Starting
this year, the deadline for filing the annual Report of Foreign Bank and
Financial Accounts (FBAR) is now the same as
for a federal income tax return. This means that the 2016 FBAR, Form 114, was
normally required to be filed electronically with the Financial Crimes
Enforcement Network (FinCEN) by April 18, 2017. But FinCEN is granting filers
missing the original deadline an automatic extension until Oct. 16, 2017
to file the FBAR. Specific extension requests are not required. In the past,
the FBAR deadline was June 30 and no extensions were available. In general, the
FBAR filing requirement applies to anyone who had an interest in, or signature
or other authority, over foreign financial accounts whose aggregate value
exceeded $10,000 at any time during 2016. Because of this threshold, the IRS
encourages taxpayers with foreign assets, even relatively small ones, to check
if this filing requirement applies to them. The form is only available through
the BSA E-filing System
website. Report in
U.S. Dollars Any income received or deductible expenses paid in
foreign currency must be reported on a U.S. tax return in U.S. dollars.
Likewise, any tax payments must be made in U.S. dollars.
Both Forms
114 and 8938 require the use of a Dec. 31 exchange rate for all transactions,
regardless of the actual exchange rate on the date of the transaction.
Generally, the IRS accepts any posted exchange rate that is used consistently.
For more information on exchange rates, see Foreign Currency
and Currency Exchange Rates.
Source: Internal Revenue Service
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