IRS Internal Procedure Document Discusses BSA Record (includingi FBAR) Access for Other Agencies (8/29/12)

In PMTA 2012-015 (5/9/12), here, the IRS discusses into the inner workings for access to BSA records (including FBARs), addressing specifically a change in procedure for requesting FBAR records.  Here are key points:

1.  "FinCEN owns and controls documents required to be filed pursuant to the Bank Secrecy Act (BSA), 31 U.S.C. § 5311 et. seq., including, but not limited to, currency transaction reports, casino transaction reports, registration of money services business, foreign bank account reports, suspicious activity reports, and, if filed after January 1, 2002, reports of over $10,000 received in a trade or business."

2.  As of 1/3/12, FinCEN now is the agency to which requests for FBAR records must be made.  The IRS no longer processes such requests.

3.  The consequence of that "fact" is that the FBAR records are not IRS records and thus not "return information" subject to Section 6103's secrecy / confidentiality requirements until and unless they are use in an IRS investigation.

If a copy of a BSA record is obtained by the IRS in the course of administering the internal revenue laws, then it becomes an IRS record, as well as return information subject to I.R.C. § 6103. As such, the IRS can certify the authenticity of such a record as a genuine copy of a record received from FinCEN. In order to obtain from the IRS a certified copy of a BSA record that has become part of a tax investigation file, and therefore subject to the confidentiality rule of I.R.C. § 6103, U.S. Attorneys must follow the procedures for obtaining an ex parte order pursuant to I.R.C. § 6103(i), if the record will be used in a nontax criminal investigation or proceeding. See I.R.C. § 6103(i)(1)(B).

4.  As to IRS disclosures to FinCEN to obtain BSA records:

A corollary question is what authority exists for IRS employees to make disclosures to FinCEN in order to obtain copies of BSA records for use in Title 26 investigations. IRS officers and employees, including Counsel, are specifically authorized by I.R.C. § 6103(k)(6) and Treas. Reg. § 301.6103(k)(6)-1 to disclose return information to the extent that disclosure is necessary to obtain information which is not otherwise reasonably available with respect to the correct determination of any tax, or the amount to be collected, or with respect to the enforcement of any other provision of the Code. Under this authority, IRS agents may disclose to FinCEN a minimal amount of return information, such as the taxpayer's name and identifying information, in order to obtain a copy of a BSA record in a timely and probative manner when the record is used for a tax investigation or proceeding.