FBAR is required for Legal Permanent Residents (Green-Card Holders) that reside in the U.S. or abroad outside of the United States.
One common question we receive often involves whether or not a Legal Permanent Resident (aka Green card holder) is required to file an annual FBAR (FinCEN 114 aka Report of Foreign Bank and Financial Account Form) to disclose their foreign accounts, certain assets in investments to the US government – and unfortunately, the answer is yes.
Why do Permanent Residents/Green Card Holders have to file?
Because it is important to remember that a Green Card Holder is considered a U.S. Person for US tax purposes.
And, if someone is a US person (not just US citizens) they are required to report their worldwide income and file an annual FBAR statement if they meet the threshold requirements for doing so.
What if they Reside Overseas?
Even if the individual resides outside of United States and qualifies as a foreign resident, it has no impact on the actual FBAR filing requirement.
Unlike FATCA (Foreign Account Tax Compliance Act) the threshold requirements for filing do not change if the person resides outside of United States.
What is the Minimum Threshold Filing Requirement?
If a person has an annual aggregate total of more than $10,000 USD combined in all of their foreign accounts on any given day of the year, then the person has to disclose all of the accounts on the FBAR.
It is important to note (a common misconception) is that once the $10,000 threshold is met, then all of the accounts have to be recorded – not just the account(s) that exceed $10,000.
Out of Compliance with the IRS?
If you are out of compliance for not properly filing the FBAR for other international reporting forms, there can be significant fines and penalties issued against you.
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Sean holds a Master's in Tax Law from one of the top Tax LL.M. programs in the country at the University of Denver. He has also earned the prestigious IRS Enrolled Agent credential. Mr. Golding's articles have been referenced in such publications as the Washington Post, Forbes, Nolo, and various Law Journals nationwide.