In October 2008, the IRS issued a revised version of TD F 90-22.1 “Report of Foreign Bank and Financial Accounts (“FBAR”).
The revised FBAR form states: “Do not use previous editions of this form after December 31, 2008”. All FBAR’s due for Tax Years 2008 (forward) and back year FBAR’s (unfiled) are to be reported on the new
The revised FBAR form includes new provisions designed to facilitate IRS off-shore enforcement. Specific new provisions are included for:
1. Foreign Trusts (Trust Protector)
If a U.S. person appoints a Trust protector, for a foreign account held by a Foreign Trust, the U.S. person has a financial interest in the account and must file a FBAR.
2. Foreign Trusts (Trust Beneficiaries)
Trust beneficiaries do not have a FBAR filing requirement unless they are a U.S. person who is the beneficiary of more than 50% of a Trust holding a foreign account.
3. Debit Card (Prepaid Credit Cards)
Reportable financial accounts include debit cards and prepaid credit card accounts.
4. Foreign Persons
Foreign persons in and doing business in the U.S. are required to provide identifying information (i.e., “foreign identification number”, such as foreign passport number) and file FBAR’s.
5. Account Value
Instead of an account value range, U.S. taxpayers must fill in the exact value of the account during the calendar year.
6. Foreign Account Owners
U.S. persons, with signature authority over the account (who file the FBAR) must identify the account’s foreign owner.
7. Joint Filing for Married Taxpayers
Previously, married taxpayers had to file separate FBAR’s for a jointly owned account. The new FBAR allows joint filing. The new FBAR requires the filer to provide the identifying information for the “principal joint owners”.
8. Record Retention
The new FBAR explicitly states the records must be kept for a period of 5 years and must be kept at all times available for inspection.