There is a two-part filing requirement for those who hold a managing or controlling interest in a foreign account or business. If you have a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, information about the account has to be reported to the IRS with your tax return, Form 1040, Schedule B no matter how small the dollar amount.
The second reporting requirement under FBAR requires a second report yearly to the Department of Treasury by electronically filing a Financial Crimes Enforcement Network (FinCEN) 114, Report of Foreign Bank and Financial Accounts (FBAR). Generally, this requirement applies to accounts you personally manage or oversee, and does not apply to retirement accounts and IRAs managed on your behalf.
It is better to report, and not need to, than to not report and find out later that you are under the IRS “microscope.” See the ‘Who Must File an FBAR’ section below for additional criteria.
United States persons are required to file the Financial Crimes Enforcement Network (FinCEN) 114, Report of Foreign Bank and Financial Accounts (FBAR) if:
the United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
the aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year reported.
