If you have a bank account outside of the United States and the fund exceeds a certain amount, you are required to file a "Report of Foreign Bank and Financial Accounts (FBAR)" by June 30th. FinCen (Financial Crimes Enforcement Network) made the following changes to FBAR starting this year.
1. FBAR form changed from "TD F 90-22.1" to "FinCen Form 114"
2. Mandatory online filing
3. "FinCen Form 114a" required for joint filing with spouse or third party filing by an accountant (it is not required to submit FinCen Form 114a at the time of reporting; however, it is necessary to fill out the form and keep it on record in case FinCen or the IRS requests the documentation.)
As it was in the past, FBAR filing requires U.S. citizens and residents to report the aggregated value of all foreign financial accounts exceeding $10,000 at any time during the calendar year. Even if you are not the main account holder, any individual or organization that holds the signing authority over the account is required to report under the FBAR rule.
Failure to properly file a complete and correct FBAR report may result in a penalty of up to $10,000 per nonwillful violation that is not due to reasonable cause. If the violation was found to be "willful" (for example, answering "no" to the question on schedule B of an income tax return where you are asked if you have had any foreign financial accounts), the penalty may be the greater than $100,000 or 50% of the balance in the account at the time of the violation, for each violation.
FBAR submission can be completed through this link.
You can also find more information on FBAR from IRS’s official website.
With exceptions to the types of financial accounts and reporting requirements, navigating FBAR can be tricky. The regulatory authority can review records from past years for violation and misreporting; thus, it is extremely important to complete FBAR filing with caution.