Sometimes a change makes so much sense that you wonder why it didn't happen earlier. Many taxpayers with offshore accounts would agree this is the case with the recent adjustment of the filing date for the FBAR form.
In this post, we will inform you about the change, under which the FBAR (now known as FinCEN Report 114) will move to an earlier date, beginning next year.
Historically, the FBAR form (for Report of Foreign Bank and Financial Accounts) has come due at the end of June. As a result, holders of offshore accounts that meet the required valuations to trigger reporting requirements have essentially had to contend with two filing season deadlines: one for income tax returns on April 15, and then another for offshore accounts on June 30.
Yet another date is June 15, which is the filing deadline for certain U.S. taxpayers living abroad who are eligible for an automatic two-month filing extension. These taxpayers often have to request further extensions in order to also comply with tax obligations in the countries they are living in.
Under federal legislation that recently took effect, as of next year FinCEN Report 114 will come due on April 15. It appears that the legislation will allow one automatic extension, until June 15. And certain filers will be permitted an extension until October 15.
If you are a bit boggled by all of the dates crammed into the preceding paragraphs, that is entirely understandable. Indeed, the need to simplify overly complicated reporting requirements is one reason why the change to the April 15 filing date for FinCEN 114 makes so much sense.
To be sure, there are additional steps that Uncle Sam could take to make offshore tax compliance less burdensome for taxpayers. For example, FinCEN Report 114 could conceivably be combined with IRS Form 8938, the form that is now required as part of the Foreign Account Tax Compliance Act (FATCA).