Filing Deadline for 2016 FBAR Quickly Approaching
The FBAR due date has been accelerated from June 30 to April 15 (actually April 18 this year), starting with the FBAR for the 2016 calendar year. The FBAR must be filed electronically on FinCEN Form 114 if the aggregate value of all of your foreign financial accounts exceeded $10,000 at any time during the prior calendar year. However, there is no need to panic if you miss this new filing deadline since for the time being there is an automatic six-month extension (i.e., until October 15) of this FBAR filing deadline. This extension is available to all filers and, unlike the extensions for annual individual and corporate tax returns, specific written requests for this extension are not required.
The penalties for not filing an FBAR are quite harsh. If you are lucky enough to have your non-filing deemed non-willful by the IRS, you will be subject to a $10,000 penalty for each unreported foreign account for each year you fail to file. However, if your non-filing is deemed to be willful you are looking at a civil penalty equal to the greater of $100,000 or 50% of the value of the account at the time of the violation, for each year you failed to file, not to mention possible criminal penalties. Since the IRS can go back six years on non-filed FBARs, a penalty of this magnitude could easily wipe out your entire foreign account(s).
Fortunately, there are options available for curing delinquent FBAR filings and avoiding these exorbitant penalties. In fact, under certain circumstances and procedures you may be able to file your delinquent FBARs and avoid all penalties. If you have failed to file FBARs in the past or need assistance with the preparation and filing of your 2016 FBAR, feel free to give me a call for a consultation or assistance.