FinCEN Releases Updated FBAR Due Dates for Certain Financial Professionals

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FinCEN Notice 2018-1 provides an extension until April 15, 2020, for certain individuals who have signature authority over,but no interest in, foreign financial accounts.

On December 4, 2018, the Financial Crimes Enforcement Network (FinCEN) announced an additional extension of time to file FinCEN 114 (known as the FBAR) until April 15, 2020 for certain individuals who have signature or authority over, but no financial interest in, foreign financial accounts of their employer or another closely related entity.

On March 10, 2016, FinCEN issued a notice of proposed rulemaking, which would expand and clarify the exemptions for certain U.S. individuals with signature or other authority over foreign financial accounts. FinCEN issued Notice 2018-1 to extend the filing due date to April 15, 2020, for such filers since the proposed rules have yet to be finalized.

This extension applies to the reporting of signature or other authority held during the 2018 calendar year, as well as all reporting deadlines extended by previous Notices 2017-1, 2016-1, 2015-1, 2014-1, 2013-1, 2012-1 and 2012-2, along with Notices 2011-1 and 2011-2.The following provides a list of those who would benefit from the extension if they have signature or other authority over, but no financial interest in, foreign financial accounts of their employer or another closely related entity:

  • Officers and employees of a bank that is examined by certain authorities.
  • Officers and employees of a financial institution that is registered with and examined by certain authorities.
  • Officers and employees of an entity registered with and examined by the SEC that provides services to a registered entity with the SEC investment company.
  • Officers and employees of an entity with a class of equity securities or American depository receipts listed on any U.S. national securities exchange.
  • Officers and employees of a U.S. subsidiary of a U.S. entity with a class of equity securities listed on a U.S. national securities exchange.
  • Officers and employees of an entity that has a class of equity securities or American depository receipts in respect of equity securities registered under section 12(g) of the Securities Exchange Act.

For all other individuals required to file an FBAR, the filing due date for the 2018 calendar year remains April 15, 2019. Significant penalties can be assessed for failure to file the FBAR. A non-willful failure carries a penalty of $10,000 per violation. A willful failure to file penalty is the greater of $100,000 or 50% of the balance in the account at the time of violation.

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Bess Zhou | Manager, DHG Tax
tax@dhg.com