Foreign Bank Account Reporting (FBAR) Compliance

If you have a foreign bank account, are you aware of all your reporting obligations? 

The IRS pays close attention to Foreign Bank Account Reporting (FBAR) compliance. 

If you have a total balance of $10,000 or more in foreign bank accounts or investments at any point during the year, you may be required to file an FBAR (FinCEN Report 114).

FBARs are due April 15th (with possible extensions to October 15th). Failure to file can result in substantial penalties. Our team can help you understand your FBAR obligations and ensure you're compliant. Don't wait for penalties to accrue.

The Foreign Account Tax Compliance Act (FATCA) and its Implications

Since July 2014, foreign financial institutions have been required to follow the terms of the Foreign Account Tax Compliance Act (FATCA). FATCA requires these institutions to provide U.S. account-holder information to the U.S. government to ensure taxpayers have been reporting earnings in foreign bank accounts. This includes your name, address, and account balance. 

If you’re not sure whether the FATCA affects you and how you can stay compliant, we can guide you through the necessary steps to comply with these regulations.

If you have a foreign financial assets, you should contact a tax lawyer immediately to find out how FATCA may affect you.

International Tax Forms

International tax law often involves numerous complex forms. Are you or your accountant overwhelmed by the paperwork? Our tax controversy and tax planning experience covers supporting taxpayers for a wide range of international tax forms and their related penalties, including:

• Form 1118: Foreign Tax Credit - Corporations
• Form 3520: Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts
• Form 3520-A: Annual Information Return of Foreign Trust with a U.S. Owner
• Form 5471: Information Return of U.S. Persons With Respect To Certain Foreign Corporations
• Form 5472: Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business
• Form 8621: PFIC/Passive Foreign Investment Company Reporting
• Form 8858: Information Return of U.S. Persons With Respect to Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs)
• Form 8865: Return of U.S. Persons With Respect to Certain Foreign Partnerships
• Form 8891: U.S. Information Return for Beneficiaries of Certain Canadian Registered Retirement Plans
• Form 8938: Statement of Specified Foreign Financial Assets

We can help you understand the requirements of these forms, ensure accurate and timely filing, and avoid potential penalties.

Voluntary Disclosure Programs and Procedures

Have you failed to report foreign income or accounts in the past? Are you worried about the consequences? 

Taxpayers who have unreported foreign income or bank accounts may be eligible for the IRS Streamlined Filing Compliance Procedures, including both Streamlined Domestic Offshore Procedures (SDOP) and Streamlined Foreign Offshore Procedures (SFOP).  For taxpayers that reside in the US, you must:

• Have filed tax returns for each of the most recent 3 years
• Fail to meet the applicable non-residency requirement for the Streamlined Foreign Offshore Procedures (SFOP)
• Have failed to report gross income from a foreign asset
• Have failed to file certain international information returns (e.g., FBAR, Forms 3520)
• Certify that the compliance failures resulted from non-willful conduct
• Not be under audit or investigation by the IRS

For taxpayers who may be subjected to criminal prosecution for a willful conduct, the IRS offers a Criminal Investigation Voluntary Disclosure Practice. To be eligible, you must:

• Produce complete and accurate disclosures
• Cooperate with the IRS to determine the correct tax liability
• Make arrangements to pay back all taxes, interest, and penalties
• Certify that the compliance failure resulted from willful conduct
• Not be under audit or investigation by the IRS

Our experienced tax professionals can help you determine your eligibility and guide you through the filing process.

Experienced International Tax Attorneys on Your Side

International tax issues can be stressful, but you and your accountant do not have to face them alone. Contact us today at (443) 743-3381 or fill out our contact form for a confidential case evaluation.

We proudly serve clients throughout Maryland, including Baltimore, Towson, Catonsville, Columbia, Rockville, and around the globe. Our team of attorneys includes dual-licensed lawyers and CPAs who can provide personalized guidance and effective representation in the most complex tax law matters. 

Let us help you overcome the challenges of international tax compliance and achieve peace of mind. Contact our team today.