Foreign Bank and Financial Accounts (FBAR)
If you are an officer, manager, director, or other responsible party for a U.S. entity that has foreign financial accounts, you better be sure the entity files an FBAR – or the taxman will come for you. And let’s face it, that’s an unpleasant experience that no one wants.
U.S. entities like corporations, limited liability companies, partnerships, estates, trusts, etc. are considered U.S. persons. And the IRS requires that an FBAR be filed by any U.S. person with a “financial interest in, or signature or other authority over, financial accounts in a foreign country that have combined value that exceeds $10,000 during a calendar year.”
Foreign financial accounts can include bank accounts, brokerage accounts, mutual funds, retirement plans, and “other foreign financial accounts.” The reporting obligation applies even if your account produces no taxable income.
The key words for you to focus on here are “other foreign financial accounts” because these accounts may be difficult to determine. For example, they may include retainers on account with foreign law firms or funds held in a foreign escrow account.
Esquire Group will help determine your filing requirements and ensure that your FBAR is completed and filed in a timely manner. We will be available throughout the year to answer any questions and will keep you apprised of applicable changes in the tax laws.