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Thursday, June 27, 2019

Virtual Currency Held in Foreign Accounts Not FBAR Reportable (6/27/18; 7/2/18)

I am not an expert on virtual currency or reporting requirements for virtual currency.  One issue is whether virtual currency or holding virtual currency on a foreign third-party exchange was reportable on the FBAR, FinCEN Form 114.

I link here a report from the AICPA Virtual Currency Task Force which obtained some input from the IRS on the issue.  Kirk Phillips, Virtual currency not FBAR reportable (at least for now) (Journal of Accountancy 6/19/19), here.
FinCEN responded that regulations (31 C.F.R. §1010.350(c)) do not define virtual currency held in an offshore account as a type of reportable account. Therefore, virtual currency is not reportable on the FBAR, at least for now. 
The report caveats that only FBAR reporting is addressed.  Reporting on Form 8938, Statement of Specified Foreign Financial Assets, is not addressed.

Updates:

  • James Creech (Guest Blogger), Virtual Currency, FBAR, and the Ripple Effect (ProcedurallyTaxing Blog 7/2/19), here.
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