FBAR

FBAR Services Offered

Even routine tax matters are confusing and difficult for a large part of the tax paying public. Add any level of complexity to the underlying transaction that produces the tax and you have the perfect recipe for misunderstanding and non-compliance.

This is certainly the case when it comes to the IRS’ disclosure requirements for offshore accounts. Many U.S. citizens (both those living in the U.S. and those living abroad) are completely unaware of the existence of strict disclosure requirements with respect to even fairly small offshore accounts.

An FBAR Attorney Dallas Account Holders Can Consult

A foreign account may be connected to family savings, work abroad, an inheritance, or a business relationship. The reporting question depends on your U.S. status and the account arrangements, not simply why you opened it. FBAR attorneys at Gregory Law Group, PLLC help clients in Dallas and Addison evaluate foreign bank account reporting and address questions before making potentially consequential filings.

FBAR Filing Requirements in Dallas and Addison, TX

Worse still are the harsh penalties that can accompany these failures to disclose the existence of these accounts.

Under the Report of Foreign Bank and Financial Accounts (aka “FBAR”) regime, any “U.S. person” must file an FBAR if: (1) the “U.S. person” had a financial interest in or signature authority over at least one financial account located outside of the U.S.; and (2) the aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported. The term “U.S. person includes U.S. citizens, U.S. residents, and some types of entities. Furthermore, a U.S. person that holds a foreign financial account generally has a filing obligation even if the account produces no taxable income.

Applying the FBAR Filing Threshold

The FBAR filing threshold applies to accounts collectively, rather than separately to each account. For example, two reportable accounts holding $6,000 each at the same time can create a filing requirement even though neither account individually exceeds $10,000. We review ownership, signature authority, account locations, and applicable exceptions before determining what must be reported.

FinCEN Form 114 is generally filed electronically through the Treasury Department’s reporting system, separately from your income tax return. The annual due date is April 15, with an automatic extension to October 15. Special relief may apply in certain circumstances. Gathering annual statements and maximum account values early makes it easier to prepare accurate reports.

FBAR penalties depend on the conduct, reporting year, assessment timing, and applicable law. Civil maximums are adjusted for inflation, so older dollar figures should not be treated as current limits. The distinction between willful vs. non-willful FBAR penalties requires careful factual review; non-willful reporting penalties generally apply per annual report, while willful violations can carry substantially greater exposure. Reasonable cause may matter where legally available.

Needless to say, these penalties will get anyone’s attention.

Separate Account Reporting from Income Reporting

Offshore account compliance involves more than checking whether an account generated tax. A reportable account can require disclosure without producing income. Conversely, unreported foreign income can require corrections to income tax returns as well as account reports. An international tax attorney can review the relationship between those obligations and identify additional information returns that may apply.

Form 8938 (FATCA) has separate filing rules, thresholds, and asset coverage. Filing it does not replace an FBAR, and an FBAR does not replace that form. Depending on the circumstances, a taxpayer may need one, both, or neither. A coordinated review helps prevent an account-reporting correction from leaving a separate tax-return issue unresolved.

Review the Compliance Route Before Filing

Additionally, willfully failing to file an FBAR or willfully filing a false FBAR is subject to criminal prosecution.

Late or delinquent FBAR filing should follow a review of the missing years, income reporting, prior advice, and any government contact. Older guidance discussing the Delinquent FBAR Submission Procedures should not be assumed to provide a currently available penalty-free route. We check current IRS instructions and the specific facts before advising how to correct missed reports.

The Streamlined Filing Compliance Procedures may be available to eligible taxpayers whose failures were non-willful. They require a truthful certification and have different rules for qualifying domestic and foreign residents. Taxpayers already under an IRS civil examination or criminal investigation are ineligible. Participation does not provide blanket protection from later examination, penalties, or prosecution.

Where willful conduct may be involved, IRS voluntary disclosure requires a separate assessment of eligibility, timing, cooperation, and payment obligations. A timely, complete disclosure may influence a prosecution recommendation, but it does not guarantee immunity. Do not assume that filing amended returns by itself resolves potential criminal exposure.

Prepare for Your Account Review

An organized history helps counsel distinguish an overlooked requirement from a more complicated reporting problem. Useful materials include:

Account statements showing owners, institutions, locations, opening dates, and maximum annual balances.
Previously filed returns, account reports, and communications with tax preparers.
Records explaining signature authority, inherited interests, and any IRS correspondence.

Tell your attorney about closed accounts and missing documents as well. Preserve available records, avoid changing historical explanations, and request guidance before submitting a certification you do not understand. FBAR filing requirements can intersect with other international reporting rules, so accuracy across the full submission matters.

During the consultation, explain when you learned about the reporting obligation and what advice you previously received. Details such as how an account was opened, who controlled it, and how income was reported can affect the analysis. An inherited or jointly held account should be reviewed on its own facts rather than assumed to be exempt. A complete history supports accuracy.

If another professional prepared earlier filings, preserve the questionnaires and information you supplied. Those records can help clarify the history and support an accurate explanation of any reporting gap.

These are complicated international tax matters that require experienced tax attorneys. Garrett and Deborah Gregory both served as International Field Counsel for over 12 years for the IRS before starting their own law firm, Gregory Law Group, PLLC.

Discuss Your Reporting Questions in Dallas and Addison, TX

Our former IRS attorneys can help you understand your obligations and evaluate the next step. Contact Gregory Law Group, PLLC to schedule a consultation about your accounts, filing history, and any notices received.