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IRS Extends FBAR Filing Deadline Again, more tax for the US Government

The Internal Revenue Service has extended the filing deadline yet again for people to report on foreign tax accounts, giving them until June 30 of next year, but only under certain circumstances.

About two months ago, the IRS extended the deadline from June 30 of this year to Sept. 23 to allow more taxpayers to file the Form TDF 90-22, “Report of Foreign Bank and Financial Accounts,” or FBAR (see IRS Extends Deadline for Filing FBAR). The agency has been cracking down on the use of offshore tax havens and the hiding of assets in secret foreign bank accounts, encouraging more taxpayers to come forward voluntarily before their holdings are discovered.

In Notice 2009-62, which the IRS released Friday, the agency provided administrative relief to taxpayers with signature authority over, but no financial interest in, a foreign financial account, and taxpayers with a financial interest in, or signature authority over, a foreign commingled fund. They now have until June 30, 2010, to file an FBAR for the 2008 and earlier calendar years. The IRS said the reason for the extension was the additional time needed for the Treasury Department to address issues pertaining to FBAR filing requirements and the need to provide administrative relief.

The current instructions for the FBAR provide, with certain exceptions, that U.S. persons that have signature authority over, but no financial interest in, a foreign financial account are required to file an FBAR. They must report the account on an FBAR even if the foreign financial account is reported on an FBAR filed by the owner of the account (or other person that has a financial interest in the account).

The current instructions also provide that a foreign financial account that must be reported on an FBAR includes any bank, securities, securities derivatives, or other financial instruments account. The FBAR instructions further provide that those accounts “generally also encompass any accounts in which the assets are held in a commingled fund and the account owner holds an equity interest in the fund (including mutual funds).”

Interested persons should submit comments with regards the guidance on FBAR reporting by October 6, 2009
It is a reformative step by IRS(Internal revenue service) of USA relating to FBAR deadline extension.There is no doubt that more hidden money will be disclosed and the tax collection base of US would improve a lot.The US economy is already under pressure due huge bailout package.So this is a wise step to extend the dead line beyond September 23th 2009 to June 30th. 2010.

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