Guidance for Filing Past Due FBAR and FATCA Reports
Whether you missed filing your FBAR (Foreign Bank Account Report) and FATCA (Foreign Account Tax Compliance Act) forms in the past, there are specific procedures in place to help you bring your returns into compliance. This article delves into the steps you can take and the options available, including streamlined filing procedures and conventional delinquent filing processes.
Understanding FBAR and FATCA Compliance
FBAR and FATCA filings are reporting requirements for individuals with financial interests in foreign financial accounts. Missing these deadlines can result in severe penalties. It is essential to understand the penalties involved and the available options for rectifying past oversights.
Streamlined Filing Compliance Procedures
If your failure to file was due to non-willful conduct, the streamlined filing compliance procedures are a viable option. These procedures allow you to file past due FBAR and FATCA forms with reduced penalties. The streamlined approach is designed to provide a simplified process for taxpayers who did not intend to file late, and there are no penalties for FBARs filed under these procedures.
Steps to Follow: Review your financial accounts to identify any missing reports. Fill out the necessary forms, which are available on the IRS website. Prove that your failure to file was due to non-willful conduct. Submit the corrected reports and forms.
Delinquent FBAR Submission Procedures
For those who failed to file due to circumstances that are not necessarily non-willful, the delinquent FBAR submission procedures may be applicable. These procedures involve filing past due FBARs with an electronic submission through the BSA E-Filing System and providing a statement explaining the reason for the delay.
Steps to Follow: Log in to the IRS website and navigate to the BSA E-Filing System. Submit your past due FBARs through the system. Attach a statement explaining why the forms are late, including any relevant circumstances or unexpected events that may have prevented timely filing.
Delinquent FATCA Forms
Delinquent FATCA forms, which include Form 8938 (Statement of Specified Foreign Financial Assets), also require special filings. These forms must be submitted along with any late FBARs and should be accompanied by a reasonable cause statement. The reasonable cause statement should detail any justifiable reasons for the delay in filing.
Steps to Follow: Review your tax returns to identify any missing FATCA forms. Ensure that all required forms, including Form 8938, are completed accurately. Attach a reasonable cause statement explaining the late filing of these forms. Submit the updated and corrected tax returns to the IRS.
Consult a Tax Professional for Guidance
To ensure that your filings are accurate and meet all legal requirements, it is highly recommended that you consult with a tax professional. A tax professional will guide you through the complexities of FBAR and FATCA compliance, helping you to submit the correct forms and potentially minimizing any penalties or other issues that may arise.
Key Takeaways: Understand the differences between streamlined and conventional delinquent filing procedures. Be prepared to provide evidence of non-willful conduct for streamlined procedures. Verify that all required forms, including Form 8938, are included and accurate. Submit all filings through the appropriate channels, such as the BSA E-Filing System. Consider professional guidance to ensure compliance and accuracy.
Conclusion
Missing the deadlines for filing your FBAR and FATCA reports can have serious consequences. However, by understanding the available procedures and following the steps outlined here, you can work towards bringing your filings into compliance. Remember to consult with a tax professional for personalized guidance and support. Being peaceful and proactive can lead to a smoother tax compliance journey.