Foreign Pension Plan FBAR Reporting

Foreign Pension Plan FBAR Reporting

FBAR Reporting Foreign Pension Plans

Reporting Foreign Pension Plans & FBAR: The FBAR is the Foreign Bank and Financial Account Reporting form. It is also referred to as FinCEN Form 114 and used by U.S. persons worldwide to report foreign bank and financial accounts to the IRS. When it comes to FinCEN Form 114, FBAR Foreign Plan Reporting is required.

Each year, when a U.S. person meets or exceeds the threshold requirements for reporting foreign accounts, the foreign pension is included on the form.

In recent years, the IRS has taken an aggressive position toward enforcement of foreign accounts compliance — and this includes foreign pensions.

It is important to note that the reporting requirements are not the same as the tax rules. A foreign pension is reportable, even in a year that it is not taxable in the U.S. Common international reporting forms, include FBAR, FATCA, Schedule B.

If a person is out of compliance, they may consider FBAR Amnesty, or one of the other voluntary disclosure programs.

We will summarize foreign pension plan FBAR reporting.

What type of Foreign Pension Plans are Reportable on FBAR?

The FBAR Foreign Pension Plan reporting rules are tough, primarily because Foreign Pension Plans come in all different flavors. In short, a foreign pension is an account. Therefore, the account must be reported.

This is true, even if the account was opened and earned prior to becoming a U.S. Person. It is also important to note that even if no distributions are being made, it still must be reported on the FBAR.

Some common examples:

  • Provident Fund
  • Superannuation
  • Employer-Based Retirement
  • Private Retirement
  • Foreign Social Security

When it comes to reporting foreign Pension Plans, there are 4 main issues:

  1. Should the Pension Plan be reported on an FBAR?
  2. Should the Pension Plan be reported on a Form 8938 FATCA Form?
  3. Should the Pension Plan be reported as a PFIC (Form 8938)?
  4. Should the income be reported as income, and if so, on Schedule B and/or, Line 16 or Line 21 on the 1040

FATCA & Foreign Pension (Form 8938)

The same general rules apply to FATCA Form 8938, and the foreign pension is generally reportable on the IRS 1040 Form 8938.

Schedule B

Even if you do not meet the threshold requirements for filing FBAR or FATCA, the foreign pension is still considered an “Account” for purposes of Schedule B.

Golding & Golding: About Our International Tax Law Firm

Golding & Golding specializes exclusively in international tax, and specifically IRS offshore disclosure

We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe. Our attorneys have worked with thousands of clients on offshore disclosure matters, including FATCA & FBAR.

Each case is led by a Board-Certified Tax Law Specialist with 20 years of experience, and the entire matter (tax and legal) is handled by our team, in-house.

*Please beware of copycat tax and law firms misleading the public about their credentials and experience.

Less than 1% of Tax Attorneys Nationwide Are Certified Specialists

Sean M. Golding is one of less than 350 Attorneys (out of more than 200,000 practicing California Attorneys) to earn the Certified Tax Law Specialist credential. The credential is awarded to less than 1% of Attorneys.

Recent Golding & Golding Case Highlights

  • We represented a client in an 8-figure disclosure that spanned 7 countries.
  • We represented a high-net-worth client to facilitate a complex expatriation with offshore disclosure.
  • We represented an overseas family with bringing multiple businesses & personal investments into U.S. tax and offshore compliance.
  • We took over a case from a small firm that unsuccessfully submitted multiple clients to IRS Offshore Disclosure.
  • We successfully completed several recent disclosures for clients with assets ranging from $50,000 – $7,000,000+.

How to Hire Experienced Foreign Accounts Counsel?

Generally, experienced attorneys in this field will have the following credentials/experience:

  • Board Certified Tax Law Specialist credential
  • Master’s of Tax Law (LL.M.)
  • Dually Licensed as an EA (Enrolled Agent) or CPA
  • 20-years experience as a practicing attorney
  • Extensive litigation, high-stakes audit and trial experience

Interested in Learning More about Golding & Golding?

No matter where in the world you reside, our international tax team can get you IRS offshore compliant. 

Golding & Golding specializes in FBAR and FATCA. Contact our firm today for assistance with getting compliant.