Looking to file an extension for an FBAR?
We all know the importance of filing FBARs timely and accurately. Still there are many questions that exist for FBAR filers. One of the issues we see is that many expats believe that if they file an extension for their personal return that it will extend to an FBAR filing. Let’s take a closer look…
The Bank Secrecy Act authorized the Department of Treasury to collect financial information from U.S. persons (as defined within the Act) who have interests in (or even just signature authority over) certain financial accounts that are maintained and administered by financial institutions (banks, brokerages, etc.) that are located outside of the United States. This specific provision of the Act requires that a FinCEN Report 114 (this is the FBAR itself) be filed if the total aggregate maximum values of the foreign financial accounts combined exceed $10,000 at any point during a given calendar year.
The Financial Crimes and Enforcement Network (FinCEN) delegated the enforcement of FBARs to the IRS. Accordingly, the IRS is responsible for investigating any possible civil violations, assessing and collecting civil penalties as necessary, and issuing administrative rulings that govern process and procedure.
Can you file an FBAR extension?
This is a question that is asked by many taxpayers, especially expats. Because of the sensitivity of the FBAR and the fact that there is a lot of confusion, many taxpayers don’t file timely and often look to file an extension. In addition, many CPAs don’t understand the FBAR rules because they may not see them very often in their business.
Unfortunately, you cannot file an extension for an FBAR. The deadline is firm – June 30th. An extension of time to file a federal tax return does NOT extend the time for filing an FBAR. If a delinquent FBAR is filed, a section in the electronic form itself allows the filer to provide a statement explaining the reason for the late filing.