Information About New Rules for Individuals with Foreign Bank, Brokerage and Stock Holdings
Individuals with business or personal ties in a foreign country who may have a foreign bank account, securities account or signature authority over such account are now responsible for filing two new forms – TD F 90-22.1 and Form 8938. The TD F 90-22.1 form, or FBAR statement, must be filed if the aggregate value of the accounts exceeds $10,000 at any time during the calendar year. Failure to file a FBAR will result in fines dependent on the willfulness of the violation.
A person must file a Statement of Specified Foreign Financial Assets, or Form 8938, if the individual has an interest in such assets with an aggregate fair market value exceeding either $50,000 on the last day of the tax year or $75,000 at any time during the tax year. In addition, the reporting threshold is increased for an individual residing outside the United States who is a qualified individual under Code Sec. 911(d)(1). Consequently, failure to report specified foreign financial assets for a tax year will result in a $10,000 penalty.
If you have any questions about the above forms, or if you are uncertain whether you are, or will be, required to file a FBAR of Form 8938 for the current or past year, do not hesitate to call your Lewis & Knopf team member at 810-238-4617.