Friday, February 26, 2010

FinCEN Proposes Changes in FBAR Reporting Requirements

FinCEN (web site here) has announced here a Notice of Proposed Rule Making (NPRM) for changes in the FBAR requirements.  The press releases advises that, in formulating the NPRM, FinCEN worked closely with the Department of Treasury, Office of Tax Policy and the IRS, but FinCEN retained authority to revise the regulations.

The press release says:

The proposed rule:

•  Includes provisions intended to prevent persons from avoiding reporting requirements.
•  Defines a "United States person" required to file the FBAR and defines the types of reportable accounts such as bank, securities, and other financial accounts.
•  Exempts certain persons with signature or other authority over, but no financial interest in, foreign financial accounts from filing FBARs.
•  Exempts certain low-risk accounts e.g., the accounts of a government entity or instrumentality for which reporting will not be required.
•  Exempts participants/beneficiaries in certain types of retirement plans and includes a similar exemption for certain trust beneficiaries.
•  Clarifies what it means for a person to have a "financial interest" in a foreign account.
•  Permits summary filing by persons who have a financial interest in 25 or more foreign financial accounts, or signature or other authority over 25 or more foreign financial accounts. Also permits an entity to file a consolidated FBAR on behalf of itself and the subsidiaries of which it owns more than a 50 percent interest.

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