Foreign Bank Account Reporting In addition to reporting your worldwide income, you must also report on your U.S. tax return whether you have any foreign bank or investment accounts. The Bank Secrecy Act requires you to file a Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR), if:
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You have financial interest in, signature authority, or other authority over one or more accounts in a foreign country, and
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The aggregate value of all foreign financial accounts exceeds $10,000 at any time during the calendar year.
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More information on foreign financial account reporting requirements is in News Release FS-2007-15, Foreign Financial Accounts Reporting Requirements and IRS Publication 4261, Do You have a Foreign Financial Account?
Consequences for Evading Taxes on Foreign Source Income
You will face serious consequences if the IRS finds you have unreported income or undisclosed foreign financial accounts. These consequences can include not only the additional taxes, but also very substantial penalties, interest, fines and even imprisonment.
Please feel free to contact a MillerMusmar CPAs representative at 001-703-437-8877 or via email to discuss this article or any other tax needs.
