Several weeks ago, we reported on the extension of the filing deadline for the Report of Foreign Bank and Financial Accounts ("FBAR"). These reports are required for individuals and entities which hold either a financial interest in or signatory authority over a foreign financial account. The types of reportable accounts had been expanded through recently revised filing instructions and informal comments by IRS representatives. The IRS then extended the filing deadline until September 23, 2009 for taxpayers who reported and paid tax on all of their income from foreign accounts but who only recently learned of their FBAR filing obligation.
On August 7, the IRS issued Notice 2009-62, which provides additional relief by further extending the deadline for filing 2008 and earlier FBAR until June 30, 2010 for (i) persons with signature authority over, but no financial interest in, a foreign financial account and (ii) persons with a financial interest in, or signature authority over, a foreign commingled fund, including foreign mutual funds, foreign hedge funds and private equity funds.
The IRS has requested comments on these two situations and indicated that formal guidance will be issued. It is possible that such guidance will reduce or eliminate the FBAR requirements in these cases, particularly if duplicative reporting is already being made by other parties.
The new extension is limited to the two categories of taxpayers. Taxpayers with financial interests in other foreign financial accounts, such as plain bank accounts, must still file their 2008 and prior year FBAR by September 23, 2009. Also, taxpayers who would avail themselves of a voluntary disclosure program to obtain partial penalty relief (those who did not file FBAR reports and did not report and pay tax on the income from the applicable account.) must do so by September 23, 2009.
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