Several months ago, I participated in a phone form on the FBAR program (Foreign Bank Account Rreporting); generally, if you have a foreign bank account with $10,000 or more in it you must file Form TD F90-22.1 with the Department of the Treasury by June 30th of each year. Today I received information on questions that were asked in that phone forum (the phone forum was in early June, so it took nearly six months for the answers to be distributed…).
Some of the answers are different than what I was led to believe during the conference call.
- The due date of the FBAR is June 30th, but the form must be received by June 30th, not postmarked by June 30th. This is different from tax forms which have a postmark due date.
- You must file a form if you have $10,000 in one or more foreign bank accounts. This is determined by adding the maximum balance in each account during the year, not the maximum balance of all the accounts at one point during the year. For example, the maximum you have in foreign accounts is $9,500 ($9,000 in account 1 and $5,000 in account 2 on June 15th). However, the maximum you had in account 2 was $4,000 on August 10th (the maximum in account 1 was $9,000). You are required to file Form TD F90-22.1.
- A faxed signature is not acceptable for an FBAR.
- Foreign life insurance can be considered a foreign financial account subject to reporting (by the policyholder) on an FBAR.
- A line of credit does not have to be reported on an FBAR.
There were many other items listed in this email; I’ve only posted the highlights. Anyone who believes they are impacted by this should talk with their tax professional to get full information on their situation.
Tags: FBAR