FBAR & FATCA

Foreign Bank Account Reporting for US Expats - FBAR

The FBAR is only required  if you have a financial interest signature right in one or more foreign financial accounts and the total value of all of the financial accounts combined was $10,000 or more during any point during the tax year.

The FBAR (FinCEN Form 114) must be filed electronically with the US Treasury Department (not the IRS) by April 15th.

Individuals and business owners with foreign assets exceeding higher thresholds may be required to file also form 8938 with their federal income tax return. This requirement follows the much publicized Foreign Account Tax Compliance Act (FATCA). In Czech Republic is FATCA represented by act 330/2014 Sb. about exchanging financial informations between USA and CR.

Since 2014, FATCA requires foreign banking institutions to report to the IRS all US individuals and businesses that have foreign financial accounts.   In effect, both US taxpayers and foreign banking institutions are now jointly responsible for reporting.

The IRS now has the ability to locate US taxpayers with offshore financial assets and ability to match information received from foreign (Czech) financial institutions and foreign to filed tax returns and immediately issue notices.