# Filing FBAR for last several years



## canuckguy

I'm in a bit of a pickle due to my specific situation regarding FBAR and need some advice. Here's my story.

- Moved to U.S. in 2011 from Canada
- Have had aggregate balance over 200k USD in a Canadian joint bank for a couple of years going back to 2011
- Have been filing U.S. taxes since 2011
- Have been audited once by IRS for business expenses due to my accountant's mistake. This was cleared after paying taxes owed.
- Have never filed FBAR because I didn't know about it
- Owe a couple hundred dollars of state taxes (didn't know I owed state taxes on these) on one particular account only for the last two years (federal taxes already paid in Canada)

My concern is that out of the three options (file delinquent, streamlined, OVDP), the first two are unavailable to those who have been audited. I certainly don't want to pay the (27.5% + 'misc' + possible attorney) fee for the OVDP program, which is really akin to volunteering to wiping out half my savings! What I really want to know is that can I still try to go with the first option, i.e. file delinquent FBAR's even though I've been audited before? What happens if I try to do that? Does the online forum throw an error? Or is the FBAR not accepted and the automated acceptance email they send reflect that? I'd really like to hear from someone who has had a civil tax examination (audit) and tried to do this.

This is the only option I really want to pursue, provided it's doable, i.e. the forums can be submitted (and accepted) online without error. My line of reasoning here is that as long as I file truthfully disclose all information, the worst they can do is levy the non-willful yearly penalties, which could be anywhere from as low as nothing (they decide to be nice) to 10k for all 5 years = 50k, which is still less than OVDP!

Of course, this all hinges on the premise that it is possible for previously audited individuals to electronically file delinquent FBARs.

Also, does it make sense to amend tax returns for the last two years to pay the state taxes or would that attract unnecessary attention? Of course filing FBAR's is no less inconspicuous!

Any thoughts would be appreciated.


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## iota2014

canuckguy said:


> My concern is that out of the three options (file delinquent, streamlined, OVDP), the first two are unavailable to those who have been audited.


Read it again:



> Taxpayers who do not need to use either the OVDP or the Streamlined Filing Compliance Procedures to file delinquent or amended tax returns to report and pay additional tax, but who:
> 
> * have not filed a required Report of Foreign Bank and Financial Accounts (FBAR) (FinCEN Form 114, previously Form TD F 90-22.1),
> 
> * are not under a civil examination or a criminal investigation by the IRS, and
> 
> * have not already been contacted by the IRS about the delinquent FBARs
> 
> should file the delinquent FBARs according to the FBAR instructions.


https://www.irs.gov/individuals/international-taxpayers/delinquent-fbar-submission-procedures

Seems to describe your situation to a T, since you don't owe Federal tax, you're not now under audit, and you haven't been contacted about the FBARs. The IRS has no reason to want to prevent people who've previously been audited from backfiling information returns as required by law. That's what you're _supposed_ to do.



> I certainly don't want to pay the (27.5% + 'misc' + possible attorney) fee for the OVDP program, which is really akin to volunteering to wiping out half my savings!


Indeed. The OVDP program is an opportunity for people who've been engaged in criminal tax evasion to come in from the cold, leaving most of their worldly possessions at the door as they enter. It's not designed for those of us didn't get told about FBARs.

My (amateur) suggestion would be that you forget you ever heard of OVDP, backfile the FBARs choosing the reason "Did not know I had to file", and amend returns as necessary to pay the state tax owed.


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## canuckguy1

Thank you for your response. I appreciate it. I will proceed to file the delinquent fbars.


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## Zip88

I am also concerned here. Been filing FBAR since 2010, but just recently realized I misunderstood that all accounts must be reported if the aggregate value is over USD 10,000. (I previously thought only accounts over USD10,000 need to be reported)

Therefore, I only reported 1 account with 38,000 but left out 2 accounts with 8500 and 1500 each.

Should I just correct the mistake in 2016 FBAR or amend the previous years? Will amending FBAR increase the audit risk?

Feedback will be very appreciated.


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## Bevdeforges

Up to now at least, there has been little checking of FBARs and certainly no "audits" of FBARS. I'd just go ahead and fix your omission on the current FBAR filing and if and when they come back to ask the question, explain what you have done here. The chances of your hearing from anyone in Treasury are very very slight. Just make sure that you have been reporting any interest or other income from the two smaller accounts on your tax returns. (Though again, with the current interest rates, it wouldn't make much of a difference in your taxable income that would be worth the IRS' notice.)
Cheers,
Bev


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## iota2014

Zip88 said:


> I am also concerned here. Been filing FBAR since 2010, but just recently realized I misunderstood that all accounts must be reported if the aggregate value is over USD 10,000. (I previously thought only accounts over USD10,000 need to be reported)
> 
> Therefore, I only reported 1 account with 38,000 but left out 2 accounts with 8500 and 1500 each.
> 
> Should I just correct the mistake in 2016 FBAR or amend the previous years? Will amending FBAR increase the audit risk?


My suggestion would be, since you're amending for 2016 it would make sense to amend also for the years 2010-15.


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## Zip88

Many thanks to your kind replies.

Another question I have is that I work at an investment manager. And as an employee of the investment manager, I often have to sign off disposition of funds from brokerage/bank accounts own by a foreign private investment fund (hedge fund), such as from one brokerage account to another brokerage account. Although the money never leaves the fund, only the investors of the hedge fund can give final order to the custodian to take money out of the hedge fund.

Does this mean I have signature authority with no financial interest? Do I need to file these accounts on FBAR too? It would be almost impossible because I don’t have the bank/brokerage records, even if I do, I can’t calculate the largest balances on them. Also I don’t think my employer will let me disclose due to privacy concern.

Also, if I want to amend the past 6 years FBAR, I only have the email identifier starting 2013, how can I do it for 2010 to 2012?

Pls. help!


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## Zip88

In addition, the investment fund does not have US person investors.


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## iota2014

Zip88 said:


> Many thanks to your kind replies.
> 
> Another question I have is that I work at an investment manager. And as an employee of the investment manager, I often have to sign off disposition of funds from brokerage/bank accounts own by a foreign private investment fund (hedge fund), such as from one brokerage account to another brokerage account. Although the money never leaves the fund, only the investors of the hedge fund can give final order to the custodian to take money out of the hedge fund.
> 
> Does this mean I have signature authority with no financial interest? Do I need to file these accounts on FBAR too? It would be almost impossible because I don’t have the bank/brokerage records, even if I do, I can’t calculate the largest balances on them. *Also I don’t think my employer will let me disclose due to privacy concern.*


Understandably. I would suggest it might be a good idea to discuss the possible implications of your US citizenship with your employer, and be guided accordingly.



> Also, if I want to amend the past 6 years FBAR, I only have the email identifier starting 2013, how can I do it for 2010 to 2012?


I seem to recall the FBAR tool tells you what to do if you don't have the identifier. Someone else may be better informed than I.


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## Moulard

From the FBAR Filing Instructions...

If your Prior Report BSA Identifier is not known, please enter 00000000000000 in the Prior Report BSA Identifier field.


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## Bevdeforges

Zip88 said:


> Many thanks to your kind replies.
> 
> Another question I have is that I work at an investment manager. And as an employee of the investment manager, I often have to sign off disposition of funds from brokerage/bank accounts own by a foreign private investment fund (hedge fund), such as from one brokerage account to another brokerage account. Although the money never leaves the fund, only the investors of the hedge fund can give final order to the custodian to take money out of the hedge fund.
> 
> Does this mean I have signature authority with no financial interest? Do I need to file these accounts on FBAR too? It would be almost impossible because I don’t have the bank/brokerage records, even if I do, I can’t calculate the largest balances on them. Also I don’t think my employer will let me disclose due to privacy concern.
> 
> Also, if I want to amend the past 6 years FBAR, I only have the email identifier starting 2013, how can I do it for 2010 to 2012?
> 
> Pls. help!


I honestly don't think you would be expected to report the accounts of those "customers" - while you may have to sign off on the disposition of funds, the fact remains that you would not be able to initiate a transaction based on your signature alone (as you would in a joint account, for example).
Cheers,
Bev


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