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Avoid Penalties for Failure to File – Important Foreign Disclosures


Important Foreign Disclosures  Due June 30  Avoid Penalties. File Now!

U.S. Bureau of Economic Analysis (“BEA”)

BE-10 Benchmark Survey of U.S. Investment Abroad

Every five years, the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA) conducts a benchmark survey of U.S. investments in foreign business enterprises. In the past, the survey was by invitation only. Starting in 2014, the BEA is requiring all U.S. entities and individuals owning directly or indirectly 10% or more of the voting stock of a foreign enterprise, or an equivalent interest in an unincorporated foreign business enterprise, to complete a BE-10 survey. This means that if a U.S. entity or individual owns an investment property outside of the U.S. or if they own foreign companies, they would be required to complete and file a BE-10 survey.

The deadline to complete the survey is June 30, 2015. If you are required to file and fail to do so, you may incur a civil penalty between $2,500 and $25,000. Willful failure to file by the deadline can result in criminal penalties for the U.S. filer.

BE-10 filing can be extended. An extension form and instructions for BE-10 filing can be obtained through BEA’s website. The extension form must be filed no later than June 30, 2015.

 

Report of Foreign Bank and Financial Accounts (FBAR)

 

Report of Foreign Bank and Financial Accounts (FBAR), also known as Fin CEN 114, is required to be filed for each U.S. entity and individual who has financial interest in, or signature or other authority over, foreign financial accounts that have aggregate value exceeding $10,000 at any time during the calendar year.

Penalty for failure to file an FBAR could be subject to a maximum of $10,000 per violation. If the U.S. Treasury determines that the failure to file is willful, the penalty is the greater of $100,000 or 50% of the amount in the account at the time of violation. Willful violation may also be subject to criminal penalties.

Unfortunately, FBAR cannot be extended. It is imperative that FBARs are electronically filed no later than June 30th to avoid penalties.

For further information regarding filing an FBAR, please visit the IRS’s website.

If you need assistance with the FBAR or BE-10 filing, please contact Liting Chuang, Principal and Leader of the International Consultancy Group at Berntson Porter at 425-289-7625 or lchuang@bpcpa.com.