In our previous post regarding disclosing foreign accounts, we discussed the OVDP and the Streamlined Filing procedures.  These programs were implemented for taxpayers who have foreign financial accounts and have not reported the income from these foreign assets. If a taxpayer has reported the income from her foreign financial accounts and paid taxes on it, the Delinquent FBAR Submission Procedures permit a taxpayer to file the missing FBARs (FinCen Form 114) without a late filing penalty.

A taxpayer qualifies for this Delinquent FBAR Submission Procedures if:

1. the taxpayer has not filed an FBAR;

2. the taxpayer is or was not under a civil examination/audit or a criminal investigation by the IRS; and

3. the taxpayer has not been contacted by the IRS about the delinquent FBARs.

To enter the program, the taxpayer must file the missing FBARs through the FinCen website. When filing the late forms, select “other” as the reason for why you are filing late and include a statement explaining the circumstances for the late filing.

Dealing with offshore accounts can be a complicated matter, and selecting the correct disclosure procedure to avoid significant penalties and potential exposure to criminal adjudication requires the expertise of an experienced tax attorney.  For a consultation on FBAR filing requirements and disclosure of delinquent FBAR procedures and other tax-related matters, please contact Judith S. Lambert and Lambert Law Offices, PL, a Tampa Bay area firm with expertise in Business Formation and Transactions, Estate Planning, and Tax Preparation and Appeals.