial accounts, such as bank accounts, brokerage accounts and mutual funds, to the Treasury Department and keep certain records of those accounts. You report the accounts by filing a Report of Foreign Bank and Financial Accounts (FBAR) on FinCEN Form 114.
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More on FBAR (Report of Foreign Bank and Financial Accounts)
Many San Francisco residents have overseas income or assets. Perhaps you live part year in San Francisco, and part year in Beijing or Berlin. Perhaps your business has an office in San Francisco as well as one in London or one in Sydney. Having a foreign bank account or other type of asset, however, can trigger the so-called FBAR (Report on Foreign Bank and Financial Accounts) reporting requirement. This is also known as FinCen Form 114. From the US government’s perspective, the purpose of this to combat tax evasion, specifically by having US citizens and permanent residents be required to report money and other types of assets in non-US banks. This isn’t submitted, however, to the IRS but rather to the US Treasury Department’s Financial Crimes and Enforcement Network, here.
FBAR compliance is complicated! It has an impact as to what country is involved (Canada, China, the United Kingdom, Germany, etc.), and what type of citizen you are (US citizen or resident alien), and what type of assets are involved. It also is important how much is involved in terms of dollar value and what type of authority you have over the asset. Different deadlines and forms are required, and this can vary quite a bit.
Q. What is FBAR?
A. FBAR is short for Foreign Bank and Financial Account. It is an accounting of any overseas financials, including bank accounts, brokerage accounts, and mutual funds. When an individual gets into this tax territory, it’s best to find a skilled, certified public accountant for support. Reporting overseas assets to the IRS can get complicated. Our expert CPA team – based in San Francisco, but serving all of California – manages FBAR filings for many countries, including China, Japan, and Canada. To learn more about FBAR regulations, visit the Internal Revenue Service page on FBAR.
Q. How do I know if I need to file FBAR?
A. If you have any overseas investments, you must file FBAR. It is filed annually along with your annual tax returns, with an April 15th deadline. You may be able to get an extension on overseas tax filings, but it’s best to speak to a CPA first. Misunderstandings can lead to heavy tax penalties including criminal penalties. If you have overseas or international tax exposure (by having assets of any type), you want to double-check with your accountant. FBAR compliance is an onerous and very serious requirement.
Q. How can a CPA help me file the FBAR?
A. You need a California CPA firm that understands FBAR. Our team of international tax accountants knows precisely what to do if you have to file FBAR. Our team of overseas tax and accounting experts can review your overseas interests and determine what needs to happen. For instance, if your overseas earnings are above $10,000.00, you may need to file a FinCen. Consulting with a professional CPA team to make sure your global financials are reviewed and remain compliant is a wise move. Don’t know what a FinCEN is? Visit the government website at https://www.fincen.gov/ for more information.
Q. Do businesses file FBAR?
A. Company FBAR filings are essential. A large number of California companies – especially here in the internationally oriented San Francisco Bay Area – are multinational businesses. Each country has its financial standards, but in the United States, earned income must be reported. Basically, the FBAR is designed to fight tax evasion. Working with a CPA skilled in international taxes and FBAR disclosure is best. Our team understands how to simplify the FBAR process and manage all foreign accounts open or closed during the tax year.
In summary, the FBAR is a complicated regulatory requirement. That’s the bad news. The good news is that we are considered one of the top-rated international CPA firms in California, and our team has deep experience when it comes to FBAR and international tax requirements. Indeed, we are even experts at expat tax return preparation.
