IRS Extends FBAR Filing Relief; FinCEN Proposes Regs

Article excerpt

The IRS suspended any requirement for persons other than U.S. citizens and domestic entities to file a Form TD F 9022.1, Report of Foreign Bank and Financial Accounts (FBAR), otherwise due on June 30, 2010. The Service also extended until June 30, 2011, the deadline for filing an FBAR that would otherwise be due for 2010 and earlier calendar years for persons who only have signature authority over, but no financial interest in, a foreign financial account and those holding foreign commingled funds. Also, the Treasury Department's Financial Crimes Enforcement Network (FinCEN) issued proposed regulations clarifying these and other issues.

In Announcement 2010-16, the IRS temporarily suspended the FBAR filing requirement for persons who are not U.S. citizens or residents or domestic corporations, partnerships, trusts or estates. Such persons had not been required to file an FBAR under instructions for a July 2000 version of the form. However, instructions with an October 2008 revision of the form added to the definition of a U.S. person required to file those "in and doing business in the United States." In response to "numerous questions and comments" about the revised definition, the Ins in Announcement 2009-51 said persons could rely on the earlier definition for FBARs due on June 30, 2009. On Feb. 26, the IRS extended that relief to FBARs due June 30, 2010, and substituted the earlier definition of U.S. person with respect to FBARs for calendar 2009 and earlier calendar years.

In Notice 2010-23 the Ins provided administrative relief from FBAR filing responsibility for persons with only signature authority over, but no financial interest in, a foreign financial account and those with signature authority over or a financial interest in foreign commingled funds. The 2008 revised form instructed persons holding only signature authority to file even if the owner of the account reported it separately on an FBAR. They also defined foreign accounts as including those "in which the assets are held in a commingled fund and the account owner holds an equity interest in the fund (including mutual funds)."

For both signing authority only and commingled funds, the Ins in Notice 2009-62 provided an extended filing date of June 30, 2010, for FBARs due in 2009 and earlier calendar years. …