Foreign Bank Accounts and FBAR Filing Requirements: What Florida Taxpayers Need to Know

The Sunshine State has one of the most internationally connected populations in the country, with large communities of residents who maintain financial ties abroad. If you have accounts at foreign financial institutions, federal law may require you to report them every year, regardless of whether you earned any income from them.

Failing to meet this obligation can be far more costly than most people realize. Our experienced Florida tax and IRS attorney explains what Florida taxpayers need to know.

Who Needs to File an FBAR and What Accounts Must Be Reported

If you are a Florida taxpayer and have financial accounts outside the US, you may be required to report them to the federal government each year. This is done by filing what is known as an FBAR, or Report of Foreign Bank and Financial Accounts.

The filing requirement kicks in when the combined value of all your foreign accounts topped $10,000 at any point during the year, even if only briefly. You are generally required to report:

• Bank accounts held at financial institutions located outside the United States.
• Foreign brokerage accounts, mutual funds, and other investment accounts.
• Accounts over which you have signature authority, even if you do not own them personally.
• Joint accounts held with a spouse or other person that exceed the $10,000 threshold.
• Certain foreign accounts held through partnerships, trusts, or business entities in which you have an interest.

The FBAR is due April 15 each year, with an automatic extension to October 15 that requires no formal request. Filing does not mean you owe additional taxes, but missing even one filing year can result in fines of up to $250,000 and a potential jail sentence.

Options for Florida Taxpayers With Missed Filings

The penalties for FBAR non-compliance are among the most severe in federal tax law. If you’ve missed filings, take these steps:

• File late FBARs as soon as possible, even if the IRS has not yet contacted you.
• Consider IRS Streamlined Filing Compliance Procedures, which allow qualifying taxpayers to come into compliance with significantly reduced penalties.
• Document reasonable cause for any missed filing, since penalties may be reduced if the failure was not willful.
• Request penalty abatement after filing, if you have a strong compliance history and the oversight was genuine.

Consult an experienced Florida tax attorney before taking any corrective steps, as the approach you choose directly affects your exposure.

Schedule a Consultation With Our Experienced Florida Tax and IRS Attorney

FBAR compliance is one area where small mistakes can have disproportionately large consequences. To protect yourself and address any missed filings, get Florida tax and IRS attorney Ronald Cutler on your side.

A Certified Public Accountant and former FBI Special Agent, Mr. Cutler has more than 50 years of experience handling complex federal and state tax matters for Florida taxpayers, including international reporting issues. For trusted legal help, call or contact us online today. Schedule a consultation with our Florida Tax and IRS attorney.

Sources:

irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar

fincen.gov/report-foreign-bank-and-financial-accounts