Do you need to submit a FATCA Form 8938 or an FBAR Form Fincen114?

Whether you live in Dallas or anywhere in the US, you should abide by the FATCA and the disclosure of foreign bank accounts laws if you need to file a U.S. income tax return or you have an interest in overseas financial assets. Foreign companies must also adhere to these laws. The discussion that follows is intended for people who have bank accounts overseas.

If they have to submit a US tax return, US citizens and permanent residents will be charged on their worldwide income. If you were unaware of the FBAR filing procedures and the consequences of failing to report your foreign accounts, contact a tax professional in Dallas.

Is it necessary to submit FBAR Form Fincen114, Report of Foreign Bank Accounts?

Some US individuals who meet or surpass the $10,000 threshold have to submit a statement of foreign bank accounts (FBAR) from Fincen 114. By October 15, 20XX+1, at the latest, the 20XX foreign bank accounts statement must be submitted online. Form Fincen114 must be submitted using this BSA FBAR Link by April 15 (October 15 with auto extension, without needing to request an extension). The disclosure obligation based on the minimum amount is also created by having sole interest in or signatory power over foreign accounts.

• Joint owner accounts: You are supposed to report foreign bank accounts and their entire balances if you are the joint owner of accounts that reach or surpass the threshold.
• Jointly owned accounts with nonresident aliens: You must still report the entire account balance if you have a joint bank with a nonresident alien who is exempt from filing taxes. In general, nonresident aliens are exempt from filing the FBAR form.

The following are some questions from US foreign nationals and expatriates:   

Do you need to submit FBAR Form Fincen114? In the case that both of the following 1 and 2 apply, you must submit form Fincen114:

1. You are a citizen of the United States who had a financial stake in or signatory authority over a minimum of one foreign-based financial account;
2. Consequently, for the reported calendar year, the total value of all overseas financial accounts was above $10,000.

Does having digital currency in foreign wallets require you to report it?

Foreign wallets, cryptocurrency accounts, and virtual money are now not reportable on the FBAr, according to Fincen. This position may change, though.

Does Form 8938, Statement of Specified Foreign Financial Assets, need to be submitted?

If the total value of their overseas financial assets exceeds a specific threshold, U.S. citizens, U.S. Green Card holders, or tax residents, according to the substantial presence test, must file Form 8938 to report them. The yearly individual income tax return includes this form. According to the IRS, taxpayers are barred from filing Form 8938 if the total value of their identified overseas financial assets is lower than a certain amount.

Unless the entire value exceeds $75,000 at any point during the tax year, there is no filing requirement for the whole of the period if the total value is $50,000 or less at the end of the year. For those who are married or reside outside of the US, the percentage is higher. For married couples filing joint tax returns, the thresholds are different.