Penalties for late filing your FBAR
Penalties for filing an FBAR late can be substantial. Failing to timely file a complete and correct FBAR may result in an FBAR penalty of up to $10.000 if the failure to file is non-willful. For willful violations, the penalty may be the greater of $100.000 or 50% of the balance in the account at the time of the violation. These penalty amounts apply per violation: the amounts double for failure to file a complete and correct FBAR two years in a row.
If you have reported on your tax return the income from the foreign account that you have failed to report on your FBAR, you have paid all taxes on that income, and you have not already been contacted by the IRS, the IRS will not impose an FBAR penalty.
In addition to the Foreign Bank Account Report (FinCEN Form 114), you may be required to file Form 8938. This form is filed as part of your tax return (Form 1040). The Form 8938 filing requirement does not replace the FBAR filing requirement. If you have filed Form 8938, but not a Foreign Bank Account Report, you are still liable for FBAR penalties. For a comparison of the requirements for Form 8938 and the FBAR, click here (IRS website).
We strongly recommend that you become compliant as soon as possible. Please contact us with any questions you may have and for assistance with preparation and filing so that you are no longer liable for FBAR penalties. Our tax professionals have helped many U.S. taxpayers become compliant. We guarantee swift and hassle-free preparation and filing of your FBAR.