What exactly is FBARS – FinCEN form 114?
The full name of FBARS- FinCEN form 114 is the Financial Crimes Enforcement Network Report of Foreign Bank and Financial Accounts. FBARS is required for any individual or business with foreign financial accounts that meet the reporting threshold, which is currently $10,000. FBARS is used to track and report foreign financial activity to prevent money laundering and other illegal activities. FBARS filings are due annually on June 30th and must be filed electronically through the BSA E-Filing System.
FBARS requirements have been in place since 1970, but FBARS filings have only become popular recently. This is because the government has cracked down on tax evasion and money laundering. If you have foreign financial accounts that meet the reporting threshold, it is important to understand FBARS requirements and file accordingly.
FBARS- FinCEN form 114 Filing Requirements
When filing, it is important to include information for all of your relevant financial accounts. If you have any of these types of accounts, you will need to file FBARS:
- Foreign bank accounts
- Foreign brokerage accounts
- Foreign retirement accounts
- Any other foreign financial accounts
However, it is important to note that if these accounts do not exceed $10,000 at any time during the tax year, you are not required to fill out the FBAR. For example, if you have $2,000 in an account in the U.K., $6,000 in an Australian account, and $4,000 in an account in New Zealand, you would be required to file an FBAR because all three accounts total more than $10,000.
You will want to keep in mind that you will have to convert the value of each foreign account into U.S. dollars when determining if the FBAR filing requirement is met.
How to Report Your Foreign Financial Accounts
Unlike most tax returns, the FBARS- FinCEN 114 form is not reported to the IRS. FBARS is instead filed with the Financial Crimes Enforcement Network (FinCEN), which is a bureau of the U.S. Department of the Treasury. Our team of experts at Quantum Accounting can help you file FBARS and ensure that all of your FinCEN 114 requirements are met.
What Happens if I Fail to File FBARs?
You may face severe penalties if you do not file FBARS when required. The penalty for failing to file FBARS is $12,459 per violation. In addition, you may also face criminal charges, which could result in up to five years in jail. If you have any questions about FBARS or need help filing, our team at Quantum Accounting is here to help. We offer expert FBARS filing services and can ensure that you stay compliant with all FinCEN 114 requirements.
Why should I use Quantum Accounting for FBARS – FinCEN 114 filings?
Here at Quantum Accounting, we offer expert FBARS filing services and can help you stay compliant with all FinCEN 114 requirements. Our experienced CPAs and tax professionals will work with you to ensure that all FBARS filings are completed accurately and on time. We understand the FBARS requirements and can help you navigate the FBARS filing process.